Question 1

aq.swot.007_1802
Which of the following is not an example of an internal factor in SWOT
analysis?
Physical assets
Human skills
Customer demographics
Reputation and Brand
This Answer is Correct
This is not an example of an internal factor in SWOT analysis.
Question 2
tb.swot.011_1805
Which of the following statements concerning strategic planning is correct?
A company selling paint likely uses a longer time frame for strategic planning than does a
company selling women's clothing.
A company selling paint and a company selling women's clothing both likely use a 3-year time
frame for strategic planning.
A company selling paint likely uses a shorter time frame for strategic planning than does a
company selling women's clothing.
A company selling paint may use a longer or shorter time frame for strategic planning than
does a company selling women's clothing, depending on management's preferences.
This Answer is Correct
The appropriate time frame to use for strategic planning varies depending on
factors such as the intensity of competition and how quickly products and
services change. Organizations facing less intense competition and selling
products and services that change less quickly typically use longer time
frames for strategic planning than do other organizations. A company selling
paint likely faces less competition and less rapid product changes than does a
company selling women's clothing. As a result, the company selling paint
likely uses a longer time frame for strategic planning; therefore, this is the
correct answer.
Question 3
tb.swot.014_1805
Which of the following is not an external factor that should be analyzed
during the strategic planning process?
A greater number of political leaders calling for an increase in tariffs on imported goods
The ability of workers to operate a new generation of manufacturing equipment
A reduction in expected economic growth in markets where a company operates
A major competitor going out of business
You Answered Correctly!
An organization needs to analyze external factors that could have an impact
on its ability to achieve its goals and objectives as part of the strategic
planning process. These external factors can create opportunities or threats
to the organization. While the ability of workers to operate a new generation
of manufacturing equipment likely impacts the company's ability to achieve
its goals and objectives, this is an internal factor, not an external factor;
therefore, this is the correct answer.
Question 4
tb.swot.012_1805
Which of the following is an external factor that should be analyzed during
the strategic planning process?
A company acquiring your largest competitor and investing money in the company
The ability of a manufacturing company to reduce waste such that selling prices can be
reduced
The ability of R&D personnel to develop a new product
The ability of a company to fund an expansion with operating cash flow
This Answer is Correct
An organization needs to analyze external factors that could have an impact
on its ability to achieve its goals and objectives as part of the strategic
planning process. These external factors can create opportunities or threats
to the organization. One type of external factor is changes in competition.
Changes in competition can have a positive impact on the organization
(opportunity) or a negative impact on the organization (threat). A company
acquiring your largest competitor and investing money in the company is an
example of a change in competition that can impact an organization;
therefore, this is the correct answer.
Question 5
tb.swot.004_1805
Which of the following is not a level at which companies develop strategies?
Functional
Mission
Corporate
Competitive
This Answer is Correct
Companies develop strategies at multiple levels. They can be developed at
the corporate, competitive, and functional levels. Strategies are not set at the
“mission” level because there is no such thing as the “mission” level;
therefore, this is the correct answer.
Question 6
1B1-W001
How is strategic planning different from strategy formulation?
Strategic planning addresses how to implement business strategies, whereas strategy
formulation results in new strategies.
Strategy formulation develops designs to implement strategies and achieve the goals, whereas
strategic planning creates strategies and defines goals.
Strategy formulation identifies the opportunities and threats in the short term, whereas
strategic planning continually reevaluates strategies based on perceived long-term
opportunities and threats.
Strategy formulation typically identifies external opportunities, limitations, and threats,
whereas strategic planning identifies internal factors, such as organizational strengths,
weaknesses, and competitive advantages.
This Answer is Correct
In practice, strategy formulation and strategic planning overlap quite a bit.
But the two processes have important conceptual differences. On a
fundamental level, strategy formulation results in new strategies, and
strategic planning addresses how to implement the strategies.
Question 7
tb.swot.006_1805
Which of the following statements concerning vision statements and mission
statements is correct?
A vision statement is the same thing as a mission statement.
A vision statement provides a clear statement about how the organization will work toward
achieving its mission while a mission statement expresses an organization's success in terms of
its contribution to society.
A vision statement results from an organization's strategic planning process but a mission
statement does not.
A vision statement expresses an organization's success in terms of its contribution to society
while a mission statement provides a clear statement about how the organization will work
toward achieving its vision.
You Answered Correctly!
A vision statement expresses an organization's success in terms of its
contribution to society while a mission statement provides a clear statement
about how the organization will work toward achieving its vision. They are
related to each other but not the same things; therefore, this is the correct
answer.
