1.

Which of the following is not a limitation of SWOT (Strengths, Weaknesses, Opportunity,

Threats) analysis?
A)

Organizational strengths may not lead to competitive advantage

B)

SWOT gives a one-shot view of a moving target

C)

SWOT's focus on the external environment is too broad and integrative

D)

SWOT overemphasizes a single dimension of strategy

2. A marketing department that promises delivery quicker than the production department's
ability to produce is an example of a lack of understanding of the
A)

synergy of the business units.

B)

need to maintain the reputation of the company.

C)

organizational culture and leadership.

D)

interrelationships among functional areas and firm strategies.

3. XYZ Corp. is centering on the objective of low-cost, high quality, on-time production by
curtailing idle productive facilities and workers. The XYZ Corp. is taking advantage of a
____________ system.
A)

Just-In-Time (JIT)

B)

Last In, First Out (LIFO)

C)

First In, First Out (FIFO)

D)

Highly mechanized

4. Which of the following lists is comprised of support activities:

A)

human resource management, information systems, procurement, and firm infrastructure

B)

customer service, information systems, technology development, and procurement

C)
human resource management, technology development, customer service, and
procurement

D)

human resource management, customer service, marketing and sales, and operations

5. Although firm infrastructure is quite frequently viewed only as overhead expense, it can
become a source of competitive advantage. Examples include all of the following except:
A)

negotiating and maintaining ongoing relations with regulatory bodies.

B)

marketing expertise increasing a firm's revenues and enabling it to enter new markets.

C)
effective information systems contributing significantly to a firm's overall cost leadership
strategy.
D)

top management providing a key role in collaborating with important customers.

6. The competencies or skills that a firm employs to transform inputs into outputs are:
A)

tangible resources.

B)

intangible resources.

C)

organizational capabilities.

D)

reputational resources.

7. An array of firm resources include interpersonal relations among managers in the firm, its
culture, and its reputation with its customers and suppliers. Such competitive advantages are
based upon
A)

physical uniqueness.

B)

path dependency.

C)

social complexity.

D)

tangible resources.

8. A company's ability to meet its short-term financial obligations is measured by which of the
following categories?
A)

liquidity ratios

B)

profitability ratios

C)

activity ratios

D)

leverage ratios

9. The "balanced scorecard" supplies top managers with a _____________ view of the business.
A)

long-term financial

B)

detailed and complex

C)

simple and routine

D)

Fast but comprehensive

Answer of MCQ
1. c
2. d
3. a
4. a
5. b
6. c
7. c
8. a
9. d

10. The three stages of strategic management are

a. strategy formulation, strategy implementation, and strategy execution.
b. strategy formulation, strategy execution, and strategy assessment.
c. strategy formulation, strategy implementation, and strategy evaluation.

d. stratify assessment, strategy execution, and strategy evaluation.

11. Job titles that refer to strategists include which of the following?
a.
b.
c.
d.

External audit
Owner, entrepreneur, executive director, and accountant
Chief executive officer, salesman, dean, and lawyer
Owner, dean, president, and executive director

12. Relative deficiency or superiority is important information in performing which activity?

a.
b.
c.
d.

External audit
Allocating resources
Internal audit
Evaluating strategies

13. How often should strategic-management activities be performed?

a.
b.
c.
d.

Annually
Quarterly
Monthly
Continuously

14. Who is most responsible for developing, communicating, and enforcing the code of business
ethics for a firm?
a.
b.
c.
d.

Strategists
Line managers
Staff managers
All managers

15. Strategy-implementation activities include

a. conducting research.
b. measuring performance.
c. preparing a TOWS matrix.

d. establishing annual objectives.

16. In a large organization, strategic management activities occur at what level(s)?

a.
b.
c.
d.

Corporate and divisional only

Divisional
Strategic business unit only
Functional, divisional, and corporate

17. Conducting research, integrating intuition with analysis, and making decisions are all
__________ activities.
a.
b.
c.
d.

strategy-formulation
strategy-implementation
long-range planning
short-range planning

18. Which of these questions is addressed by a mission statement?

a.
b.
c.
d.

What do we want to become?

What is our business?
How many employees must we have?
Who do we want to serve?

19. Internal strengths and weaknesses are usually

a.
b.
c.
d.

the major cause of organizational demise or success.

controllable activities within an organization.
most important for CEOs and the board of directors.
not as important as external opportunities and threats.

