BUS 536 Week 11 Final Exam – Strayer New
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Chapter 7 Through 12
Chapter
7 – MAKING STRATEGIC ALLIANCEE AND NETWORKS WORK
TRUE/FALSE
QUESTIONS
- Examples
of equity-based alliances include strategic investment.
- A
non-JV, equity-based alliance can be regarded as two firms “getting
married,” but not having “children.”
- The
term “strategic networks” is derived from the term “social networks”
highlighting the social aspects of interfirm relationships.
- In regards to strategic alliances and
networks, in the traditional industry-based view, firms are dependent
players.
- From the view of industry structure, in
oligopolistic industries, there are an above average number of available
players as potential partners.
- From the perspective of network position,
firms located in the center of interfirm networks accumulate less power
and influence.
- Firms with a high degree of network centrality
are likely to be more attractive partners.
- Successful alliances and networks normally
avoid socially complex relations among partners.
- The ad hoc approach to organization allows
firms to systematically learn from the experience.
- Since firms act to enhance or protect their
legitimacy, copying other reputable organizations is not a way to gain legitimacy.
- In
finding organizational partners, it is desirable to identify candidates
that present both strategic fit and organizational fit.
- The more tacit the resources and capabilities
are, the less likely firms will prefer equity involvement in establishing
relationships.
- A firm would prefer equity relationships if it
fears that its intellectual property may be expropriated by partners.
- As each firm is likely to have multiple
interfirm relationships, it is important to not manage the relationships
as a corporate portfolio.
- Possible ways to minimize the threat of
opportunism include
swapping critical skills and technologies through credible
commitments.
- In international alliances, setting up a
parallel and reciprocal relationship in the foreign partner’s home country
may decrease the incentives for both partners to cooperate.
- Weak ties excel at connecting with distant
others who possess unique and novel information.
- Strong ties are more beneficial to
environments conductive for exploitation whereas weak ties are more
suitable for exploration.
- An increase in the experience of one partner
may bring instability into the relationship as it reduces the need to rely
on the other partner.
- Higher level shared technology is associated
with lower profitability for parent firms.
MULTIPLE CHOICE QUESTIONS
1. Strategic alliances involve:
a. Voluntary
agreements between firms.
b.
Compromises
between short-term transactions and long-term solutions.
c.
Contracts.
d.
Equity-based
arrangements.
e.
All
of the above.
2. Contractual alliances include all
of the following except:
a.
Co-marketing.
b.
Research
and development (R&D) contracts.
c.
Cross-shareholding.
d.
Turnkey
projects.
e.
Licensing/franchising.
3. A joint venture can be described
as:
a.
A
special case of equity-based alliance.
b.
A
new legally independent entity.
c.
A
“corporate child” given birth by two (or more) parent firms.
d.
All
of the above.
e.
None
of the above.
4. Which represents an alliance with
suppliers?
a.
Horizontal alliances.
b.
Upstream vertical.
c. Downstream
vertical.
d. All of
the above.
e. None
of the above.
5. Which
is not an advantage of strategic alliances and networks?
- Reduce costs, risks
and uncertainties.
- Costs of negotiation
and coordination.
- Gain access to
complementary assets and capabilities.
- Opportunities to
learn from partners.
- Possibilities to use
alliances and networks as real options.
6. Which
of the following are not true regarding managers involved in alliances and
networks?
a. They
require relationship skills which foster trust with partners.
b.
They must guard against opportunism.
c. They
must recognize that interests of the firms fully overlap.
d. They
have to represent the interests of their respective firms.
e.
They must attempt to make the complex relationship
work.
7. Institution-based
considerations regarding organization include:
a. Collusion
concerns.
b. Entry
requirements.
c. The
social pressures to find partners.
d. The
internalized beliefs in the value of collaboration.
e.
All
of the above.
8. Cooperation
between rivals is usually suspected of being:
a. Tacit
collusion.
b. Explicit
collusion.
c. Socialism.
d. All of
the above.
e. None
of the above.
9. Emerging
trends concerning formal government policies on entry mode requirements
include:
a.
