Question 1

The rate of growth of Internet-based applications could be affected by the possibility of Internet service providers charging users for downloading those applications.

Accepted Answer

If Internet service providers charge users for downloading applications, it could deter users from using or experimenting with new applications, thereby slowing down the rate of growth of Internet-based applications.

Question 2

The I/O (industrial organization) model assumes that the uniqueness of a firm's resources and capabilities are its main source of above-average returns.

Accepted Answer

The answer of The I/O (industrial organization) model assumes that...

Question 3

An effective vision stretches and challenges people and can result in increased innovation as illustrated by Apple's CEO Steve Jobs who is known to think bigger and differently than most people ("putting a dent in the universe").

Accepted Answer

An effective vision should stretch and challenge people, and Steve Jobs is known for doing just that with Apple's vision. This can lead to increased innovation and creativity.

Question 4

The needs and desires of organizational stakeholders are inherently contradictory.

Accepted Answer

The needs and desires of different stakeholders such as customers, employees, investors, and suppliers are diverse and often competing. For example, employees may want higher salaries and better working conditions, while investors may want higher profits and lower costs. Balancing these conflicting demands is a key challenge for organizational leaders.

Question 5

A firm's mission tends to be enduring while its vision can change in light of changing environmental conditions.

Accepted Answer

The answer of A firm's mission tends to be enduring...

Question 6

The degree to which the firm is dependent on a stakeholder group gives that stakeholder less influence.

Accepted Answer

The degree of dependence on a stakeholder group actually gives that group more influence. The more essential their resources or support are to the firm, the more power they hold in decision-making and other activities.

Question 7

Research shows that a greater percentage of a firm's profitability is explained by the I/O rather than the resource-based model.

Accepted Answer

The answer of Research shows that a greater percentage of...

Question 8

The assumptions of the industrial organizational model and the resource-based model are contradictory. Therefore, organizational strategists must choose one or the other model as the basis for developing a strategic plan.

Accepted Answer

The industrial organizational model and the resource-based model are not necessarily contradictory, but rather offer different perspectives on strategic planning. Some organizations may choose to incorporate aspects of both models into their overall strategy.

Question 9

Resources are considered rare when they have no structural equivalent.

Accepted Answer

The answer of Resources are considered rare when they have...

Question 10

An effective vision statement will specify the market to be served.

Accepted Answer

The answer of An effective vision statement will specify the...

Question 11

Relative power is the most critical criteria for prioritizing the demands of stakeholders.

Accepted Answer

Prioritizing the demands of stakeholders based on their relative power is a commonly used approach in stakeholder management. It involves considering the level of influence or impact each stakeholder has on the project or organization to determine the priority of their demands. Stakeholders with higher levels of power are typically given more attention and their demands may be addressed before those with lower power.

Question 12

The five forces model suggests that firms should target the industry with the highest potential for above-average returns and then implement either a cost-leadership strategy or a differentiation strategy.

Accepted Answer

The five forces model suggests that firms should analyze the industry structure to identify the industry with the highest potential for above-average returns. Once identified, the firm can implement a cost-leadership strategy or a differentiation strategy to achieve sustainable competitive advantage in the industry.

Question 13

The uniqueness of a firm's resources and capabilities is the basis for a firm's strategy and determines its ability to earn above-average returns under the I/O view.

Accepted Answer

The statement is actually in line with the Resource-Based View (RBV) of the firm, not the Industrial Organization (I/O) view. The RBV highlights that a firm's unique resources and capabilities, such as patents, brands, and specialized knowledge, are the key drivers of its performance and competitive advantage. The I/O view, on the other hand, suggests that external factors, such as industry structure and competitive forces, are the primary determinants of a firm's profitability.

Question 14

Organizational mission statements typically do not include statements about profitability and earning above-average returns.

Accepted Answer

The answer of Organizational mission statements typically do not include...

Question 15

One capability characteristic of a firm with strategic flexibility is the capacity to learn.

Accepted Answer

A firm with strategic flexibility must have the capacity to learn from its experiences, adapt to new situations, and make changes in response to shifting market conditions. This requires ongoing learning and development of new skills and knowledge, as well as a willingness to experiment and take risks in order to stay ahead of competitors. Without a focus on learning and innovation, a firm may struggle to maintain its strategic flexibility over time.

Question 16

Although the fast food (or quick-service) industry is unattractive, McDonald's has earned above-average returns through product innovations, enhancing existing facilities, and buying properties outside the United States.

Accepted Answer

The answer of Although the fast food (or quick-service) industry...

Question 17

The resource-based model assumes that if firms have resources that are rare or costly to imitate, this is sufficient to form a basis for competitive advantage.

Accepted Answer

The answer of The resource-based model assumes that if firms...

Question 18

Organizational stakeholders are the firm's internal resources, capabilities, and core competencies that are used to accomplish what may at first appear to be unattainable goals in the competitive environment.

Accepted Answer

Organizational stakeholders are actually individuals or groups outside the firm who have an interest in the company's activities, such as customers, suppliers, investors, government agencies, and the community.

Question 19

The new CEO of Opacity Enterprises is determined to make the long-established firm strategically flexible. The CEO feels that the employees of the company have the ability, training, and resources to engage in continuous learning. The main obstacle the CEO must face is inertia.

Accepted Answer

The statement implies that the CEO wants to make the company more adaptable and agile, but the main obstacle is the resistance to change or inertia from the employees.

Question 20

The CEO of Twin Spires, Inc., is emotionally and intellectually committed to using the resources of the firm to serve the needs of the natural gardening community by providing rare and native plants to individuals and nurseries around the United States. This commitment has carried the CEO through long periods of below average returns on investment. The perspective of the CEO of Twin Spires is consistent with the assumptions of the industrial organizational (I/O) model.

Accepted Answer

The answer of The CEO of Twin Spires, Inc., is...

Quiz 1: Strategic Management and Strategic Competitiveness