Which of the following reasons is not a reason that atlas door could lose competitive advantage?

Chapter 05

Business-Level Strategy: Creating and Sustaining Competitive Advantages

True / False Questions

1.A business-level strategy is a strategy designed for a multi-business company that competes across multiple

businesses.

True False

2.The three generic strategies that Michael Porter believes a firm can use to overcome the five forces and

achieve competitive advantage include overall price leadership.

True False

3.Concentrating solely on one form of competitive advantage generally leads to the highest possible level of

profitability.

True False

4.A firm striving for cost leadership will typically spend relatively more on product-related research and

development than on process-related research and development.

True False

5.To generate above average returns, a firm following an overall cost leadership position should not be

concerned with attaining parity or proximity on the basis of differentiation relative to its peers.

True False

6.The experience curve concept suggests that production costs tend to decrease as production increases.

True False

7.A firm can attain an overall cost leadership position by increasing the management layers in order to reduce

overhead costs.

True False

8.A firm can attain an overall cost leadership position by using automated technology to reduce scrappage

rates.

True False

5-1

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