Management Capstone Final Exam
Course Introduction
Management Capstone is a culminating course designed to integrate and apply knowledge and skills acquired throughout a management program. Through case studies, simulations, team projects, and strategic analysis, students tackle complex business problems and develop solutions that require critical thinking, ethical decision-making, and leadership. This course emphasizes experiential learning and encourages students to synthesize concepts from various business disciplines, preparing them to excel in real-world management roles and make informed, strategic decisions in dynamic organizational environments.
Recommended Textbook
Strategic Management 2nd Edition by Frank T. Rothaermel
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12 Chapters
1522 Verified Questions
1522 Flashcards
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Page 2
Chapter 1: What Is Strategy
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134 Verified Questions
134 Flashcards
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Sample Questions
Q1) State-level government agencies that check whether firms are meeting statutory safety measures in their production units are considered to be the firms' _____.
A) stockholders
B) shareholders
C) internal stakeholders
D) external stakeholders
Answer: D
Q2) The management of Five Square Corp.wants to reduce the separation between ownership (by shareholders)and control of the firm (by professional managers).Which of the following practices would best help the company do this?
A) Allowing employees to purchase the stock of the company at a discounted rate
B) Reinvesting the annual profits of the company into research and development
C) Issuing new additional shares to the existing stockholders in proportion to their current holdings
D) Declaring the annual profits as bonus dividends to the existing stockholders
Answer: A
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Chapter 2: Strategic Leadership: Managing the Strategy Process
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125 Verified Questions
125 Flashcards
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Sample Questions
Q1) A _____ is best described as any activity a firm pursues to explore and develop new products and processes, new markets, or new ventures.
A) strategic initiative
B) value chain
C) supply chain
D) corrective action
Answer: A
Q2) What are the three areas of strategy formulation?
Answer: It is helpful to break down strategy formulation into three distinct areas: corporate, business, and functional:
Corporate strategy concerns questions relating to where to compete (industry, markets, and geography).
Business strategy concerns the question of how to compete (cost leadership, differentiation, or integration).
Functional strategy concerns the question of how to implement business strategy.
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Page 4
Chapter 3: External Analysis: Industry Structure,
Competitive Forces, and Strategic Groups
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129 Verified Questions
129 Flashcards
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Sample Questions
Q1) Which of the following factors best contributes to the U.S.automotive industry being characterized by high entry barriers?
A) New auto companies create electric cars powered by simpler motors and gearboxes.
B) New entrants in the automotive industry expect that incumbents will not or cannot retaliate.
C) Car manufacturers require large-scale production in order to be cost-competitive.
D) Few industrial products are as easy to build as cars powered by internal combustion engines.
Answer: C
Q2) True West Airlines Inc.follows a cost-leadership strategy.Which of the following firms will most likely be its direct competitor?
A) Pioneer Airlines Inc., which follows a cost-increase strategy
B) West Railways, which follows a differentiation strategy
C) Jet King Airlines Inc., which follows a low-cost strategy
D) Blue Cabs Inc., which follows a cost-leadership strategy
Answer: C
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Page 5
Chapter 4: Internal Analysis: Resources, Capabilities, and Core Competencies
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127 Flashcards
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Sample Questions
Q1) Which of the following statements accurately describes a firm's resource flow?
A) It is the firm's level of investments to maintain or build a resource.
B) It is the firm's current level of intangible resources.
C) It is the firm's current level of tangible resources that are common to other firms.
D) It is the firm's level of expertise to efficiently deploy a valuable resource.
Q2) Define the value chain.
Q3) Maroon Inc.is a leading international apparel company.Competitors across the globe have failed to imitate Maroon Inc.'s production models, supply chain systems, knowledge systems, and culture.These attributes have remained unique to Maroon Inc.for a long time.Which of the following assumptions of the resource-based model of competitive advantage does this scenario best illustrate?