20. An organization's strengths and weaknesses are determined relative to

a. its strategic business units.
b. government
c. competitors

d. external opportunities and threats.

21. __________ are the means by which long-term objectives will be achieved
a.
b.
c.
d.

Mission statements
Strategies
Vision statements
Long-term goals

22. Strategic management allows an organization to be more

a.
b.
c.
d.

complacent
proactive
authoritarian
reactive

23. __________ may be the most important benefit of strategic management.

a.
b.
c.
d.

Profit
Commitment
Understanding
Order

24. __________ is one of the reasons for poor or no strategic planning in organizations.
a.
b.
c.
d.

Prior good experience

Fear of success
Low expense
Self-interest

Answer of MCQ
10. c
11. d

12. c
13. d
14. a
15. d
16. d
17. a
18. b
19. b
20. c
21. b
22. b
23. c
24. d

25. Which statement is CORRECT about strategic-management process?

a. It occurs once a year
b. it is a continue process
c. It applies mostly to large business
d. It applies mostly to small businesses

26. Which of the following period strategic management was considered to be cure for all
problems?
a. Mid 1950s to mid 1960s
b. Mid 1960s to Mid 1970s
c. Mid 1970s to mid 1980s

d. Mid 1980s to mid 1990s

27. The mission statement answers which of the following Question?

Select correct option:
a. what is our business.
b. What do we want to become?
c. Who are our stakeholders?

28. Intuition is based on all of the following factors EXCEPT:

a. Select correct option:
b. Past experiences
c. Judgments
d. Uncertanities

29. A desired future state that the organization attempts to realize. Identify the term relevant to
the given statement.
Select correct option:
a. goal
b. Strategy
c. Policy
d. Procedure

30. Selling includes all of the following marketing activities EXCEPT:

a. Advertising
b. pricing

c. Sales promotion
d. Customer relations

Answer of MCQ
25. b
26. b
27. a
28. d
29. a
30. b

31. A strategic decision can be distinguished from other types of decisions by three factors, these
are magnitude, time-scale and:
a) Commitment
b) Riskiness
c) Impact
d) Longevity

32. 'Logical incrementalism' can be described as:

a) Careful design and planning
b) Emergent
c) Cautious resource allocation
d) Top management rational analysis

33. An organization in which strategy development is characterized by internal political

negotiation and self-interest is operating in which strategy-making mode?

a) The transactive mode

b) The muddling through mode
c) The command mode
d) The emotional mod

34. 'Influence' is defined as the ability to ____________ someone to something they would not
otherwise have done.
a) Intimidate
b) Force
c) Order
d) Persuade

35. McDonalds is deciding whether to expand into manufacturing kitchen equipment in China.
At what level is this decision likely to be made?
a) Business
b) Corporate
c) Functional
d) International

36. The authors believe there are three tests that can be applied to judge whether a strategy is
'good'. These are:
a) Fit, distinctiveness, sustainability
b) Fit, internal resources, external environment
c) Distinctiveness, internal resources, fit
d) Sustainability, distinctiveness, external environment

37. Diversification into many unrelated areas is an example of:

a) Risk management
b) Good management
c) Uncertainty reduction
d) Sustainability

38. According to Porter, dealing with the paradox of premature commitment versus not enough
commitment involves some kind of:
a) Trade-off
b) Lock-in
c) Lock-out
d) Diversification

39. Corporate governance is concerned with:

a) Executive remuneration, disclosure of information, auditing and accounting procedures, and
organizations' management structures
b) Elections to the board of directors
c) Relationships with national governments
d) Corporate-level strategy

40. The principal-agent problem is concerned with:

a) Procurement
b) Appropriation of shareholders' investment by a firm's managers
c) How to control a firm's distributors and dealers
d) Corporate social responsibility

Answer of MCQ
31. a
32. b
33. b
34. d
35. b
36. a
37. a
38. a
39. a
40. b

41.To find out what an organization's strategy is, you should:

a) Read the mission statement
b) Look at what the organization actually does
c) Read the strategic plan
d) Ask the CEO

42. Which of the following statements is not true when describing a successful strategy?
a) It provides some property that is unique or distinctive
b) It provides the means for renewing competitive advantage
c) It addresses changes in the external environment

d) It guarantees long term survival

43. In the context of strategic management resources can be defined as:

a) The knowledge and skills within the organization
b) Something that an organization owns or controls that cannot be copied
c) Something that an organization owns, controls or has access to on a semi-permanent basis
d) The physical assets of the organization

