Managing in Complex Environments QUIZ 2 Name ANSWERS Fall 2009 Professor Atkin My lecture time is This closed book closed note quiz has 35 3 point questions Answers go on optical scan sheets To get a grade you must return a the quiz b the answer sheet and c the peer evaluation Good luck 1 The domestic operations of US Steel are substantially vertically integrated while American Eagle is not verically integrated From just this information we can reasonably conclude that A a US Steel is a diversified firm c b American Eagle is a conglomerate d none of the above both of the above 2 Assume we do a Porter type analysis and learn the industry in 2009 is unattractive Given this we can reasonably infer that this industry will be unattractive 3 5 years from now B a true b false 3 We know that industries can be nested within another industry For example the movie industry is nested withing the entertainment industry Assume we do a Porter analysis on the entertainment industry and conclude it is unattractive From that finding we can also conclude the movie industry is also unattractive B a true b false 4 As branding becomes more important in an industry A a entry barriers tend to increase c scale economies tend to increase b customer power tends to increase d all of the above 2 An analysis of the domestic automobile market in 2009 would probably suggest it is an unattrative industry Yet Ford s most recent quartely earnings statement showed it unexpectedly profitable and in significantly better financial condition than last year at this time From this we can reasonably conclude that a Porter analyses are inaccurate c D b Ford is vertically integrated d none of the above both of the above 5 A major assumption of the Porter analysis is that entry and exit from an industry are costless B a true b false 6 Assume we learn the following about an industry Entry is expensive there are substantial economies of scale demand is growing there is undercapacity and existing customers are brand loyal Given just this information D a most industry rivals are focused c b most rivals in the industry are profitable d none of the above both of the above 7 When suppliers have relatively greater power over the rivals in an industry C a supplier prices are likely to be higher than when rivals have greater power over b rivals costs are likely to be higher than when rivals have greater power over suppliers suppliers 8 d none of the above c both of the above For which portion ot he life cycle is a Porter Analysis most appropriate C a introduction c maturity Patents branding and distribution channel lock up are all examples of C a first mover advantages both of the above c 10 For a transaction to occur D b barriers to entry d none of the above b growth d all of the above 9 a there must be at least two parties b each party must have something that is of value to the other party c each party can freely accept or reject the exchange d all of the above 11 Exchange generally occurs as a means to increase the benefit or utility of all parties to the transaction A a true b 12 A product is an offering by one party to a transaction that can satisfy a need of the false other party to the transaction A a true b false 13 Many first mover advantages C a are also barriers to entry both of the above c b require the firm to make an investment d none of the above 14 A brand name is an identifier such as the McDonald s Golden Arches B a true b false 15 As developed in class is how much one party gets relative to what that party value gives in order to strike and consummate the transaction C a utility c In this course we assume parties to a transaction are rational in the sense of seeking and striking transactions that are lowest cost B a true d none of the above b false b price 16 17 At Burger King may include regular walk up drive through and perhaps internet or fax ordering C a marketing channels both of the above c b selling channels d none of the above 18 CRM refers to the firm s choice of products based on what they know best how to make 19 20 b false B a true In the same transaction A a each party can be engaged in marketing a different product b one party seeks the lowest price and the other party seeks the lowest cost c both of the above If we change the packaging of a product such that buyers view the difference as important we have C a extended the product c b refined the product d standardized the product differentiated the product d none of the above 21 Market research and product development are both examples of transaction related marketing functions B a true b false 22 Product lines vary over time by C a product extension both of the above c b product refinement d none of the above 23 When a firm extends a product it also D a changes its product mix c changes its marketing mix b increases the number of SKUs it sells d all of the above 24 Segments are groups of sellers with similar utility profiles B 25 Head to head competitors are rivals in the same market segments A a true b false 26 Trade names are brand marks or brand names that are legally registered and protected b false b false a true B a true 27 Store brands and private labels are examples of D a knockoffs c both of the above b producer brands d none of the above 28 A generally good measure of brand equity is D a net income c the economic cost of building the brand d none of the above 29 The make buy lease problem concerns C b current period accounting profit a the decision whether or not to manufacture the product b the decision whether or not to purchase the product from a contract manufacturer c both of the above d none of the above 30 Higher priced goods produce more value for the buyer than do lower priced goods B b false a true 31 Data presented in the readings imply that C a first movers usually dominate second movers b fast second movers usually dominate slow second movers c second movers can enter usuing a leapfrogging strategy d all of the above 32 Products are often in different stages of the life cycle in different parts of the world A a true b false 33 Apple has developed a reputation for introducing many innovative consumer products Therefore we can reasonably conclude they are early adopters B a true b false 34 My best guess is that my performance on this quiz is better than on quiz 1 a true b false Peer Evaluation …