Business Administration Exam Review
Course Introduction
Business Administration is an interdisciplinary course that introduces students to the fundamental concepts, theories, and practices essential for effective management and operation of organizations. Covering core areas such as accounting, finance, marketing, human resources, operations management, and organizational behavior, the course provides a comprehensive understanding of how businesses are structured and managed in both local and global contexts. Through case studies, group projects, and practical exercises, students develop analytical, problem-solving, and leadership skills necessary to navigate complex business environments and contribute to organizational success.
Recommended Textbook
Strategic Management and Competitive Advantage 6th Edition by Jay B. Barney
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12 Chapters
1185 Verified Questions
1185 Flashcards
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Page 2
Chapter 1: What Is Strategy and the Strategic Management Process
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) Which ratio signals a greater risk of bankruptcy as it increases?
A)debt to equity
B)quick ratio
C)debt to assets
D)cash flow per share
Answer: C
Q2) Which type of ratios focus on the ability of a firm to meet its short-term financial obligations?
A)activity ratios
B)liquidity ratios
C)leverage ratios
D)profitability ratios
Answer: B
Q3) A firm's ________ is its long-term purpose that defines both what it aspires to be in the long run and what it wants to avoid in the meantime.
A)mission
B)strategy
C)objective
D)goal
Answer: A
Page 3
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Chapter 2: Evaluating a Firms External Environment
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99 Verified Questions
99 Flashcards
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Sample Questions
Q1) Identify the five most common threats facing firms from their local competitive environment that are represented in the five forces framework,and discuss under what conditions firms in a specific industry are most likely to earn an above average profit and when they are likely to earn a below average profit.
Answer: The five threats that constitute the five forces framework include the threat from new competition,the threat from competition among existing companies,the threat of substitutes,the threat of suppliers,and the threat of buyers.When all five threats are low,competition begins to approach what economists call a monopoly and firms are able to earn above average profits.Alternatively,when all five forces are very high,competition begins to approach perfect competition and the best firms can hope to earn is competitive parity.
Q2) First movers that invest only in technology usually obtain sustained competitive advantages,even if they do not tie up strategically valuable resources in an industry before their full value is widely understood.
A)True
B)False Answer: False
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Page 4
Chapter 3: Evaluating a Firms Internal Capabilities
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98 Verified Questions
98 Flashcards
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Sample Questions
Q1) Computer hardware and software technology,robots used in manufacturing and automated warehouses are examples of which type of resources?
A)financial resources
B)physical resources
C)human resources
D)organizational resources
Answer: B
Q2) Tacit cooperation is only a viable strategy when an industry is perfectly competitive.
A)True
B)False
Answer: False
Q3) The budgeting and reporting activities that Bates uses are examples of
A)informal management controls.
B)formal reporting structures.
C)formal management controls.
D)primary value chain activities.
Answer: C
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Page 5
Chapter 4: Cost Leadership
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99 Flashcards
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Sample Questions
Q1) Identify which bases of cost leadership are more likely to be rare and costly to imitate.
Q2) If Sematech's expansion plans did not produce the desired cost savings but the company decided to continue production expansion in an effort to capture cost reductions,this would be an example of
A)economies of scale.
B)escalation of commitment.
C)diseconomies of scale.
D)managerial diseconomies.
Q3) Cost-leadership and product-differentiation strategies are so widely recognized that they are often called
A)common business strategies.
B)generic corporate strategies.
C)generic business strategies.
D)common corporate strategies.
Q4) Which of the following is not a potential source of diseconomies of scale?
A)physical limits to efficient size
B)worker de-motivation
C)distance to markets and suppliers
D)learning-curve economies
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Chapter 5: Product Differentiation
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Sample Questions
Q1) While firms often alter the ________ of their products or services in order to implement a product-differentiation strategy,the existence of product differentiation,in the end,is always a matter of ________.
A)customer perceptions; objective properties
B)objective properties; price
C)customer perceptions; price
D)objective properties; customer perception
Q2) Attempts to create differences in the relative perceived value of a firm's products or services are rarely made by altering the objective properties of those products or services.
A)True
B)False
Q3) In developing a compensation policy used to implement a product-differentiation strategy,firms will
A)hold individuals responsible for experiments that fail.
B)punish individuals for taking risks when their projects are not successful.
C)simultaneously use multiple dimensions to examine employee performance.
D)provide appropriate incentives for managers and employees to reduce costs.
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Chapter 6: Flexibility and Real Options
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Sample Questions
Q1) Using present value analysis does not work under conditions of uncertainty.
A)True
B)False
Q2) Seymour Semiconductors has strategic options when it has the ________,but not the ________,to invest in a particular strategy.