44. In the context of strategic management, stakeholders can be defined as:

a) An individual or group with a financial stake in the organization
b) An external individual or group that is able to impose constraints on the organization
c) Internal groups or individuals that are able to influence strategic direction of the organization
d) An individual or group with an interest in the organization's activities and who seeks to
influence them

45. In the case where an organization acquires its supplier, this is an example of:
a) Horizontal integration
b) Forwards vertical integration
c) Backwards vertical integration
d) Downstream vertical integration

46. When a firm seeks the benefits of global integration and local adaptation, it is best described
as which type of strategy?
a) Transnational
b) Global
c) Multi-national

d) Global-local

47. Knowledge which is difficult to define and codify is known as:

a) Explicit
b) Tangible
c) Tacit
d) Random

48. Competitive advantage based on the creation of opportunities using internal resources is
characterized by which approach/view?
a) The positioning approach
b) The outside-in approach
c) The resource-based view
d) The knowledge-management approach

49. 'Reputation' in the context of an organization's resources can provide competitive advantage
because:
a) It is difficult to copy
b) It is based on word-of-mouth
c) It is a threshold resource
d) It is explicit

50. A strategic manager that seeks to reach acceptable profit targets as opposed to making as
much profit as possible is making decisions of which type?
a) Satisfactory
b) Satisficing

c) Irrational
d) Optimal

Answer of MCQ
41. b
42. d
43. c
44. d
45. c
46. a
47. c
48. c
49. a
50. b

51. Which of the following most accurately summarises the main sets of forces affecting
organisations?
a. government, competitors and consumers
b. general environmental factors, competitive forces, factors internal to the organisation and the
interests of stakeholders
c. external stakeholders, management and staff
d. existing and potential competitors, suppliers, customers and substitute products or service

52. Which of the following would NOT be a reason for management carrying out an
environmental or PEST analysis?
a. to determine environmentally responsible business practices
b. to identify all potential influences on the future of the organisation
c. to consider how organisational strategy should take account of changes in the outside world
d. to determine the external factors most likely to impact upon the organisation

53. Which of the following would you NOT classify as a political-legal factor in the external
environment.
a. European Union directive on working hours
b. government policy on corporate and personal income taxes
c. Oftels regulatory requirements for the telecommunications industry
d. consumer attitudes to greater competition in the gas and electricity industries

54 . According to Porter, which group of forces together determine the level of competitiveness
and profitability in an industry?
a. supplier cartels, dominant buyers and other powerful stakeholders
b. stakeholders, senior management, major competitors and customers
c. existing and potential competitors, customers and suppliers, plus the availability of
substitute products or services
d. existing and potential competitors, government regulators, buyers and suppliers

55 . Which of the following would NOT help a firm to improve its competitive position?
a.
b.
c.
d.

developing good relationships with its suppliers

building a strong brand
gaining sole rights to the extraction of key raw materials
reducing its scale of production

56. Which of the following would NOT typically characterize a highly competitive industry?

a. many firms, but none has dominant share

b. many firms but one has preferential access to distribution channels; substitute
products/services under development but not yet widely available
c. several firms in an industry, with high fixed costs of production, creating pressure to use
capacity, substitute products available
d. little scope for differentiation between firms products and customers can switch easily
between suppliers

57. Which of the following firms is likely to operate in the least complex environment:
a. a firm engaged directly in the production, distribution and sale of fashion garments
b. a firm specialising in selling domestic properties in the south west of England
c. a firm exporting fresh produce to more than 50 countries across the world
d. a firm manufacturing components for the global consumer electronics industry

58. What is the main purpose of stakeholder mapping?

a. to establish how each main stakeholder fits into the organisations future plans
b. to clarify the main roles of individual stakeholders in an organisations activities
c. to identify major stakeholders, their expectations and their sources of power over the
organisation
d. to identify how the business of each stakeholder relates to that of the organisation

59. The most accurate definition of scenario planning is:

a. preparing detailed plans to cope with all possible futures
b. creating visions of a desired future
c. testing financial projections using different assumptions about future sales growth
d. building up pictures of possible futures to challenge existing assumptions and to test
alternative strategies

60. In large organisations, which of the following groups is least likely to have a role in
environmental analysis and strategic planning?
a. individual product or market divisions
b. strategic business units
c. corporate communications departments
d. corporate planning departments

Answer of MCQ
51. c
52. d
53. a
54. a
55. d
56. a
57. d
58. c
59. d
60. a

61. A business whether national or international contains the following activities or functions:
a)
Operations, Human Resource Management, Accounting, Marketing and Research and
Development.
b)
Production, Human Resource Management, Finance & Accounting, Marketing, and
Research and Development.

c)
Production, Human Resources, Finance, Sales and Marketing, Research and
Development.
d)
Operations, Human Resources, Accounting & Finance, Sales, Research and
Development.
Correct!

