1
Q.1.
The value of a product to an average consumer is V; and the average price that the firm can charge a consumer for that product is P.
Here, V - P can be termed as:
A. consumer surplus per unit.
B. producer surplus per unit.
C. profit growth.
Q.2.
D. profit per unit sold.
A consumer surplus can be best described as:
A. what the consumer has "left-over" after a purchase.
B. how much extra a consumer has to pay for a product.
C. value for the money.
Q.3
D. the premium charged for a quality product.
A strategy that focuses on increasing the attractiveness of a product is referred to as a(n):
A. differentiation strategy.
B. low cost strategy.
C. effectiveness strategy.
D. efficiency strategy.
2
Q.4.
The efficiency frontier has a convex shape because of:
A. consumer surplus.
B. diminishing returns.
C. profitability.
Q.5
D. differentiation strategy.
_____ imply that when a firm already has significant value built into its product offering, increasing value by a relatively small amount
requires significant additional costs.
A. Efficiency matrixes
B. Diminishing returns
C. Cost plus curves
D. Strategy convex curves
3
Q.6. The basic strategy paradigm suggests that to maximize its profitability, a firm should do all of the following, EXCEPT:
A. choose, according to strategy, any position on the efficiency frontier as all positions are viable.
B. pick a position on the efficiency frontier that is viable in the sense that there is enough demand to support that choice.
C. configure its internal operations so that they support the position on the efficiency frontier.
D. make sure that the right organization structure is in place to execute the strategy.
Q.7. _____ activities are basically concerned with creating the product, marketing and delivering the product to buyers, and providing support
and after-sales service.
A. Support
B. Subordinate
C. Ancillary
D. Primary
Q.8. _____ activities are basically concerned with creating the product, marketing and delivering the product to buyers, and providing support
and after-sales service.
A. Support
B. Subordinate
C. Ancillary
4
D. Primary
Q.9. Centralization and decentralization differ because:
A. centralization hinders coordination, while decentralization facilitates coordination.
B. centralization prevents top-level managers from making required organizational changes, while decentralization
gives top-level managers greater power to make organizational changes.
C. centralization ensures that decisions are consistent with organizational objectives, while decentralization can
result in decisions at variance with organizational goals.
D. centralization promotes flexibility, while decentralization reduces flexibility.
Q.10.
Which of the following decisions is typically centralized at a firm's headquarters?
A. Production decisions
B. Human resource management
C. Marketing decisions
D. Overall firm strategy
Q.11. The emphasis on local responsiveness in firms pursuing a localization strategy creates strong pressures
for:
A. centralizing all decisions regarding marketing, R&D, and human resource management.
5
B. decentralizing operating decisions to foreign subsidiaries.
C. centralizing all operating decisions.
D. global learning.
Q.12.. Global learning based on the multidirectional transfer of skills between subsidiaries and the corporate
center is a central feature of a firm pursuing a(n) _____ strategy.
A. localization
B. global standardization
C. transnational
D. international
Q.13. Which of the following would be a typical responsibility of a product division in a product divisional
structure?
A. Operating decisions
B. Overall strategic development of the firm
C. Financial control of the various divisions
D. Decisions regarding legal issues
Q.14. Which of the following statements is true about a product divisional structure?
A. In a product divisional structure, the responsibility for the financial control of the firm is typically
decentralized.
6
B. A product divisional structure tends to be organized on geography.
C. In a product divisional structure, each product division is set up as a self-contained, largely
autonomous entity with its own functions.
D. In a product divisional structure, the responsibility for operating decisions is typically centralized.
Q.15.Regardless of a firm's domestic structure, its international division tends to be organized on:
A. product.
B. geography.
C. people.
D. economy.
SECTION B
35 MARKS
Q.16.
Identify and explain at least five reasons why a firm like Namibia Breweries Limited should
decentralise its decision making.
(15).
Q.17.
Discuss the two types of competitive pressures that firms competing in the global marketplace face and
how they respond to these pressures?
(10)
Q.18.
Discuss why Namibian companies should consider doing business internationally.
7
(10)
8