Introduction to Strategic Management – Strategic Management MCQ

Introduction to Strategic Management – Strategic Management MCQ

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Introduction to Strategic Management – CS Executive Financial and Strategic Management MCQ Questions with Answers you can quickly revise the concepts.

Introduction to Strategic Management – Strategic Management MCQ

Question 1.
We may define the term ‘strategy’ as a ……… blueprint.
(A) Long range
(B) Short range
(C) Short and medium range
(D) Unlimited range
Answer:
(A) Long range

Question 2.
Strategic management involves the decision-making and the activities in an organization which –
(A) Have wider ramifications
(B) Have a long time perspective
(C) Use critical resources towards perceived opportunities or threats in a changing environment
(D) All of the above
Answer:
(D) All of the above

Question 3.
According to Chandler ‘Strategic Management’ is –
(A) That set of decisions and actions which lead to the development of an effective strategy or strategies to help achieve corporate objectives.
(B) The formulation and implementation of the major goals and initiatives taken by a company’s top management.
(C) Determination of the basic long-term goals and objectives of an enterprise and adoption of course of action and allocation of resources necessary to carry out these goals.
(D) Developing the company’s vision,environmental scanning, strategy formulation, implementation and evaluation and control.
Answer:
(C) Determination of the basic long-term goals and objectives of an enterprise and adoption of course of action and allocation of resources necessary to carry out these goals.

Question 4.
According to Glueck ‘Strategic Management’ is set of decisions and actions which lead to the development of an effective strategy or strategies to help achieve –
(A) Major objectives
(B) Planning objectives
(C) Corporate objectives
(D) National objectives
Answer:
(C) Corporate objectives

Question 5.
According to Hambrick ‘Strategic Management’ Strategic management is the formulation and implementation of the taken by a company’s top management on behalf of owners, based on consideration of resources and an assessment of the internal and external environments in which the organization competes.
(A) Major goals and initiatives
(B) Major plans and process
(C) Major decisions
(D) Product development
Answer:
(A) Major goals and initiatives

Question 6.
Strategic management involves developing the –
I. Company’s vision
II. Training of personnel
III. Environmental scanning
IV. Strategy formulation
V. New software
VI. Strategy implementation
Select the correct answer from the options
given below.
(A) I, III & IV only
(B) IV, III, I & VI
(C) I and IV only
(D) Except V all
Answer:
(B) IV, III, I & VI

Question 7.
Strategic management emphasizes the monitoring and evaluation of external opportunities and threats in the light of a company’s and designing strategies for the survival and growth of the company.
(A) Plans and budget
(B) Asset and liabilities
(C) Strengths and weaknesses
(D) Opportunities and plans
Answer:
(C) Strengths and weaknesses

Question 8.
According to Chandler ‘Strategic Management’ is determination of the basic long-term goals and objectives of an enterprise and adoption of course of action and allocation of …………. necessary to carry out these goals.
(A) Sources
(B) Resources
(C) Assets
(D) Expenses
Answer:
(B) Resources

Question 9.
Arrange the process of strategic management in proper sequence –
R Where we want to be?
Q. How can we ensure arrival?
R. How might we get there?
S. Where are we now?
T. Which way is best?
Select the correct answer from the options given below.
(A) S, P, R, T. Q
(B) S, T, R, P, Q
(C) P, R, S, T, Q
(D) R, S, P, Q, T
Answer:
(A) S, P, R, T. Q

Question 10.
Match the List I with List II with reference to strategic management process:
Introduction to Strategic Management - Strategic Management MCQ 1
Answer:
(C)

Question 11.
Out of all the alternatives generated in the earlier stage the organization selects the best suitable alternative. This stage in strategic management process is called as –
(A) Evaluation
(B) Means
(C) Ends
(D) Beginning
Answer:
(A) Evaluation

Question 12.
The strategic management process is defined as the process by which the managers are able to make a choice of a set of strategies for the organization that will enable it to accomplish –
(A) Targeted marketing plans
(B) improved performance
(C) Better debt equity ratio
(D) Government help
Answer:
(B) improved performance

Question 13.
Strategic management –
(A) Is not a static
(B) Is continuous process
(C) Consists of different phases
(D) All of the above
Answer:
(D) All of the above

