Reference no: EM132265822

1. Which of the following is a danger for vertically specialized companies?

a. they have the flexibility to quickly make changes to the business model.

b. they go out of business if they do not make enough profit.

c. they do not allow the firm to focus on makign profits.

d. they offer their best product at the lowest price.

2. The following statements link various changing circumstances (causes) with effects on the breakeven point. Which of these statements is inaccurate?

a. When a recession cuts demand, breakeven point increases.

b. When automation replaces workers, fixed cost increases while variable cost decreases; the effect on breakeven point varies.

c. A price increase results in a breakeven point decrease.

d. When a price war forces a price cut, breakeven point increases.

e. Hiring extra staff causes breakeven point to increase.

3. How can firms protect themselves against misrepresentation?

1) By creating an equity alliance with the partnering company

2) By desisting from forming any kind of alliance with other firms

3) By partnering only with trustworthy individuals and firms

4) By partnering only with start-ups

4. Two organizations that are positioned at different stages along the value chain form an alliance. The contract includes the conditions under which the contract will be closed and the consequences of closure for each partner. Which of the following clauses specifies the above conditions?

1) Voting rights clauses

2) Termination clauses

3) Noncompete clauses

4) Preemption rights clauses

5. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. They retain their individual ownership; however, they agree to share production facilities and manpower, and they also decide to market their products through combined promotional tools. The arrangement made by the two retail chains to combine resources and collaborate for a common objective refers to a _________.

1) mass-customization strategy

2) standardization venture

3) strategic alliance

4) product-differentiation strategy