62. The 3 basic forms of businesses are:

a)

Retail, Wholesale and Direct Sales.

b)

Manufacturing, Service and Retailing.

c)

Sole Trader, Shareholders and Cooperatives.

d)

Sole Trader, Partnership and Limited Company

63. State-owned enterprises or nationalised enterprises differ from privately-funded companies

because:
a)
they are funded or bought out by the government; funded from taxation and are known as
public sector enterprises.
b)

they are industries that are too big for ordinary investors to be able to fund and manage.

c)
all nationalised, or state owned enterprises, have failed in the private sector, and can only
succeed under government control.
d)
Public ownership involves workers in the running of the company more than in the
private sector.
e)

Public companies can never belong to individual shareholders.

64. Organisational structures can be divided into the following three broad categories
a)

Large, medium, small.

b)

Structures based on Functions, Divisions and Matrix.

c)

Strict hierarchy, Board Control, devolved control.

d)

Collective control, Co-operative arrangements, shareholder control.

65. Empowerment is expected to increase efficiency, what makes it effective:

a)

True empowerment avoids the emergence of anarchy.

b)
The notion of shared direction - strategic intent - ensures individual freedom and
concerted and coordinated effort.
c)

Empowerment creates networking.

d)

All the above.

66. Current Corporate Governance issues can centre around the point of view of the shareholder
and will centre on a set group of issues:
a)

Maximising profit or shareholder value should be the primary aim of the company.

b)

The directors are accountable through the board structure.

c)
Active investors, as shareholders, seek to promote active monitoring of directors and
voice shareholder concerns.
d)
Stakeholders represent a range of broader interests which impact directly or indirectly on
the company.
e)

a, b, and c.

67. The acronym PEST is used to represent:

a)

The bad things about a company.

b)

The company's place in the marketplace.

c)

The company's external environment.

d)

The state of a company's finances.

e)

b and d.

68. The acronym SWOT is used to analyse the company's

a)

internal threats and opportunities as well as strengths and weaknesses

b)

internal strengths, opportunities and external weaknesses and threats

c)

external strengths and weaknesses plus the internal opportunities and threats.

d)

the internal strengths and weaknesses as well as the external threats and opportunities.

69. The function of Operations within the company is responsible for:

a)

the Transformation process

b)

making tangible products.

c)

the Transfer Process.

d)

transforming raw materials into tangible goods.

70. An intangible product is produced by :

a)

a manufacturing company.

b)

R&D as a "ghost" proposal for a new product.

c)

a service company

d)

either a manufacturing or service company.

71. Operations is defined as:

a)

the production area of the company.

b)

creation and provision of both goods and services.

c)

producing goods and services.

d)

creating new products.

e)

c and d

72. The five performance objectives of Operations are:

a)

Quantity, Dependability, Safety, Flexibility and Cost.

b)

Quality, Dependability, Safety, Flexibility and Control.

c)

Quality, Dependability, Speed, Flexibility and Cost.

d)

Quantity, Dependability, Speed, Flexibility and Control

73. The marketing concept is:

a)

to make the sales force's job easier

b)

to sell and market as much as possible profitably

c)

to meet the needs and wants of the customer/consumer

d)

to pile it high sell it cheap

e)

to advertise and promote strongly.

74. Providing separate goods and services for distinct groups of consumers is known as:
a)

Separation.

b)

Specialisation.

c)

Segmenting.

d)

Segmentation.

e)

Differentiation.

75. Identify the correct statement(s);

a)

You market products not services

b)

A brand is a name or logo which is a trademark.

c)

Consumers are not interested in brands

d)

Consumers identify with and buy brands not products

e)

b and d

Answer of MCQ
61. a
62. d
63. a
64. b
65. d
66. e
67. c
68. d
69. a
70. c
71. b
72. c
73. c
74. d
75. c