Midterm Quiz # 5

• Technological forces represent major opportunities and threats that must be considered in formulating strategies.

  TRUE
• Competitive intelligence is not corporate espionage because 95 percent of the information a company needs to make strategic decisions is available and accessible to the public.

  TRUE
• Changes in external forces translate into changes in consumer demand for both industrial and consumer products and services.

  TRUE
• Economic factors have an indirect impact on the potential attractiveness of various strategies.

  FALSE
• The process of performing an external audit must involve as many managers only as possible.

  FALSE
• Matching key external opportunities/threats with key internal strengths/weaknesses provides the basis for successful competitive advantage.

  FALSE
• Trends in the peso value have significant and unequal effects on companies in different industries and in different locations all over the world.

  FALSE
• As the term finite suggests, the external audit is aimed at developing an exhaustive list of every possible factor that could influence the business.

  FALSE
• Unethical tactics such as bribery, wiretapping, and computer break ins should never be used to obtain information.

  TRUE
• Effective integration and understanding of both external and internal factors is the key to securing and keeping a competitive advantage.

  TRUE
• Foreign businesses and countries are not willing to learn, adapt, innovate, and invent to compete successfully in the marketplace.

  FALSE
• The purpose of an external audit is to develop a finite list of opportunities that could harm a firm and threats that should be avoided.

  FALSE
• One of the advantages of a Weak Dollar is that it can cause rise in oil prices.

  FALSE
• It is not a question of whether external or internal factors are more important in gaining and maintaining competitive advantage.

  TRUE
• Revolutionary technological changes and discoveries are having a dramatic impact on organizations.

  TRUE
• The intensity of rivalry among competing firms tends to increase as the number of competitors increases.

  TRUE
• External forces affect the types of products developed, the type of services offered etc.

  TRUE
• The media has changed the very nature of opportunities and threats by altering the life cycles of products, increasing the speed of distribution, etc.

  FALSE
• To perform an external audit, a company first must collect competitive intelligence and information about the five forces.

  FALSE
• Once information is gathered, it should be printed.

  FALSE
• No forecast is perfect, and some forecasts are even wildly inaccurate.

  TRUE
• One of the disadvantages of a Weak Dollar is that Domestic Firms would lead to more exports.

  FALSE
• Firms should be able to respond offensively to the factors by formulating strategies that take advantage of external opportunities.

  FALSE
• Rival firms may offer extended warranties or special services to gain customer loyalty whenever the bargaining power of consumers is substantial.

  TRUE
• Identifying and evaluating external opportunities and threats enables organizations to develop a clear mission etc.

  TRUE
• Bargaining power of consumers also is higher when the products being purchased are standard or undifferentiated.

  TRUE
• People today are more willing than ever to pay for good service if it limits convenience.

  FALSE
• The Internet is altering economies of scale, changing entry barriers, and redefining the relationship between industries and various suppliers, creditors, customers, and competitors.

  TRUE
• Meetings are unnecessary to collectively identify the most important opportunities and threats facing the firm.

  FALSE
• External audit is not aimed at identifying key variables that offer actionable responses.

  FALSE