Question 1

Which of the following is true about the first mover strategy?

Accepted Answer

First movers often incur significant costs in developing new products and educating the market, which can be a disadvantage if competitors quickly follow with improved or cheaper alternatives.

Question 2

The term co-opetition refers to a blending of competition and cooperation between two firms.

Accepted Answer

Co-opetition is a strategic concept where businesses collaborate in certain areas while still competing in others, combining elements of both competition and cooperation.

Question 3

Hypercompetition is a situation that involves very rapid and unpredictable moves and countermoves that can undermine competitive advantages.

Accepted Answer

Hypercompetition refers to a market environment where the pace of change is fast, and companies must constantly adapt to maintain their competitive edge, often leading to rapid and unpredictable strategic moves.

Question 4

A joint venture is a cooperative arrangement between two or more organizations that does not involve the creation of a new entity.

Accepted Answer

A joint venture typically involves the creation of a new entity where the participating organizations share ownership, control, and profits.

Question 5

A strategic alliance is a cooperative arrangement between two or more organizations that does not involve the creation of a new entity.

Accepted Answer

A strategic alliance involves collaboration between organizations to achieve common goals without forming a new legal entity.

Question 6

A strategic alliance is a cooperative arrangement that involves two or more organizations, each contributing to the creation of a new entity.

Accepted Answer

A strategic alliance is a cooperative arrangement between organizations to achieve common goals, but it does not necessarily involve creating a new entity.

Question 7

The partners in a joint venture share decision making authority, control of the operation, and any profits that the joint venture earns.

Accepted Answer

In a joint venture, partners typically share decision-making authority, control, and profits, as it is a collaborative business arrangement between two or more parties.

Question 8

By undercutting rivals on tuition, using data analytics to identify students who are struggling, and relying on low paid adjunct instructors rather than full-time professors, Southern New Hampshire University developed what type of situation?

Accepted Answer

Southern New Hampshire University created a disruptive situation by changing the traditional higher education model, offering lower tuition, using data analytics for student support, and employing adjunct instructors, which challenges established institutions.

Question 9

The bricolage strategy refers to a blending of competition and cooperation between two firms.

Accepted Answer

The bricolage strategy involves creating new solutions by using available resources in innovative ways, not blending competition and cooperation.

Question 10

Apple's creation of a user-friendly small computer in the early 1980s helped fuel a reputation for creativity and innovation that persists today. This is an example of a _____ strategy.

Accepted Answer

Apple's creation of a user-friendly small computer in the early 1980s is an example of a first mover strategy, as they were among the first to introduce such innovative technology, establishing a strong market presence and reputation.

Question 11

A _____ strategy involves creating a new, untapped market rather than competing with rivals in an existing market.

Accepted Answer

A blue ocean strategy involves creating a new, untapped market rather than competing with rivals in an existing market.

Question 12

The blue ocean strategy involves blending of competition and cooperation between two firms.

Accepted Answer

The blue ocean strategy focuses on creating new market spaces (blue oceans) where competition is irrelevant, rather than blending competition and cooperation.

Question 13

Which of the following is true about disruptive innovations?

Accepted Answer

Disruptive innovations often conflict with traditional approaches and can threaten to replace existing industry practices by offering simpler, more affordable, or more accessible alternatives.

Question 14

Which of the following best describes the foothold strategy?

Accepted Answer

A foothold strategy involves a firm establishing a small position in a market where it does not yet compete, allowing it to gain insights and prepare for a larger entry.

Question 15

When IKEA enters a new country, it opens just one store. This store is then used as a showcase to establish IKEA's brand. Once IKEA gains brand recognition in a country, more stores are established. This is an example of the _____ strategy.

Accepted Answer

The foothold strategy involves establishing a small initial presence in a new market to gain brand recognition and then expanding further once the brand is established.

Question 16

Co-location occurs when goods and services offered under different brands are located very close to each other.

Accepted Answer

Co-location refers to the practice of placing goods and services from different brands in close proximity to each other, often to attract more customers and increase convenience.

Question 17

Genentech's early development of biotechnology allowed it to overcome many of the pharmaceutical industry's traditional entry barriers (such as financial capital and distribution networks) and become a profitable firm. This is an example of a _____ strategy.

Accepted Answer

Genentech's early development of biotechnology represents a first mover strategy, as it was one of the first companies to leverage biotechnology, allowing it to overcome traditional industry barriers and establish a profitable position in the market.

Question 18

A _____ advantage exists when making the initial move into a market allows a firm to establish a dominant position that other firms struggle to overcome.

Accepted Answer

A first mover advantage exists when a firm is the first to enter a market, allowing it to establish a strong position that can be difficult for later entrants to challenge.

Question 19

Co-opetition is a situation that involves very rapid and unpredictable moves and countermoves that can undermine competitive advantages.

Accepted Answer

Co-opetition refers to a strategy where competing companies collaborate in certain areas while still competing in others, rather than engaging in rapid and unpredictable moves.

Question 20

A _____ innovation is an innovation that conflicts with, and threatens to replace, traditional approaches to competing within an industry.

Accepted Answer

A disruptive innovation is one that displaces established competitors and traditional methods in an industry, often creating a new market or value network.

Quiz 6: Supporting the Business-Level Strategy: Competitive and Cooperative Moves