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The luxury market is characterized by Fewer competitors than in a mass market

The luxury market is characterized by:

a.Fewer competitors than in a mass market.

b.Less use of incentives and price cuts to induce purchases.

c.Healthier profit margins than in a mass-market segment.

d.All of the above.

e.None of the above.

2.The ultra luxury automobile market is characterized by:

a.Little competition in the past – but that is changing.

b.A small number of cars produced each year – but they are very expensive.

c.Being the same as the luxury market.

d.A and B above.

e.None of the above.

3.Which of the following is NOT true of the industrial organization (IO) economics model?

a.Industry structure determines firm conduct (strategy), which determines firm performance.

b.Original goal – help regulators set policy to minimize the ability of firms to earn excess profits.

c.Strategists use the IO model to try to earn above-average returns (excess profits).

d.All of the above are NOT true.

e.All of the above ARE true.

4.Which of the following tends to reduce the intensity of rivalry?

a.Similarity of firms in terms of size, market influence and product offerings.

b.Products are big-ticket items and purchased infrequently.

c.New capacity must be added in large increments.

d.Slow industry growth or decline in demand.

e.None of the above.

5.Which of the following are scale-based low cost advantages?

a.Experience curves.

b.Proprietary technology.

c.Favorable access to raw materials and distribution channels.

d.Favorable locations.

e.None of the above.

6.Which of the following would tend to reduce the bargaining power of suppliers?

a.Dominance of the supplier industry by a few firms.

b.Suppliers provide unique, differentiated products with few or no substitutes.

c.Focal firm is not an important customer.

d.Unwillingness and inability of suppliers to integrate forward.

e.None of the above.

7.Which of the follow would tend to reduce the bargaining power of buyers?

a.Large number of buyers.

b.Products of the industry do not produce clear cost advantages or enhance the quality of life for buyers.

c.Purchase standard, undifferentiated commodity products from suppliers.

d.Willingness and ability of buyers to integrate backward.

e.All of the above.

8.Which of the following are true concerning cost leadership?

a.Targets average customers for mass market – little differentiation.

b.Key functional areas are manufacturing and materials management.

c.Relentless drive to cut costs might compromise value that customers desire.

d.All of the above.

e.None of the above.

9.Which is generally NOT true of differentiation?

a.Difficult to sustain basis of differentiation in the long run.

b.Relentless efforts of competitors to duplicate differentiation.

c.Key areas of application include research and development, marketing/sales and after-sale services.

d.It is a challenge to identify attributes that are valued by customers in each market segment.

e.Inability to pass on suppliers’ price increases to buyers.

10.Related and supporting industries are called _________ and they are an additional force that can impact the competitiveness of an industry.

a.Complementors

b.All-rounders

c.Customizers

d.Flexible manufacturing

e.Supporters

Feb 14 2020 View more View Less

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