Question 1

Entrepreneurship refers to new value creation and can include activities in major corporations.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following refers to a situation where a company has a high concentration of its business in a particular industry market?

Accepted Answer

A)  competitor resources
B)  resource similarity
C)  market dependence
D)  actor reputationE) B) and C)
F) A) and D)

Question 3

Which of the below best describes the competitive tendencies of small firms?

Accepted Answer

A)  Small firms tend to signal their competitive actions long before they launch those actions, because they lack legitimacy in the marketplace.
B)  Small firms typically have more resources available as they undertake competitive attacks than do large firms.
C)  Small firms are more nimble and can respond quickly to competitive attacks.
D)  Small firms are more nimble and cannot respond quickly to competitive attacks.E) A) and C)
F) None of the above

Question 4

Running Press created a line of palm-sized mini books that were sold as point-of-sale impulse items. The company grew rapidly, even though it had a small fraction of the sales in the publishing industry. They used a pure overall cost leadership strategy to capture market share.

Accepted Answer

A) True 
 B)False

Question 5

In the Model of Competitive Dynamics, Exhibit 8.4 in the textbook, motivation and capability to respond is one of the reasons companies launch competitive challenges. The Toyota Prius offer set off the competitive dynamic cycle for more fuel-efficient automobiles.

Accepted Answer

A) True 
 B)False

Question 6

Developed in 1993, WorldWideWeb, later named Nexus, was the first web browser. It radically changed how users access information on the Internet. This is an example of a pioneering new entry strategy.

Accepted Answer

A) True 
 B)False

Question 7

Opportunities can be found through a structured search process. The example of Ancient Ales with their innovative line of craft beers demonstrates which of the following types of structured search?

Accepted Answer

A)  Identify frustrations with current products or processes.
B)  Talk to people who know including suppliers, customers, frontline employees.
C)  Borrow ideas from other markets.
D)  Find historical ideas and re-purpose them.E) A) and B)
F) B) and C)

Question 8

Which of the following is not one of the reasons a company might launch new competitive actions?

Accepted Answer

A)  to obtain first mover advantages
B)  to improve market position
C)  to find new sources of raw materials
D)  to capitalize on growing demandE) A) and B)
F) A) and C)

Question 9

Running Press launched the Miniature Editions line of books in 1993. Today it has sold over 20 million copies. Which of the following most closely represents their strategy?

Accepted Answer

A)  differentiation
B)  overall cost leadership
C)  focus
D)  combinationE) A) and B)
F) C) and D)

Question 10

As investors, venture capitalists rarely provide any help or services to entrepreneurial firms other than financing.

Accepted Answer

A) True 
 B)False

Question 11

Tuft and Needle makes mattresses, according to Strategy Spotlight 8.5 in the textbook. Which generic strategy most closely represents theirs?

Accepted Answer

A)  differentiation
B)  overall cost leadership
C)  focus
D)  combinationE) All of the above
F) B) and C)

Question 12

The Amazon approach to selling books, using the Internet and offering superior customer service, gave it a strong entry strategy. This is an example of a focus strategy.

Accepted Answer

A) True 
 B)False

Question 13

According to the text, new ventures launched by entrepreneurial teams are more likely to be successful than ventures launched by

Accepted Answer

A)  established corporations.
B)  lone wolf entrepreneurs.
C)  bootstraps.
D)  individual investors.E) B) and D)
F) All of the above

Question 14

Which of the following is not a factor that affects how a competitor will respond to a competitive attack?

Accepted Answer

A)  how dependent the competitor is on that industry or particular market segment
B)  the degree of market power and reputation of the company that initiated the attack
C)  the stock market reaction to the initial competitive attack
D)  the resources which are available for a firm to respondE) A) and D)
F) A) and C)

Question 15

Vision is an important element of entrepreneurial leadership because

Accepted Answer

A)  a vision statement is part of the documentation used to obtain venture financing.
B)  the entrepreneur has to envision realities that do not yet exist.
C)  organizations cannot function without a detailed and operational vision.
D)  banking institutions require it.E) A) and D)
F) A) and B)

Question 16

Entrepreneurial firms that pursue a low-cost leadership strategy use all of the following to achieve lower costs except

Accepted Answer

A)  cost-saving technology such as the Internet.
B)  simple organizational structures.
C)  rapid decision making.
D)  extensive investment in order to achieve economies of scale.E) A) and B)
F) B) and C)

Question 17

New ventures may find it difficult to use differentiation strategies successfully because they lack _____________ and __________.