Question 14.
There are ………….. indispensable phases of every strategic management process.
(A) Five
(B) Four
(C) Six
(D) Three
Answer:
(B) Four

Question 15.
Which of the following is first phase of strategic management process?
(A) Strategy Formulation
(B) Strategy Evaluation
(C) Strategy Implementation
(D) Environmental Scanning
Answer:
(D) Environmental Scanning

Question 16.
Environment scanning is careful monitoring of an organization’s environments for detecting early signs of opportunities and threats that may influence its current and future plans.
(A) Internal
(B) External
(C) Internal and external
(D) Internal or external
Answer:
(C) Internal and external

Question 17.
Which of the following is/are NOT features of business environment?
(I) Uncertainty
(II) Relativity
(III) Static Nature
Select the correct answer from the options given below
(A) (I) only
(B) (II) only
(C) (III) only
(D) None of the above
Answer:
(C) (III) only

Question 18.
Which of the following describes the desired future position of the company?
(A) Vision statement
(B) Mission statement
(C) Planning statement
(D) Forecasting statement
Answer:
(A) Vision statement

Question 19.
Which of these basic questions should a vision statement answer?
(A) What is our business?
(B) Who are our competitors?
(C) Where we are to go?
(D) Why do we exist?
Answer:
(C) Where we are to go?

Question 20.
Which of the following is beginning stage of strategic management process?
(A) Process of goal setting for the organization after it has finalized its vision and mission.
(B) The organization selects the best suitable alternative.
(C) Firm find out its relative market position, corporate image, its strength and weakness and also threats and opportunities.
(D) The organization deals with the various strategic alternatives it has.
Answer:
(C) Firm find out its relative market position, corporate image, its strength and weakness and also threats and opportunities.

Question 21.
A defines the company’s business, its objectives and its approach to reach those objectives.
(A) Vision statement
(B) Mission statement
(C) Planning statement
(D) Forecasting statement
Answer:
(B) Mission statement

Question 22.
According to Porter, what is usually the most powerful of the five competitive forces?
(A) Rivalry among existing firms
(B) Potential development of substitute products
(C) Bargaining power of buyers and suppliers
(D) Potential entry of new competitor
Answer:
(A) Rivalry among existing firms

Question 23.
Mission and Vision Statements are NOT commonly used to:
(A) Guide management’s thinking on strategic issues, especially during times of significant change
(B) Create wider linkages with customers, suppliers and alliance partners
(C) Help establish a framework for ethical behaviour
(D) Inspire employees to work more productively by providing focus and common goals
Answer:
(B) Create wider linkages with customers, suppliers and alliance partners

Question 24.
A business has absolute control in the …………….. (X), whereas it has no control on the …………….. (Y)
Select the correct answer from the options given below.
Introduction to Strategic Management - Strategic Management MCQ 2
Answer:
(C)

Question 25.
What type of organizational structure do most small businesses follow?
(A) Divisional Structure
(B) Functional Structure
(C) Hour Glass Structure
(D) Matrix Structure
Answer:
(D) Matrix Structure

Question 26.
Which of the following contains the owner of the business, the shareholders, the managing director, the non-managers, employees, the customers, the infrastructure of the business organization, and the culture of the organization?
(A) Internal environment
(B) External environment
(C) Outside environment
(D) All of above
Answer:
(A) Internal environment

Question 27.
We may define the term ‘strategy’ as a long range blueprint of an organization’s desired –
A. Image
B. Direction
C. Destination
Select the correct answer from the options given below.
(A) A & C
(B) B & C
(C) A & B
(D) All of the above
Answer:
(D) All of the above

Question 28.
In evaluating strategies, which one of Rumelt’s criteria for evaluating strategies, refers to the need for strategists to examine sets of! rends?
(A) Consistency
(B) Consonance
(C) Feasibility
(D) Advantage
Answer:
(B) Consonance

Question 29.
Your ………. is your ultimate goal, your ………… is how you will get there.
(A) Mission, Vision
(B) Vision, Mission
(C) Vision, Vision
(D) Mission, Mission
Answer:
(B) Vision, Mission

Question 30.
Internal environment includes M’s
(A) 3
(B) 4
(C) 5
(D) 6
Answer:
(D) 6

