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If Finolo and Ethver, companies that manufacture televisions, develop the same customer knowledge base and create products that provide the same customer appeal as Invoro, a market leader in consumer electronics, then:


A) Finolo and Ethver will have a VRIO resource.
B) Invoro will have a resource that is valuable but no longer rare.
C) Invoro will have a sustainable competitive advantage in the industry.
D) Invoro will have a resource that is rare but no longer valuable.

E) A) and D)
F) A) and C)

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Which of the following is an example of a firm's intangible resources?


A) The firm's cash at bank
B) The firm's finished goods inventory
C) The firm's organizational culture
D) The firm's land and building

E) B) and C)
F) A) and B)

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Which of the following is an implication of high employee turnover in a company?


A) It results in a reduction in the company's intangible-resource stocks.
B) It makes the source of the company's competitive advantage causally ambiguous.
C) It makes the source of the company's competitive advantage socially complex.
D) It results in greater immobility and heterogeneity of the company's resources.

E) B) and C)
F) None of the above

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Explain the value chain perspective of a firm's competitive advantage.

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The value chain perspective enables mana...

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The "Gold Crisps" potato wafers manufactured by True Foods Inc.have been the highest selling wafers in the market.Though the market for wafers is flooded with competitors, True Foods Inc.has been able to maintain its market position for a long time.This is mainly attributed to the unique taste of the wafers that comes from the unique natural flavoring used by the company.This competency of True Foods Inc.will be considered as a(n) _____ resource in the VRIO framework.


A) inexhaustible
B) rare
C) intangible
D) virtual

E) B) and C)
F) A) and C)

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List the four isolating mechanisms that act as barriers to imitation.

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Although no competitive advantage can be...

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List two ways by which a firm's valuable and rare resources can be imitated.

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A firm that enjoys a competitive advanta...

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In the context of SWOT analysis, distinguish the factors that are internal to an organization from the factors that are external to it.

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Internal strengths (S)and weaknesses (W)...

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Provide examples of the primary activities in a firm's value chain.

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The primary activities of a firm add val...

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The share price of Groupon, a daily-deal website, fell by 90 percent just a year after its successful initial public offering.The firm was not able to sustain its competitive advantage because of the emergence of other daily-deal sites that were able to better serve the needs of local markets and specific population groups.Which of the following is the most accurate inference from this example?


A) Groupon's competency was not hard to imitate.
B) Groupon's competency was built more on an intangible resource than on a tangible one.
C) Groupon operated in an industry where the barriers to entry were high.
D) Groupon invested in resources that were invaluable and common.

E) A) and B)
F) C) and D)

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Nike has come a long way from its humble beginnings.It has been able to outperform adidas in sales and become the undisputed leader in the athletic shoe and apparel industry.Which of the following statements accurately explains one of the main reasons for Nike's success?


A) It stopped spending money on celebrity endorsements and started restricting its expenditure for sponsoring only track and field sports stars.
B) It made the unorthodox move to spend basically its entire budget for a specific sport on a single star athlete.
C) It spread its marketing budget more widely.
D) It focused on sponsoring future athletic superstars who embodied a likely success story.

E) A) and B)
F) A) and C)

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True Sync Inc.is a software company, which has built and acquired numerous assets over the years.According to the resource-based view of a firm, which of the following assets of True Sync Inc.will best enable it to gain and sustain a competitive advantage?


A) The resources of the company that are mobile
B) The capital raised by the company from its shareholders
C) The expertise acquired by the employees in the company
D) The headquarters owned by the company

E) A) and B)
F) A) and C)

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Elaborate on the dynamic capabilities perspective of competitive advantage.

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In the dynamic capabilities perspective,...

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Explain the SWOT analysis.

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SWOT analysis is a framework that allows...

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How does causal ambiguity act as an isolating mechanism for organizations?


A) It makes it difficult for the competitors to understand why a company has been so successful.
B) It creates a situation in which different social and business systems interact with one another.
C) It makes it difficult for competitors to deploy their resources by creating ambiguity within their organizational structures.
D) It makes it difficult for competitors to imitate core competencies quickly due to time compression diseconomies.

E) A) and C)
F) B) and D)

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Vior Systems Inc.took many decades to build its core competencies, and these competencies were based primarily on the decisions made by the company's top management in the past.This process is called:


A) path dependence.
B) dependence complexity.
C) causal dependence.
D) path immobility.

E) All of the above
F) A) and B)

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Amazon.com's ability to provide the largest selection of items online, combined with superior IT systems and customer service, can be referred to as its _____.


A) equity reserve
B) economic equity
C) core competency
D) capital gain

E) B) and C)
F) A) and B)

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GN Corp.and BC Inc.are two competing firms in the same industry.GN Corp.'s tangible assets are valued at $15 billion and its intangible assets are valued at $35 billion.BC Inc.'s tangible assets are valued at $5 billion and its intangible assets are valued at $45 billion.What can be concluded from this information?


A) It is easier to buy intangible assets with cash than tangible assets.
B) It is likely that BC Inc. is better enabled than GN Corp. to gain and sustain a competitive advantage.
C) It takes longer time to build tangible assets than intangible assets.
D) There is no resource heterogeneity between the two firms, BC Inc. and GN Corp. as they operate in the same industry.

E) A) and B)
F) A) and C)

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It is difficult even for Apple's managers to pinpoint the underlying cause of the company's phenomenal success.The term that best applies to this difficulty is known as _____.


A) competitive dependence
B) resource mobility
C) causal ambiguity
D) path dependence

E) All of the above
F) A) and C)

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Due to path dependence:


A) strategic decisions have long-term consequences.
B) the occurrence of time compression diseconomies becomes rare.
C) competitors can easily imitate or create core competencies quickly.
D) past decisions of a firm do not affect its current situation.

E) A) and D)
F) A) and C)

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