Accepted Answer

A)  sufficient funding; superior innovation
B)  competitors; superior technology
C)  sufficient funding; qualified entrepreneurs
D)  innovative ideas; potential customersE) B) and C)
F) All of the above

Question 18

Which of the following is not a factor that makes it more difficult for new ventures to be successful as differentiators?

Accepted Answer

A)  The strategy is thought to be expensive to put into action.
B)  Establishing a brand, important to a differentiation strategy, is thought to be expensive.
C)  Superior innovation is often very costly.
D)  Customer service is often costly, but it does not affect a differentiation strategy.E) A) and C)
F) B) and D)

Question 19

Refinements or extensions of existing strategies are often referred to as tactical actions.

Accepted Answer

A) True 
 B)False

Question 20

The process of identifying, selecting, and developing new venture opportunities is known as

Accepted Answer

A)  innovativeness.
B)  bootstrapping.
C)  opportunity recognition.
D)  brainstorming.E) None of the above
F) A) and C)

Exam 8: Entrepreneurial Strategy and Competitive Dynamics

Which of the following is not a factor that affects how a competitor will respond to a competitive attack?

Correct AnswerverifiedShow Answer

Tuft and Needle makes mattresses, according to Strategy Spotlight 8.5 in the textbook. Which generic strategy most closely represents theirs?

Correct AnswerverifiedShow Answer

As investors, venture capitalists rarely provide any help or services to entrepreneurial firms other than financing.

Correct AnswerverifiedShow Answer

Running Press created a line of palm-sized mini books that were sold as point-of-sale impulse items. The company grew rapidly, even though it had a small fraction of the sales in the publishing industry. They used a pure overall cost leadership strategy to capture market share.

Correct AnswerverifiedShow Answer

Opportunities can be found through a structured search process. The example of Ancient Ales with their innovative line of craft beers demonstrates which of the following types of structured search?

Correct AnswerverifiedShow Answer

Running Press launched the Miniature Editions line of books in 1993. Today it has sold over 20 million copies. Which of the following most closely represents their strategy?

Correct AnswerverifiedShow Answer

In the Model of Competitive Dynamics, Exhibit 8.4 in the textbook, motivation and capability to respond is one of the reasons companies launch competitive challenges. The Toyota Prius offer set off the competitive dynamic cycle for more fuel-efficient automobiles.

Correct AnswerverifiedShow Answer

According to the text, new ventures launched by entrepreneurial teams are more likely to be successful than ventures launched by

Correct AnswerverifiedShow Answer

Which of the following is not a factor that makes it more difficult for new ventures to be successful as differentiators?

Correct AnswerverifiedShow Answer

Entrepreneurial firms that pursue a low-cost leadership strategy use all of the following to achieve lower costs except

Correct AnswerverifiedShow Answer

Vision is an important element of entrepreneurial leadership because

Correct AnswerverifiedShow Answer

Developed in 1993, WorldWideWeb, later named Nexus, was the first web browser. It radically changed how users access information on the Internet. This is an example of a pioneering new entry strategy.

Correct AnswerverifiedShow Answer

Which of the following refers to a situation where a company has a high concentration of its business in a particular industry market?

Correct AnswerverifiedShow Answer

Which of the following is not one of the reasons a company might launch new competitive actions?

Correct AnswerverifiedShow Answer

Entrepreneurship refers to new value creation and can include activities in major corporations.

Correct AnswerverifiedShow Answer

The Amazon approach to selling books, using the Internet and offering superior customer service, gave it a strong entry strategy. This is an example of a focus strategy.

Correct AnswerverifiedShow Answer

Which of the below best describes the competitive tendencies of small firms?

Correct AnswerverifiedShow Answer

The process of identifying, selecting, and developing new venture opportunities is known as

Correct AnswerverifiedShow Answer

New ventures may find it difficult to use differentiation strategies successfully because they lack _____________ and __________.

Correct AnswerverifiedShow Answer

Refinements or extensions of existing strategies are often referred to as tactical actions.

Correct AnswerverifiedShow Answer

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New ventures may find it difficult to use differentiation strategies successfully because they lack ___ and .

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