Question 31.
What can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives?
(A) Strategy Formulation
(B) Strategy Evaluation
(C) Strategy Implementation
(D) Strategic Management
Answer:
(D) Strategic Management

Question 32.
Match the List I with List II with reference to strategic management process:
List I ———- List II
A. Where we want to be? — 1. Stage 4
B. Where are we now? — 2. Stage 1
C. How can we ensure arrival? — 3. Stage 5
D. How might we get there? — 4. Stage 2
E. Which way is best? — 5. Stage 3
Introduction to Strategic Management - Strategic Management MCQ 7
Answer:
(B)

Question 33.
Where you want your business to be in 10 years time. This can be termed as:
(A) Mission statement
(B) Vision statement
(C) Statement of purpose
(D) Memorandum of understanding
Answer:
(B) Vision statement

Question 34.
The internal factors that contribute to the business environment is/are:
1. Research and Development
2. Company Image
3. Brand Equity
4. Value System
Select the correct answer from the options given below.
(A) 2, 1 & 3 only
(B) 4, 3 & 2 only
(C) 2 & 4 only
(D) 4, 1,2,3
Answer:
(D) 4, 1,2,3

Question 35.
The competencies or skills that a firm employs to transform inputs into outputs are
(A) Tangible resources
(B) Intangible resources
(C) Organizational capabilities
(D) Reputational resources
Answer:
(C) Organizational capabilities

Question 36.
…………… may include inventions and techniques which affect the way of doing things that is, designing, producing and distributing products.
(A) Research and Development
(B) Company Image and Brand Equity
(C) Value System
(D) All of above
Answer:
(A) Research and Development

Question 37.
The principles of right and wrong that are accepted by an individual or organization are what comprise
(A) Research and Development
(B) Company Image and Brand Equity
(C) Value System
(D) All of above
Answer:
(C) Value System

Question 38.
Individual investors are reliant on upon the organization’s managers to……
(A) Maximize short-term returns in the form of dividends.
(B) Add value to their investments in a way that the stockholders could not accomplish on their own.
(C) Achieve risk reduction at a lower cost than stockholders could obtain on their own.
(D) Diversify the stockholder’s investments in order to reduce risk.
Answer:
(B) Add value to their investments in a way that the stockholders could not accomplish on their own.

Question 39.
Competitor analysis involves:
(1) Identifying the actual competitors
(2) Assessing competitors’ objectives, strategies, strengths & weaknesses, and reaction patterns
(3) Selecting the strategies to deal with competitors
Select the correct answer from the options given below –
(A) (1) and (2)
(B) (2) and (3)
(C) (1) and (3)
(D) All of the above
Answer:
(D) All of the above

Question 40.
An organization has little or no control over its –
A. Internal environment
B. Inner environment
C. External environment
Select the correct answer from the options given below –
(A) A and B
(B) B and C
(C) A only
(D) C only
Answer:
(D) C only

Question 41.
Change in company’s ……….. gives rise to problems necessitating a new …………. to be made.
(A) Structure. Strategy
(B) Strategy, Structure
(C) Structure, Structure
(D) Strategy, Strategy
Answer:
(B) Strategy, Structure

Question 42.
To develop caliber professionals facilitating good corporate governance is ………. of ICSL
(A) Mission
(B) Vision
(C) Both (A) and (B)
(D) None of above
Answer:
(A) Mission

Question 43.
To be a global leader in promoting good corporate governance is of ICSI.
(A) Mission
(B) Vision
(C) Both (A) and (B)
(D) None of above
Answer:
(B) Vision

Question 44.
The micro environment is also known as the ……..
(A) Task environment
(B) Operation environment
(C) Task environment and operating environment
(D) None of the above
Answer:
(C) Task environment and operating environment

Question 45.
Feature(s) of strategy is/Eire:
(A) It is a specialized planning to retaliate competitors.
(B) It explains how managers have to respond to the subordinate in providing leadership.
(C) It is one of the way to manage the people in organization.
(D) All of above
Answer:
(A) It is a specialized planning to retaliate competitors.

