QUESTION According to researchers, firms facing strong pressures for local responsiveness should pursue a global standardization strategy. Indicate whether the statement is true or false. ANSWER FALSE When a firm simultaneously faces both strong cost pressures and strong pressures for local responsiveness, it should pursue a transnational strategy.
QUESTION The term organizational structure refers to the totality of a firm’s organization, including organization architecture, control systems and incentives, organizational culture, processes, and people. Indicate whether the statement is true or false. ANSWER FALSE The term organization architecture can be used to refer to the totality of a firm’s organization, including formal organizational […]
QUESTION An international strategy involves taking products first produced for their domestic market and selling them internationally with only minimal local customization. Indicate whether the statement is true or false. ANSWER TRUE International strategy involves taking products first produced for their domestic market and selling them internationally with only minimal local customization. The distinguishing […]
QUESTION Maintaining the company infrastructure is a support activity. Indicate whether the statement is true or false. ANSWER TRUE The company infrastructure, a support activity, is the context within which all the other value creation activities occur. The infrastructure includes the organizational structure, control systems, and culture of the firm.
QUESTION The amount of value a firm creates is measured by: A. the difference between the previous year’s profitability and the current year’s profitability. B. dividing the market price of its products by the price that customers are actually willing to pay. C. the difference between its costs of production and the value that consumers […]
QUESTION Location economies are the economies that arise from performing a value creation activity in the optimal location for that activity, wherever in the world that might be. Indicate whether the statement is true or false. ANSWER TRUE Location economies are the economies that arise from performing a value creation activity in the optimal […]
QUESTION In general, the more value customers place on a firm’s products: A. the lesser the profitability of the firm. B. the higher the competitive pressure from other firms. C. the lesser the quality of the product. D. the lesser the consumer surplus for those products. E. the higher the price the firm can charge […]
QUESTION Learning effects will be more significant in an assembly process which involves 100 simple steps than in an assembly process which involves 1,000 complex steps. Indicate whether the statement is true or false. ANSWER FALSE Learning effects tend to be more significant when a technologically complex task is repeated, because there is more […]
QUESTION The experience curve refers to systematic increases in production costs that have been observed to occur over the life of a product. Indicate whether the statement is true or false. ANSWER FALSE The experience curve refers to systematic reductions in production costs that have been observed to occur over the life of a […]
QUESTION The ability to spread fixed costs over a large volume is one of the sources of economies of scale. Indicate whether the statement is true or false. ANSWER TRUE Economies of scale have a number of sources. One is the ability to spread fixed costs over a large volume. Fixed costs are the […]
