Question 1

The value a consumer attaches to a product or service is captured in the

Accepted Answer

A)   least price a consumer is willing to pay for it.
B)   consumer's maximum willingness to pay for it.
C)   expenses incurred by the firm in manufacturing it.
D)   difference between the price charged for it and the cost to produce it.E) A) and D)
F) B) and C)

Question 2

Which of the following is a disadvantage of measuring firm performance through total return to shareholders and firm market capitalization?

Accepted Answer

A)   Market volatility makes it difficult to assess firm performance through these measures, particularly in the short-term.
B)   These tools fail to indicate how the stock market views all available public information about a firm's expected future performance.
C)   These tools measure competitive advantage in absolute terms rather than relative terms.
D)   Only the book value of the share prices is taken into account when applying these measures, and not the market value.E) A) and B)
F) B) and C)

Question 3

Which of the following statements is true of accounting data?

Accepted Answer

A)   Accounting data focus mainly on intangible assets, rather than tangible assets.
B)   Accounting data are historical data and thus backward-looking.
C)   Accounting data do not have to be adjusted in any manner to compare companies with different capital structures.
D)   Accounting data consider off-balance sheet items, such as pension obligations of a firm.E) A) and C)
F) C) and D)

Question 4

Which of the following business models has been traditionally used by the magazine and newspaper industry?

Accepted Answer

A)   subscription-based
B)   razor-razor-blade
C)   pay-as-you-go
D)   freemiumE) B) and D)
F) C) and D)

Question 5

_____ indicates how fast a firm is collecting the credit amount extended by a firm to its customers.

Accepted Answer

A)   Payables turnover
B)   Receivables turnover
C)   Assets turnover
D)   Inventory turnoverE) A) and D)
F) All of the above

Question 6

From an investors' or shareholders' perspective,the measure of competitive advantage that matters most is the

Accepted Answer

A)   return on risk capital.
B)   economic value created.
C)   consumer surplus.
D)   inventory turnover.E) A) and D)
F) A) and C)

Question 7

_____ are the legal owners of public companies.

Accepted Answer

A)   Employees
B)   Shareholders
C)   Category captains
D)   CreditorsE) A) and B)
F) A) and C)

Question 8

Genevieve is a recent fashion graduate.She started her own apparel store with an investment of $300,000.In the first year she made a profit of $60,000.If she had taken up a job as a fashion editor for a magazine,she would have earned $50,000 as salary per year.Also,she could have invested her capital,$300,000,in treasury bonds and earned an interest of $12,000.Thus,the amount $62,000 ($50,000 + $12,000) would be Genevieve's

Accepted Answer

A)   social cost.
B)   break-even price.
C)   reservation price.
D)   opportunity cost.E) A) and B)
F) C) and D)

Question 9

Which of the following expressions accurately describes market cap?

Accepted Answer

A)   It is the product of the number of outstanding shares and the share price.
B)   It is the difference between the book value and the market value of a firm's assets.
C)   It is the ratio of a firm's equity finance and its debt finance.
D)   It is the difference between a firm's account receivables and account payables.E) A) and D)
F) A) and C)

Question 10

The management team for SafeCare Chemicals Inc.came up with the following vision statement: "SafeCare Chemicals will conscientiously track its financial performance to ensure profits for its investors,enhance its community through employment and supporting charities,and dispose of waste in a manner that will not harm the environment." This vision statement is most likely based on the

Accepted Answer

A)   accounting profitability approach.
B)   economic value creation approach.
C)   triple-bottom-line approach.
D)   balanced-scorecard approach.E) C) and D)
F) All of the above

Exam 5: Competitive Advantage, Firm Performance, and Business Models

The value a consumer attaches to a product or service is captured in the

Correct Answer
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Which of the following statements is true of accounting data?

Correct Answer
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Which of the following business models has been traditionally used by the magazine and newspaper industry?

Correct Answer
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From an investors' or shareholders' perspective,the measure of competitive advantage that matters most is the

Correct Answer
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Which of the following expressions accurately describes market cap?

Correct Answer
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_____ indicates how fast a firm is collecting the credit amount extended by a firm to its customers.

Correct Answer
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Which of the following is a disadvantage of measuring firm performance through total return to shareholders and firm market capitalization?

Correct Answer
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_____ are the legal owners of public companies.

Correct Answer
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Exam 5: Competitive Advantage, Firm Performance, and Business Models

The value a consumer attaches to a product or service is captured in the

Correct AnswerverifiedShow Answer

Which of the following statements is true of accounting data?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following business models has been traditionally used by the magazine and newspaper industry?

Correct AnswerverifiedShow Answer

From an investors' or shareholders' perspective,the measure of competitive advantage that matters most is the

Correct AnswerverifiedShow Answer

Which of the following expressions accurately describes market cap?

Correct AnswerverifiedShow Answer

_____ indicates how fast a firm is collecting the credit amount extended by a firm to its customers.

Correct AnswerverifiedShow Answer

Which of the following is a disadvantage of measuring firm performance through total return to shareholders and firm market capitalization?

Correct AnswerverifiedShow Answer

_____ are the legal owners of public companies.

Correct AnswerverifiedShow Answer

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