Business Management Test Bank
Course Introduction
Business Management is an interdisciplinary course that explores the fundamental concepts, principles, and practices involved in effectively overseeing and coordinating business operations. Students will examine topics such as organizational structure, leadership, strategic planning, human resource management, marketing, financial analysis, and decision-making processes. The course emphasizes problem-solving, critical thinking, and ethical considerations in managing businesses of various sizes and industries, preparing students to adapt to the dynamic global marketplace and pursue leadership roles in their future careers.
Recommended Textbook
Strategic Management and Business Policy 15th Global Edition by J. David Hunger
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Page 2
Chapter 1: Basic Concepts in Strategic Management
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112 Verified Questions
112 Flashcards
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Sample Questions
Q1) The ability of an organization to reshape its environment is described by
A) population ecology theory.
B) institution theory.
C) the strategic choice perspective.
D) organizational learning theory.
E) organizational citizenship theory.
Answer: C
Q2) Which of the following is an example of an objective?
A) to diversify product line to appeal to more people
B) to increase sales by ten percent over last year
C) to pay highest salaries to keep high quality employees
D) to develop and sell quality appliances worldwide
E) to divide a sales region into a group of sales districts
Answer: B
Q3) Climate change has become a growing concern for businesses to include in their corporate strategies.
A)True
B)False
Answer: True
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Page 3
Chapter 2: Corporate Governance
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99 Flashcards
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Sample Questions
Q1) The relationship among the board of directors,top management,and shareholders is referred to as
A) corporate synergy.
B) corporate management.
C) corporate governance.
D) corporate strategy.
E) corporate responsibility.
Answer: C
Q2) Under what circumstances does a DIRECT interlocking directorate exist?
A) when both management and the board establish corporate strategic management
B) when a corporation's employees are included on its board
C) occurs when two firms share a director or when an executive of one firm sits on the board of a second firm
D) when all board members are also employed by the corporation
E) when two corporations have directors who serve on the board of a third firm
Answer: C
Q3) Generally,the smaller the corporation,the less active is its board of directors.
A)True
B)False
Answer: True
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Chapter 3: Social Responsibility and Ethics in Strategic Management
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103 Verified Questions
103 Flashcards
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Sample Questions
Q1) Being known as a socially responsible firm may provide a company with social capital that can be used for competitive advantage.
A)True
B)False
Answer: True
Q2) The concept of social responsibility proposes that a corporation has responsibilities to society that extend beyond making a profit.
A)True
B)False
Answer: True
Q3) Issues in affirmative action such as reverse discrimination are examples of conflicts between
A) compensatory and punitive justice.
B) retributive and distributive justice.
C) distributive and compensatory justice.
D) retributive and compensatory justice.
E) punitive and retributive justice.
Answer: C
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Chapter 4: Environmental Scanning and Industry Analysis
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Sample Questions
Q1) Distinguish between a fragmented and consolidated industry.
Q2) Which of the following is not descriptive of a high level of bargaining power of suppliers?
A) Substitutes are readily available.
B) The product or service is unique.
C) The supplier industry is dominated by a few companies, but sells too many.
D) The purchasing industry buys only a small portion of the supplier group's goods and services.
E) Suppliers are able to integrate forward and compete directly with their present customers.
Q3) A formal program of gathering information on a company's competitors is referred to as
A) statistical modeling.
B) competitive intelligence.
C) competitive strategy.
D) quantitative forecasting.
E) qualitative matrix.
Q4) Key success factors seldom vary from industry to industry.
A)True
B)False
Page 6
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Chapter 5: Organizational Analysis and Competitive Advantage
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110 Flashcards
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Sample Questions
Q1) Flexible manufacturing permits the low-volume output of custom-tailored products at relatively low unit costs through economies of scope.
A)True
B)False
Q2) Core competencies may mature and become core deficiencies.
A)True
B)False
Q3) The particular combination of product,place,promotion,and price is called
A) marketing position.
B) product life cycle.
C) market segmentation.
D) marketing mix.
E) marketing leverage.
Q4) Research indicates that greater leverage has a positive impact on performance for firms in stable environments,but a negative impact for firms in dynamic environments.
A)True
B)False
Q5) Describe Barney's VRIO framework.
Q6) What is corporate culture and what are the two distinct attributes of culture?
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Chapter 6: Strategy Formulation: Business Strategy
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Sample Questions
Q1) All of the following reflect criticisms of the SWOT analysis EXCEPT
A) it is simply the opinions of those filling out the boxes.
B) virtually everything that is a strength is also a weakness.
C) it provides a rational link to strategy implementation.
D) virtually everything that is an opportunity is also a threat.
E) there is no tie to the view from the customer.
Q2) Which of the following is not considered a strategic alliance success factor?
A) Have a clear strategic purpose.
B) Operate with short-term time horizon.
C) Agree on an exit strategy for when the partners' objectives are achieved or the partnership fails.
D) Minimize conflicts among the partners by clarifying the objectives.
E) Identify likely partnering risks and deal with them when the alliance is formed.
Q3) One risk of a cost leadership strategy is that the technology for production or of products may change.
A)True
B)False
Q4) What are cooperative strategies?
