Deck 3: The External Assessment

Question 1

Which of the following is a process of worldwide integration of strategy formulation,implementation and evaluation activities?

A)Globalization
B)Industrialization
C)Mission development
D)Brainstorming
E)Industry analysis

Answer 1

A

Question 2

What is the range for a firm's total weighted score in an External Factor Evaluation Matrix?

A)1 to 4
B)1 to 5
C)0 to 5
D)0 to 10
E)0 to 4

Answer 2

A

Question 3

The process of performing an external audit needs to include

A)primarily front- line supervisors
B)stockholders and external government agencies
C)as many managers and employees as possible.
D)only top level managers,as it's a planning function.
E)between 15 to 20 managers for it to be valid

Answer 3

C

Question 4

Learning from the partner is a major reason why firms enter into cooperative agreements.

A)European
B)American
C)Mexican
D)African
E)Asian

Question 5

The term that refers to the EU's effort to end competitive tax breaks among member countries is

A)double taxation.
B)tax reconciliation.
C)tax harmonization.
D)taxation bias.
E)equity taxation.

Question 6

Which statement about business intelligence is least accurate?

A)Intelligence gathering is an unethical business practice.
B)Running an intelligence program requires many computers and other resources.
C)Running an intelligence program requires many people.
D)Collecting intelligence about competitors violates antitrust laws.
E)Business intelligence is equal to espionage.

Question 7

Which of these does not significantly affect firms?

A)Antitrust legislation
B)Tax rates
C)Patent laws
D)Lobbying activities
E)Constitutional laws

Question 8

What is the first step in designing an EFE Matrix?

A)Summing the weighted score for each competitor
B)Identifying key external factors in the industry
C)Calculating the sales of each competitor
D)Determining four competitors
E)Drawing the horizontal and vertical lines for the matrix

Question 9

Some countries that have petitioned to be admitted to the EU include

A)Croatia
B)Georgia
C)Ukraine
D)Turkey
E)All the above

Question 10

To perform an external audit,a company first must

A)perform an internal audit.
B)get an approval from the Securities and Exchange Commission.
C)gather competitive intelligence and information about external trends.
D)hire a consultant to develop a comprehensive strategic plan.
E)all of these

Question 11

Intensity of competition in lower- return industries.

A)is highest
B)is lowest
C)fluctuates
D)is non- existent
E)is not important

Question 12

In 2010,which company had the dominant market share in the beverages industry?

A)Molson Brewing
B)Coca- Cola Enterprises
C)Dr Pepper Snapple Group
D)PepsiCo
E)Coca Cola

Question 13

If suppliers are unreliable or too costly,which of these strategies may be appropriate?

A)Concentric diversification
B)Forward integration
C)Backward integration
D)Horizontal integration
E)Market penetration

Question 14

Globalization of industries is occurring for all of these reasons except

A)e- commerce and the instant transmission of money and information across continents.
B)the emergence of global sellers.
C)a worldwide trend toward similar consumption patterns.
D)a worldwide trend toward different consumption patterns.
E)the emergence of global buyers.

Question 15

Which Arab country or territory will have the highest percentage of population aged 60 years and older as of 2050 ?

A)Bahrain
B)UAE
C)Sudan
D)Kuwait
E)Comoros

Question 16

Which country is Japan's largest trading partner?

A)China
B)U.S.
C)Germany
D)UAE
E)U.K.

Question 17

What level of bargaining power do consumers have when the products being purchased are standard or undifferentiated?

A)High
B)Marginal
C)Not necessary
D)Low
E)Negative

Question 18

Which Arab country or territory has the highest percentage of population aged 60 years and older as of 2000 ?

A)Lebanon
B)Yemen
C)Tunisia
D)Algeria
E)Djibouti

Question 19

According to I/O theorists,which of the following contributes least to firm performance?

A)Barriers to market entry
B)Economies of scale
C)Level of competitiveness
D)Internal resources
E)Product differentiation

Question 20

Who are the world's longest- living people?

A)Filipinos
B)Indians
C)Egyptians
D)Americans
E)Japanese

Question 21

is not a basic mission of a competitive intelligence program.

A)To identify areas where competitors are vulnerable and to assess the impact strategic actions would have on competitors
B)To identify potential moves a competitor might make that would endanger a firm's position in the market
C)To provide a general understanding of an industry
D)To identify industry executives who could be hired by the firm
E)To provide a general understanding of a company's competitors

Question 22

The term used to describe the systematic and ethical process for gathering and analyzing information about the competition's activities and general trends to further a business' own goals is

A)artificial intelligence.
B)information sharing.
C)unethical business practice.
D)competitive advantage.
E)competitive intelligence.

