Question 1

The industry environment directly influences the firm and its competitive actions and responses.

Accepted Answer

The industry environment, which includes factors such as competitors, customers, suppliers, and regulatory conditions, has a significant impact on a firm's strategic decisions and competitive behavior. Therefore, it is important for firms to understand and adapt to the industry environment in order to succeed in the market.

Question 2

Although health care reform legislation was passed in the early part of the Obama administration,it continues to be a bone of contention for employers,employees,and politicians because of its delays and increased expenses.
These attitudes about health care reform make up the sociocultural segment of the general environment.

Accepted Answer

The statement is true. The attitudes and debates surrounding health care reform are part of the sociocultural segment of the general environment.

Question 3

Firms can directly control the elements of the seven segments of the general environment.

Accepted Answer

Firms cannot directly control the elements of the general environment, as they are external factors that can only be influenced to some extent. Firms can only adapt to these elements in order to succeed in the market.

Question 4

When firms analyze the external environment,they typically have complete and unambiguous data.

Accepted Answer

Firms rarely have complete and unambiguous data when analyzing the external environment. The external environment is complex and constantly changing, making it difficult to gather and interpret data accurately. Firms must rely on various sources of information and employ analytical tools and techniques to make informed decisions.

Question 5

Globalfocusing is often used by firms with high levels of international operations who further increase their internationalization by focusing on global niche markets.

Accepted Answer

The answer of Globalfocusing is often used by firms with...

Question 6

The external environment facing business stays relatively constant over time.

Accepted Answer

The external environment facing business is constantly changing and evolving due to various factors such as technological advancements, changes in consumer preferences, economic conditions, and regulatory policies. Therefore, it does not stay relatively constant over time.

Question 7

Developing a political strategy by the newly formed General Motors would likely be ineffective as firms are generally unable to influence the political/legal environment.

Accepted Answer

While it is true that firms have limited power to directly influence the political/legal environment, they can still develop effective political strategies by analyzing and responding to the existing environment. This may include lobbying, advocacy, and engagement with policymakers and government officials. Additionally, firms can work with industry associations, community groups, and other stakeholders to shape the political and regulatory landscape.

Question 8

Monitoring involves the development of a forecast of what might happen at a future point in time.

Accepted Answer

The answer of Monitoring involves the development of a forecast...

Question 9

Contrary to popular belief,the global segment of the external environment does not provide many opportunities for firms such as H.J. Heinz,SAB Miller,and Citigroup,all of which recently experienced low growth and profits coming from emerging markets.

Accepted Answer

The global segment of the external environment often provides significant opportunities for firms, especially in emerging markets, where there is potential for growth and increased profits due to expanding economies and consumer bases.

Question 10

The European sovereign-debt crisis and political upheavals in Egypt,Tunisia,Libya,and Syria illustrate uncertainties in the political/legal segment of the general environment that could affect the performance of business firms.

Accepted Answer

The statement is true. The European sovereign-debt crisis and political upheavals in Egypt, Tunisia, Libya, and Syria are examples of political/legal uncertainties that could have an impact on the performance of business firms. These events can affect factors such as economic stability, trade policies, and regulations, which in turn can affect businesses operating both domestically and internationally.

Question 11

The legislation introduced in the U.S. Congress during the early tenure of the Obama administration intended to reduce the amount of work U.S. companies outsource and is an example of a potential change in the sociocultural segment of the general environment.

Accepted Answer

The answer of The legislation introduced in the U.S. Congress...

Question 12

Competitor analysis is focused on the factors and conditions influencing an industry's profitability potential.

Accepted Answer

The answer of Competitor analysis is focused on the factors...

Question 13

Demographic,economic,political/legal,sociocultural,technological,global,and physical are the seven elements comprising the industry environment.

Accepted Answer

The statement is true, as these are the seven key elements that make up the industry environment, which can impact the success and growth of a business within a given industry.

Question 14

Scanning involves detecting meaning through early signals of environmental trends.

Accepted Answer

The answer of Scanning involves detecting meaning through early signals...

Question 15

Age structure,geographic distribution,income distribution,interest rates,and process innovations are all elements of concern when studying the demographic segment of the general environment.

Accepted Answer

The answer of Age structure,geographic distribution,income distribution,interest rates,and process innovations...

Question 16

In recent times,businesspeople have become more confident in the ability of economists to provide valid and reliable predictions about the world's economic environment.

Accepted Answer

There is no clear evidence to suggest that businesspeople have become more confident in the ability of economists to provide accurate economic predictions. Economic forecasting is still subject to a high degree of uncertainty and variability, and many business leaders may prefer to rely on their own experiences and insights when making decisions about the future of their companies. Additionally, there have been several high-profile incidents in recent years where economists and financial experts failed to predict major economic events, such as the global financial crisis of 2008.

Question 17

Early adopters of new technology often achieve higher market shares and higher returns than later adopters of the technology.

Accepted Answer

Early adopters have the advantage of being the first to offer a new technology to the market, allowing them to capture a larger share of the market before competition arises. This can result in higher profits and returns on investment. Later adopters may struggle to break into the market and may have to spend more on marketing or differentiate their offering to compete.

Question 18

The recent bankruptcy filings by General Motors and Chrysler Corporation illustrate that firms cannot directly control the general environment's segments.

Accepted Answer

The bankruptcy filings of General Motors and Chrysler Corporation were largely due to external factors such as the economic recession and changing consumer preferences, which are part of the general environment that firms cannot directly control.

Question 19

When Philip Morris International studies the cigarette tax policies of various nations,it is engaged in the forecasting component of the environmental analysis process.

Accepted Answer

Forecasting involves predicting future trends, while studying current tax policies is part of the scanning or monitoring component of environmental analysis.

Question 20

The objective of assessing the external environment is to determine the timing and importance of the effects of environmental changes and trends on the strategic management of the firm.

Accepted Answer

The objective of assessing the external environment is indeed to determine the timing and importance of the effects of environmental changes and trends on the strategic management of the firm.

Quiz 2: The External Environment: Opportunities, Threats, Industry Competition, and Competitor Analysis.