A)responsibility; resources
B)resources; manpower
C)obligation; ability
D)ability; obligation
Q3) What are strategic options?
Q4) A firm hiring contract and temporary employees instead of full-time employees is an example of the option to ________.
A)defer
B)contract
C)grow
D)abandon
Q5) For a firm to have strategic flexibility,it must possess strategic options.
A)True
B)False
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Chapter 7: Collusion
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Sample Questions
Q1) Firms that consciously make price and output decisions in order to reduce competition may be engaging in what the courts call ________.
A)conspicuous consumption
B)conscious parallelism
C)predatory action
D)coalitionary action
Q2) Firms can collude to reduce the threats from new competitors by working together to decrease the barriers to entry into an industry.
A)True
B)False
Q3) Joint lobbying efforts by industry incumbents can increase the cost of entry into an industry.
A)True
B)False
Q4) A "soft" signal is an indication that the signaling firm will not aggressively respond to cheating.
A)True
B)False
Q5) What is collusion?
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Chapter 8: Vertical Integration
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100 Verified Questions
100 Flashcards
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Sample Questions
Q1) Firms should not vertically integrate into business activities where they do not possess the resources necessary to gain competitive advantages.
A)True
B)False
Q2) A decision-making setting is ________ when the future of an exchange cannot be known when investments in that exchange are being made.
A)uncertain
B)opportunistic
C)flexible
D)dynamic
Q3) If Iron Horse Helmets (IHH)were to contract with a Chinese manufacturing firm to provide IHH with superior quality helmets for sale in the United States but discovered that the shipments were actually of inferior quality when they were received,IHH would be said to be acting opportunistically.
A)True
B)False
Q4) Define vertical integration and differentiate between forward vertical integration and backward vertical integration.
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Page 10
Chapter 9: Corporate Diversification
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Sample Questions
Q1) Both shared activities and internal capital allocation are examples of economies of scope that have the potential for generating positive returns for a firm's equity holders.
A)True
B)False
Q2) Exploiting market power is an example of costly-to-duplicate economies of scope.
A)True
B)False
Q3) Which of the following economies of scope do not have the potential for generating positive returns for a firm's equity holders since the economies of scope can be realized by outside equity holders at a low cost by investing in a diversified portfolio of stock?
A)shared activities
B)diversification to maximize the size of a firm
C)internal capital allocation
D)exploiting market power
Q4) Identify which economies of scope are more likely to be subject to low-cost imitation and which are less likely to be subject to low-cost imitation and discuss why each is either costly or less costly to duplicate.
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11
Chapter 10: Organizing to Implement Corporate
Diversification
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98 Verified Questions
98 Flashcards
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Sample Questions
Q1) If a well-managed diversified firm uses both accounting and economic measures,it will be able to unambiguously evaluate divisional performance.
A)True
B)False
Q2) In an agency relationship the party delegating the decision-making authority is called the agent.
A)True
B)False
Q3) In a diversified firm,market prices are set by a firm's corporate management to accomplish corporate objectives while transfer prices are determined by the market forces of supply and demand.
A)True
B)False
Q4) Discuss the relationship between accounting methods of measuring divisional performance and economic methods,identify the formula used for calculating economic value added,and discuss methods for adjusting accounting earnings and the importance of making these adjustments.
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Chapter 11: Strategic Alliances
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Sample Questions
Q1) The rarity of strategic alliances depends solely on the number of competing firms that have already implemented an alliance.
A)True
B)False
Q2) What is the connection between strategic alliances and real options?
Q3) Although joint ventures between firms in the same industry ________ collusive implications,research has shown that these kinds of joint ventures are ________.
A)may have; relatively rare
B)are not likely to have; relatively rare
C)may have; relatively common
D)are not likely to have; relatively common
Q4) When potential cooperative partners misrepresent the skills,abilities,and other resources that they will bring to an alliance,this is a form of cheating known as adverse selection.
A)True
B)False
Q5) Define the three fundamental forms of cheating in strategic alliances and discuss the short- and long-term implications of cheating in a strategic alliance.
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Chapter 12: Mergers and Acquisitions
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Sample Questions
Q1) The acquisition of strategically unrelated targets will generate substantial economic profits for both the bidding and the target firms.
A)True
B)False
Q2) A firm engages in an acquisition when it purchases a second firm.
A)True
B)False
Q3) The number of firms that have used merger and acquisition strategies to become diversified over the past few years is minimal after the credit crunch crisis in 2008.
A)True
B)False
Q4) Describe three major challenges that firms integrating acquisitions are likely to face.
Q5) Firms should pursue merger and acquisition strategies only to obtain valuable economies of scope that outside investors find too costly to create on their own.
A)True
B)False
Q6) How are poison pills different from shark repellents?
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