Question 23

Which company has survived as a manufacturer of inexpensive audio products by centralizing its world production in Singapore?

A)Philips
B)General Electric
C)Hewlett-Packard
D)Sony
E)Panasonic

Question 24

is not part of an external audit.

A)Analyzing financial ratios
B)Analyzing social,cultural,demographic and geographic forces
C)Analyzing available technologies
D)Analyzing competitors
E)Studying the political environment

Question 25

Keeping strategies secret from employees and stakeholders can do all of the following except

A)inhibit employee and stakeholder understanding.
B)inhibit employee and stakeholder commitment.
C)inhibit employee and stakeholder communication.
D)provide competitive advantage to competitors.
E)forego valuable employee or stakeholder input.

Question 26

Which is an important sector of the economy for a number of Arab countries highly vulnerable to climate change?

A)Food production
B)Paper
C)Tourism
D)Textiles
E)Metals

Question 27

The Arab world has just over million people.

A)200
B)250
C)300
D)350
E)400

Question 28

Collecting and evaluating information on competitors is essential for successful

A)strategy evaluation.
B)strategy implementation.
C)internal analysis.
D)strategy management.
E)strategy formulation.

Question 29

The effect of trends in the dollar's value on companies in different industries and in different locations are

A)marginal and equal.
B)significant and unequal.
C)neglibible.
D)significant and equal.
E)insignificant and unequal.

Question 30

When an industry relies heavily on government contracts,which forecasts can be the most important part of an external audit?

A)Political
B)Technological
C)Competitive
D)Multinational
E)Economic

Question 31

Identifying and evaluating key social,political,economic,technological and competitive trends and events are the main components of

A)formulating strategy.
B)conducting an internal audit.
C)implementing strategy.
D)performing an external audit.
E)developing an effective mission statement.

Question 32

Because of the Internet,barriers to personal and business success are

A)acting like glass walls.
B)lower.
C)being built.
D)significantly enhanced.
E)being eliminated.

Question 33

Freund emphasizes that key external factors should be all of these except

A)hierarchical in the sense that some will pertain to the overall company while others will be more narrowly focused.
B)important for achieving long- term and annual objectives.
C)applicable to all competing firms.
D)relatively few in number.
E)measurable.

Question 34

The international challenge faced by Arab corporations is twofold:

A)how to gain and maintain exports to other nations and how to defend domestic markets against imported goods.
B)how to increase exports to other countries and how to increase imports from other countries.
C)how to gain exports to other nations and enhance market share for imported goods in domestic markets.
D)how to defend domestic markets against imported goods while minimizing exports.
E)how to enhance imported goods in domestic markets and minimize exports to other nations.

Question 35

Older population segments are especially interested in

A)travel and leisure.
B)health care.
C)financial servoces.
D)crime prevention.
E)All the above.

Question 36

What happens to the demand for discretionary goods when interest rates rise?

A)It rises.
B)It stays the same.
C)It declines.
D)There is no way to tell.
E)It first rises then declines.

Question 37

The I/O approach to competitive advantage argues that external factors are internal factors in a firm achieving competitive advantage.

A)less important than
B)less common than
C)as important as
D)more important than
E)more common than

Question 38

Technological advancements can create new advantages that are more powerful than existing advantages.

A)economic
B)environmental
C)competitive
D)social
E)comparative

Question 39

Which large ethinic minority in North Africa contributes significantly to the economic prosperity and development of the area?

A)Indian
B)Berber
C)Kenyan
D)British
E)Moroccan

Question 40

Whenever new firms can easily enter a particular industry,the intensity of competitiveness among firms

A)neutralizes.
B)stays the same.
C)fluctuates.
D)increases.
E)decreases.

Question 41

The critical success factors in a Competitive Profile Matrix are often the same as those in an EFE Matrix.

Question 42

Industry analysis is also referred to as external strategic management audit.

Question 43

One difference between CPM and EFE is that

A)CPM is only used in small firms.
B)CPM includes both internal and external issues.
C)CPM is performed only for the company,whereas EFE is performed for both the company and the competitors.
D)CPM ratings range from 1 to 10.
E)the weight and total weighted score mean opposite.

Question 44

Decreasing demands for oil will significantly impact the economies of many countries in the Middle East region,as these countries are either oil producers or labor exporters for the
oil- producing countries.

