18/05/2018 Quiz: Hitt/Ireland/Hoskisson, Strategic Management: Concepts: Competitiveness and Globalization, 9e, Chapter 6

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Assignment Name: Hitt/Ireland/Hoskisson, Strategic Management: Concepts: Competitiveness and Globalization, 9e, Chapter
6

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Certain regulatory changes (such as antitrust regulation and tax laws) create incentives or disincentives for
diversification that ________.
a. reduce value

b. are managerial motives to diversify

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c. are value-neutral

d. create value

status: not answered ()

correct: c
your answer:

The term "conglomerates" refers to firms using the ________ diversification strategy.
a. related constrained

b. global
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c. related linked

d. unrelated

status: not answered ()

correct: d
your answer:

3 The drawbacks to transferring competencies by moving key people into new management positions include all
EXCEPT:
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18/05/2018 Quiz: Hitt/Ireland/Hoskisson, Strategic Management: Concepts: Competitiveness and Globalization, 9e, Chapter 6

Summary of Results

a. the people involved may not want to move.

b. top-level managers may resist having these key people transferred.

c. managerial competencies are not easily transferable to different organizational cultures.

d. managers with these skills are expensive.

status: not answered ()

correct: c
your answer:

The lowest level of diversification is the ________ level.

a. unrelated

b. related constrained
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c. dominant business

d. single business

status: not answered ()

correct: d
your answer:

One method of facilitating the transfer of competencies between firms is to:

a. share support activities, such as purchasing practices.

b. transfer key people into new management positions.

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c. virtually integrate the two firms.

d. restructure the weaker firm to mirror the structure of the more successful firm.

status: not answered ()

correct: b
your answer:

The more "constrained" the relatedness of diversification:

a. the lower the proportion of total organizational revenue derived from the dominant-business.

b. the fewer the linkages between the businesses within the portfolio owned by the firm.
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c. the wider the variation in the portfolio of businesses owned by the firm.

d. the more links there are among the businesses owned by an organization.

status: not answered ()

correct: d
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18/05/2018 Quiz: Hitt/Ireland/Hoskisson, Strategic Management: Concepts: Competitiveness and Globalization, 9e, Chapter 6

Summary of Results
your answer:

When a firm simultaneously practices operational relatedness and corporate relatedness:

a. the firm will suffer from diseconomies of scope which outweigh cost savings generated.

b. the firm is seeking to create value through financial economies.

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c. the firm is likely to be overvalued by investors.

d. it is difficult for investors to observe the value created by the firm.

status: not answered ()

correct: d
your answer:

Among the value-neutral incentives to diversify, some come from the firm's external environment while others are
internal to the firm. External incentives to diversify include:
a. the fact that other firms in an industry are diversifying.

b. pressure from stockholders who are demanding that the firm diversify.
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c. a firm's low performance.

d. changes in antitrust regulations and tax laws.

status: not answered ()

correct: d
your answer:

The purchasing of firms in the same industry is called:

a. networking the organization.

b. vertical integration.
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c. unrelated diversification.

d. horizontal acquisition.

status: not answered ()

correct: d
your answer:

10 Which of the following reasons for diversification is most likely to increase the firm's value?

a. increasing managerial compensation

b. taking advantage of changes in tax laws

c. conforming to antitrust regulation

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18/05/2018 Quiz: Hitt/Ireland/Hoskisson, Strategic Management: Concepts: Competitiveness and Globalization, 9e, Chapter 6

Summary of Results

d. reducing costs through business restructuring

status: not answered ()

correct: d
your answer:

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