International Marketing

3) The essence of marketing strategy is successfully relating the strengths of an organization to its environment.

Answer: TRUE

Diff: 2 Page Ref: 485

AACSB: Reflective Thinking

4) Competition in an industry tends to drive rates of return on invested capital up towards the level of "perfect competition."

Answer: FALSE

Diff: 2 Page Ref: 485

AACSB: Reflective Thinking

5) "Switching costs" are one of the barriers to entry in Porter's five forces model.

Answer: TRUE

Diff: 2 Page Ref: 486

AACSB: Reflective Thinking

6) Unique product attributes represent a barrier to industry entry known as differentiation.

Answer: FALSE

Diff: 2 Page Ref: 486

AACSB: Reflective Thinking

7) In many industries, the digital revolution has altered the nature of competition by increasing the cost for potential new entrants to an industry.

Answer: TRUE

Diff: 3 Page Ref: 487

AACSB: Reflective Thinking

8) Analyzed in terms of Porter's five forces model, online music file sharing services represent a threat to the music industry in the form of a substitute product.

Answer: TRUE

Diff: 2 Page Ref: 487

AACSB: Reflective Thinking

9) Analyzed in terms of Porter's five forces model, Wal-Mart's ability to dictate terms to the music industry is one indication of the retail giant's supplier power.

Answer: FALSE

Diff: 2 Page Ref: 487-488

AACSB: Reflective Thinking

10) Microsoft and Intel are two companies that illustrate the concept of "bargaining power of suppliers" in Porter's five forces model of industry competition.

Answer: TRUE

Diff: 2 Page Ref: 488

AACSB: Reflective Thinking

11) In Michael Porter's model, "buyers" refers to manufacturers (e.g., GM) and retailers (e.g. Wal-Mart), rather than consumers.

Answer: TRUE

Diff: 2 Page Ref: 487

AACSB: Reflective Thinking

12) If suppliers have enough leverage over industry firms, they can raise prices high...