Question 45

What is not one of Michael Porter's five competitive forces?

A)Bargaining power of unions
B)New entrants
C)Bargaining power of suppliers
D)Bargaining power of buyers
E)Rivalry among existing firms

Question 46

Linear regression is based on the assumption that the future will be different from the past.

Question 47

Political forecasts can be the most important part of an external audit for firms that depend heavily on government contracts.

Question 48

A Competitive Profile Matrix allows strategists to summarize and evaluate economic,social,cultural,demographic,environmental,political,governmental,legal,technological,and competitive information.

Question 49

According to Porter,what is usually the most powerful of the five competitive forces?

A)Bargaining power of consumers
B)Potential development of substitute products
C)Potential entry of new competitors
D)Bargaining power of suppliers
E)Rivalry among competing firms

Question 50

In an External Factor Evaluation Matrix,opportunities often receive higher weights than threats,but threats too can receive high weights if they are especially severe or threatening.

Question 51

What are educated assumptions about future trends and events?

A)Forecasts
B)Guesses
C)Facts
D)Predictions
E)Statistics

Question 52

Qualitative forecasts are most appropriate when historical data are available,and when the relationships among key variables are expected to remain the same in the future.

Question 53

Forward integration is used by firms to gain control or ownership of suppliers.

Question 54

Which of the following was a small village in the 1960s and is now a thriving world city?

A)Dubai
B)Abu Dhabi
C)Jeddah
D)Muscat
E)Manama

Question 55

Competitive intelligence is not considered corporate espionage because 95 percent of the information a company needs to make strategic decisions is available and accessible to the public.

Question 56

Research findings suggest that a greater percentage of a firm's profitability can be explained by the industry than can be explained by the firm's internal factors.

Question 57

"Innovate or evaporate; particularly in technology- driven businesses,nothing quite recedes like success" is a characteristic of the most competitive companies.

Question 58

Generally,at the present time,a high worldwide demand for generates more revenue for Arab countries and allows these countries to invest in various economic sectors.

A)diamond
B)food
C)steel
D)oil
E)gold

Question 59

A global strategy includes designing,producing,and marketing products with global needs in mind,instead of considering individual countries alone.

Question 60

The bargaining power of consumers can be the most important force impacting competitive advantage.

Question 61

The aim of an external audit is to develop an exhaustive list of every possible factor that could influence the business.

Question 62

A global strategy seeks to meet the needs of customers worldwide with the lowest cost at the highest value.

Question 63

Freund argues that key external factors must not be hierarchical.

Question 64

External audits attempt to identify key variables that offer actionable responses.

Question 65

In addition to liberalization,Arab executives have shown an interest in asking their respective governments to join the World Trade Organization and in protecting the environment.

Question 66

All Arab countries share a similar culture and have the same ethnic and religious beliefs.

Question 67

According to Business Week,9 out of 10 large companies have employees dedicated solely to gathering competitive intelligence.

Question 68

An EFE Matrix does not alow strategists to summarize and evaluate economic,social,cultural,demographic,environmental,political,governmental,legal,technological,and competitive information.

Question 69

As many managers and employees as possible should be involved in the process of performing an external audit.

Question 70

According to Business Week,there are less than 500 corporate spies now actively engaged in intelligence activities.

Question 71

To perform an external audit,a company first must gather competitive intelligence and information about social,cultural,demographic,environmental,economic,political,legal,governmental and technological trends.

Question 72

The most powerful of Porter's five competitive forces is usually the bargaining power of consumers.

Question 73

Corporate intelligence can be defined as a systematic and ethical process for gathering and analyzing information about the activities and general business trends of the competition,to further a business's own goals.

Question 74

Mass communication and high technology are creating similar patterns of consumption in diverse cultures worldwide,which means that many companies may find it difficult to survive by relying solely on domestic markets.

Question 75

Political,governmental,and legal factors are considered key threats for most small and large organizations.

Question 76

Both a Competitive Profile Matrix and an EFE Matrix have the same meaning in the weights,ratings and total weighted scores.

Question 77

In practice,critical technology decisions are too often delegated to lower organizational levels or are made without an understanding of their strategic implications.

Question 78

In some Arab countries,companies that depend heavily on imports benefit greatly when the dollar falls against the yen and euro.

Question 79

The Arab Human Development Report 2009 shows that life expectancy of the Arab population,on average,jumped from 46 years in 1960 to about 70 in 2005.

Question 80

The Internet is changing the very nature of many industries by altering product life cycles and changing the historical trade- off between production standardization and flexibility.