BB309 – Strategic Management
Tutorial Questions
Chapter 2 – The External Environment

TRUE or FALSE QUESTIONS

The external environment facing business stays relatively constant over time.

False

Firms can directly control the elements of the seven segments of the general environment.

True

To successfully deal with today’s external environment and to achieve strategic competitiveness, firms must be aware and fully understand the different segments of that environment.

True

The industry environment directly influences the firm and its competitive actions and responses. (True or False)

When firms analyze the external environment, they typically have complete and unambiguous data. (True or False)

Scanning involves detecting meaning through early signals of environmental trends. (True or False)

Early adopters of new technology often achieve higher market shares and higher returns than later adopters of the technology. (True or False)

Compared with the general environment, the industry environment has a more indirect effect on the firm’s strategic competitiveness and ability to earn above-average returns. (True or False)

The main competitive factor facing newspaper companies is the existence of substitute products and services. (True or False)

The process of competitor analysis should examine the competitor’s future objectives, current strategy, assumptions, and capabilities.
(True or False)

MULTIPLE CHOICE QUESTIONS

1. The three parts of the external environment which affect a firms strategic actions are
|a. |economic, political, and legal |
|b. |general, industry, and competitor |
|c.