Which of the following is false regarding how a differentiation strategy can help a

firm to improve its competitive position vis-à-vis Porter's five forces? *

1 point

It helps a firm to deal with supplier power and reduces buyer power since buyers lack
comparable alternatives.
By increasing a firm's margins, it avoids the need for a low-cost position.
Firms will enjoy high customer loyalty, thus experiencing less threat from substitutes than its
competitors.
Supplier power is increased because suppliers will be able to charge higher prices for their
inputs.

All of the following would be viewed as advantages of global diversification except *

1 point

a firm with large margins at home helping subsidize its operations in other nations.
a firm not being solely dependent on the domestic market
fewer social and political risks than domestic operations.
the potential to lower costs of operation even if the primary market is at home.

It may be advantageous to vertically integrate when *

1 point

lower transaction costs and improved coordination are vital and achievable through vertical
integration.
flexibility is reduced, providing a more stationary position in the competitive environment.
the minimum efficient scales of two corporations are different.
various segregated specializations will be combined.

In the __________ stage of the industry life cycle, there are few segments, the
emphasis on process design is low, and the major functional areas of concern are
general management and finance. *
1 point

Introduction
Growth
Maturity
Decline

An antitakeover tactic in which existing shareholders have the option to buy

additional shares of stock at a discount to the current market price is called *
1 point

a golden parachute.
a poison pill.
scorched earth.
greenmail.

Which of the following is a risk (or potential pitfall) of cost leadership? *

1 point

Cost differences increase as the market matures.

Attempts to stay ahead of the competition may lead to gold plating.
Producers are more able to withstand increases in suppliers' cost.
Cost cutting may lead to the loss of desirable features.