More liberal policies.
b. Imposing
considerable requirements.
c. A and
B above.
d. Welcoming
wholly owned subsidiaries.
e.
Banning joint ventures.
10. Which
(if any) of the following are not involved in the stages of forming business
relationships?
- The decision to
cooperate.
- The decision to not
cooperate.
- The choice of
contract or equity.
- Positioning the
Relationship.
- All of the above are involved.
11. The
strategic choice concerning whether to form cooperative interfirm relationships
or to rely on pure market transactions or M&As to grow the firm is part of:
a. Stage
One.
b. Stage
Two.
c. Stage
Three.
d. Stage
Four.
e. Stage
Five.
12. In
comparing M&As with alliances and networks, which of the following is not
correct?
- M&As are costly.
- M&As have
significant transaction costs.
- Many M&As end up
destroying value.
- Alliances and
networks preclude future upgrading into possible M&As.
- Alliances and
networks can be considered as a flexible intermediate solution.
13. Strategic
fit refers to whether the partner firm possesses:
- Technology.
- Capital.
- Distribution
channels.
- A through C above.
- Goals, experiences,
and behaviors that facilitate cooperation.
14. The
first concern in determining whether a relationship should be based on contract
or equity is:
- The kind of
resources and capabilities that are shared.
- Direct monitoring
and control.
- Real options.
- Institutional
constraints.
- None of the above.
15. Weak
ties in organizational relationships:
a.
Are more trustworthy and are cultivated over a long
period of time.
b. Are
associated with exchanging finer-grained information.
c. Provide
an informal, social control mechanism.
d. A
through C above.
e.
Are less costly to maintain.
16. As a
type of relationship tie, exploitation refers to such things as:
a. Selfishness.
b. Choice.
c. Efficiency.
d. Execution.
e. B
through D above.
17. In
measuring the performance of strategic alliances and networks, subjective
measures include:
- Market performance.
- Stability.
- A and B above.
- The level of
managers’ satisfaction.
- Longevity.
18. Which
(if any) of the following will not influence the performance of alliances and
networks?
- Equity.
- Learning and
experience.
- Nationality.
- Relational
capabilities.
- All can have an influence.
19. A
lower level of ____contribution may indicate a firm’s relative lack of
commitment:
- Equity
- Learning and
experience
- Nationality
- Relational
capabilities
- All of the above
20. The stock
market responds favorably to alliance activities, but only under which
circumstances?
a.
Complementary resources.
b.
Previous alliance experience.
c.
Ability to manage the host country’s political
risk.
d. Partner
buyouts.
e. All of
the above.
SHORT ANSWER ESSAY QUESTIONS
- How can an organizational alliance be
“win-win?” How can the concept of
“cooperative specialization” help?
- Why and how might a “real option” be useful in
a joint venture?
- A
friend of yours stated: “I would never want to be dependent on an
alliance. I prefer an acquisition so that everything would be under my control.” How would you respond?
- What are the limitations in trying to clearly
identify rights and expectations for alliances and acquisitions among
global corporations?
- What can be done to maintain a successful
alliance among global firms?
Chapter
8 – MANAGING GLOBAL COMPETITIVE
DYNAMICS
TRUE/FALSE QUESTIONS
- Strategy
involves planning for actions rather than reactions or interaction.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-1; Bloom’s: Knowledge; Difficulty: Moderate
- Multimarket
competition occurs when firms engage the same rivals in multiple markets.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-1; Bloom’s: Knowledge; Difficulty: Easy
- Multimarket
competition destroys mutual forbearance.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-1; Bloom’s: Comprehension; Difficulty: Moderate
- If
an attack is so subtle that rivals are not aware of it, the attacker’s
objectives are not likely to have been attained.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-5; Bloom’s: Comprehension; Difficulty: Moderate
- If
the attacked market is of marginal value, managers may decide not to
counterattack.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-5; Bloom’s: Comprehension; Difficulty: Easy
- The
“strategy as action” perspective highlights the power of creative
destruction.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-1; Bloom’s: Comprehension; Difficulty: Easy
- Bargaining
can take place through signals and actions.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-5; Bloom’s: Comprehension; Difficulty: Easy
- Industry-based
considerations are fundamentally concerned with the very first of the
Porter five forces, interfirm rivalry.
a.
