Exam 2

Question 1

Demand Conditions

Answer 1

The nature of domestic customers especially whether they have high expectations of the goods and services that they buy.

Question 2

Global Strategy

Answer 2

To sacrifice responsiveness to local preferences in favor of efficiency.

Question 3

Stuck in the Middle

Answer 3

A situation in which a business-level strategy does not offer features that are unique enough to convince customers to buy its offerings and its prices are too high to compete effectively on based on price.

Question 4

Just-in-Time inventory Management

Answer 4

A production system that conserves space and lowers costs by requiring inputs to arrive at the moment they are needed.

Question 5

Company Strategy
Structure
Rivalry

Answer 5

How challenging it is for companies to survive domestic competition.

Question 6

First-Mover Advantage

Answer 6

When the initial move into a market allow a company to establish a dominant position that other companies struggle to overcome.

Question 7

Licensing

Answer 7

One organization grants another the right to create its product, often using patented technology, in exchange for a fee.

Question 8

Multipoint Competition

Answer 8

A situation in which a company faces the same rival in more than one market

Question 9

Strategic Alliance

Answer 9

A cooperative arrangement between two or more organizations that does not involve the creation of a new entity.

Question 10

Focused Cost Leadership

Answer 10

A generic business strategy that requires competing based on price to target a narrow market.

Question 11

First Mover

Answer 11

An initial entrant into a market.

Question 12

Blue Ocean Strategy

Answer 12

Creating a new, untapped market rather than competing with rivals in an existing market.

Question 13

Price Sensitive

Answer 13

The extent to which a price increase makes a buyer less likely to purchase an item.

Question 14

Political Risk

Answer 14

The potential for government upheaval or interference with business to harm an operation within a country.

Question 15

Business Risk

Answer 15

The potential that a business operation might fail.

Question 16

Nationalization

Answer 16

The seizure of privately owned business operations by a national government.

Question 17

Focus Strategies

Answer 17

Generic business approaches that involve targeting a relatively narrow niche of potential customers.

Question 18

Colocation

Answer 18

When goods and services offered under different brands are located close to one another.

Question 19

Focused Differentiation

Answer 19

A generic business strategy that requires offering unique features that fulfill the demands of a narrow market

Question 20

Cultural Risk

Answer 20

The potential for a company’s operations in a country to struggle because of differences in language, customs, norms, and customer preferences.

Question 21

Factor Conditions

Answer 21

The nature of raw material and other inputs that companies need to create goods and services

Question 22

Economic Risk

Answer 22

The potential for a country’s economic conditions and polices, property rights protections, and currency exchange rates to harm an operation.

Question 23

Multinational Corporation (MNC)

Answer 23

A company that has operations in more than one country.

Question 24

Foothold

Answer 24

A small position that a company intentionally establishes within a market in which it does not yet compete.

Question 25

Offshoring

Answer 25

The relocation of a business activity to another country.

Question 26

Joint Venture

Answer 26

A cooperative arrangement that involves two or more organization’s, each contributing to the creation of a new entity.

Question 27

Exporting

Answer 27

Creating goods within a company’s home country and then shipping them to another country where they are sold to customers by a local company.

Question 28

Transnational Strategy

Answer 28

Involves balancing the desire for efficiency with the need to adjust to varying preferences across countries.

Question 29

Disruptive Innovation

Answer 29

An improvement that conflicts with and threatens to replace, traditional approaches to competing within an industry.

Question 30

Best-Cost

Answer 30

A business-level strategy followed by companies that charge relatively low prices and offers substantial differentiation.

Question 31

Related and Supporting Industries

Answer 31

The extent to which companies’ domestic suppliers and other complementary industries are developed and helpful

Question 32

Multidomestic Strategy

Answer 32

To sacrifice efficiency in favor of responsiveness to varying preferences across countries.

Question 33

Generic Strategy

Answer 33

A general way of positioning a company’s business-level strategy within an industry.

Question 34

Cost Leadership

Answer 34

Generic strategy that offers products or services with acceptable quality and features to a broad set of customers at a low price.

Question 35

Greenfield Venture

Answer 35

A foreign operation that a company creates entirely by itself.

Question 36

Mutual Forbearance

Answer 36

A situation in which rivals do not act aggressively because each recognizes that the other can retaliate in multiple markets.

Question 37

Co-opetition

Answer 37

A blending of competition and cooperation between tow companies.

Question 38

Franchising

Answer 38

An organization (called a franchisor) grants the right to use its brand name, products and processes to other organizations (known as franchisees) in exchange for an up-front payment (franchise fee) and percentage of franchises’ revenues (royalty)

Question 39

Economies of Scale

Answer 39

A cost advantage created when a company can produce a good or service at a lower per-unit price due to producing the good or service in large quantities.

Question 40

Fighting Brand

Answer 40

A lower-end brand that a company introduces to try to protect the company’s market share without damaging the company’s existing brands.

Question 41

Reshoring

Answer 41

The relocation to a company’s home country of business activity that had been sent overseas.

Question 42

Differentiation Strategy

Answer 42

A generic positioning that attempts to convince customers to pay a premium price for its good or services by providing unique and desirable features.

Question 43

Bricolage

Answer 43

Using whatever materials and resources happen to be available as the inputs into a creative process.

Question 44

Hypercompetition

Answer 44

A situation that involves very rapid and unpredictable moves and countermoves that can undermine competitive advantages.