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CHAPTER 6
Contributed by: Laong
  • 1. What is the main goal of the strategy analysis and choice process?
A) To prepare financial reports
B) To evaluate employees’ performance
C) To generate, evaluate, and select feasible alternative strategie
  • 2. Which factor is essential for ensuring understanding and commitment in strategy choice?
A) Technology adoption
B) Involvement of as many managers and employees as possible
C) Cost reduction
  • 3. What is encouraged in generating alternative strategies?
A) Creativity
B) Competition
C) Cost minimization
  • 4. What information should participants have available when formulating strategies?
A) Marketing reports only
B) Supplier contracts
C) Vision, mission, EFE, CPM, and IFE information
  • 5. The Strategy-Formulation Analytical Framework consists of how many stages?
A) Two
B) Four
C) Three
  • 6. Which stage summarizes basic input information for strategy formulation?
A) Input Stage
B) Matching Stage
C) Implementation Stage
  • 7. Which matrices are included in the Input Stage?
A) QSPM
B) SPACE, Grand Strategy
C) EFE, IFE, CPM
  • 8. Which stage uses input information to generate feasible alternative strategies?
A) Matching Stage
B) Decision Stage
C) Evaluation Stage
  • 9. Which stage involves a single analytical technique to determine strategy attractiveness?
A) Decision Stage
B) Implementation Stage
C) Matching Stage
  • 10. The SWOT Matrix is used to:
A) Plot a company’s financial position
B) Match key internal and external factors to generate strategies
C) Evaluate political risks
  • 11. How many strategy cells are in a SWOT Matrix?
A) Nine
B) Six
C) Four
  • 12. What is the purpose of a WO strategy?
A) Use strengths to exploit opportunities
B) Overcome weaknesses by taking advantage of opportunities
C) Maintain current strategy
  • 13. SMaintain current strategy
A) Use weaknesses to create opportunities
B) Increase internal weaknesses
C) Use strengths to reduce the impact of external threats
  • 14. WT strategies focus on:
A) Defensive tactics to reduce weaknesses and avoid threat
B) Maximizing revenue
C) Exploiting opportunities
  • 15. Why must strategies be stated in specific terms?
A) To create flexible plans
B) To allow estimation of costs and accountability
C) To avoid documentation
  • 16. One limitation of SWOT analysis is that it:
A) Focuses only on external factors
B) Provides a snapshot in time and doesn’t show how to gain competitive advantage
C) Is only for financial planning
  • 17. The SPACE Matrix is designed to indicate:
A) Internal weaknesses only
B) Historical financial trends
C) Appropriate strategy types based on four dimensions
  • 18. Which of the following is NOT a dimension of the SPACE Matrix?
A) Market Share Position
B) Industry Position
C) Financial Position
  • 19. Quadrants of the SPACE Matrix include:
A) SO, WO, ST, WT
B) Aggressive, Conservative, Defensive, Competitive
C) Stars, Cash Cows, Dogs
  • 20. The BCG Matrix evaluates divisions based on:
A) External threats and internal weaknesses
B) Strategy implementation costs
C) Relative market share position and industry growth rate
  • 21. In the BCG Matrix, 'Stars' are characterized by:
A) Low market share and low growth
B) High market share and high growth
C) High market share and low growth
  • 22. Which BCG category may require substantial investment to maintain growth?
A) Dogs
B) Stars
C) Cash Cows
  • 23. Cash Cows are divisions that:
A) Require significant investments
B) Generate more cash than needed
C) Have low market share and low growth
  • 24. Dogs in the BCG Matrix are:
A) Always profitable
B) Low market share and low growth divisions
C) Stars in the making
  • 25. The IE Matrix positions divisions based on:
A) BCG quadrants
B) IFE and EFE total weighted scores
C) SPACE dimensions
  • 26. Cells I, II, III in the IE Matrix suggest:
A) Liquidation
B) Hold and maintain strategies
C) Grow and build strategies
  • 27. Cells IV, V, VI in the IE Matrix recommend:
A) Harvest and divest strategies
B) Aggressive strategies
C) Hold and maintain strategies
  • 28. Cells VII, VIII, IX in the IE Matrix imply:
A) Market penetration
B) Product development
C) Harvest and divest strategies
  • 29. The Grand Strategy Matrix is based on:
A) Competitive position and market growth
B) Political factors
C) Financial ratios
  • 30. Quadrant I of the Grand Strategy Matrix suggests:
A) Diversification only
B) Excellent position; focus on integration or development strategies
C) Retrenchment
  • 31. Quadrant II of the Grand Strategy Matrix focuses on:
A) Improving weak competitive position using intensive strategies
B) Backward integration
C) Maintaining current strategies
  • 32. Quadrant III implies:
A) Weak competitive position and slow market growth; drastic changes needed
B) Market penetration
C) Strong competitive position
  • 33. Quadrant IV suggests:
A) Maintaining current operations
B) Diversification or joint ventures in promising areas
C) Weak competitive strategies
  • 34. The QSPM is used to:
A) Objectively determine the relative attractiveness of feasible strategies
B) Evaluate marketing campaigns
C) Assign employee bonuses
  • 35. The strategy with the highest STAS in QSPM is:
A) The most popular strategy
B) The most feasible strategy
C) The least costly strategy
  • 36. Estimating costs in recommendations should rely on:
A) Company data, industry data, and expert opinion
B) Competitor opinions only
C) Wild guesses
  • 37. Organizational culture in strategy formulation refers to:
A) Shared values, beliefs, and practices that support strategy implementation
B) External market trends
C) Financial performance
  • 38. Political considerations in strategy choice involve:
A) Reducing costs only
B) Avoiding decision-making
C) Navigating power dynamics and negotiations to gain commitment
  • 39. Bias in strategy analysis may be caused by:
A) Subjective factors like personal prejudice, emotions, and halo error
B) Financial ratios
C) Market trends
  • 40. A limitation of QSPM is that it:
A) Always requires subjective judgments
B) Focuses only on external factors
C) Ignores costs
  • 41. The Recommendations Page in a strategic plan lists:
A) Historical data only
B) Competitor strategies
C) Proposed actions and estimated costs
  • 42. A key aspect of strategy analysis and choice is:
A) Objective evaluation of alternatives based on input data
B) Following trends blindly
C) Reducing financial risks only
  • 43. Which matrix shows divisions’ positions in nine cells based on internal and external factors?
A) IE Matrix
B) SPACE Matrix
C) SWOT Matrix
  • 44. Which matrix is the only analytical technique designed to objectively rank strategies?
A) QSPM
B) SPACE Matrix
C) Grand Strategy Matrix
  • 45. Which factor is NOT considered in the SPACE Matrix?
A) Employee turnover
B) Financial Position
C) Stability Position
  • 46. The analogy of strategy analysis and choice is compared to:
A) Playing chess at a grandmaster level
B) Writing a report
C) Building a house
  • 47. Why is specificity important in strategy formulation?
A) To reduce planning time
B) To improve creativity
C) To estimate costs and assign responsibilities clearly
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