Question 46.
Formulating strategies is the job of –
(A) Low level management
(B) Top level management
(C) Middle level management
(D) All of above
Answer:
(B) Top level management

Question 47.
Which of the following is concerned with the overall purpose and scope of the business to meet stakeholder expectations?
(A) Operational strategy
(B) Corporate strategy
(C) Business unit strategy
(D) Operation strategy
Answer:
(B) Corporate strategy

Question 48.
Consider following two statements.
(I) Strategic management is a bundle of tricks and magic.
(II) Strategic management is not needed in non-profit organizations.
Select the correct answer from the options given below.
(A) Statement I is true and Statement II is false
(B) Statement II is true and Statement I is false
(C) Both Statement I and Statement II are true
(D) Both Statement I and Statement II are false.
Answer:
(D) Both Statement I and Statement II are false.

Question 49.
Assertion (A):
Success or failure of a strategy is dependent on several extraneous factors.
Reason (R):
Strategic management is much more serious affair and requires some tricks or magic.
Select the correct answer from the options given below.
(A) A is false but R is true
(B) A and R are true and R is correct explanation of A
(C) A and R are true but R is not correct explanation of A
(D) A is true but R is false
Answer:
(D) A is true but R is false

Question 50.
Assertion (A):
Strategy is a substitute for sound, alert and responsible management.
Reason (R):
Strategy can never be perfect, flawless and optimal. Strategies are goal-directed decision and actions in which capabilities and resources are matched with the opportunities and threats in the environment. A good management at the top can steer the organizations by adjusting its path on the basis of the changes in the environment.
Select the correct answer from the options given below.
(A) A and R are true and R is correct explanation of A
(B) A is false but R is true
(C) A and R are true but R is not correct explanation of
(D) A is false and R is true; it explains how A is false
Answer:
(D) A is false and R is true; it explains how A is false

Question 51.
………. is the ability to influence others to voluntarily make decisions that enhance the prospects for the organization’s long – term success while maintaining long-term financial stability.
(A) Marketing leadership
(B) Strategic leadership
(C) Operational leadership
(D) Financial leadership
Answer:
(B) Strategic leadership

Question 52.
The consists of the factors in the company’s immediate environment that affects the performance and working of the company.
(A) Micro environment
(B) Macro environment
(C) Business environment
(D) Outside environment
Answer:
(A) Micro environment

Question 53.
………… is concerned more with how a business competes successfully in a particular market and often described as mission statement.
(A) Operational strategy
(B) Corporate strategy
(C) Business unit strategy
(D) Mix strategy
Answer:
(C) Business unit strategy

Question 54.
Strategic leadership refers to a manager’s potential to –
(A) Articulate the strategic vision for the organization
(B) Motivate, guide and influence his subordinates to attain the objectives g of that vision.
(C) Both (A) and (B)
(D) (B) but not (A)
Answer:
(B) Motivate, guide and influence his subordinates to attain the objectives g of that vision.

Question 55.
Micro environmental factors can be described as close to a business that have a direct impact on its strategy.
(A) Employees relationship
(B) Internal factors
(C) Media relation
(D) Competitive environment
Answer:
(B) Internal factors

Question 56.
Which of the following statement is true?
1. Strategic leaders generate organizational structure, assign resources and communicate strategic vision.
2. Strategic leaders have to work in an certain environment on various strategic issues.
3. The main purpose of strategic leadership
4. Strategist develops a short-range course of action or set of goals to align with the organization’s vision.
Select the correct answer from the options given below
(A) 2 only
(B) 3 and 4 only
(C) 1, 2 and 3 only
(D) 2 and 4 only
Answer:
(D) 2 and 4 only

Question 57.
How you will classify a Strategic Leader who clearly and quickly works through the complexity of key issues, problems and opportunities to affect actions?
(A) Global Thinker
(B) Enterprise Guardian
(C) Navigator
(D) Talent Advocate
Answer:
(C) Navigator

Question 58.
………….. are generally more uncontrollable than micro environment factors.
(A) Macro factors
(B) Micro factors
(C) Estimated factors
(D) Non-business
Answer:
(A) Macro factors

Question 59.
Strategic management facilitates to prepare the organization to face the future and act as –
(A) Leader
(B) Pathfinder
(C) Director
(D) Friend
Answer:
(B) Pathfinder

Question 60.
Strategic management serves as a corporate defense mechanism against –
(A) Right and wrong
(B) Choice and investment
(C) Mistakes and pitfalls
(D) Flawless and optimal
Answer:
(C) Mistakes and pitfalls

Question 61.
Match the following:
Introduction to Strategic Management - Strategic Management MCQ 4
Introduction to Strategic Management - Strategic Management MCQ 5
Answer:
(D)

Question 62.
Assertion (A):
Strategic management is not needed in non-profit organizations.
Reason (R):
Though non-profit organizations are not working for the profit, they have to have purpose, vision and mission. They also work within the environmental forces and need to manage strategically to stay afloat to accomplish their objectives.
Select the correct answer from the options given below.
(A) Both A and Rare true and R is correct explanation of A.
(B) BothAandRaretruebutR is correct explanation of A
(C) A is true and R is false
(D) A is false and R is true explaining how A is false
Answer:
(D) A is false and R is true explaining how A is false

Question 63.
Match the List I with List II with reference to strategic management process:
List — I List — II
(W) Strategist — 1. Builds passion & commitment toward a common goal
(X) Entre preneur — 2. Identifies and exploits opportunities for new products and markets.
(Y) Captivator — 3. Develops a long range action or set of goals to align with organization’s vision.
(Z) Mobilizer — 4. Proactively builds and aligns stakeholders, capabilities and resources for getting things done quickly and achieving complex objectives.
select the correct answer from the options given below.
Introduction to Strategic Management - Strategic Management MCQ 6
Answer:
(D)

Question 64.
The following factors are key drivers of globalization:
(A) Government action, exchange rates,competition and socio demographic factors
(B) Market convergence, competition, exchange rates and cost advantages.
(C) Cost advantages, government action,economic cycles and competition
(D) Market, cost, competition and government policies.
Answer:
(D) Market, cost, competition and government policies.

Question 65.
Which of the following is concerned with how each part of the business is organized to deliver the corporate and business-unit level strategic direction and is concerned with strategic decisions about choice of products, meeting needs of customers etc?
(A) Operational strategy
(B) Corporate strategy
(C) Business unit strategy
(D) All of above
Answer:
(A) Operational strategy

Question 66.
Strategic management helps organizations to be more –
(A) Proactive
(B) Reactive
(C) Turbulence
(D) Uncertain
Answer:
(A) Proactive

Question 67.
Value system of an organization have an impact on its:
I. Objectives
II. Policies
III. Practices
IV. Profit
The correct option is –
(A) I and II only
(B) I, II and III only
(C) II, III and IV only
(D) I, II, III and IV
Answer:
(D) I, II, III and IV

Question 68.
Who attracts, develops, and retains talent to ensure that people with the right skills and motivations to meet business needs are in the right place at the right time is called as -………….
(A) Captivator
(B) Talent Advocate
(C) Change Driver
(D) Enterprise Guardian
Answer:
(B) Talent Advocate

Question 69.
Which of the following can be treated as feature of strategy?
(1) It reflects concern to effectively mobilize resources.
(2) It maximizes chances to achieve objectives.
(3) Formulating strategies is the job of top management.
Select the correct answer from the options given below.
(A) (1) & (3) only
(B) (1), (2) & (3)
(C) (2) & (3) only
(D) (1) & (3) only
Answer:
(B) (1), (2) & (3)

Question 70.
Assertion (A):
Developing annual objectives & short term strategies that are compatible with the selected set of long term objectives are one of the major tasks of strategic management.
Reason (R):
A company’s set of strategic objectives should include both short term and long term performance target. Short term objectives help to focus attention on delivering immediate performance improvements. While long term objectives represent the results expected from pursuing certain strategies.
Select the correct answer from the options given below.
(A) A is false and R is true explaining how A is false
(B) Both A and Rare true and R is correct explanation of A.
(C) A is true and R is false
(D) Both A and R are true but R is correct explanation of A
Answer:
(B) Both A and Rare true and R is correct explanation of A.

Question 71.
Change Driver –
(A) Creates an environment that embraces change
(B) Makes change happen – even if the change is radical
(C) Helps others to accept new ideas
(D) All of the above
Answer:
(D) All of the above

Question 72.
He ensures shareholder value through courageous decision-making that supports enterprise or unit-wide interest called as
(A) Navigator
(B) Entrepreneur
(C) Enterprise Guardian
(D) Talent Advocate
Answer:
(C) Enterprise Guardian

Question 73.
You are appointed as a Strategic Manager by ABC Ltd. Being a strategic manager what should be your tasks to perform?
I. Defining the mission and goals of the organization.
II. Determining what businesses it should be in.
III. To increase the production.
IV. Allocating resources among the different businesses.
V. Discovering a new product method.
Select the correct answer from the options given below.
(A) I, IV and III
(B) II and I only
(C) IV, II and I
(D) V, II, IV and I only
Answer:
(C) IV, II and I

Question 74.
A Company Secretary has to take care ………. of the critical facets of the business ie.
(A) Risk management
(B) Assessing the sustainability of an organization
(C) Contribution towards corporate vision and mission
(D) All of the above
Answer:
(D) All of the above

Question 75.
Which core competencies are required for a Company Secretary to become effective player of strategic management?
1. Thorough knowledge of the company’s business.
2. Specialist as to mathematical and statistical methods and calculation.
3. Sound knowledge of laws relating to company, capital markets, industry related etc.
4. Ability to read and write.
Select the correct answer from the options given below.
(A) 1,2 and 4
(B) 2 and 4 only
(C) 2,3 and 4 only
(D) 1 and 3 only
Answer:
(D) 1 and 3 only

Question 76.
There are mainly two types of business environment –
(A) Internal and external
(B) Internal and operational
(C) Operational and external
(D) Matrix and diagonal
Answer:
(A) Internal and external

Question 77.
Environment is complex. Which of the following supports this?
(A) Customers are the people who pay money to acquire an organization’s products.
(B) The environment consists of a number of factors, events, conditions and influences arising from different sources and it is somewhat easier to understand in parts but difficult to grasp in totality.
(C) A study of the competitive scenario is essential for the marketer, particularly threats from competition.
(D) If a supplier provides a poor service, this could increase timescales or lower product quality.
Answer:
(B) The environment consists of a number of factors, events, conditions and influences arising from different sources and it is somewhat easier to understand in parts but difficult to grasp in totality.

Question 78.
Operational strategy focuses on issues of …………
(A) Resources
(B) Processes
(C) People
(D) All of above
Answer:
(D) All of above

Question 79.
Which of the following is a characteristic of business environment?
(A) Environment is complex.
(B) Environment is dynamic.
(C) Environment is multi-faceted.
(D) All of the above
Answer:
(D) All of the above

Question 80.
Micro environment is also known as –
(A) General Environment
(B) Global Environment
(C) Task Environment
(D) Matrix Environment
Answer:
(C) Task Environment

Question 81.
The Porter’s ………… Forces tool is a simple but powerful tool to evaluate the power of business.
(A) Four
(B) Five
(C) Six
(D) Ten
Answer:
(B) Five

Question 82.
Micro environment has ……… influence on the business.
(A) Indirect
(B) Direct
(C) Negative
(D) Minor
Answer:
(B) Direct

Question 83.
According to Michael Porter, the essence of strategy formulation is
(A) Mapping the Five Forces
(B) Developing core competences
(C) Coping with competition
(D) Balancing stakeholder interests
Answer:
(C) Coping with competition

Question 84.
Which of the following is element of micro environment?
(A) Demographic Environment
(B) Competitors
(C) Socio-cultural factors
(D) Economic terms
Answer:
(B) Competitors

Question 85.
The Porter’s Five Forces tool is a simple but powerful tool to evaluate the power of business. Which of the following is not one of the five?
(A) Bargaining power of suppliers
(B) Bargaining power of customer
(C) Rivalry among current players
(D) None of the above
Answer:
(D) None of the above

Question 86.
Assertion (A);
Porter’s five forces model considers new entrants as a significant source of competition.
Reason (R):
New capacity and product range that the new entrants bring in throw up new competitive pressure. Bigger the new entrant, more severe the competitive effect. New entrants also place a limit on prices and affect the profitability of existing players.
Select the correct answer from the options given below.
(A) A is false and R is true explaining how A is false
(B) Both A and Rare true and R is correct explanation of A.
(C) A is true and R is false
(D) Both A and R are true
Answer:
(B) Both A and Rare true and R is correct explanation of A.

Question 87.
Business strategy focuses on:
(A) Strategies related to functional areas such as Marketing, Production and HRM.
(B) Where a firm is going and the scope of its activities.
(C) How a firm competes within a particular market or industry.
(D) How to allocate resources between different parts of the business
Answer:
(C) How a firm competes within a particular market or industry.

