1. A blue ocean strategy differs from a low-cost strategy in that

A. the intent of a blue ocean strategy is not to be the absolute lowest-cost provider because a blue ocean must also increase perceived value.

B. the focus of a blue ocean strategy is on lowering the economic value created, whereas a cost-leader focuses on increasing the economic value created.

C. economies of scale are more important to a blue ocean strategy, while economies of scope are more important to a cost-leader.

D. a blue ocean's research and development focus is on process technologies, and a cost-leader's focus is on product technologies.

2. When evaluating the sustainability of a firm's competitive advantage, which of the following statements is not true?

A. The competitive advantage will not be sustainable if there are substitutes for the firm's core competence.

B. If managed effectively, existing core competencies can help sustain the competitive advantage indefinitely.

C. Social complexity often leads to a competitive advantage that is sustainable.

D. When expectations of future resource value turn out to be accurate and can be repeated, then a sustained competitive advantage is realized.

3. A successfully implemented blue ocean strategy allows a firm to

A. charge a higher price than the cost-leader in the industry.

B. create lesser economic value than the differentiator in the industry.

C. reduce its value gap beyond that created by the cost-leader in the industry.

D. increase its price above that of the differentiator in the industry.

4. In the context of SWOT analysis, which of the following best exemplifies a firm's external opportunity?

A. an increase in its financial resources

B. an increase in its brand equity

C. an increase in its customers' disposable income

D. an increase in its employee productivity

5. Triple-bottom-line is a combination of economic, social, and _____ concerns that can lead to a sustainable strategy.

A. cultural

B. ecological

C. investment

D. aesthetic

6. When using the balanced-scorecard approach to assess a firm's performance, which of the following is not a key question that managers need to answer?

A. How do customers view us?

B. How do we reduce the economic value created?

C. What core competencies do we need?

D. How do shareholders view us?

7. Which of the following approaches to assess competitive advantage is based on the view that noneconomic factors can have a significant impact on a firm's financial performance?

A. the triple-bottom-line approach

B. the economic value creation framework

C. the accounting profitability approach

D. the balanced-scorecard