True b. False
AACSB:
BUSPROG: Reflective Thinking; DISC: Strategy
LO:
8-2; Bloom’s: Comprehension; Difficulty: Moderate
- Barriers
for entrants with similar products and with substitute products are
involved in the other two of the five forces.
a.
True b. False
AACSB:
BUSPROG: Reflective Thinking; DISC: Strategy
LO:
8-2; Bloom’s: Comprehension; Difficulty: Challenging
- Collusion
survives because it does not have an incentive problem as is illustrated
by the prisoner’s dilemma.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-2; Bloom’s: Comprehension; Difficulty: Challenging
- The
capability to attack in multiple markets throws the firm off balance
leaving it vulnerable to rivals and thus reducing value.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-3; Bloom’s: Knowledge; Difficulty: Moderate
- Firms
that have a high degree of resource similarity are likely to have similar
strengths and weaknesses.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-3; Bloom’s: Knowledge; Difficulty: Easy
- Under
antitrust law a company can be in trouble for setting prices too high but
not for setting them too low.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Legal Responsibilities
LO:
8-3; Bloom’s: Knowledge; Difficulty: Easy
- US
courts have not sought to unilaterally punish non-US cartels (if
they are legal elsewhere) simply because they may have a substantial
adverse impact on US markets.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Legal Responsibilities
LO:
8-4; Bloom’s: Knowledge; Difficulty: Easy
- Critics
of US policy on dumping at least agree that our policy on predatory
pricing is consistent both domestically and internationally.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Legal Responsibilities
LO:
8-4; Bloom’s: Knowledge; Difficulty: Moderate
- Thrust makes use of military theory that the attacker
needs to have at least a three-to-one advantage to overcome a
well-defended position through a conventional frontal assault.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-5; Bloom’s: Knowledge; Difficulty: Easy
- Local
firms’ primary strengths lie in a deep understanding of local markets, and
thus they would pursue a dodger strategy.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-6; Bloom’s: Comprehension; Difficulty: Moderate
- A
strategy that leverages local assets is called an extender strategy.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-6; Bloom’s: Knowledge; Difficulty: Easy
- An
extender strategy may be appropriate in some industries where pressures
for globalization are relatively low.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-6; Bloom’s: Comprehension; Difficulty: Easy
- An
extender strategy is being used when local firms engage in rapid learning
to approach the capabilities of the MNEs and then expand overseas.
a.
True b. False
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-6; Bloom’s: Knowledge; Difficulty: Easy
MULTIPLE CHOICE QUESTIONS
21. Which is true of strategy?
f.
Business
strategy has similarities with military strategy.
g.
Military
principles cannot be completely applied in business.
h.
Militaries
fight over territories, waters, and air spaces, firms compete in markets.
i.
All
of the above.
j.
None
of the above.
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-1; Bloom’s: Knowledge; Difficulty: Easy
22. Which of the following are least
likely to result in collusion?
f.
High
concentration ratio.
g.
Heterogeneous
products.
h.
High
entry barriers.
i.
High
market commonality.
j.
Industry
price leader exists.
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-2; Bloom’s: Analysis; Difficulty: Challenging
23. The main types of attack include:
f.
Thrust.
g.
Feint.
h.
Gambit.
i.
All
of the above.
j.
None
of the above.
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-5; Bloom’s: Knowledge; Difficulty: Easy
24. Issues affecting collaboration
include:
f.
Secrecy.
g.
Exclusivity.
h.
Informality.
i.
All
of the above.
j.
None
of the above.
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-2; Bloom’s: Comprehension; Difficulty: Moderate
25. In developing a strategy
regarding competition or cooperation, it would be useful to not:
- Understand the nature of your industry.
- Strengthen capabilities that more effectively
compete and/or cooperate.
- Understand the rules of the game governing
competition.
- “Look ahead, reason back
- All of the above.
AACSB:
BUSPROG: Analytic; DISC: Strategy
LO:
8-8; Bloom’s: Analysis; Difficulty: Moderate
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