A) determining the industry's outlook for future profitability.
B) determining which firms in the industry have a competitive advantage and how they got their advantage.
C) determining the overall strength of the five competitive forces.
D) constructing a strategic group map and assessing the attractiveness of the competitive position of each strategic group to determine the overall attractiveness of all the strategic groups.
E) using value chain analysis to determine the relative cost positions of rival firms and to learn who the industry's low-cost producer is.
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A) incumbent firms are willing and able to be aggressive in defending their market positions against entry.
B) incumbent firms are complacent.
C) buyers are not particularly price-sensitive and the industry already contains a dozen or more rivals.
D) the relative cost positions of incumbent firms are about the same, such that no one incumbent has a meaningful cost advantage.
E) buyer switching costs are moderately low because of strong product differentiation among incumbent firms.
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A) identifying the relative price/performance relationship of the substitutes, the switching costs, and the overall buyer demand for the substitute.
B) identifying the attractiveness of other industries.
C) measuring Coke as a substitute for Pepsi and applying dynamic simulation modeling techniques.
D) adopting a substitute product concentration factor to the buyer volume.
E) judging whether industry members are capable of self-manufacturing their products.
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Unless a company pays attention to the s...View Answer
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A) is competitively unattractive from the standpoint of earning good profits.
B) offers little ability to build a sustainable competitive advantage.
C) is highly conducive to achieving strong product differentiation and high customer loyalty to the company's brand.
D) offers moderate to good prospects for making a reasonable profit and building a sustainable competitive advantage.
E) requires that industry members have a strongly differentiated product offering in order to be profitable.
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A) a salad as a substitute for French fries
B) wireless phones as a substitute for wired telephones
C) Coca-Cola as a substitute for Pepsi
D) snowboards as a substitute for snow skis
E) video-on-demand services from a cable TV company as a substitute for going to the movies
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A) the race of industry members to build strong defenses against the industry's driving forces
B) the constant rivalry of firms to strengthen their standing with buyers and win a competitive edge over rivals
C) the ongoing race among rival sellers to have the highest-quality product
D) the ongoing efforts of industry members to introduce new and improved products/services at a faster rate than their rivals
E) the ongoing race among rivals to achieve the fastest rate of growth in revenues and profits
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A) are likely to prosper in the future.
B) are likely to continue their present strategy with only minor fine-tuning.
C) are virtually certain to make fresh strategic moves.
D) recognize the status quo as the best course of action to adopt
E) realize that refocusing will ensure competitive gains.
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Rivalry among competing sellers decrease...View Answer
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A) the speed with which general economic conditions and interest rates are changing.
B) the extent to which buyers can exercise enough bargaining power to influence the conditions of sale in their favor and whether strategic partnerships between certain industry members can adversely affect other industry members.
C) how many buyers purchase all of their requirements from a single seller versus how many purchase from several sellers.
D) the number of buyers versus the number of sellers.
E) whether industry members are spending more or less on advertising.
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A) What are the industry product R&D capabilities and expertise in product design?
B) On what basis do buyers choose between the competing brands of sellers?
C) What product attributes and service characteristics are crucial?
D) What resources must a company have to be competitive?
E) What shortcomings are almost certain to put a company at a significant disadvantage?
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A) harder it is for the sellers of attractive substitutes to lure buyers to their offering.
B) more intense the competitive pressures posed by substitute products.
C) less intense the competitive pressures posed by substitute products.
D) greater the bargaining power from both suppliers and influential customers.
E) lesser the bargaining power from both suppliers and influential customers.
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A) building the picture of competition in three steps: (1) identify the different parties involved, along with specific factors that bring about competitive pressures; (2) evaluate how strong the pressures stemming from each of the five forces are (strong, moderate or weak) ; and (3) determine whether the collective impact of the five competitive forces is conducive to earning attractive profits in the industry.
B) building the picture of competition in two steps: (1) determine which rival has the biggest competitive advantage and (2) assess whether the competitive advantages possessed by various industry members allow most industry members to earn above-average profits.
C) evaluating whether competition is being intensified or weakened by the industry's driving forces and key success factors.
D) assess whether the collective impact of all five forces is weak enough to allow industry members to go on the offensive or use a defensive strategy to insulate against fierce competitive pressures.
E) gauging the overall strength of competition based on how many industry rivals are operating with a competitive advantage and how many are operating at a competitive disadvantage.
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A) global distribution capabilities of suppliers
B) product attributes and service characteristics that buyers consider to be crucial
C) low switching costs of buyers and suppliers
D) accurate filling of buyer orders
E) short delivery time capability
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A) determines the strength of the industry's driving forces.
B) determines the extent of the competitive pressure on industry profitability.
C) means that fewer companies can achieve a competitive advantage via anything other than being the industry's low-cost leader.
D) means there will be a larger number of competitive advantage opportunities for industry members.
E) means there will be a greater number of industry key success factors.
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A) when certain competitors are dissatisfied with their market position and make moves to bolster their standing
B) when strong companies outside the industry acquire weak firms in the industry and launch aggressive moves to transform their newly acquired competitors into stronger market contenders
C) when competitors are fairly equal in size and capability
D) when the products of rivals are weakly differentiated, buyer switching costs are low, and market demand is growing slowly
E) when there are vast numbers of small rivals so the impact of any one company's actions is spread thinly across all industry members
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Salient drivers of industry change in ho...View Answer
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A) the industry's growth potential, whether competition appears destined to become stronger or weaker, and whether the industry's overall profit prospects are above average, average, or below average
B) an assessment of which firms in the industry have the best and worst competitive strategies, whether the number of strategic groups in the industry is increasing or decreasing, and whether economies of scale and experience curve effects are a key success factor
C) whether there are more than five key success factors and more than five barriers to entry
D) constructing a strategic group map and assessing the attractiveness of the competitive position of each strategic group
E) whether the market leaders enjoy competitive advantages and how hard it is to develop a strongly differentiated product
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The expected reaction of industry incumb...View Answer
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A) changes in the long-term industry growth rate
B) entry or exit of major firms
C) shifts in who buys the product and how the product is used
D) changes in costs and efficiency
E) regulatory influences and government policy changes
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