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Which of the following examples describes the task of an alliance manager?


A) Sophia oversaw the agreement between her company and the potential alliance partner and offered support when needed.
B) Ira used his knowledge of digital watches to help him to manage the day-to-day operations of the alliance.
C) Natasha reviewed the alliance portfolio to make sure it fit with the corporate strategy of her firm.
D) Fyodor trained the employees of his alliance partner in the skills needed to create a display for an e-notebook.

E) C) and D)
F) All of the above

Correct Answer

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Partner compatibility and partner commitment are necessary conditions for successful alliance formation.Partner compatibility captures


A) aspects of cultural fit between different firms in an alliance.
B) features of the financial health of the different alliance partners.
C) the readiness to accept short-term sacrifices to ensure long-term awards.
D) the willingness to make available necessary resources.

E) B) and D)
F) A) and B)

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One of the first new business apps resulting from the alliance of Apple and IBM will help airline pilots determine the right amount of fuel to carry on a particular flight.This task not only requires significant data analytics but also the need to display the information in an easily understandable way so that pilots can digest it quickly when glancing on their iPad in a cockpit prior to departure.Which of the following parts of this example will Apple be responsible for?


A) the organization and analysis of data analytics
B) the display of information in an easy-to-understand way
C) the determination of the amount of fuel to carry on a flight
D) the arrangement of the cockpit to facilitate the use of the iPad

E) C) and D)
F) B) and D)

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What causes the winner's curse?


A) buying a firm with principal-agent problems
B) overpaying for an acquisition
C) buying a firm with a competitive disadvantage
D) underpaying for an acquisition

E) A) and B)
F) None of the above

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In the New United Motor Manufacturing,Inc.(NUMMI) joint venture,why did Toyota enter into a strategic alliance with General Motors (GM) ?


A) to access GM's completely new production system
B) to learn and implement the just-in-time inventory system pioneered by GM
C) to learn how to implement its lean manufacturing program with an American workforce
D) to access GM's distribution system and marketing expertise

E) A) and B)
F) B) and C)

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_____ are best described as contractual alliances in which the participants regularly exchange codified knowledge.


A) Cartels
B) Licensing agreements
C) Equity alliances
D) Acquisitions

E) All of the above
F) A) and D)

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In a strategic alliance,the firm that learns faster


A) has the tendency to lose its competitive advantage.
B) has the incentive to reduce its knowledge sharing.
C) has the tendency to move up a learning curve.
D) has the incentive to invest further in the alliance.

E) All of the above
F) A) and B)

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The success of the Pixar-Disney strategic alliance demonstrated that


A) Disney was in desperate need of Pixar's graphic display systems.
B) the two entities' complementary assets matched.
C) it was easier for the alliance partners to reduce the value gap created.
D) the companies were effectively managing an unrelated diversification strategy.

E) A) and C)
F) All of the above

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Dream Slope Inc.is a leader in producing winter sports equipment,including skis and skates.Recently,the firm decided to expand into the bobsled market and acquired Sleek Phantom Inc.This company produced bobsleds,but its sales had slowed.The managers of Dream Slope convinced themselves that they were able to manage the business of Sleek Phantom more effectively even though they had no experience in the bobsled market.However,this move backfired and the sale of Sleek Phantom's bobsleds plummeted.Which of the following terms is often used to describe this scenario?


A) managerial disadvantage
B) managerial hubris
C) managerial sympathy
D) managerial empathy

E) A) and B)
F) C) and D)

Correct Answer

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Why did Quaker Oats Company's acquisition of Snapple fail?


A) strong competitive disadvantage
B) managerial hubris
C) inferior acquisitions ability
D) shareholder unrest

E) A) and C)
F) A) and B)

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Google,the leader in online search and advertisement,engaged in a number of smaller acquisitions of tech ventures.It did this in order to


A) imitate the actions of its competitors like Apple and Facebook.
B) solve its principal-agent problems.
C) fill gaps in its competency lineup.
D) expand through unrelated diversification.

E) A) and B)
F) A) and C)

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Which of the following statements is true of joint ventures?


A) They enable the exchange of both tacit and explicit knowledge.
B) They reduce the possibilities of trust and commitment.
C) They are characterized by single reporting lines.
D) They cannot entail long negotiations.

E) B) and D)
F) B) and C)

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Which of the following is an advantage of equity alliances when compared to non-equity alliances?


A) They are more flexible and easy to initiate and terminate.
B) They require smaller capital investments.
C) They produce stronger ties between partners.
D) They are based on contracts rather than ownership.

E) A) and C)
F) B) and C)

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Which of the following best illustrates a merger between the two companies GD Inc.and VS Inc.?


A) GD Inc. purchases VS Inc. for $80 billion despite VS Inc. being against the purchase.
B) GD Inc. and VS Inc. join together to form a third new entity, while they also operate separately.
C) GD Inc. outsources a few of its business activities to VS Inc. for competitive advantage.
D) GD Inc. and VS Inc. join together to form a single new company called GDVS Inc.

E) All of the above
F) A) and D)

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In terms of the build-borrow-or-buy framework,a firm's internal resources are considered to be relevant when they are


A) similar to those that need to be developed and superior to those of competitors in the targeted area.
B) similar to those that need to be developed and inferior to those of competitors in the targeted area.
C) different from those that need to be developed and superior to those of competitors in the targeted area.
D) different from those that need to be developed and inferior to those of competitors in the targeted area.

E) All of the above
F) B) and D)

Correct Answer

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Which of the following is the best definition of a complementary asset?


A) an asset a firm needs to complete the value chain from upstream innovation to downstream commercialization
B) an asset a firm would like to add to its portfolio even though it is not vital to the running of the company
C) an asset a firm can use to attract a potential joint venture partner
D) an asset a firm keeps because it helps them maintain a strong image for marketing

E) A) and B)
F) None of the above

Correct Answer

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Which of the following reasons motivated Facebook to acquire Instagram,a photo and video-sharing social media site,for $1 billion in 2012?


A) the desire to gain a new capability
B) the need to enter a new geographical market
C) the need to reduce its level of horizontal integration
D) the desire to pursue an unrelated diversification strategy

E) A) and B)
F) A) and C)

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How does Kraft Foods benefit from its hostile takeover of Cadbury PLC in 2010?


A) Its main strategic focus is now on the domestic market.
B) It opens a market for it that is growing slowly but has high profit margins.
C) It has access to convenience stores and a new distribution channel.
D) It automatically gains monopoly in the chocolate-manufacturing industry.

E) All of the above
F) None of the above

Correct Answer

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Which of the following statements is true of explicit knowledge?


A) Explicit knowledge is about knowing how to do a certain task.
B) Explicit knowledge is knowledge that cannot be codified.
C) Explicit knowledge is shared in non-equity alliance firms.
D) Equity knowledge is acquired only through actively participating in a process.

E) All of the above
F) None of the above

Correct Answer

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How does taking a real-options perspective by entering strategic alliances help incumbent firms?


A) It helps the incumbent firms gain the confidence of the partnering company by making credible commitments.
B) It helps the incumbent firms reduce the value gap they create through their product and service offerings.
C) It allows the incumbent firms to buy time and wait for the uncertainty surrounding the market and technology to fade.
D) It reduces the incumbent firms' cost of acquisition by enabling them to make the entire investment decision in the beginning itself.

E) A) and C)
F) All of the above

Correct Answer

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