Corporate Strategy MCQs
Corporate Strategy MCQs
Answer these 100+ Corporate Strategy MCQs and assess your grip on the subject of Corporate Strategy.
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1: Which of the following is a Visit Cost of benchmarking?
A. (All of these)
B. travel costs
C. hotel rooms
D. lost labor time
2: Which of the following is an example of a retrenchment strategy?
A. Delta airlines reducing flights to several areas of the United States.
B. Facebook purchasing popular photo-sharing service Instagram.
C. Google investing in the expansion of fiber networks to build its broadboard services offerings.
D. Amazon redesigning its website to better accomodate mobile users.
3: With the inherent risk involved, why would a company choose unrelated diversification as a strategy?
A. A firm targeted for acquisition has undervalued assets, or is in financial distress
B. A firm targeted for acquisition has more personnel than the acquiring firm
C. A firm targeted for acquisition has valuable assets
D. A firm targeted for acquisition is more stable than the acquiring firm
4: What are the three varieties of Vertical Integration?
A. Forward, Balanced, Horizontal
B. Backward, Forward, Balanced
C. Backward, Forward, Horizontal
D. Backward, Balanced, Horizontal
5: What kind of outlook would make organizational stability a prudent action?
A. A strong future
B. A future anticipating a series of buyouts
C. An uncertain future
D. A future with diversification planned
6: What activity must come first in the performance management process?
A. Specifying the relevant aspects of performance.
B. Providing performance feedback.
C. Identifying behaviors that lead to increased performance
D. Appraising performance.
7: Which of the following is not considered a corporate growth strategy?
A. Analytical expansion
B. International expansion
C. Diversification
D. Concentration
8: How should a corporation structure itself in order to maximize its abilities to execute a strategy?
A. Centralized and flexible
B. Static and flexible
C. Static and dynamic
D. A corporation should be decentralized and flexible
9: In 2013, Office Max and Office Depot completed a merger that allowed them to increase operating efficiencies. What is this type of merger known as?
A. divestiture
B. horizontal merger
C. vertical merger
D. conglomerate merger
10: According to the product life cycle, which stage do products occupy if they are characterized by slowing growth and lower profits caused by increased competition?
A. Maturity
B. Growth
C. Decline
D. Introduction
11: What benefit would diversification pose for a company such as BP?
A. It allows a secondary profit channel in the case its main product becomes undesirable
B. It allows them to sell their primary product in a different market
C. It allows them to sell different products within their core market
D. It allows them the opportunity to restructure their core
12: What is an example of a growth strategy a firm may pursue?
A. National growth
B. International expansion
C. Internal growth
D. Restructuring
13: What are two methods of implementing growth strategies?
A. Diversification and concentration
B. Concentration and liquidation
C. Mergers and acquisitions
D. Insolvency and synergy
14: Vertical integration provides what benefit to a firm?
A. Increase in personnel
B. Reduced purchasing and selling costs
C. Decrease in waste
D. Increase in expansion capabilities
15: In 2014, Google announced that it was selling Motorola Mobility to Lenovo for roughly $2.91 billion. What is this an example of?
A. spin-off
B. retrenchment
C. divestiture
D. carve-out
16: What major disadvantage can a firm encounter with related diversification?
A. Difficulty in managing single business units
B. Difficulty in managing different, but related businesses
C. Difficulty in managing new personnel
D. Difficulty in managing new products
17: What is financing derived from the sale of common stock or from retained earnings?
A. debt financing
B. equity financing
C. leverage financing
D. stock financing
18: Which of the following positioning strategies requires an organization to produce a specialized product or service that is targeted towards a small segment of customers?
A. cost leadership strategy
B. firm level strategy
C. focus strategy
D. differentiation strategy
19: Which of the following is a potential detriment that vertical integration causes?
A. Increase in globalization and a reduction in flexibility
B. Increase in centralization and an increase in flexibility
C. Increase in expansion and an increase in flexibility
D. Increase in centralization and a reduction in flexibility
20: What legal issue could potentially arise as a result of horizontal integration strategies?
A. Antitrust violations
B. Patent violations
C. Trademark infringement
D. Copyright violations
21: Which of the following is not a step to the performance management cycle?
A. setting performance expectations
B. establishing incentives
C. providing feedback
D. evaluating performance
22: What is total quality management (TQM)?
A. A strategy focused on decreasing the number of defective products.
B. A technique used to increase the rate or production.
C. A management approach focused on customer focus, continuous improvement, and teamwork.
D. A philosophy for decreasing the number of one-the-job accidents.
23: True or False? Operational Management focuses on the responses of external market issues.
A. True
B. False
24: What growth strategy is implemented with the combination of equity and significant amounts of debt, while utilizing the target's assets to pay off said debt?
A. A merger
B. A hostile takeover
C. An acquisition
D. A leveraged buyout
25: What is the main difference between corporate and business strategy?
A. There is no difference in the two
B. Business strategy focuses on business as a global unit, while corporate strategy focuses on the overall direction of individual business units
C. Business strategy focuses on business as a global unit, while corporate strategy focuses on the overall direction a corporation must take
D. Business strategy focuses on individual business units, while corporate strategy focuses on the overall direction a corporation must take
26: Which of the following best categorizes individuals or groups who have an interest in the actions of an organizations?
