Chapter 5

Question 1

5.1 Who was among the first to recognize the importance of studying and understanding the competitive landscape?

Answer 1

Sun Tzu

Question 2

5.2 Which of the following is NOT considered an environmental trend?

Economic, Social, Business, Technological, Political

Answer 2

Business

Question 3

What are the Porter’s five forces that determine industry profitability?

Answer 3

Threat of Substitutes, Threat of new entrants, Rivalry among existing firms, bargaining power of suppliers, bargaining power of buyers

Question 4

5.4 Which of the following is NOT one of the major sources of barriers to entry in an industry?

Number and balance of competitors, Economies of Scale, Product differentiation, capital requirements, access to distribution channels

Answer 4

Number and balance of competitors

Question 5

5.5 Which factor affects the ability of suppliers to exert pressure on buyers and suppress the profitability of the industries they serve?

Answer 5

Threat of forward integration

Question 6

5.6 Porter’s five forces model helps firms to determine if it _______.

Answer 6

should enter an industry

Question 7

5.7 Which industry type presents an entrepreneurial firm the best opportunity for a first-mover advantage?

Emerging, Fragmented, Declining, Mature, Global

Answer 7

Emerging

Question 8

5.8 What type of industry is characterized by many firms of approximately equal size?

Answer 8

Fragmented

Question 9

5.9 What is the first step in conducting a competitor analysis?

Answer 9

Determine who the competition is

Question 10

5.10 In the beverage industry, soda, fruit juice, and sports juice would be considered what type of competitors of bottled water?

Indirect, Future, Direct, Identical, Similar

Answer 10

Indirect