Model (2)

Multiple Choice Questions

Choose the one alternative that best completes the statement
or answers the question
1. Long-term objectives are needed at which level(s)
in an organization?

A) Corporate & B) C) Corporate D) Both

divisional levels Functional & divisional "A" and "B"
levels, but not
functional
level
2. Anything that a firm does especially well
compared to rival firms is referred to as

A) competitive B) C) an external D)
advantage comparative opportunity opportunity
disadvantage cost
3. Which of the following is part of the Strategic-
Management Model?

A) Measure B) Develop C) Implement D) All of

and evaluate mission and strategies the above
performance vision
statements,
and establish
long-term
objectives
4. Internal ________ are controllable activities in an
Model (3) Page 1 of 6
 organization that are performed especially well.

A) B) C) strengths D)
opportunities competencies objectives
5. In which phase of strategic management are
annual objectives are especially important?

A) Reduction B) C) D)
Evaluation Formulation Implementation
6. ________ is NOT a strategy-implementation
activity.

A) Taking B) C) D)
corrective Allocating Establishing Devising
actions resources annual policies
objectives
7. What step in the strategic management process
involves mobilizing employees and managers to
put strategies into action?

A) Strategy B) Strategy C) Strategy D) Strategic

formulation evaluation implementation advantage
8. Forward integration and backward integration are
sometimes collectively referred to as
A) horizontal B) vertical C) D)
integration integration hierarchical diversification
integration
9. What refers to a strategy of seeking ownership of,
or increased control over a firm's competitors?

Model (3) Page 2 of 6

 A) Forward B) C) Backward D)
integration Conglomerate integration Horizontal
diversification integration

10. Which strategy seeks to increase market share

for present products or services in present markets
through greater marketing efforts?

A) Market B) Forward C) Market D)

penetration integration development Backward
integration
11. Which strategy generally entails large research
and development expenditures?

A) Forward B) Product C) Market D)

integration development penetration Divestiture

12. When a domestic company first begins to

export to India, it is an example of

A) horizontal B) C) forward D) market

integration backward integration development
integration

13. What are enduring statements of purpose that

distinguish one business from other similar firms?
A) Policies
B) Mission statements
Model (3) Page 3 of 6
C) Vision
D) Employee conduct guidelines

14. A mission statement should be all of the

following EXCEPT
A) it should be broad enough to include all
ventures.
B) it should be stated in clear terms.
C) it should distinguish an organization from all
others.
D) it should define what an organization is.

15. An effective mission statement should do all of

the following EXCEPT
A) include monetary amounts, numbers,
percentages and ratios.
B) be inspiring and reconciliatory..
C) reveal that the firm is environmentally
responsible.
D) identify the utility of a firm's products.

16. What question is asked in conjunction with the

philosophy component of a mission statement?
A) What are the firm's major products or services?
B) Is the firm committed to growth and financial
Model (3) Page 4 of 6
soundness?
C) What are the basic beliefs, values, aspirations,
and ethical priorities of the firm?
D) Is the firm responsive to social, community, and
environmental concerns?

17. Which component of a mission statement

addresses the firm's distinctive competence or
major competitive advantage?
A) Technology
B) Self-concept
C) Concern for public image
D) Customers

18. In which situation would horizontal integration

be an especially effective strategy?
A) When an organization can gain monopolistic
characteristics in a particular area or region
without being challenged by the governmental
regulations to reduce competition.
B) When an organization competes in a slowing
industry.
C) When decreased economies of scale provide
major competitive advantages.
D) When an organization has neither the capital
nor human talent needed to successfully manage
an expanded organization.

19. To provide women quality fragrances,

cosmetics, and jewelry at reasonable prices backed
Model (3) Page 5 of 6
by outstanding customer service provided by our
thousands of representatives operating globally.
Avon representatives put integrity first. Which
components are missing in this mission statement?
A) Self- concept; customer; and concern for
public image.
B) Concern for employee; self-concept; and
Concern for survival, growth and profitability.
C)Technology; concern for public image; and
Concern for survival, growth and profitability
D) Philosophy; concern for employee and
concern for public image.

20) Strategy evaluation is necessary because

A) internal and external factors are constantly
changing.
B) firms have limited resources.
C) success today is a guarantee of success
tomorrow.
D) all of the above

Model (3) Page 6 of 6