Question 1

The U.S.cell-phone industry uses a combination of the razor-razor-blade model with which other model when it offers a two-year contract in exchange for a heavily subsidized new phone?
A) A subscription-based model
B) An ink cartridge model
C) A bait-and-switch model
D) A network effects model

Accepted Answer

The U.S. cell-phone industry uses a combination of the razor-razor-blade model and a subscription-based model.

Question 2

A strategy is a manager's theory of how to compete; however,the theory is useless if it is NOT put into action.What is the translation of strategy that details the firm's competitive tactics and initiatives?
A) The business model
B) The business formula
C) The corporate model
D) The corporate formula

Accepted Answer

Business models are the translation of strategy that details the firm's competitive tactics and initiatives.

Question 3

BRIC countries have more than 40% of the world's population and occupy more than a quarter of the world's landmass.Which of these countries is not a part of BRIC?
A) India
B) Brazil
C) Canada
D) Russia

Accepted Answer

The BRIC emerging markets are in Brazil, Russia, India, and China.

Question 4

A business model is the translation of strategy into action,which details the firm's competitive tactics and initiatives.Another way to say this is ___________.
A) It's reliant on co-opetition to be successful
B) It's a crowdsourcing process for the firm
C) It's how the firm intends to make money
D) It's how network effects are taken into account

Accepted Answer

A business model, at its heart, is how the firm does or intends to make money.

Question 5

The General Manager of a strategic business unit (SBU)would be mostly concerned with questions of ____________.
A) How to compete
B) Where to compete
C) How to implement a business strategy
D) How to form strategic alliances

Accepted Answer

The General Manager of a strategic business unit (SBU) would be mostly concerned with the question of "how to compete."

Question 6

IBM is headquartered in Armonk,New York,but more than 70% of its employees work for the company outside of the U.S.What is given as a major reason for this in the text?
A) IBM is following Coca-Cola and Sony corporate strategies.
B) Two-thirds of its revenue and most of its growth are occurring outside the U.S.
C) Bottom-of-the-pyramid effects on technology consulting.
D) High corporate tax rates in the U.S. are driving firms offshore.

Accepted Answer

IBM employment trends are following its revenue and growth pattern.

Question 7

Who has the responsibility for implementing business strategy within a single area?
A) General managers
B) The executive staff
C) The Chief Executive Officer
D) Functional managers

Accepted Answer

Functional managers are responsible for implementing a business strategy within a single area.

Question 8

In recent years,China has invested a tremendous amount of money on increasing its infrastructure with high-speed rails,state-of-the-art airports,and modern roads.China also has the largest number of Internet users of any country in the world.How will this combination of infrastructure and technology likely impact China over the next few years?
A) New innovations will diffuse more quickly throughout China than in the past.
B) It will not have a major impact as China's economy is too diverse.
C) It will increase the income disparity between coastal and rural areas of China.
D) These investments will increase the costs and therefore slow down the growth of new technologies in China.

Accepted Answer

With accelerating technological change, the infrastructure China is building will help it adopt new technologies more rapidly and more widely than ever before.

Question 9

The division director of marketing of a major consulting firm is most often making decisions at which level of strategy?
A) Corporate strategy
B) Functional strategy
C) Business-level strategy
D) Alliance strategy

Accepted Answer

The division director of marketing of a major consulting firm is most often making decisions in the functional strategy area of her department.

Question 10

Which of the following is not an example of the razor-razor-blade business model?
A) Razor blades
B) Cell phones
C) Inkjet printers
D) Digital cameras

Accepted Answer

The film is cheap in a digital camera as the price per gigabyte of memory cards has dropped enormously in recent years. However, razor blades, cell-phone minutes (including data plans), and ink for printers are quite expensive and generate significant profits for the firms able to collect on them.

Question 11

Functional managers have the ability to come up with strategic initiatives that may influence the direction of the company.The reason for this is?
A) Since they are responsible for executing a business strategy, how they do it impacts what actually happens.
B) They are closer to products, services, and customers.
C) Since strategic planning is a bottom-up process, they are responsible for developing the scenarios looked at.
D) They have a better understanding of what the company's capabilities are and can discern new opportunities that match.

Accepted Answer

Functional managers are closer to products, services, and customers, and therefore may have the ability to come up with strategic initiatives that may influence the direction of the company.

Question 12

IBM's CEO Sam Palmisano has moved the firm more into global IT services and out of its traditional hardware focus.What level of strategic decisions do these moves represent?
A) Corporate strategy
B) Functional strategy
C) Business-level strategy
D) Alliance strategy

Accepted Answer

This is answering the question "where to compete" and is part of corporate strategy.

Question 13

Google and Microsoft have approached the market using quite different business models.Over time,they have engaged in multi-point competition.Which of the following best describes this competition today?
A) They have very divergent corporate strategies.
B) They are an example of co-opetition in action.
C) They are largely competing in mobile device operating systems.
D) They compete for market share in several different product categories.

