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External Analysis: Industry Structure, Competitive Forces, And Strategic Groups

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Question 1
Free
True/False

For-profit businesses operating in long-standing fields such as energy and transportation usually operate in an environment of price stability.

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False

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Question 2
Free
True/False

A small coffee shop faces significant potential competition because of the low capital requirements compared with business environments such as universities and laboratories.

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False

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Question 3
Free
True/False

Federal and regional laws prevent incumbent firms from dramatically lowering prices or otherwise retaliating when a new entrant joins an industry.

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False

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Question 4
Free
True/False

Because competitors in oligopolistic industries are so interdependent, it is especially important for managers in those firms to monitor and respond to changes their competitors make.

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Question 5
Free
True/False

A video-streaming service provider such as Netflix is a complement to a manufacturer of streaming video devices such as Roku.

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Question 6
True/False

A company that owns failing movie theaters could leverage existing assets by turning the buildings into performance spaces and conference sites.

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Question 7
True/False

When smartphone manufacturers began including cameras and voice recorders in their products, that was an example of industry convergence.

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Question 8
True/False

A local manufacturer that wants to be a global manufacturer faces few mobility barriers because it has not yet invested in supply chains, which can become outdated and expensive.

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False
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Question 9
True/False

Firms within the same industry automatically belong to the same strategic group.

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True
False
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Question 10
Multiple Choice

The ________ allows the scanning, monitoring, and evaluating of changes and trends in a firm's macro environment.

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A
VRIO framework
B
SWOT analysis
C
BCG matrix
D
PESTEL framework
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Question 11
Multiple Choice

Which of the following external forces is a part of a firm's task environment?

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A
the composition of the strategic group to which the firm belongs
B
the interest rates prevalent in the economy in which the firm operates
C
the inflation level in the economy in which the firm operates
D
the recent innovations in process technology, including lean manufacturing
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Question 12
Multiple Choice

The government of Filvia has mandated that the standard minimum wage in the country be increased to $8,000 per year. Which of the following factors in a firm's general environment does this mandate best indicate?

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A
ecological factors
B
sociocultural factors
C
technological factors
D
legal factors
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Question 13
Multiple Choice

Kirsten, a manager, is writing an analysis of her employer's current and possible future revenues. Which of the following could she identify as an economic factor in her firm's external general environment?

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A
the government regulations and laws in the country in which the firm exists
B
the stage of the business cycle that the country is in
C
the values and norms prevalent in the society in which the firm operates
D
the bargaining power of the firm's suppliers and buyers
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Question 14
Multiple Choice

Managers at Sandburg Real Estate are surprised to hear that interest rates are likely to remain low for the next six months. Which of the following is an implication of low interest rates?

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A
Cost of capital for firms will be high.
B
Firms will invest less in future growth.
C
Economic growth rate will fall.
D
Consumer demand will increase.
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Question 15
Multiple Choice

Luz manages a chain of bars and restaurants in a tri-county area that has recently experienced an economic boom because of fracking and high oil prices. What is most likely to happen when there is too much money in the tri-county economy?

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A
too many goods and services
B
a drop in interest rates
C
high economic growth
D
an increase in prices
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Question 16
Multiple Choice

Marina manages the supply chain for a company that sells diamond watches. She learns that economists are predicting a moderate to severe recession in the next six to eight months. Based on that information, what action should Marina recommend to the company's owner?

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A
Increase supply. During recessions, businesses that focus on low-cost solutions make significant profits.
B
Reduce supply. Customers generally reduce their purchases of luxury items when the economy falters.
C
Maintain the supply at its current rate. Economic forecasts are rarely accurate.
D
Wait six months and see what happens. Recessions rarely affect consumer spending.
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Question 17
Multiple Choice

In a firm's external environment, ________ primarily capture population characteristics related to age, gender, family size, ethnicity, sexual orientation, religion, and socioeconomic class.

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A
political trends
B
demographic trends
C
ecological trends
D
economic trends
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Question 18
Multiple Choice

Anders is researching sociocultural factors related to his employer, a sporting goods manufacturer. Which of the following would be part of the sociocultural forces in a firm's external environment?

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A
the interest rates prevalent in an economy
B
the laws protecting small enterprises in a nation
C
the family size of the firm's target market
D
the rate of employee attrition within the firm
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Question 19
Multiple Choice

In 2008, BlackBerry's market cap peaked at $75 billion. By 2017 this valuation had fallen more than 90 percent, to $3.9 billion. BlackBerry fell victim to two important PESTEL factors in its external environment: sociocultural and technological. How did technology contribute to BlackBerry's decline?

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A
BlackBerry failed to offer strong security features for its device.
B
BlackBerry failed to change its device into one that could perform multiple tasks effectively.
C
BlackBerry failed to adapt to a groundswell that involved workers bringing mobile devices to work.
D
BlackBerry failed to produce an efficient emailing system using a keyboard.
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Question 20
Multiple Choice

How is a firm's task environment different from its general environment?

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A
Managers have some influence over external factors in the task environment; they have little direct effect over external forces in the general environment.
B
Managers have no direct effect over external factors in the task environment; they have some influence over external forces in the general environment.
C
Managers have no direct effect over external factors in the task environment; they have influence over all external forces in the general environment.
D
Managers have influence over all external factors in the task environment; they have no direct effect over external forces in the general environment.
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