Strategic Management Multiple Choice Questions
SET#1 QUESTIONS
1. (p. 3) Which of the following is an element of a firm’s remote external environment?
A. Competition
B. Suppliers
C. Government agencies
D. Economic and social conditions
Difficulty: Easy
Learning Objective: 1
2. (p. 3) Which of the following is NOT a part of a firm’s immediate external environment?
A. Technological development
B. Competitors
C. Suppliers
D. Government agencies
Difficulty: Easy
Learning Objective: 1
3. (p. 3) The immediate external environment includes:
A. Competitors
B. S. B. U. s
C. Divisions
D. Management
Difficulty: Easy
Learning Objective: 1
4. (p. 3) The _______ comprises economic and social conditions, political priorities and technological developments, all of which must be anticipated, monitored, assessed and incorporated into the executive’s decision making.
A. Remote external environment
B. Task environment
C. Operating environment
D. Internal environment
Difficulty: Easy
Learning Objective: 1
5. (p. 3) The set of decisions and actions resulting in the formulation and implementation of plans designed to achieve a company’s objectives is defined as:
A. Strategic policy
B. Business policy
C. Strategic management
D. Tactics
Difficulty: Medium
Learning Objective: 2
6. (p. 3) Strategic management compromises nine critical tasks. Which of the following is NOT one of the tasks?
A. Development of annual objectives compatible with grand strategies
B. Assessment of the company’s external environment
C. Selection of a particular set of long-term objectives and grand strategies
D. Evaluate the success of the strategic process
Difficulty: Medium
Learning Objective: 2
7. (p. 4) Strategic management involves the _____, directing, _____ and controlling of a company’s strategy-related decisions and actions.
A. Financing; marketing
B. Planning; financing
C. Marketing; planning
D. Planning; organizing
Difficulty: Medium
Learning Objective: 2
8. (p.4) Large-scale, future-oriented plans, for interacting with the competitive environment to achieve company objectives refers to its
A. Strategy
B. Goals
C. Competitive analysis
D. Dynamic policies
Difficulty: Easy
Learning Objective: 2
9. (p. 4) A strategy is a company’s
A. Game plan
B. Pricing policy
C. Value statement
D. Long-term objective
Difficulty: Easy
Learning Objective: 2
10. (p. 4) A(n) _____ reflects a company’s awareness of how, when and where is should compete, against whom it should compete and for what purpose it should compete.
A. Vision
B. Organizational structure
C. Strategy
D. Long-term objective
Difficulty: Medium
Learning Objective: 2
11. (p. 4) Strategic issues require which level of management decisions?
A. Operative
B. Top
C. Front-line
D. Middle
Difficulty: Easy
Learning Objective: 2
12. (p. 5) Strategic decisions ostensibly commit the firm for
A. 1-2 years
B. The short term
C. 3-4 years
D. A long time, typically five years
Difficulty: Medium
Learning Objective: 2
13. (p. 4-5) Some business decisions are strategic and therefore deserve strategic management attention. Which of the following is one of the six strategic issue dimensions?
A. Requires front-line employee decisions
B. Is not likely to have a significant impact on long-term prosperity of the firm
C. Necessitates considering factors in the firm’s external environment
D. Is spontaneous
Difficulty: Medium
Learning Objective: 3
14. (p. 5) Which of the following applies to strategic issues?
A. Consider only the firm’s internal environment
B. Are future oriented
C. Concern allocation of insignificant amounts of company resources
D. Do not have long-term impact on the firm’s prosperity
Difficulty: Easy
Learning Objective: 3
15. (p. 5) Strategic decisions are based on what managers _____, rather than on what they _____.
A. Forecast; know
B. React to; anticipate
C. Know; forecast
D. Compromise with; analyze
Difficulty: Hard
Learning Objective: 3
16. (p. 5) In a turbulent and competitive free enterprise environment, a firm will succeed only if it takes a(n) ____ stance towards change.
A. Reactive
B. Anti-regulatory or anti-government
C. Proactive
D. Vision and not mission
Difficulty: Medium
Learning Objective: 3
17. (p. 6) Typically how many strategic decision levels are in the corporate decision-making hierarchy?
