Quiz 3 Chapter 2 & Case 16 Movie 1.

Major airlines change hundreds of fares daily in response to competitor's tactics, which is an example of using: switching costs corporate espionage competitive intelligence scenario analysis 2. PPG emphasizes ________ in its strategic planning; it develops four alternative futures based on two key variables, the cost of energy and the extent of growth opportunities in emerging markets. SWOT analysis strategic groups scenario analysis Porter's five-forces model

3. Typically, a firm has a substantial ability to control trends in its general environment if it is able to correctly predict them. False 4. __________ is/are an important element of the political/legal segment of the general environment. (Refer To: Exhibit 2.3) Deregulation of utility and other industries Tort reform Americans with Disabilities Ace (ADA) All of these 5. Currency exchange rates are an example of which segment of the general environment? demographic political/legal economic global 6. Which of the following is NOT a reason that a manager should be familiar with Porter's fiveforces model? It clarifies whether your firm should remain in or exit an industry It helps justify changes in resource allocation It identifies which demographic trends will be most important in the short-term It suggests methods for discouraging new rivals from competing against your firm

7. When is the bargaining power of the buyer greater than that of the supplier? when cost savings from the supplier's product are minimal when the volume of purchase is low when the buyer's profit margin is low when the threat of backward integration by buyers is low 8. If able to maintain a credible threat of forward integration, the power of suppliers will be enhanced. True 9. The more attractive the price/performance ratio of substitute products, the more tightly it constraints an industry's ability to charge high prices. True 10. What trends in the general external environment might make the movie theater business a study in contradictions? Many people now have home theaters with large-screen TVs and Hi Def sound systems. Movies are expensive that's why when economy declines, people don't go to the movies. The age group of core movie goers is not growing Technology such as IMAX, 3D improves movie theater experience but also enable distribution via Internet and Netflix-type of services 11. There are 3 primary revenue sources for movie exhibitors: concessions, advertising, and boxoffice receipts. Which typically generates (1) the most revenue and (2) the most profit? Advertising, Concessions Advertising, Box-office Box-office, Advertising Box-office, Concessions Concessions, Advertising