Question 1

For a differentiation strategy to be considered successful:

Accepted Answer

A)   The organization that is pursuing the differentiation must be highly innovative
B)   Customers must be willing to pay more for the uniqueness of a product or service than the firm paid to create that uniqueness
C)   Loss of sales cannot reduce the benefits from economies of scale
D)   The organization must invest heavily in differentiating its products

Question 2

Describe the advantages of integrating cost leadership and differentiation strategies.

Accepted Answer

.Customers have increasingly high expect...

Question 3

Drivers of an effective differentiation strategy include:

Accepted Answer

A)   Product and service features
B)   The cost-efficient production of a commodity
C)   The relative importance of search goods in the industry
D)   Economies of scale

Question 4

In general,firms can be most effective if they develop business-level strategies that will serve the needs of the "average customer."

Accepted Answer

A) True 
 B)False

Question 5

What are the five generic business-level strategies? Briefly describe each one.

Accepted Answer

.The five generic strategies are: 1)diff...

Question 6

When a firm chooses a business-level strategy,it must ANS the questions "Who? What? and How?" What are these questions and why are they important?

Accepted Answer

.The firm must decide (1)who are the cus...

Question 7

Typically two or three companies in an industry will share the low-cost leadership position,making rivalry among them very intense.

Accepted Answer

A) True 
 B)False

Question 8

The differentiation strategy is effective for products that are expensive,luxury consumer goods. It is not effective for common,inexpensive products such as doughnuts.

Accepted Answer

A) True 
 B)False

Question 9

Describe the risks of a differentiation strategy.

Accepted Answer

.The risks of a differentiation strategy...

Question 10

A best cost strategy combines the elements of low-cost leadership and differentiation.

Accepted Answer

A) True 
 B)False

Question 11

Companies have little to gain from trying to create psychological or cognitive identification by customers with the company's products.

Accepted Answer

A) True 
 B)False

Question 12

A best cost strategy is most like which of the other generic business strategies?

Accepted Answer

A)   Differentiation
B)   Cost leadership
C)   Cost focus
D)   Differentiation combined with cost leadership

Question 13

A low-cost strategy is designed to appeal to only those customers who are the most price-sensitive.

Accepted Answer

A) True 
 B)False

Question 14

The integration of a cost leadership and a differentiation strategy:

Accepted Answer

A)   Is challenging because the firm must become competent in more primary and support activities
B)   Forces a firm to adapt more slowly to changes in its environment
C)   Allows the firm to avoid being "stuck in the middle"
D)   Requires such a large customer base that it is most practical for firms in the global marketplace

Question 15

Which of the following is a driver that permits a low-cost strategy to be successful?

Accepted Answer

A)   When customers tend to expect different features and benefits from products within a category
B)   When buyers and suppliers have weak bargaining power, lowering the pressure on the industry's profit margins
C)   When there are high industry entry barriers, diminishing the potential need for incumbents to compete on price
D)   When there is a standardization of products or services among industry rivals

Question 16

What is a cost leadership strategy? How might a firm pursue it? What are some of the risks associated with this strategy?

Accepted Answer

.Firms pursuing strategic flexibility ca...

Question 17

Define strategy and business-level strategy. What is the difference between these two concepts?

Accepted Answer

.In general,a strategy consists of the c...

Question 18

The effectiveness of any of the generic business-level strategies is contingent upon:

Accepted Answer

A)   Customer needs and competitors' strategies
B)   The match between the opportunities and threats in its external market and the strengths of its internal environment
C)   The trends in the general consumer base and the robustness of the global and industry economy
D)   The firm's competitive scope and its competitive advantage

Question 19

One of the benefits of the integrated cost leadership/differentiation strategy is that it is less risky than either the cost leadership or differentiation strategies.

Accepted Answer

A) True 
 B)False

Question 20

Business-level strategies are also known as ________ strategies.

Accepted Answer

A)   Value chain
B)   Divisional
C)   Executional
D)   Generic

Exam 7: Business-Level Strategy

Describe the advantages of integrating cost leadership and differentiation strategies.

Correct Answerverified.Customers have increasingly high expect...View AnswerShow Answer

Drivers of an effective differentiation strategy include:

Correct AnswerverifiedShow Answer

What are the five generic business-level strategies? Briefly describe each one.

Correct Answerverified.The five generic strategies are: 1)diff...View AnswerShow Answer

The integration of a cost leadership and a differentiation strategy:

Correct AnswerverifiedShow Answer

Define strategy and business-level strategy. What is the difference between these two concepts?

Correct Answerverified.In general,a strategy consists of the c...View AnswerShow Answer

A low-cost strategy is designed to appeal to only those customers who are the most price-sensitive.

Correct AnswerverifiedShow Answer

A best cost strategy is most like which of the other generic business strategies?

Correct AnswerverifiedShow Answer

When a firm chooses a business-level strategy,it must ANS the questions "Who? What? and How?" What are these questions and why are they important?

Correct Answerverified.The firm must decide (1)who are the cus...View AnswerShow Answer

For a differentiation strategy to be considered successful:

Correct AnswerverifiedShow Answer

In general,firms can be most effective if they develop business-level strategies that will serve the needs of the "average customer."

Correct AnswerverifiedShow Answer

The effectiveness of any of the generic business-level strategies is contingent upon:

Correct AnswerverifiedShow Answer

A best cost strategy combines the elements of low-cost leadership and differentiation.

Correct AnswerverifiedShow Answer

Describe the risks of a differentiation strategy.

Correct Answerverified.The risks of a differentiation strategy...View AnswerShow Answer

Which of the following is a driver that permits a low-cost strategy to be successful?

Correct AnswerverifiedShow Answer

The differentiation strategy is effective for products that are expensive,luxury consumer goods. It is not effective for common,inexpensive products such as doughnuts.

Correct AnswerverifiedShow Answer

Typically two or three companies in an industry will share the low-cost leadership position,making rivalry among them very intense.

Correct AnswerverifiedShow Answer

What is a cost leadership strategy? How might a firm pursue it? What are some of the risks associated with this strategy?

Correct Answerverified.Firms pursuing strategic flexibility ca...View AnswerShow Answer

Business-level strategies are also known as ________ strategies.

Correct AnswerverifiedShow Answer

Companies have little to gain from trying to create psychological or cognitive identification by customers with the company's products.

Correct AnswerverifiedShow Answer

One of the benefits of the integrated cost leadership/differentiation strategy is that it is less risky than either the cost leadership or differentiation strategies.

Correct AnswerverifiedShow Answer

Correct Answer
verified
.Customers have increasingly high expect...
View Answer

Correct Answer
verified

Correct Answer
verified
.The five generic strategies are: 1)diff...
View Answer

Correct Answer
verified

Correct Answer
verified
.In general,a strategy consists of the c...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
.The firm must decide (1)who are the cus...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
.The risks of a differentiation strategy...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
.Firms pursuing strategic flexibility ca...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified