Question 1

Which of the following is an advantage of franchising?

Accepted Answer

A)  It gives the franchisor the same level of tight control over franchisees as does chaining.
B)  It allows the franchisor to obtain the entire profits made by franchisees.
C)  It is beneficial for franchisees as they do not have to face the challenge of higher capital costs.
D)  It helps the franchisees by relieving them of the responsibility of running operations.
E)  It can help the franchisor expand his or her business rapidly.F) C) and E)
G) A) and B)

Question 2

John, a technology enthusiast, is often willing to pay premium prices to be one among those who have new versions of software packages.John most likely belongs to the group of customers.

Accepted Answer

A)  laggard
B)  early majority
C)  early adopter
D)  late majority
E)  innovatorF) A) and B)
G) None of the above

Question 3

Who among the following is most likely to fall under the category of laggards in the context of customer groups?

Accepted Answer

A)  Martha is tech-savvy and tends to actively seek out for new and innovative products in the market.
B)  Philip appreciates technology but tends to refrain from trying products that are extremely new.
C)  Allan is ignorant about the newest uses of technology and buys new products only when they become an absolute necessity.
D)  Rebecca is aware about the value that technology offers; she tends to weigh costs and benefits of a product before making a buying decision.
E)  Arnold tends to be a little apprehensive about buying new technology but buys nevertheless when he observes that a lot of people are using the new technology.F) C) and D)
G) A) and E)

Question 4

Most embryonic industries arise from:

Accepted Answer

A)  a technological breakthrough.
B)  product proliferation.
C)  lack of high entry barriers.
D)  chaining.
E)  franchising.F) B) and E)
G) D) and E)

Question 5

Which of the following statements is true in the context of declining industries?

Accepted Answer

A)  Not all segments of an industry typically decline at the same rate.
B)  A declining industry should ideally use the leadership strategy when it does not have any strengths and the competition is low.
C)  Divestment strategy is by which a declining industry seeks to improve sales by improving product quality.
D)  Greater the exit barriers of a declining industry, lesser is the intensity of competition.
E)  Intensity of competition is less in declining industries that sell commodity-like products.F) A) and C)
G) A) and D)

Question 6

A new product's relative advantage refers to the degree to which a new product is perceived as better at satisfying customer needs than the product that it supersedes.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following statements is true in the context of growing industries?

Accepted Answer

A)  Innovators and early adopters have the same customer needs as the early majority.
B)  Innovators and early adopters are typically reached through specialized distribution channels.
C)  Reaching the early majority seldom requires advertising and is usually achieved through word of mouth.
D)  Companies serving innovators need to have large-scale mass production and very low prices.
E)  Companies competing in an embryonic market typically pay more attention to increasing the reliability of a product than to its performance.F) A) and E)
G) B) and D)

Question 8

Both innovators and early adopters enter the market while the industry is in its embryonic stage.

Accepted Answer

A) True 
 B)False

Question 9

Development of a mass market is the stimulus for an industry to change from growth to embryonic.

Accepted Answer

A) True 
 B)False

Question 10

An embryonic industry is one that:

Accepted Answer

A)  a number of small and medium sized companies.
B)  is just beginning to develop.
C)  has sufficiently developed so that early industry leaders have already been identified.
D)  has initial government backing because of its importance to the general populace.
E)  is characterized by intense rivalry among established companies.F) A) and D)
G) A) and E)

Question 11

Factors leading to the slow growth of demand in embryonic industries include all of the following except the:

Accepted Answer

A)  poor quality of the first products.
B)  lack of complementary products.
C)  customer familiarity with products.
D)  high production costs of the products.
E)  lack of distribution channels for the products.F) A) and D)
G) A) and E)

Question 12

In his book Crossing the Chasm.Geoffrey Moore discusses some of the issues involved in marketing technologically new products as markets develop through different stages.What groups does Moore identify and what must companies do if they are to successfully cross the chasm?

Accepted Answer

Moore's thesis is that different groups ...

Question 13

Which of the following strategies helps companies with high cost strnctures, allowing them to survive without having to implement strategies to become more productive and efficient?

