Question 1

Which of the following approaches to assess competitive advantage is based on the view that noneconomic factors can have a significant impact on a firm's financial performance?

Accepted Answer

A)   the triple-bottom-line approach
B)   the economic value creation framework
C)   the accounting profitability approach
D)   the balanced-scorecardE) B) and C)
F) B) and D)

Question 2

The ratio Cost of goods sold/Revenue indicates how efficiently a company can

Accepted Answer

A)   produce a good.
B)   sell a good.
C)   advertise a good.
D)   design a good.E) A) and B)
F) B) and C)

Question 3

How does a sustainable strategy typically help a firm?

Accepted Answer

A)   It helps the firm focus solely on its financial goals.
B)   It reduces the need for corporate social responsibility within the firm.
C)   It facilitates the firm in effectively isolating its external stakeholders.
D)   It helps the firm achieve positive results along the social and ecological dimensions.E) B) and C)
F) C) and D)

Question 4

Erin is the manager of gardening supplies wholesaler SpringTime Inc. The company's vision is to become the leading supplier of gardening materials west of the Mississippi River. In assessing the firm's current state, Erin has determined that the firm could differentiate itself from competitors with an easy-to-use online ordering system and a two-day delivery guarantee. To accomplish this, Erin has determined that SpringTime must spend the next two quarters honing its capabilities for sourcing materials quickly and improving its web development competencies. According to the balanced scorecard approach, what is wrong with Erin's thinking?

Accepted Answer

A)   She has not considered the opportunity costs associated with launching an online ordering system.
B)   She has not addressed the question of which core competencies the firm needs.
C)   She has failed to account for external factors such as customer perceptions and shareholder perceptions.
D)   She has not addressed the question of how SpringTime will create value.E) A) and B)
F) A) and C)

Question 5

Which of the following frameworks used to measure competitive advantage relies on both an internal and an external view of a firm?

Accepted Answer

A)   the economic value creation model
B)   the accounting profitability model
C)   the shareholder value creation model
D)   the balanced-scorecard modelE) None of the above
F) All of the above

Question 6

________ precisely indicates how much of a firm's sales is converted into profits.

Accepted Answer

A)   Break-even price
B)   Working capital turnover
C)   Return on revenue
D)   Inventory turnoverE) A) and C)
F) B) and C)

Question 7

List the dimensions on which a firm can create greater economic value.

Accepted Answer

A firm's advantage can be based on super...

Question 8

Threadless allows customers to submit their own designs and to vote on which designs they would like to see printed on a T-shirt. This business uses a ________ technique.

Accepted Answer

A)   offshoring
B)   crowdsourcing
C)   peer-to-peer
D)   binge watchingE) A) and D)
F) A) and B)

Question 9

Shark Fin Golf Club requires its members to pay a quarterly or an annual fee to use its services. Irrespective of whether they frequently use the services during the payment period or not, members have to pay in advance. Which of the following business models does this best illustrate?

Accepted Answer

A)   razor-razor-blade
B)   pay-as-you-go
C)   subscription-based
D)   freemiumE) A) and C)
F) A) and B)

Question 10

________, which is the return on risk capital, includes stock price appreciation plus dividends received over a specific period.

Accepted Answer

A)   Total return to shareholders
B)   Earnings per share
C)   Receivables turnover
D)   Dividend yieldE) C) and D)
F) B) and C)

Question 11

Which of the following expressions accurately describes market cap?

Accepted Answer

A)   It is the product of the number of outstanding shares and the share price.
B)   It is the difference between the book value and the market value of a firm's assets.
C)   It is the ratio of a firm's equity finance and its debt finance.
D)   It is the difference between a firm's account receivables and account payables.E) A) and B)
F) C) and D)

Question 12

________ are best described as the value of the best forgone alternative use of the resources employed.

Accepted Answer

A)   Variable costs
B)   Opportunity costs
C)   Social costs
D)   Switching costsE) A) and D)
F) A) and B)

Question 13

Which of the following statements correctly compares Apple and Microsoft in 2016?

Accepted Answer

A)   Apple had a higher return on revenue than Microsoft.
B)   Apple had a higher return on invested capital than Microsoft.
C)   Microsoft had higher total sales than Apple.
D)   Microsoft had a lower cost structure than Apple.E) None of the above
F) A) and B)

Question 14

Return on risk capital primarily includes

Accepted Answer

A)   stock price appreciation plus dividends received over a specific period.
B)   consumer surplus plus firm profit.
C)   account receivables plus account payables.
D)   economic value created by a firm plus reservation price.E) A) and B)
F) All of the above

Question 15

How does a firm capture its producer surplus for a good or service?

Accepted Answer

A)   as cost per unit sold
B)   as profit per unit sold
C)   as earnings per share
D)   as market price per shareE) C) and D)
F) All of the above

Question 16

Which of the following scenarios exemplifies a sustainable strategy under the triple bottom line approach?