A. Investors
B. Stockholders
C. Shareholders
D. Stakeholders
27: What is the term used to describe a statement that oulines what a company does and its reason for existing?
A. Vision statement
B. Core value statement
C. Operating statement
D. Mission statement
28: Of the following, which is a potential course of action in the event of a catastrophic failure in growth strategies?
A. Diversification
B. Corporate restructuring
C. Concentration
D. Expansion
29: Which of the following is NOT an example of a corporate social responsibility activity?
A. Donating unsold or obsolte prodcuts to local non-profit organizations.
B. Offering employees flexible working arrangements to balance work and family responsibilities.
C. Increasing short-term profitability by extending the life cycle of equipment past the recommended period.
D. Using recylced paper cups as opposed to cups composed of polystyrene.
30: Which of the following costs of inventory production is associated with storing products until they are to used or sold?
A. stockout cost
B. holding cost
C. setup cost
D. ordering cost
31: Performance benchmarking let's a firm:
A. compare its efficiency.
B. compare its overall productivity.
C. assess its competitive position compared to target/peer firms.
32: What role does corporate governance framework play in corporate strategy?
A. Corporate governance framework plays no role in corporate strategy
B. Corporate governance framework ensures that corporate strategies are leveraged purely for self interest
C. Corporate governance framework ensures that corporate strategies are pursued with financial gain as their only objective
D. Corporate governance framework ensures that corporate strategies are pursued ethically
33: How can corporations use executive compensation to focus management decision making on goals that are important to shareholders?
A. Include a golden parachute provision.
B. Include a non-compete provision.
C. Include a golden handcuff provision.
D. Include a stock option grant provision.
34: What is the term used to describe a broad vision that outlines where a company wants to go?
A. Tactical plan
B. Core value statement
C. Stategic plan
D. Operational plan
35: True or False? Corporate strategy deals with industries the firm seeks to compete in.
A. False
B. True
36: Concentration strategy is when a corporation does what?
A. Focuses on its primary line of business
B. Focuses on strategies to expand internationally
C. Concentrates on a diverse portfolio
D. Focuses on acquiring other businesses
37: When diversifying, what must be kept in tact to maintain the survival of the firm?
A. The integrity of the staff
B. The retention rate of the staff
C. The retention rate of customers
D. A companies sustainable competitive advantage
38: Which of the following best describes the stakeholder approach to social responsibility?
A. Organizations should consider the intersts of only employees, investors, and customers when making decisions.
B. Organizations should consider solely the impact their decision will have on profits.
C. Organizations should consider the interests of all parties who have the potential of being affected by a decision.
D. Organizations should consider primarily the interests of their shareholders.
39: Why would a firm use diversification as a strategy?
A. Diversification allows a company to focus more on its core business functions
B. undervalued assets or is in financial distress
C. Diversification offers a company the opportunity to expand beyond its core business
D. Diversification offers a firm the opportunity to compete in unknown markets
40: What is organizational stability?
A. Organizational stability is when a firm maintains its current size
B. Organizational stability is when a firm expands its size
C. Organizational stability is when a firm acquires another business
D. Organizational stability is when a firm diversifies its market
41: What is an example of a long-term consideration of a strategic corporation?
A. Future market entry, and mergers and acquisitions
B. Quarterly sales objectives
C. Annual performance
D. Quarterly earnings
42: What company-wide message is delivered to describe a corporation's reason to exist?
A. Marketing strategy
B. Motto
C. Slogan
D. Mission Statement
43: An acquisition is the outright purchase of another company. What is a merger?
A. A merger takes place when one company buys another company.
B. A merger takes place when one company leverages its purchase of another company with external funding.
C. A merger is a legal transaction that takes place when two or more organizations unite through an exchange of stock.
D. A merger takes place when one company sells products from another company.
44: True or False? Benchmarking is comparing a firm's business metrics to the industry's bests.
A. False
B. True
45: What is an example of a benefit gained from corporate governance framework?
A. A decrease in environmental concerns that allows companies to earn more profits
B. Increased revenues and stock options
C. Ethical operations and good relationships with stakeholders ensure that all interested parties work towards a collective strategy
D. A relaxing of ethical concerns which allows corporations to earn more profits
46: Which of the following is a business function of the value chain?
A. (All of these)
B. Production
C. Marketing and Sales
D. Research and Development
47: What is the process where one company purchases another and absorbs it into its existing operations?
A. divestiture
B. merger
C. liquidation
D. acquisition
48: True or False? The Business Process Improvement system is an approach to help a company achieve efficient results.
A. True
B. False
49: Which one of the following are Porter's generic strategies
A. Segmentation Strategy
B. (All of these)
C. Cost Leadership
D. Differentiation Strategy
50: What is the purpose of the poison pill?
A. To prevent a hostile takeover.
B. To provide instant profits to investors.
C. To make the corporation appear more attractive to a prospective buyer.
D. To increase long-term profitability.
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Corporate Strategy MCQs
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