Accepted Answer

A)  Price signaling
B)  Nonprice competition
C)  Capacity control
D)  Market development 
E)  Price leadershipF) A) and D)
G) A) and B)

Question 14

In a harvest strategy, a company:

Accepted Answer

A)  significantly increases its investment in a business.
B)  extracts maximum profits from its investments.
C)  ventures into new market segments with new products.
D)  expands the number of stores or properties.
E)  significantly increases advertising expenditure.F) B) and D)
G) B) and C)

Question 15

Which of the following customer groups represents the leading wave or edge of the mass market?

Accepted Answer

A)  Early adopters
B)  Early majority
C)  Innovators
D)  Late majority
E)  LaggardsF) None of the above
G) C) and E)

Question 16

Which of the following shakeout strategies requires a company to limit or decrease its investment in a business and to extract, or milk, the investment as much as it can?

Accepted Answer

A)  Market concentration strategy
B)  Share-increasing strategy
C)  Cost-leadership strategy
D)  Hold-and-maintain strategy
E)  Harvest strategyF) A) and E)
G) C) and D)

Question 17

Which of the following factors that affect market growth rates refers to the degree to which a new product is perceived as better at satisfying customer needs than the product it supersedes?

Accepted Answer

A)  Complexity
B)  Relative advantage
C)  Compatibility
D)  Trialability
E)  ObservabilityF) None of the above
G) B) and C)

Question 18

A limit price strategy involves charging a price that is lower than that required to maximize profits in the short run, but is above the cost structure of potential entrants.

Accepted Answer

A) True 
 B)False

Question 19

Alpha corporation owns and controls several retail outlets and is thus pursuing a strategy called franchising.

Accepted Answer

A) True 
 B)False

Question 20

Laggards are technologically sophisticated customers willing to tolerate the limitations of the product.

Accepted Answer

A) True 
 B)False

Exam 6: Business-Level Strategy and the Industry Environment

Which of the following customer groups represents the leading wave or edge of the mass market?

Correct AnswerverifiedShow Answer

An embryonic industry is one that:

Correct AnswerverifiedShow Answer

Both innovators and early adopters enter the market while the industry is in its embryonic stage.

Correct AnswerverifiedShow Answer

Which of the following factors that affect market growth rates refers to the degree to which a new product is perceived as better at satisfying customer needs than the product it supersedes?

Correct AnswerverifiedShow Answer

Which of the following is an advantage of franchising?

Correct AnswerverifiedShow Answer

Which of the following strategies helps companies with high cost strnctures, allowing them to survive without having to implement strategies to become more productive and efficient?

Correct AnswerverifiedShow Answer

John, a technology enthusiast, is often willing to pay premium prices to be one among those who have new versions of software packages.John most likely belongs to the group of customers.

Correct AnswerverifiedShow Answer

Which of the following statements is true in the context of growing industries?

Correct AnswerverifiedShow Answer

Development of a mass market is the stimulus for an industry to change from growth to embryonic.

Correct AnswerverifiedShow Answer

A limit price strategy involves charging a price that is lower than that required to maximize profits in the short run, but is above the cost structure of potential entrants.

Correct AnswerverifiedShow Answer

In a harvest strategy, a company:

Correct AnswerverifiedShow Answer

Who among the following is most likely to fall under the category of laggards in the context of customer groups?

Correct AnswerverifiedShow Answer

Most embryonic industries arise from:

Correct AnswerverifiedShow Answer

Laggards are technologically sophisticated customers willing to tolerate the limitations of the product.

Correct AnswerverifiedShow Answer

Alpha corporation owns and controls several retail outlets and is thus pursuing a strategy called franchising.

Correct AnswerverifiedShow Answer

In his book Crossing the Chasm.Geoffrey Moore discusses some of the issues involved in marketing technologically new products as markets develop through different stages.What groups does Moore identify and what must companies do if they are to successfully cross the chasm?

Correct AnswerverifiedMoore's thesis is that different groups ...View AnswerShow Answer

Factors leading to the slow growth of demand in embryonic industries include all of the following except the:

Correct AnswerverifiedShow Answer

A new product's relative advantage refers to the degree to which a new product is perceived as better at satisfying customer needs than the product that it supersedes.

Correct AnswerverifiedShow Answer

Which of the following statements is true in the context of declining industries?

Correct AnswerverifiedShow Answer

Which of the following shakeout strategies requires a company to limit or decrease its investment in a business and to extract, or milk, the investment as much as it can?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Moore's thesis is that different groups ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified