The March 2011 announcement that AT&T was acquiring T-Mobile USA from Deutsche Telekom is a _________ acquisition and is intended to

The March 2011 announcement that AT&T was acquiring T-Mobile USA from Deutsche Telekom is a _________ acquisition and is intended to

a. vertical; increase diversification

b. horizontal; increase market power

c. vertical; overcome entry barriers

d. related; increase speed to market

Question 2

1 out of 1 points

Downsizing may be necessary because acquisitions often create a situation in which the newly formed firm has duplicate organizational functions such as sales, manufacturing, distribution, human resources, and management.

True

False

Question 3

1 out of 1 points

The basic types of operational economies through which firms seek value from economies of scope are

a. synergies between internal and external capital markets.

b. the leveraging of individual tangible resources.

c. the sharing of primary and support activities.

d. joint ventures and outsourcing.

Question 4

1 out of 1 points

Which acquisition would be considered the LEAST related?

a. a candy manufacturer purchases a chemical laboratory specializing in food flavorings.

b. a chain of garden centers acquires a landscape architecture firm.

c. a hospital acquires a long-term care nursing home.

d. an upscale “white-tablecloth” restaurant chain acquires a travel agency.

Question 5

1 out of 1 points

The acquisition of Sun Microsystems (a computer hardware producer) by Oracle Corporation (a software firm) is an example of a(n)

a. vertical acquisition.

b. unrelated acquisition.

c. horizontal acquisition.

d. merger of equals.

Question 6

1 out of 1 points

A manager in your company is proposing the acquisition of Taylor Company, which has developed a new, innovative product instead of a strategy of developing new products in-house. All of the following arguments are correct EXCEPT

a. The acquisition of Taylor should be primarily for defensive rather than strategic reasons.

b. Research suggests that acquisition strategies are a common means of avoiding risky internal ventures.

c. The outcomes of acquisitions can be estimated more easily and accurately than the outcomes for an internal product development process.

d. Acquisitions could become a substitute for innovation within your firm

Question 7

1 out of 1 points

PorkPride Foods produces hams and other meat products. It owns hog raising operations. This is an example of a ____ business.

a. de-integrated

b. vertically integrated

c. totally integrated

d. horizontally integrated

Question 8

1 out of 1 points

Coca Cola and PepsiCo compete across a number of products (e.g., soft drinks, bottled water) and geographic markets (U.S. and foreign markets) indicating that both companies have market commonality.

True

False

Question 9

1 out of 1 points

Which of the following is a value-reducing reason for diversification?

a. enhancing the strategic competitiveness of the entire company

b. expanding the business portfolio in order to diversify managerial employment risk

c. gaining market power relative to competitors

d. conforming to antitrust regulation

Question 10

1 out of 1 points

In order to compete effectively, standard-cycle firms need all of the following EXCEPT

a. large market share.

b. customer loyalty through brand name.

c. careful control of operations to preserve consistency for customers.

d. rapid and continuous product introductions

Question 11

1 out of 1 points

Two firms, such as Fed Ex and UPS that have similar resources and common markets would be direct and mutually acknowledged competitors.

True

False

Question 12

1 out of 1 points

It is more likely that locally owned, one-location cafes in a small town will respond more rapidly to tactical actions by each other than they will to strategic actions by the Burger King franchise that has recently moved to their town.

True

False

Question 13

1 out of 1 points

Firms can increase their speed to market for new products by pursuing an internal product development strategy rather than an acquisition strategy.

True

Explanation & Answer

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