The act of oversight and direction for an organization is referred to as

R: governance.

What is a weakness associated with a SWOT Matrix?

R: The matrix has no temporal qualities

Which strategies use a firm’s strengths to avoid or reduce the impact of external threats?

R: WT

Which stage in the strategy-formulation framework focuses on generating feasible alternative

strategies?

R: Matching

What type of strategy would divestiture be classified as?

R: Defensive

What are two external dimensions of the SPACE Matrix?

R: Environmental stability and industry strength

Strategy analysis and choice largely involves making ____ decisions based on ____ information.

R: subjective; objective

Which analytical tool determines the relative attractiveness of various strategies based on the
extent to which key external and internal critical success factors are capitalized?

R: QSPM

All of the following are principles of good organizational governance, as established by Business
Week, except:

R: At least two directors are current or former company executives.

Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding
environmental threats.

R: WT

What term is defined as the product of multiplying ratings by attractiveness scores in each row
of the QSPM?

R: Total attractiveness scores

Which of these is not a SPACE Matrix quadrant?

R: Aggressive

Each of the nine techniques included in the strategy formulation framework rely on the use of

R: intuition and analysis.

How many cells are in a SWOT Matrix?

R: nine

Which analytical tool determines the relative attractiveness of various strategies based on the
extent to which key external and internal critical success factors are capitalized?

R: QSPM

Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding
environmental threats.

R: WT

The two internal dimensions represented on the axes of the SPACE Matrix are

R: competitive advantage and financial strength.

Which strategies aim at improving internal weaknesses by taking advantage of external

opportunities?

R: WO
What type of strategy would divestiture be classified as?

R: Defensive

Which strategy formulation technique reveals the relative attractiveness of alternative

strategies and thus provides an objective basis for selecting specific strategies.

R: QSPM

Today, what are boards of directors composed mostly of?

R: outsiders

The top row of a QSPM consists of alternative strategies derived from all of these except:

R: CPM Matrix.

Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding
environmental threats.

R: WT

The two internal dimensions represented on the axes of the SPACE Matrix are

R: financial strength and environmental stability.

What term is defined as the product of multiplying ratings by attractiveness scores in each row
of the QSPM?

R: Total attractiveness scores

What is a weakness associated with a SWOT Matrix?

R: The matrix has no temporal qualities

In the SPACE analysis, what does a (+6, +3) strategy profile portray?

R: A strong industry
Which section of the SWOT Matrix involves matching internal strengths with external
opportunities?

R: The SO cell

What are two external dimensions of the SPACE Matrix?

R: Environmental stability and industry strength

Which stage in the strategy-formulation framework focuses on generating feasible alternative

strategies?

R: Matching

In establishing goals and objectives, it is important to:

d. quantify all aspects of the goals.

Marketing research begins with:

b. definition of objectives or purpose.

Which stage of marketing research is considered to be the most difficult for an entrepreneur due
to lack of knowledge or experience in marketing?

b. Defining the purpose or objectives

Market segmentation is the process of:

b. dividing the market into smaller homogeneous groups.

Which of the following statements is(are) not true?

a. Industry analysis needs to be conducted using only primary research data.

The most common approach to gathering primary information is:

c. interviewing.

Which survey method is the fastest method for obtaining data?

c. Telephone

Which survey method results in the most in-depth information and the best response rate?

c. Personal
Generally speaking, entrepreneurs see the external environment as:

d. uncontrollable.

The major interacting components that enable a firm to successfully provide products to the
marketplace are called the:

a. marketing system.

Which of the following is not a major question that should be addressed by the marketing plan?

c. Where have we been?

Which is the first step in preparing a marketing plan?

a. Defining the target market

Which survey method results in the most in-depth information and the best response rate?

b. Personal

Which of the following statements is(are) not true?

a. Industry analysis needs to be conducted using only primary research data.

The most common approach to gathering primary information is:

b. interviewing.

___ is the process of gathering information in order to determine who will buy the product and
what is the most appropriate distribution channel.

c. Marketing research

The simplest approach to gathering primary information is:

a. interviewing.

Competitor analysis begins with:

c. documenting the current strategy of each primary competitor.

Which survey method is the most expensive?

d. Personal
Once the marketing goals and objectives have been established, the entrepreneur can begin to
develop the ____ and ____ to achieve them.

d. marketing strategy; action plan

What is a central strategy-implementation technique that allows an organization to examine the

expected results of various actions and approaches?

d. Projected financial statement analysis

In preparing projected statements, to project cost of goods sold and the expense items in the
income statement, which of these methods is recommended?

d. Percentage-of-sales method

Why is market segmentation an important variable in the strategy-implementation process?

c. it directly affects marketing mix variables.

Which variable would be considered part of the place element of the marketing mix?

e. Service level

Matching of which factors would allow factories to produce desirable levels without extra shifts,
overtime or subcontracting?

a. supply and demand

Why is market segmentation an important variable in strategy implementation?

d. all of the aboveWhat entails developing schematic representations that reflect how your
products or services compare to competitors’ on dimensions most important to success in the
industry?

d. Positioning

Which two variables are of central importance to strategy implementation?

b. market segmentation and product positioning.