A) Resource homogeneity
B) Resource perishability
C) Resource equality
D) Resource immobility
Q4) Briefly describe the VRIO framework.
Q5) Define path dependence.
Q6) Explain how the activities of a firm help in achieving a competitive advantage.
Page 6
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Chapter 5: Competitive Advantage, Firm Performance, and Business Models
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125 Verified Questions
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Sample Questions
Q1) Andrew invested $200,000 in the shares of a company.At the end of a year, he had earned $7,000 as dividends on his shares along with a $1,000 appreciation in the overall value of his shares.However, if Andrew had invested the same amount on an asset, like gold, the appreciation in its value would have earned him $10,000 at the end of the year.In this scenario, which of the following is Andrew's opportunity cost?
A) $7,000
B) $10,000
C) $2,000
D) $200,000
Q2) _____ is best described as a measure of how effectively capital is being used by a firm to generate revenue.
A) Return on revenue
B) Risk capital
C) Working capital turnover
D) Revenue per employee
Q3) Describe the subscription-based business model.
Q4) How does consumer demand affect fixed costs and variable costs?
Q5) List the dimensions on which a firm can create greater economic value.
Q6) What are the three financial ratios that constitute return on revenue?
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Chapter 6: Business Strategy: Differentiation, Cost
Leadership, and Blue Oceans
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Sample Questions
Q1) Both BioThink Inc.and GD Pharma Inc.have discovered similar vaccines to prevent cancer.While GD Pharma's vaccine sells at $100 per unit, BioThink sells its vaccine at $90 per unit.This price differentiation has mainly been attributed to the companies' capital decisions.While BioThink used its retained earnings to develop the vaccine, GD Pharma borrowed funds from banks to develop the vaccine.Thus, GD Pharma pays a higher interest on its capital, which makes it necessary to price its vaccine higher.Thus, the key driver for BioThink's competitive advantage is:
A) low-cost input factors.
B) economies of scale.
C) superior customer service.
D) availability of complements.
Q2) What does a firm that pursues a cost-leadership strategy primarily focus on?
Q3) A successfully implemented integration strategy allows a firm to:
A) charge a higher price than the cost leader in the industry.
B) create lesser economic value than the differentiator in the industry.
C) reduce its value gap beyond that created by the cost leader in the industry.
D) increase its price above that of the differentiator in the industry.
Q4) What is higher value associated with?
Q5) Why do diseconomies of scale occur?
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Chapter 7: Business Strategy: Innovation, Entrepreneurship, and Platforms
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126 Verified Questions
126 Flashcards
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Sample Questions
Q1) List the five distinct stages of the industry life cycle.
Q2) Which of the following is a drawback of using the industry life cycle as a framework to guide strategic choice?
A) The framework believes that the life cycle of industries is unpredictable.
B) The framework does not explain everything about changes in industries.
C) The framework is based on the tenet that industries can be rejuvenated even in the declining stage.
D) The framework believes that the number and size of competitors remain constant throughout the life cycle.
Q3) A(n)_____ leverages new technologies to attack existing markets.
A) disruptive innovation
B) incremental innovation
C) radical innovation
D) architectural innovation
Q4) The four-step innovation process ends with:
A) idea generation.
B) invention.
C) idea testing.
D) imitation.
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Chapter 8: Corporate Strategy: Vertical Integration and Diversification
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Sample Questions
Q1) Which of the following is an example of an internal transaction cost?
A) The cost of searching for a contract manufacturer
B) The cost of signing a contract with a supplier
C) The cost of buying raw materials
D) The cost of maintaining a production unit
Q2) Evara Inc.started as a luxury brand for designer apparel.Soon, the company expanded by launching its own line of premium perfumes, watches, bags, and home furnishings.This expansion allowed the businesses under the company to share a few, if not all, of the common competencies in products, services, technology, and distribution.Which of the following corporate strategies is Evara pursuing in this scenario?