Accepted Answer

Google and Microsoft are competing in several different product categories today, and indications are this trend will continue despite their quite different roads to reach this point.

Question 14

Grameen Telecom and the Nano car introduced by Tata are examples of what new business model?
A) A subscription model of services available to all
B) Making a small revenue but across a large base of the world's poorest
C) Not-for-profit businesses trying to aid the world's poor
D) A crowdsourcing model targeted at the world's most impoverished

Accepted Answer

Microloans and the small Nano car are both very inexpensive but have the potential to spread across a large base of the world's poorest populations at the bottom of the pyramid.

Question 15

According to the text,which part of the organization seeks superior performance by asking the question "how to compete"?
A) Corporate strategy
B) Functional strategy
C) Business level strategy
D) Project strategy

Accepted Answer

Business-level strategy answers the question "how to compete."

Question 16

Web 2.0 relies on the idea that the value of a product or service increases as more people use it.This concept is called what?
A) Network consolidation
B) Network effects
C) Internet strategy
D) Accelerated technological change

Accepted Answer

Network effects is the idea that the value of a product or service increases as more people use it. One telephone is useless if there is no other one to answer it.

Question 17

Gillette invented a "razor-razor-blade" model of business,whereby the razor handle is provided at a low cost and the replacement razor blades are sold relatively expensively.Which of the following is another example of this business model?
A) Audible.com audiobooks
B) HP laser printers
C) Tom's shoe sales "1 for 1"
D) The New York Times newspaper

Accepted Answer

HP laser printers are sold relatively inexpensively and HP makes a large portion of its printer profits on the sale of ink cartridges.

Question 18

The idea of firms creating significant business opportunities for some 4 billion people on the planet who live in poverty is called ______________.
A) Top of the pyramid
B) Bottom of the line
C) Bottom of the pyramid
D) Top of the line

Accepted Answer

Bottom of the pyramid is the trend given for firms creating significant business opportunities for some 4 billion people on the planet who live in poverty.

Question 19

Which of the following is a major decision that was generated from a change in corporate strategy?
A) Changing Google's pricing model on its Google Ads products
B) Providing superior customer service at Neiman Marcus retail stores
C) Selling IBM's personal computer business to the Chinese firm Lenovo
D) Applying for patents on Pfizer's cholesterol-lowering drug Lipitor

Accepted Answer

Selling IBM's personal computer business to the Chinese firm Lenovo was a decision crystallized in a change of corporate strategy.

Question 20

People who grew up with the Internet and need no help in adapting to new technologies have been called digital natives.Those who have not grown up with such technologies but are adapting to them are called what?
A) Electronic infants
B) The greatest generation
C) Luddites
D) Digital immigrants

Accepted Answer

Digital immigrants have not grown up with such technologies but are adapting to them.

Quiz 1: What Is Strategy and Why Is It Important

The U.S.cell-phone industry uses a combination of the razor-razor-blade model with which other model when it offers a two-year contract in exchange for a heavily subsidized new phone?

A strategy is a manager's theory of how to compete; however,the theory is useless if it is NOT put into action.What is the translation of strategy that details the firm's competitive tactics and initiatives?

BRIC countries have more than 40% of the world's population and occupy more than a quarter of the world's landmass.Which of these countries is not a part of BRIC?

A business model is the translation of strategy into action,which details the firm's competitive tactics and initiatives.Another way to say this is ___________.

The General Manager of a strategic business unit (SBU) would be mostly concerned with questions of ____________.

IBM is headquartered in Armonk,New York,but more than 70% of its employees work for the company outside of the U.S.What is given as a major reason for this in the text?

Who has the responsibility for implementing business strategy within a single area?

The division director of marketing of a major consulting firm is most often making decisions at which level of strategy?

Which of the following is not an example of the razor-razor-blade business model?

Functional managers have the ability to come up with strategic initiatives that may influence the direction of the company.The reason for this is?

IBM's CEO Sam Palmisano has moved the firm more into global IT services and out of its traditional hardware focus.What level of strategic decisions do these moves represent?

Google and Microsoft have approached the market using quite different business models.Over time,they have engaged in multi-point competition.Which of the following best describes this competition today?

Grameen Telecom and the Nano car introduced by Tata are examples of what new business model?

According to the text,which part of the organization seeks superior performance by asking the question "how to compete"?

Web 2.0 relies on the idea that the value of a product or service increases as more people use it.This concept is called what?

Gillette invented a "razor-razor-blade" model of business,whereby the razor handle is provided at a low cost and the replacement razor blades are sold relatively expensively.Which of the following is another example of this business model?

The idea of firms creating significant business opportunities for some 4 billion people on the planet who live in poverty is called ______________.

Which of the following is a major decision that was generated from a change in corporate strategy?

People who grew up with the Internet and need no help in adapting to new technologies have been called digital natives.Those who have not grown up with such technologies but are adapting to them are called what?