A. 5 or more
B. 4
C. 3
D. 2
Difficulty: Easy
Learning Objective: 4
18. (p. 6) To a large extent, attitudes at the corporate level reflect the concerns of
A. Stockholders and society at large
B. Top managers
C. The CEO
D. The federal government
Difficulty: Medium
Learning Objective: 4
19. (p. 6) The top of the decision-making hierarchy comprises all of these EXCEPT
A. Board of directors
B. Front-line managers
C. The CEO
D. Administrative officers
Difficulty: Easy
Learning Objective: 4
20. (p. 6) In a multi-business firm, ______ -level executives determine the businesses in which the firm should be involved.
A. Business
B. Functional
C. Corporate
D. Operative
Difficulty: Medium
Learning Objective: 4
21. (p. 6) At Office Supply, Inc., ____ -level managers would be responsible for determining whether the company should be involved in home furnishings or electronic appliance businesses, where as ____ -level managers would be responsible for determining how the firm will compete in the selected product-market arena.
A. Business; corporate
B. Corporate; functional
C. Functional; business
D. Corporate; business
Difficulty: Hard
Learning Objective: 4
22. (p. 6) In the middle of the decision-making hierarchy is the _____ level.
A. Corporate
B. Functional
C. Business
D. Strategic
23. (p. 6) Who determines the basis on which a company can compete in the selected product-market arena?
A. Functional-level strategic managers
B. Corporate-level strategic managers
C. Business-level strategic managers
D. Operational managers supervising operative
Difficulty: Medium
Learning Objective: 4
24. (p. 6) Which of these managers tries to identify and secure the most profitable and promising market segment?
A. Functional managers
B. Corporate managers
C. Business managers
D. Operative
Difficulty: Medium
Learning Objective: 4
25. (p. 6) The functional level of decision making is characterized by:
A. The board of directors deriving corporate goals
B. Managers of product, geographic and functional areas
C. The CEO developing a company profile
D. Business managers interpreting the mission into operational objectives
Difficulty: Medium
Learning Objective: 4
26. (p. 6) Which strategic level is typically responsible for developing annual objectives and short-term strategies?
A. Functional level
B. Corporate level
C. Business level
D. Board of Directors level
Difficulty: Medium
Learning Objective: 4
27. (p. 6) Which of the following is NOT a level in the decision-making hierarchy of a firm?
A. Business
B. Corporate
C. Operative
D. Functional
Difficulty: Medium
Learning Objective: 4
28. (p. 6) Functional managers are typically responsible for which of the following?
A. Annual objectives
B. Tactics
C. Corporate goals
D. Mission
Difficulty: Medium
Learning Objective: 4
29. (p. 6) Whereas corporate and business-level managers center their attention on _____, managers at functional-level center their attention on ____.
A. Operational issues; strategic issues
B. Doing things right; doing the right things
C. Entrepreneurial mode; adaptive mode
D. Doing the right things; doing things right
Difficulty: Hard
Learning Objective: 4
30. (p. 6) Decisions at which level of management tend to be more value-oriented and conceptual?
A. Functional
B. Corporate
C. Operative
D. Business
Difficulty: Medium
Learning Objective: 4
31. (p. 7) Dividend policies are decided at the
A. Corporate level
B. Business level
C. Functional level
D. Operational level
Difficulty: Medium
Learning Objective: 4
32. (p. 7) Which level of decisions encompasses greater risk, cost and profit potential?
A. Business
B. Lower echelon
C. Corporate
D. Functional
Difficulty: Medium
Learning Objective: 4
33. (p. 8) Corporate-level decisions are characterized by:
A. Decreased risk
B. Doing things right
C. Short-time horizons
D. Greater profit
Difficulty: Hard
Learning Objective: 4
34. (p. 7) Decisions concerning plant location, distribution channels, geographic coverage and market segmentation are typically made at:
A. The corporate level
B. The business level
C. The functional level
D. The front-line operational level
Difficulty: Medium
Learning Objective: 4
35. (p. 8) The degree to which participation, responsibility, authority and discretion in decision-making are specified is called:
A. Informality
B. Formality
C. Functional tactic
D. Dynamic mode
Difficulty: Medium
Learning Objective: 4
36. (p. 8) Which of these is usually positively correlated with the cost, comprehensiveness, accuracy and success of planning?
A. Greater formality
B. Functional structure
C. Organizational matrix
D. Functional tactics
Difficulty: Medium
Learning Objective: 4
37. (p. 8) According to Henry Mintzberg, very large firms typically use the _____ mode of strategic management.
