Question 1

First movers can gain a sustained competitive advantage when they reduce their costs through reverse engineering.

Accepted Answer

False

Question 2

The capability to attack in multiple markets throws the firm off balance leaving it vulnerable to rivals and thus reducing value.

Accepted Answer

The capability to attack in multiple markets can actually increase the value of a firm by diversifying its revenue streams and reducing its dependence on a single market. However, it is important for the firm to carefully manage its resources and prioritize its markets in order to avoid spreading itself too thin and becoming vulnerable to competitors.

Question 3

To be a first mover,the firm must have readily available resources to invest in R&D as well as to rapidly and successfully produce and market a stream of innovative products.

Accepted Answer

Being a first mover requires the ability to invest in research and development as well as the capacity to quickly and effectively produce and promote new and inventive products.

Question 4

It is much easier for a competitor to implement strategic actions than tactical actions.

Accepted Answer

Tactical actions are usually more specific and time-sensitive, requiring a greater level of coordination and execution. Strategic actions, on the other hand, require more long-term planning and resources. Therefore, it is usually easier for competitors to implement tactical actions, as they require less investment and can be executed more quickly.

Question 5

Intensified rivalry within an industry results in decreased average profitability for the firms within it.

Accepted Answer

As competition increases, firms will have to lower their prices or increase the quality of their products in order to stay competitive, leading to a decrease in profit margins. This is known as the "competitive pressure" or "competitive intensity" within an industry.

Question 6

Competitive rivalry is the contest to be the first mover in an international market.

Accepted Answer

Competitive rivalry refers to the competition among existing companies in a market, not specifically related to being the first mover in an international market.

Question 7

Firms are likely to imitate the actions of a competitor that is noted for risky,complex,and unpredictable behavior because this is a way to imitate unobservable core competencies.

Accepted Answer

Firms are unlikely to imitate a competitor that is noted for risky, complex, and unpredictable behavior as it goes against the principles of rational decision-making and strategic thinking. Instead, firms are more likely to imitate competitors that are noted for successful and observable core competencies.

Question 8

Competitive rivalry often increases during recessions and some selected businesses in particular industries experience heightened demand.

Accepted Answer

During a recession, businesses may face decreased consumer spending, leading to increased competition for a smaller pool of customers. However, certain industries such as healthcare, discount retail, and essential goods may see increased demand during a recession, leading to competition among businesses in those industries.

Question 9

The benefits of being a first mover are most substantial in fast cycle markets.

Accepted Answer

In fast cycle markets, being a first mover can provide significant advantages such as establishing brand recognition, capturing market share, and setting industry standards before competitors have a chance to enter the market. However, in slower cycle markets, the benefits of being a first mover may not be as significant as there is more time for competitors to enter and establish themselves.

Question 10

Firms with high market commonality and highly similar resources are direct and mutually acknowledged competitors.

Accepted Answer

When firms have high market commonality and highly similar resources, they are likely to compete directly with each other and recognize each other as competitors in the marketplace. This is because they are both targeting the same customer segments and offering similar products or services, which can lead to rivalry and a zero-sum competition.

Question 11

Low levels of competition may be caused by high fixed costs.

Accepted Answer

The answer of Low levels of competition may be caused...

Question 12

"Competitive dynamics" indicates that firms and their strategic actions are independent.

Accepted Answer

Competitive dynamics refers to the interactions and interdependencies between firms within a market or industry. As such, firms and their strategic actions are not independent but rather closely intertwined and influenced by one another.

Question 13

A strategy's success is determined not only by the firm's initial competitive actions but also by how well it anticipates competitors' responses to them and by how well the firm anticipates and responds to its competitors initial actions.

Accepted Answer

This statement is true as a strategy's success is not only determined by the firm's own actions but also by its ability to anticipate and respond to competitors' actions. Being able to predict and respond to competitors' reactions can help a firm position itself in the market and gain a strategic advantage.

Question 14

Competitive rivalry is the set of competitive actions and responses that occur among firms as they maneuver for an advantageous market position.

Accepted Answer

Competitive rivalry refers to the actions and responses taken by firms to gain an advantage over their competitors in the market. It involves various tactics such as pricing, advertising, product differentiation, and innovation.

Question 15

A tactical competitive action involves a significant commitment of specific and distinctive organizational resources.

Accepted Answer

The answer of A tactical competitive action involves a significant...

Question 16

Competitive dynamics refers to the total set of actions and responses taken by all firms competing within a market.

Accepted Answer

Competitive dynamics refer to the interactions and responses between all firms operating in a particular market, including pricing strategies, product development, advertising, and other actions taken to gain a competitive advantage.

Question 17

Competitive tactics are concerned with how the firm intends to position itself to create value for its customers.

Accepted Answer

The answer of Competitive tactics are concerned with how the...

Question 18

The two primary drivers of hypercompetition are the emergence of the global economy and technology.

Accepted Answer

The emergence of the global economy and technology have increased competition among companies, leading to hypercompetition.

Question 19

Firms operating in the same market,offering similar products and targeting similar customers are competitors.

Accepted Answer

Competitors are defined as firms operating in the same market, offering similar products and targeting similar customers.

Question 20

A competitive action is a strategic or tactical action taken by a firm to gain or defend a competitive advantage or improve its market position.

Accepted Answer

This statement defines what a competitive action is.

Quiz 10: Competitive Rivalry & Competitive Dynamics