Chap 2- Part 2

Question 1

The competitve environment of business includes what

Answer 1

The competitive environment of business includes

• suppliers
• distributors
• external costumers
• competitors

Question 2

What is the Porter’s five forces model

Answer 2

The Porter’s five forces analyst model is used by managers to analyze competitive situations and decipts the five forces that affect industry competition

Question 3

What are the five threat of a business

Answer 3

The five possible threats are:

• threat of entrants
• threat of subsitute
• Bargening power of buyers
• Bargening power of suppliers
• Rivalry among existing competitors

Question 4

What is an entrant threat

Answer 4

The treath that brand names are not well known

Question 5

What is a susbtitute threat?

Answer 5

A susbtitute threat is when a consumer can easily switch to the product of another industry that is cheaper

Question 6

What is the bargening power of buyers

Answer 6

The bargening power of buyers is when they purchase product of high volume, buyer switching cost are low

Question 7

What is the bargening power of supply

Answer 7

The bargening power of suppliers is when the product is highly differentiated or subsitutes are unavailable

Question 8

What is rivalry among existing competitors?

Answer 8

When there are many competitors that have equal size or market share, there is little differentiation between products, or consumers have no preference for a particular brand.