Accepted Answer

A)   Rather than complying with the restrictive recycling laws in the United States, Impervious Plastics outsourced its manufacturing to a country that has fewer environmental restrictions.
B)   Impervious Plastics developed a chemical additive that doubled the life of its plastics. The additive was currently legal, but environmental groups argued that it harmed the environment.
C)   Impervious Plastics reformulated its products to eliminate chemicals that were widely used in the industry but were being investigated for their potential negative effects on the environment.
D)   Impervious Plastics' nearest competitor increased the salaries of its production workers by 30 percent, but Impervious kept its wages the same to gain a cost advantage over its competitor.E) A) and C)
F) A) and B)

Question 17

The difference between the price charged for a product and the cost to manufacture it is referred to as the

Accepted Answer

A)   consumer surplus.
B)   break-even price.
C)   producer surplus.
D)   reservation price.E) C) and D)
F) B) and C)

Question 18

The translation of strategy into action primarily takes place in a firm's

Accepted Answer

A)   mission statement.
B)   executive summary.
C)   business model.
D)   code of conduct.E) C) and D)
F) A) and D)

Question 19

When SW International declared a dividend of $20,000,000, its market value increased from $8 billion to $8.5 billion. However, it lost a chance to reinvest $20,000,000 in the research and development of a new product which would have earned a profit of $200 million. Thus, this $200 million is referred to as SW International's

Accepted Answer

A)   producer surplus.
B)   consumer surplus.
C)   opportunity cost.
D)   social cost.E) A) and B)
F) None of the above

Question 20

Cloudlink is a file hosting service that allows users to store up to 5GB of data with no restrictions or charges. However, users have to pay a fee for advanced features on the cloud storage system and additional storage space. Which of the following business models does this best illustrate?

Accepted Answer

A)   subscription-based
B)   freemium
C)   pay-as-you-go
D)   razor-razor-bladeE) C) and D)
F) None of the above

Exam 5: Competitive Advantage, Firm Performance, and Business Models

List the dimensions on which a firm can create greater economic value.

Correct Answer
verified
A firm's advantage can be based on super...
View Answer

The translation of strategy into action primarily takes place in a firm's

Correct Answer
verified

Which of the following statements correctly compares Apple and Microsoft in 2016?

Correct Answer
verified

Threadless allows customers to submit their own designs and to vote on which designs they would like to see printed on a T-shirt. This business uses a ________ technique.

Correct Answer
verified

Correct Answer
verified

How does a sustainable strategy typically help a firm?

Correct Answer
verified

Shark Fin Golf Club requires its members to pay a quarterly or an annual fee to use its services. Irrespective of whether they frequently use the services during the payment period or not, members have to pay in advance. Which of the following business models does this best illustrate?

Correct Answer
verified

________ are best described as the value of the best forgone alternative use of the resources employed.

Correct Answer
verified

How does a firm capture its producer surplus for a good or service?

Correct Answer
verified

Correct Answer
verified

Return on risk capital primarily includes

Correct Answer
verified

________, which is the return on risk capital, includes stock price appreciation plus dividends received over a specific period.

Correct Answer
verified

Which of the following frameworks used to measure competitive advantage relies on both an internal and an external view of a firm?

Correct Answer
verified

The difference between the price charged for a product and the cost to manufacture it is referred to as the

Correct Answer
verified

Which of the following expressions accurately describes market cap?

Correct Answer
verified

The ratio Cost of goods sold/Revenue indicates how efficiently a company can

Correct Answer
verified

Which of the following approaches to assess competitive advantage is based on the view that noneconomic factors can have a significant impact on a firm's financial performance?

Correct Answer
verified

Cloudlink is a file hosting service that allows users to store up to 5GB of data with no restrictions or charges. However, users have to pay a fee for advanced features on the cloud storage system and additional storage space. Which of the following business models does this best illustrate?

Correct Answer
verified

________ precisely indicates how much of a firm's sales is converted into profits.

Correct Answer
verified

Which of the following scenarios exemplifies a sustainable strategy under the triple bottom line approach?

Correct Answer
verified

Exam 5: Competitive Advantage, Firm Performance, and Business Models

List the dimensions on which a firm can create greater economic value.

Correct AnswerverifiedA firm's advantage can be based on super...View AnswerShow Answer

The translation of strategy into action primarily takes place in a firm's

Correct AnswerverifiedShow Answer

Which of the following statements correctly compares Apple and Microsoft in 2016?

Correct AnswerverifiedShow Answer

Threadless allows customers to submit their own designs and to vote on which designs they would like to see printed on a T-shirt. This business uses a ________ technique.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

How does a sustainable strategy typically help a firm?

Correct AnswerverifiedShow Answer

Shark Fin Golf Club requires its members to pay a quarterly or an annual fee to use its services. Irrespective of whether they frequently use the services during the payment period or not, members have to pay in advance. Which of the following business models does this best illustrate?

Correct AnswerverifiedShow Answer

________ are best described as the value of the best forgone alternative use of the resources employed.

Correct AnswerverifiedShow Answer

How does a firm capture its producer surplus for a good or service?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Return on risk capital primarily includes

Correct AnswerverifiedShow Answer

________, which is the return on risk capital, includes stock price appreciation plus dividends received over a specific period.

Correct AnswerverifiedShow Answer

Which of the following frameworks used to measure competitive advantage relies on both an internal and an external view of a firm?

Correct AnswerverifiedShow Answer

The difference between the price charged for a product and the cost to manufacture it is referred to as the

Correct AnswerverifiedShow Answer

Which of the following expressions accurately describes market cap?

Correct AnswerverifiedShow Answer

The ratio Cost of goods sold/Revenue indicates how efficiently a company can

Correct AnswerverifiedShow Answer

Which of the following approaches to assess competitive advantage is based on the view that noneconomic factors can have a significant impact on a firm's financial performance?

Correct AnswerverifiedShow Answer

Cloudlink is a file hosting service that allows users to store up to 5GB of data with no restrictions or charges. However, users have to pay a fee for advanced features on the cloud storage system and additional storage space. Which of the following business models does this best illustrate?

Correct AnswerverifiedShow Answer

________ precisely indicates how much of a firm's sales is converted into profits.

Correct AnswerverifiedShow Answer

Which of the following scenarios exemplifies a sustainable strategy under the triple bottom line approach?

Correct AnswerverifiedShow Answer

Correct Answer
verified
A firm's advantage can be based on super...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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