Question 8
tb.swot.005_1805
Which of the following statements concerning strategy levels is correct?
Functional-level strategies address what businesses a company should compete in.
Corporate-level strategies address areas such as marketing, operations, and R&D.
Competitive-level strategies address how an individual business unit creates value in its
industry.
The outcomes should be identical for the various levels of strategy in an organization.
This Answer is Correct
Companies develop strategies at multiple levels. They can be developed at
the corporate, competitive, and functional levels. Strategies at the
competitive level involve plans and objectives for an individual business unit.
For example, competitive-level strategies address how an individual business
unit creates value in its industry. Therefore, this is the correct answer.
Question 9
aq.swot.005_1802
The CEO of Chroma, Inc., a large multinational company, believes that the
company should prepare strategic plans at least once a year. However, the
company's president believes that strategic plans should not be changed
frequently and should be prepared only every three years. Which of the
following types of organization structures for Chroma would support the CEO's
position on the time frame of strategic plans for Chroma?
Chroma is in the business of publishing a trade magazine for the woodworking machinery
industry in Colorado.
Chroma is a leading provider of cutting-edge communication technology and functions in a
fast-moving and highly competitive market.
Chroma is the only seller of antique Asian musical instruments on the West Coast.
 Chroma's business comes primarily from the long-term contracts it has with the U.S.
government to carry out construction projects.
You Answered Correctly!
Organizations prepare strategic plans at different intervals depending on the
industry, the level of competition (e.g., new entrants), and how fast products
or services change. If Chroma is a provider of cutting-edge communication
technology in a fast-moving competitive market, it will need to revise and
prepare strategic plans at relatively short intervals.
Question 10
aq.swot.001_1802
Which of the following correctly describes strategy?
Strategy is the short-term planning and work of the organization. Strategy work is not the day-
to-day operations work of the organization, but strategy does guide that daily work in the
organization. Strategy provides a framework and feedback mechanism to evaluate the short-
term effects of daily work on the future of the organization.
Strategy is the long-term planning and work of the organization. Strategy work is the day-to-
day operations work of the organization, guiding that daily work in the organization. Strategy
provides a framework and feedback mechanism to evaluate the long-term effects of daily work
on the future of the organization.
Strategy is the short-term planning and work of the organization. Strategy work is the day-to-
day operations work of the organization, guiding that daily work in the organization. Strategy
provides a framework and feedback mechanism to evaluate the short-term effects of daily
work on the future of the organization.
Strategy is the long-term planning and work of the organization. Strategy work is not the day-
to-day operations work of the organization, but strategy does guide that daily work in the
organization. Strategy provides a framework and feedback mechanism to evaluate the long-
term effects of daily work on the future of the organization.
This Answer is Correct
This correctly describes strategy.
Question 11
AICPA.08211325BEC.V.A
Which of the following steps in the strategic planning process should be
completed first?
Translate objectives into goals.
Determine actions to achieve goals.
Develop performance measures.
Create a mission statement.
This Answer is Correct
The creation of the mission statement, the purpose of the organization, is the
first step in the strategic planning process. All strategies should be directly
derived from and consistent with the mission statement.
Question 12
tb.swot.003_1805
Which of the following statements concerning strategic planning is not true?
An organization's vision and mission flow from its strategic plan.
An organization's long-term goals are typically laid out in its strategic plan.
To help achieve its long-term goals an organization typically establishes milestones in its
strategic plan.
 An organization's strategic plan takes into consideration its industry, competitors, and
environment.
This Answer is Correct
An organization's strategic plan is a long-term plan that it uses to help it
achieve its long-term goals and mission. It is based on its vision and mission.
This means the strategic plan flows from its vision and mission, not the other
way around; therefore, this is the correct answer.
Question 13
1A1-LS14
Which of the following best describes the long-term goals and objectives of
an entity?
Sales forecast.
Master budget.
Strategic plans.
Capital expenditure
plan.
This Answer is Correct
The strategic planning process is part of the long-term planning of the firm
that focuses on the long-term goals and objectives of a firm. During this
process, the strengths and weaknesses of the firm are addressed and utilized
to develop a strategy to improve the firm.
Question 14
tb.swot.017_1805
Which of the following is an internal factor that should be analyzed during the
strategic planning process?
A greater number of political leaders calling for an increase in tariffs on imported goods
The availability of high-speed wireless access on customers’ ability to access your product
A major competitor going out of business
The ability of a tax return company to prepare returns that are error-free and on-time
This Answer is Correct
An organization needs to analyze internal factors that could have an impact
on its ability to achieve its goals and objectives as part of the strategic
planning process. These internal factors help ensure the organization has the
resources, skills, and processes in place to achieve its goals and objectives.
