Question 1

The three techniques used by advocacy groups to influence companies are public communications, media advocacy, and product boycotts.

Accepted Answer

This statement is true. Advocacy groups use public communications, media advocacy, and product boycotts as techniques to influence companies.

Question 2

The best way to manage legal responsibilities is to retain a large staff of legal specialists to defend the company against any charges.

Accepted Answer

The best way to manage legal responsibilities is to educate managers and employees about laws and regulations and potential lawsuits that could affect a business.

Question 3

Proactive customer monitoring is defined as identifying and addressing customer trends and problems after they occur.

Accepted Answer

This defines reactive customer monitoring.

Question 4

Managers often prefer economic statistics to business confidence indices as tools for managerial decision making because of their inherently greater accuracy.

Accepted Answer

Managers often prefer business confidence indices to economic statistics because they know that the level of confidence reported by real managers affects their business decisions. Unfortunately, the economic statistics that managers rely on when making these decisions are notoriously poor predictors of future economic activity.

Question 5

The general environment is unique to each firm's industry and directly affects the way it conducts day-to-day business.

Accepted Answer

This is the definition of the specific environment. The general environment consists of the economy and the technological, socio-cultural, and political/legal trends that indirectly affect all organizations.

Question 6

External environments are the forces and events outside a company that have the potential to influence or affect it.

Accepted Answer

This statement is true. External environments can include factors such as economic conditions, market trends, political and legal factors, technology advancements, and social and cultural factors. These factors can impact a company's operations, strategies, and performance.

Question 7

Environmental complexity refers to the degree of change in the external factors that affect organizations.

Accepted Answer

Environmental complexity is the number of external factors in the environment that affect organizations. Environmental change refers to the rate at which a company's general and specific environments change.

Question 8

Advocacy groups are typically composed of concerned citizens who have a strong feeling about a common issue even though the members' viewpoints differ significantly.

Accepted Answer

The members of advocacy groups generally share the same point of view on a particular issue.

Question 9

The general environment consists of the economy and the technological, socio-cultural, and political/legal trends that indirectly affect all organizations.

Accepted Answer

The general environment includes the economy and the four external environmental factors that indirectly affect organizations: technological, socio-cultural, political/legal, and natural.

Question 10

In contrast to the general segment of the external environment that DIRECTLY influences an organization, changes in the specific segment of an organization's external environment INDIRECTLY affect the way a company conducts its business.

Accepted Answer

General environments INDIRECTLY influence organizations, while changes in an organization's specific environment DIRECTLY affects the way a company conducts its business.

Question 11

Managers often do a poor job of identifying potential competitors.

Accepted Answer

Managers may focus too much on the direct competitors they already know about, and fail to recognize potential indirect competitors or emerging threats from new market entrants.

Question 12

Changes in any sector of the general environment eventually affect most organizations.

Accepted Answer

This statement is true. The general environment includes economic, political, technological, sociocultural, and demographic factors that can have an impact on organizations in various ways. These changes can create opportunities or threats that organizations must respond to in order to survive and thrive.

Question 13

The specific segment of an organization's external environment is unique to its region of the country.

Accepted Answer

The specific environment is unique to the firm's industry, not region of the country.

Question 14

The two kinds of external organizational environments are the general environment and the specific environment.

Accepted Answer

This statement is true. The general environment refers to factors that affect all organizations, such as economic trends, political developments, and technological changes. The specific environment, on the other hand, includes factors that are unique to a particular organization, such as competitors, customers, and suppliers.

Question 15

Under conditions in which the rate of both environmental change and complexity go up while environmental resources become scarce, environmental uncertainty can be expected to increase.

Accepted Answer

This statement is true, as increasing rates of environmental change and complexity, combined with resource scarcity, can make it difficult for organisms to predict and respond to changes in their environment. This results in increased environmental uncertainty.

Question 16

A decrease in either buyer dependence or supplier dependence can lead to opportunistic behavior.

Accepted Answer

An increase in either buyer dependence or supplier dependence can lead to opportunistic behavior.

Question 17

Business confidence indices are a viable alternative to economic statistics for management decision making.

Accepted Answer

Business confidence indices reflect the sentiment and outlook of businesses regarding the future of the economy and their own operations. This can provide valuable information for management decision making, as it can help assess risks and opportunities for growth. Economic statistics only provide a snapshot of the current state of the economy and may not accurately reflect future trends or industry-specific variables. However, it is important to use multiple sources of information when making business decisions.

Question 18

Buyer dependence is the degree to which a company relies on a supplier because of the importance of the supplier's product to the company and the difficulty of finding other sources of that product.

Accepted Answer

This is the definition of supplier dependence.

Question 19

According to its rate of environmental change, an organization's environment can be either stable or dynamic, but not both.

Accepted Answer

According to punctuated equilibrium theory, companies often experience both stable and dynamic external environments.

Question 20

Resource scarcity is the degree to which an organization's external environment has an abundance or lack of critical organizational resources.

Accepted Answer

Resource scarcity refers to the abundance or lack of critical organizational resources in an organization's external environment.

Quiz 3: Section 1: Organizational Environments and Cultures