Strategic Management Quiz 1-Testing Concepts of Strategies

Question 1

Bankruptcy can sometimes be good strategic decision for an organization.

Accepted Answer

true

Question 2

Organizations should attempt to pursue all the investment projects available to them.

Accepted Answer

false

Question 3

Related diversification is riskier than unrelated diversification.

Accepted Answer

false

Question 4

Forward integration and backward integration deal mainly with distributors and suppliers, respectively.

Accepted Answer

true

Question 5

A benefit of strategic management is that an organization is reactive in controlling its own destiny.

Accepted Answer

false

Question 6

Increasing advertising expenditures can be termed a “market development strategy.”

Accepted Answer

false

Question 7

All sizes and types of organizations can utilize and benefit from strategic-management concepts and techniques.

Accepted Answer

true

Question 8

Forward integration is an appropriate strategy when the advantages of stable prices are high.

Accepted Answer

false

Question 9

A small beauty parlor at Tariq Road acquiring a food processing company is an example of unrelated diversification.

Accepted Answer

false

Question 10

Strategic management concepts provide a subjective basis for allocating resources.

Accepted Answer

false

Question 11

A strategic management approach can sometimes guarantee success.

Accepted Answer

true

Question 12

Horizontal integration means seeking ownership or increased control over competitors.

Accepted Answer

true

Question 13

A primary purpose of diversification is to gain control over competitors.

Accepted Answer

false

Question 14

Pearl Continental Hotels selling petrol to its customers is an example of unrelated diversification.

Accepted Answer

true

Question 15

Backward integration is a good strategy to use when an organization needs to acquire a resource quickly.

Accepted Answer

true

Question 16

Retrenchment and turnaround are the same strategy.

Accepted Answer

true

Question 17

A company can legally declare bankruptcy first and then liquidate various divisions to raise needed capital.

Accepted Answer

false

Question 18

Market development is an appropriate strategy when an organization has excess production capacity.

Accepted Answer

true

Question 19

A laser printer manufacturer introducing a new laser printer is an example of forward integration.

Accepted Answer

false

Question 20

Unrelated diversification is opted when an present distribution channels are used for new products to current customers.

Accepted Answer

false

Question 21

If an organization’s overall strategy is ineffective, then all the efficiency in the world may not be enough to succeed.

Accepted Answer

true

Question 22

Market penetration is an appropriate strategy when the correlation between sales and marketing expenditure has been low.

Accepted Answer

false

Question 23

A strategic-management approach to decision making is not a guarantee of success.

Accepted Answer

true

Question 24

Divestiture is an appropriate strategy when there exists a need to introduce a new technology quickly.

Accepted Answer

false

Question 25

A mission statement is a declaration of and organization’s financial status.

Accepted Answer

false

Question 26

When an organization’s basic industry is becoming global in scope, the firm should pursue a joint venture strategy.

Accepted Answer

true

Question 27

One reason for vertical integration is to gain control over creditors.

Accepted Answer

false

Question 28

Backward integration is an appropriate strategy when the advantages of stable production are particularly important.

Accepted Answer

false

Question 29

Selling a division or part of an organization is liquidation.

Accepted Answer

false

Question 30

Introducing present products into new geographic areas is market development.

Accepted Answer

true

Question 31

There are four basic types of diversification: related, unrelated, forward and backward.

Accepted Answer

false

Question 32

Objectives, strategies and the allocation of resources are in strategy formulation stage.

Accepted Answer

false

Question 33

Market penetration is a suggested strategy when the usage rate of present customers could be significantly increased.

Accepted Answer

true

Question 34

Product development is an appropriate strategy when a firm has successful products that are in the maturity stage.

Accepted Answer

false

Question 35

Liquidation should be pursued after successful retrenchment and divestiture strategy.

Accepted Answer

false

Question 36

Unrelated diversification is an appropriate strategy when existing markets for present products are saturated.

Accepted Answer

true

Question 37

Small businesses generally do not require strategic management.

Accepted Answer

false

Question 38

An effective mission statement can be viewed to exhibit twelve characteristics or components.

Accepted Answer

false

Question 39

Liquidation is often appropriate when retrenchment and divestiture have failed.

Accepted Answer

true

Question 40

Related diversification is an strategy when 2+ firms are having trouble competing with a large rival firm.

Accepted Answer

false

Question 41

Selling land the firm owns can be termed “divestiture.”

Accepted Answer

false

Question 42

Intensive strategies include market penetration, market development, product development, and joint venture.

Accepted Answer

false

Question 43

Holiday Corporation (Hotel chain parent company) selling its Holiday Inn Division is an example of retrenchment.

Accepted Answer

true

Question 44

Indus Motors buying out all of its auto dealers is an example of horizontal integration.

Accepted Answer

false

Question 45

The airline industry has been slow to globalize, because air-traffic controllers speak different languages.

Accepted Answer

false

Question 46

Selling a division or part of an organization only is defined as divestiture.

Accepted Answer

false

Strategic Management Quiz 1-Testing Concepts of Strategies

Questions 46

Strategic Management Quiz 1-Testing Concepts of Strategies

Questions 46