A) Taper integration strategy
B) Niche marketing strategy
C) Related-constrained strategy
D) Related-linked strategy
Q3) Briefly discuss the application of the Boston Consulting Group (BCG)growth-share matrix.
Q4) List the benefits of vertical integration.
Q5) List the drawbacks of vertical integration.
Q6) Describe the two types of vertical integration along the industry value chain.
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Chapter 9: Corporate Strategy: Strategic Alliances, Mergers and Acquisitions
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Sample Questions
Q1) When entering a foreign market, it is advisable for a new venture that has a core competency only in R&D to form a strategic alliance with a local partner because:
A) the local partner can better protect its proprietary know-how.
B) building downstream complementary assets can be expensive and time-consuming. C) the strategic alliance will reduce the differentiation of its product and service offerings.
D) the value gap created by the firm can be easily lowered in an alliance.
Q2) How is explicit knowledge different from tacit knowledge?
Q3) How does horizontal integration help firms increase differentiation?
Q4) What is a strategic alliance?
Q5) How have strategic alliances helped big pharmaceutical firms hedge against uncertainty?
Q6) What is the build-borrow-or-buy framework?
Q7) What are the advantages and disadvantages of a joint venture?
Q8) How can strategists decide between borrowing and buying the resource in question?
Q10) When does co-opetition occur? Page 11
Q9) How does horizontal integration decrease competitive intensity within an industry?
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Chapter 10: Global Strategy: Competing Around the World
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Sample Questions
Q1) Which of the following is a drawback faced by multinational enterprises (MNEs)pursuing an international strategy?
A) They cannot leverage their home-based core competencies in foreign markets.
B) They are highly affected by exchange rate fluctuations.
C) They have to be highly responsive to local needs and preferences.
D) They cannot reap the benefits of economies of scale due to their highly customized products.
Q2) Which of the following foreign entry modes primarily involves producing goods in one country to sell in another?
A) Greenfield operations
B) Brownfield operations
C) Exporting
D) Crowdsourcing
Q3) Which of the following modes of entering a foreign market allows for the lowest level of control?
A) Greenfield ventures
B) Exporting
C) Joint ventures
D) Acquisitions
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Page 13
Chapter 11: Organizational Design: Structure, Culture, and Control
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Sample Questions
Q1) A firm that uses a structure that is organized along different business functions such as HR, R&D, Sales, and Marketing and also along different geographical areas such as different countries of the world is most likely using a _____ structure.
A) global matrix
B) multidivisional
C) functional
D) simple
Q2) What are the drawbacks of adopting a functional strategy?
Q3) _____ describes the degree to which a task is divided into separate jobs.
A) Hierarchy
B) Formalization
C) Centralization
D) Specialization
Q4) Define span of control.How is it influenced by an organization's hierarchical structure?
Q5) How does a firm's corporate-level strategy impact its organizational structure?
Q6) How does an unrelated-diversification strategy differ from a related-diversification strategy?
Q7) What are the shortcomings of the matrix organizational structure?
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Chapter 12: Corporate Governance and Business Ethics
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126 Flashcards
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Sample Questions
Q1) All public companies listed on the U.S.stock exchanges must file a number of financial statements with the _____.
A) GovernanceMetrics International (GMI)
B) Securities and Exchange Commission (SEC)
C) EDGAR database
D) Wall Street Journal
Q2) Which of the following statements best supports the view that GE's ecomagination strategy is in line with the Shared Value creation framework?
A) The ecomagination strategy is the brainchild of the founder of the company.
B) The ecomagination strategy helps GE spend more on research and development than other similar companies.
C) The ecomagination strategy generated $3 billion in revenues for GE during 2012.
D) The ecomagination strategy allows GE to produce "green" products while increasing revenue and competitive advantage.
Q3) How does the market for corporate control work?
Q4) How do principal-agent problems cascade down the hierarchy in an organization?
Q5) What is Porter's view on creating shared value?
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Page 15