A. Adaptive
B. Entrepreneurial
C. Informal
D. Planning
Difficulty: Medium
Learning Objective: 4
38. (p. 8) Henry Mintzberg identified a mode which he associates with medium-sized firms in relatively stable environments. This is referred to as a(n) ____ mode.
A. Entrepreneurial
B. Adaptive
C. Business
D. Planning
Difficulty: Medium
Learning Objective: 4
39. (p. 8) Firms that are basically under the control of a single individual and produce a limited number of products/services are referred to as following ______ mode.
A. Entrepreneurial
B. Intrapreneurial
C. Managerial
D. Corporate
Difficulty: Medium
Learning Objective: 4
40. (p. 8) The informal, intuitive and limited approach to strategic management associated with owner-managers of smaller firm refers to the ____ mode of formality, according to Mintzberg.
A. Entrepreneurial
B. Functional
C. Planning
D. Adaptive
Difficulty: Easy
Learning Objective: 4
41. (p. 8) The planning mode refers to the
A. Strategic formality associated with the large firms that operate under a comprehensive, formal planning system
B. Strategic formality associated with medium-sized firms that emphasize the incremental modification of existing competitive approaches
C. Strategic formality associated with global firms that emphasize cultural value systems
D. Informal, intuitive and limited approach to strategic management with owner-manager of smaller firms
Difficulty: Medium
Learning Objective: 4
42. (p. 8) According to Mintzberg, the adaptive mode refers to
A. Strategic formality associated with the large firms that operate under a comprehensive, formal planning system
B. Strategic formality associated with medium-sized firms that emphasize the incremental modification of existing competitive approaches
C. Strategic formality associated with global firms that emphasize cultural value systems
D. Informal, intuitive and limited approach to strategic management with owner-manager of smaller firms
Difficulty: Medium
Learning Objective: 4
43. (p. 8) Which of these is NOT a mode of formality identified by Mintzberg?
A. Adaptive
B. Planning
C. Functional
D. Entrepreneurial
Difficulty: Easy
Learning Objective: 4
44. (p. 9) The ideal strategic management team includes decision makers from
A. All three company levels (corporate, business and functional)
B. Just the functional level since they are closest to the customers
C. Just the corporate and business levels given that they focus on doing the right thing
D. Just the top management since they understand the big picture
Difficulty: Medium
Learning Objective: 4
45. (p. 8) Managers at the _____ level typically have principal responsibilities for developing environmental analysis and forecasting, establishing business objectives and developing business plans prepared by staff groups.
A. Corporate
B. Functional
C. Operational
D. Business
Difficulty: Medium
Learning Objective: 4
46. (p. 9) When the dominance of the CEO approaches autocracy, the effectiveness of the form’s strategic planning and management processes are likely to:
A. Enhance strategic planning but diminish its processes
B. Be greatly enhanced
C. Have no effect
D. Be diminished
Difficulty: Medium
Learning Objective: 5
47. (p. 11) Which of these is NOT true about the behavioral effect of strategic management?
A. Strategy formulation activities enhance the firm’s ability to prevent problems
B. Resistance to change is reduced
C. Gaps and overlaps in activities among individuals and groups are increased to ensure the checks and balance
D. The employee involvement is strategy formulation improves their understanding of the productivity reward relationship in every strategy plan
Difficulty: Hard
Learning Objective: 5
48. (p. 11) Managers must be trained to guard against all of the following types of unintended negative consequences of involvement in strategy formulation EXCEPT
A. Managers must be trained to minimize the negative impact on operational responsibilities by scheduling their duties to allow the necessary time for strategic activities
B. Managers must be trained to limit their promises to performance that the decision makers and their subordinates can deliver
C. Managers must be trained to anticipate and respond to the disappointment of participating subordinates over unattained expectations
D. Managers must be trained to disregard the productivity-reward relationship since strategy implementation makes it invalid
Difficulty: Hard
Learning Objective: 5
49. (p. 11) Which of the following is a major function of the strategic management model?
A. It helps make profits for the firm
B. It helps in identifying key issues faced by the firm
C. It helps in deciding which products to sell
D. It depicts the sequence and relationships of the major components of the strategic management process
Difficulty: Medium
Learning Objective: 5
50. (p. 13) Social responsibility is a critical consideration for a company’s strategic decision makers since
A. Stockholders demand it
B. The mission statement must express how the company intends to contribute to the societies that sustain it
C. It increases a company’s profits
D. It helps make decisions