Which of the following is not an example of a decision that may require finance/accounting
policies?

c. To determine the amount of product diversification

Perhaps the most dramatic new market segmentation strategy is the

d. targeting of regional tastes.

After completing an EPS/EBIT analysis, what conclusions would you make if the debt line is
above the stock line throughout the range of EBIT on the graph?

c. Debt appears to be the best financing alternative.

Projected financial analysis is an important strategy-implementation technique because

a. it allows an organization to examine the expected results of various actions and approaches.

Why is market segmentation an important variable in strategy implementation?

a. mass production, mass distribution and mass advertising are not always required.

Which of the following is not an example of a decision that may require finance/accounting
policies?

e. To determine the amount of product diversification

A benefit of using projected balance sheets and income statements is that

d. an organization can compute projected financial ratios under various scenarios.

In the low earnings period, too much __ in the capital structure of an organization can endanger
stockholders’ return and jeopardize company survival.

d. debt

What level of management is directly affected by strategy implementation?

b. all of these

Multidimensional scaling is used to determine

c. product positioning.

What becomes a more attractive financing technique when cost of capital is high?

a. stock issuance
In preparing projected statements, to project cost of goods sold and the expense items in the
income statement, which of these methods is recommended?

b. Percentage-of-sales method

What pay strategy requires employees or departments to establish performance targets, such as
“if actual results exceed objectives then all members get bonuses.

d. Gain sharing

What type of organizational structure do most small businesses follow?

d. Functional structure

Resistance to change can manifest itself through

a. All of the options

Which pay strategy is not a form of incentive compensation?

b. Hourly wage

What are three categories of approaches for managing and resolving conflict?

b. Avoidance, payoff and diffusion

Why do changes in company strategy often require changes in the way an organization is
structured?

c. Structure dictates how goals and objectives will be established

Which organizational structure has ambiguous roles for senior executives as a major
disadvantage?

c. strategic business unit (SBU)

Which strategy could be best defined as an effective, multi-method technique of studying and
altering a firm’s culture?

a. Triangulation

Which of these involves comparing a firm against the best firms in the industry on a wide
variety of performance-related criteria?

e. Benchmarking

What is not a major benefit of having a diverse workforce?

a. An increase in training costs

Medium-sized firms are more likely to use which type of structure.

a.divisional

Which approach for managing and resolving conflict involves exchanging members of conflicting
parties of that each can gain an appreciation of the others point of view?

d.Confrontation

Establishing objectives is a

e. decentralized activity.

What is not one of the basic ways a divisional structure can be organized?

e. By cost

Formal statements of organizational philosophy, charters, creeds, materials used for recruitment
and selection and socialization help an organization

a. link culture to strategy.

Which of the following is not true about objectives?

c. They should incorporate policies.

How are objectives in the areas of profitability, growth and market share commonly
established?

a. All of the options

Which of the following issues may not require a management policy?

e. To increase motivation

What are three categories of approaches for managing and resolving conflict?

e. Avoidance, payoff and diffusion

Which of these is true about strategy implementation?

c. It is primarily an operational process.

Which type of ownership is the most expensive to start?

a. Corporation

Bonds can be used to raise capital in which form of ownership?

a. Corporation

Sole proprietorships:

b. allow a member of the deceased partner's family take over as a partner.

Which type of ownership is the least expensive to start?

c. Sole proprietorship

To build a successful organization culture the entrepreneur:

c. should focus and not try out different things.

In designing the organization:

d. poor design is a significant cause for business failure since the entrepreneur often performs all
organization functions themselves.

_____ have unlimited liability for the actions of the business.

c. General partners

In which form of organization does the owner have greatest control?

c. Sole proprietorship

Our text tells us that much of an entrepreneur's time during start-up is spent:

b. putting out fires.

Which of the following ways of distributing the income of corporations is taxed twice?

d. Dividends

Liability is one of the most critical reasons for establishing a:

c. corporation.

Which for form of organization has time limits on writing off capital losses?

b. partnership

Corporations distribute profits to owners through:

c. dividends.

In a limited partnership, the limited partners:

d. are liable only for the amount of their capital contributions.

The management team of a new venture:

d. must operate the business full-time.

In an S corporation, the transfer of interest can occur:

b. only as long as the buyer is an individual.

Sole proprietorships:
b. allow a member of the deceased partner's family take over as a partner.

Which of the following ways of distributing the income of corporations is taxed twice?

d. Salary

The board of directors:

c. is less objective than the entrepreneur.

In a limited liability partnership (LLP) death or withdrawal of a partner:

b. has no effect on the partnership

When it comes to decision making, in a limited partnership:

d. limited partners have no control over business decisions.

Which of the following ways of distributing the income of corporations is taxed twice?

a. Dividends

To build a successful organization culture the entrepreneur:

d. should spend extra time in the hiring process.

Compensation for board members can take the form of all of the following except:

a. perks, such as vacations

Which type of ownership is the least expensive to start?

c. Sole proprietorship

Liability is one of the most critical reasons for establishing a:

a. corporation.

In designing the organization:

a. poor design is a significant cause for business failure since the entrepreneur often performs all
organization functions themselves.

Organization costs in a proprietorship are:

a. not amortizable.

In an S corporation, the transfer of interest can occur:

a. only as long as the buyer is an individual.