Question 88.
Porter’s notion of a differentiation strategy is best described as one in which firms seek a competitive advantage:
(A) Through having a lower cost than their competitors.
(B) Through establishing their uniqueness.
(C) Through concentrating on a narrow market segment.
(D) Through achieving a match between their internal and external environments
Answer:
(B) Through establishing their uniqueness.

Question 89.
Which of the following is not an element of Porter’s 5 Forces Model?
(A) The bargaining power of suppliers.
(B) The firm’s existing competition.
(C) The firm’s macro-economic environment.
(D) The potential competition from new entrants.
Answer:
(C) The firm’s macro-economic environment.

Question 90.
Porter’s Value Chain is essentially a tool for:
(A) Identifying the competitive forces within an industry.
(B) Advising firms on how to price their products.
(C) Diagnosing and enhancing sources of competitive advantage within an organization.
(D) Calculating what a firm is worth.
Answer:
(C) Diagnosing and enhancing sources of competitive advantage within an organization.

Question 91.
In Porter’s five forces model, conditions are more favourable for firms within an industry if:
(A) Buyer power is high
(B) Supplier power is high
(C) Entry threat is low
(D) Substitute threat is high
Answer:
(C) Entry threat is low

Question 92.
If a firm takes over a competitor then, according to Porter’s 5 forces model:
(A) Buyer power is higher
(B) Supplier power is higher
(C) Substitute threat is higher
(D) Rivalry is lower
Answer:
(D) Rivalry is lower

Question 93.
Which of the following is not a force in the Porter Five Forces model?
(A) Buyers
(B) Suppliers
(C) Complementary products
(D) Industry rivalry
Answer:
(C) Complementary products

Question 94.
According to Porter, suppliers are more able to exercise bargaining power over buyers when:
(A) The supply industry is dominated by a few large firms.
(B) The supply industry is populated by a large number of small firms.
(C) When buyers have the ability to takeover suppliers.
(D) There are few buyers in the market
Answer:
(A) The supply industry is dominated by a few large firms.

Question 95.
Which core competencies are required for a Company Secretary to become effective player of strategic management?
(a) Communication and professional skills, legal skills, management skills and IT skills.
(b) Updated knowledge of legal environment, financial environment & business environment.
(c) Ability to work and achieve a consensus within multidisciplinary settings.
(d) Remaining calm under pressure and not losing sight of perspective.
Select the correct answer from the options given below.
(A) (a) and (b)
(B) (b) and (c)
(C) (a) and (c)
(D) All (a) to (d)
Answer:
(D) All (a) to (d)

Question 96.
Potential rivals will not find it difficult to enter a market where:
(A) Existing firms have long-term contracts with the biggest customers.
(B) Product differentiation is very strong.
(C) Existing firms have the ability to retaliate strongly.
(D) Economies of scale are insignificant
Answer:
(D) Economies of scale are insignificant

Question 97.
According to Porter, which of the following is most important to achieving a competitive advantage?
(A) Serving all customers equally, rather than targeting the most profitable.
(B) Operating at lower cost, commanding a premium price, or both.
(C) Focusing on becoming the most competitive business within the sector/ market.
(D) Outsourcing activities which enhance/refine your competitive advantage
Answer:
(B) Operating at lower cost, commanding a premium price, or both.

Question 98.
Identify which of the following forces does not form part of Porter’s Competitive Position Analysis?
(A) Buyer power
(B) Risk of losses
(C) Threat of new entry
(D) Supplier power
Answer:
(B) Risk of losses

Question 99.
What is likely to happen if many new businesses enter a market?
(A) Barriers to entry will rise.
(B) Industry capacity will fall.
(C) Competitive rivalry will intensify.
(D) Industry profits will increase.
Answer:
(C) Competitive rivalry will intensify.

Question 100.
In Porter’s five forces model, what is meant by the term ‘substitute’?
(A) A substitute refers to an alternative manufacturing process.
(B) A substitute is an alternative product or service that performs the same function for the consumer.
(C) A substitute is a rival firm offering the same products.
(D) A substitute is something else consumers would rather spend their money on.
Answer:
(B) A substitute is an alternative product or service that performs the same function for the consumer.