Q5) What are Porter's three generic competitive strategies?
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Chapter 7: Strategy Formulation: Corporate Strategy
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108 Flashcards
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Sample Questions
Q1) According to the text,75% of a company's market value is derived from its A) employees.
B) intangible assets.
C) plant assets.
D) joint ventures.
E) licensing agreements.
Q2) Corporate parenting is the coordination of cash flow among units.
A)True
B)False
Q3) Research comparing concentric with conglomerate diversification concludes that
A) conglomerate diversification is always less profitable than concentric diversification.
B) concentric diversification is always less profitable than conglomerate diversification.
C) the relationship between relatedness and performance follows an inverted U-shaped curve.
D) neither concentric nor conglomerate diversification are ever profitable.
E) for optimum effectiveness both conglomerate and concentric diversification should be utilized in tandem.
Q4) Discuss the two basic growth strategies.
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Chapter 8: Strategy Formulation: Functional Strategy and Strategic Choice
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Sample Questions
Q1) When components are standardized and each machine functions like a job shop but is positioned in the same order as the parts are processed,this setup is known as
A) mass customization.
B) connected line batch flow.
C) connected job flow.
D) mass batch flow.
E) mass job flow.
Q2) "The customer is always right" is an example of a policy in Nordstrom's.
A)True
B)False
Q3) The flow of products into and out of the manufacturing process is a factor when developing a(n)________ strategy.
A) marketing
B) logistics
C) operations
D) financial
E) human resource management
Q4) What is a corporate scenario? What are the three steps in their construction?
Page 10
Q5) Distinguish between a market development and a product development strategy.
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Chapter 9: Strategy Implementation: Global Strategy
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Sample Questions
Q1) An MNC uses which international strategy for entering a foreign market by associating itself with a firm in the host country or a government agency in that country to combine resources and expertise needed for the development of a new product or technologies?
A) licensing
B) joint ventures
C) production sharing
D) exporting
E) acquisitions
Q2) A relatively quick way to move into an international area is through green-field development.
A)True
B)False
Q3) Management contracts are common when a host government expropriates part or all of a foreign-owned company's holdings in its country.
A)True
B)False
Q4) What are the more popular options for international entry?
Q5) Discuss the five stages of international development.
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Chapter 10: Strategy Implementation: Organizing and Structure
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Sample Questions
Q1) One of the goals to be achieved in strategy implementation is synergy between and among functions and business units.
A)True
B)False
Q2) Stage V in the organizational life cycle is the
A) birth stage.
B) growth stage.
C) maturity stage.
D) decline stage.
E) death stage.
Q3) The job design technique that combines tasks to give a worker more of the same type of duties to perform is known as A) job combination.
B) job rotation.
C) job enrichment.
D) job enlargement.
E) job motivation.
Q4) A crisis of control may develop in the Stage III divisional structure.
A)True
B)False
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Chapter 11: Strategy Implementation: Staffing and Directing
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Sample Questions
Q1) Boards realize that the best way to force a change in strategy is to
A) hire a new CEO who has no connections to the current strategy.
B) hire an outsider with no experience in the industry.
C) hire an insider dissatisfied with the status quo.
D) continue with the current CEO.
E) increase the compensation package for the CEO.
Q2) Companies that pursue related diversification strategies through internal development make greater use of interdivisional transfers of people than do companies that grow through unrelated acquisitions.
A)True
B)False
Q3) The emphasis of TQM is correction,not prevention.
A)True
B)False
Q4) A corporation following a concentration strategy emphasizing vertical or horizontal growth would probably not want an aggressive new chief executive with a great deal of experience in that particular industry-a dynamic industry expert.
A)True
B)False
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Chapter 12: Evaluation and Control
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Sample Questions
Q1) EVA may eventually replace ROI as the standard performance measure.
A)True
B)False
Q2) A responsibility center which measures resources in dollars without consideration of service or product costs is called a(n)
A) investment center.
B) revenue center.
C) expense center.
D) profit center.
E) standard cost center.
Q3) Which is the MOST commonly used measure of corporate performance (in terms of profit)?
A) EPS
B) ROE
C) DPS
D) ROI
E) ROVA
Q4) Discuss the guidelines for proper control.
Q5) What is the balanced scorecard? What are the four areas to be addressed?
Q6) Discuss the benchmarking process.
Page 14
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Chapter 13: Suggestions for Case Analysis
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Sample Questions
Q1) A company's annual report from the year of the case can be helpful,but the SEC 10-K form is not beneficial for those conducting a case analysis.
A)True
B)False
Q2) Converting categories on financial statements from dollar terms to percentages results in
A) inflation-adjusted statements.
B) diverse rates of returns.
C) common-size statements.
D) constant dollar denominations.
E) equivalency comparison.
Q3) What is the main purpose of conducting outside research into the environmental setting of the case?
A) It allows students to identify how the company addressed the problem.
B) It provides a learning experience on library usage, which is helpful in all courses.
C) It gives a realistic background of the industry during a specified period.
D) It gives you clues as to what the organization should be doing in the future.
E) It furnishes large amounts of data-both pertinent and extraneous.
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