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Industry analysis – nature of competitive forces

Industry analysis is a means by which one examines whether the nature of competitive forces makes an industry subject to the purview of the Federal Trade Commission.

Group of answer choices
True
False
2.A successful new product development team works in a state-of-the-art lab and is aided by a crack team of market researchers. This is likely to be a source of durable competitive advantage for the company because of
a.
historical conditions.
b.
smart investments.
c.
social complexity.
d.
efficient operations.
3.The business level strategy that carries the most risk, especially if it does not establish a leadership position, is
a.
low cost leadership.
b.
differentiation.
c.
focused differentiation.
d.
integrated cost-leadership differentiation.
4.A low-cost leader can achieve superior profit performance by
a.
using the low-cost edge to under price competitors and attract price sensitive buyers in large enough numbers to increase total profits.
b.
refraining from price-cutting and use the low-cost advantage to earn a bigger profit margin on each unit sold.
c.
going all out to use its cost advantage to capture a dominant share of the market.
d.
spending heavily on advertising to promote its cost advantage and the fact that it charges the lowest prices in the industry—it can then use this reputation for low prices to build very strong customer loyalty, gain repeat sales year after year, and earn sustained profits over the long-term.
e.
both a and b.
5.Achieving a cost advantage over rivals entails
a.
concentrating on narrow portion of the value chain and abandoning all other activities that create costs.
b.
being a first-mover in pursuing backward and forward integration and controlling as much of the value chain as possible.
c.
out-managing rivals in controlling the cost drivers and finding creative ways to cut cost- producing activities out of the value chain.
d.
being a heavy user of offensive strategies and a light user of defensive strategies.
e.
producing a standard product, redesigning the product infrequently, and having minimal advertising.
6.The production emphasis of a company pursuing a broad differentiation strategy usually involves
a.
a search for continuous cost reduction without sacrificing acceptable quality and essential features.
b.
strong efforts to be a leader in manufacturing process innovation.
c.
above-average expenditures for new product R&D and efforts to build-in whatever features that buyers are willing to pay for.
d.
aggressive pursuit of economies of scale and experience curve effects
e.
developing a distinctive competence in zero-defect manufacturing techniques.

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