Internal factors can be strengths or weaknesses of the organization. The
ability of a tax return company to prepare returns that are error-free and on-
time represents an internal factor that should be analyzed during the
strategic planning process; therefore, this is the correct answer.
Question 15
aq.swot.002_1802
Which of the following correctly describes vision statement and mission
statement, respectively?
The mission statement describes what the organization intends to be or become and answers
the question, “Who are we?” The mission statement guides subsequently the development of
the vision statement. The vision statement describes what the organization is committed to do
or how it will act and answers the question, “What do we do?”
The vision statement describes what the organization intends to be or become and answers the
question, “Who are we?” The vision statement guides subsequently the development of the
 mission statement. The mission statement describes what the organization is committed to do
or how it will act and answers the question, “What do we do?”
The vision statement describes what the organization intends to be or become and answers the
question, “What do we do?” The vision statement guides subsequently the development of the
mission statement. The mission statement describes what the organization is committed to do
or how it will act and answers the question, “Who are we?”
The mission statement describes what the organization is committed to do or how it will act
and answers the question, “Who are we?” The mission statement guides subsequently the
development of the vision statement. The vision statement describes what the organization
intends to be or become and answers the question, “What do we do?”
You Answered Correctly!
This option correctly describes the vision statement and mission statement.
Question 16
aq.swot.010_1802
When using SWOT in designing strategy, which of the following describes an
S-T strategy?
Identify how to use our strengths to reduce exposure to threats.
Pursue opportunities that are a good fit to our strengths.
Overcome our weaknesses to pursue available opportunities.
Establish a plan to prevent threats from exploiting our weaknesses.
This Answer is Correct
This is the description of an S-T strategy.
Question 17
1B1-W009
Wishing-Well Inc., a chain of small convenience stores in Atlanta, Georgia, has
just opened a store in a rapidly developing suburb to the north of the city. The
marketing manager of Wishing-Well believes that the suburb is a lucrative
market, as the area has several expensive homes and offices but does not
have any other convenience stores or supermarkets. Which of the following is
likely to neutralize the opportunity offered by the new market?
Wishing-Well is well known for its unique offerings of local produce and organic
food.
The suburb has well-regarded public and private schools.
Abundant retail space is available for low rates in the suburb.
Wishing-Well has a popular rewards program for its regular customers.
This Answer is Correct
Inexpensive and abundant retail space will lower entry barriers for new
entrants, posing a threat to Wishing-Well's business.
Question 18
tb.swot.010_1805
Which of the following statements concerning strategic planning is correct?
A company selling electronic products to consumers may use a longer or shorter time frame
for strategic planning than does a company selling baseballs, depending on management's
preferences.
A company selling electronic products to consumers and a company selling baseballs both
likely use a 5-year time frame for strategic planning.
A company selling electronic products to consumers likely uses a longer time frame for
strategic planning than does a company selling baseballs.
 A company selling electronic products to consumers likely uses a shorter time frame for
strategic planning than does a company selling baseballs.
This Answer is Correct
The appropriate time frame to use for strategic planning varies depending on
factors such as the intensity of competition and how quickly products and
services change. Organizations facing more intense competition and selling
products and services that change more quickly typically use shorter time
frames for strategic planning than do other organizations. A company selling
electronic products to consumers likely faces more competition and more
rapid product changes than does a company selling baseballs. As a result, the
company selling electronic products to consumers likely uses a shorter time
frame for strategic planning; therefore, this is the correct answer.
Question 19
aq.swot.008_1802
The top management of Juno, Inc., a manufacturer of cell phones and laptops,
is in the process of conducting a SWOT (strengths, weaknesses, opportunities,
and threats) analysis of its business. Andrew Hudson, a vice president of the
company, lists the company's cutting-edge research and development
division as a strength as it helps the company design premium products of
high quality. However, Melanie Harris, the marketing manager, believes that
its research and development division is now a weakness rather than a
strength. Which of the following, if true, best supports Melanie's argument?
Juno operates in a legal environment where strict regulations are in place to protect intellectual
property rights.
Juno's cell phones and laptops continue to generate high profit margins.
Due to an economic slump, Juno's target consumers are becoming increasingly price sensitive.
The bulk of Juno's business comes from consumers who are identified as early adopters of
technology.
This Answer is Correct
If consumers' focus is on price and not on quality, Juno's investment in
research and development in premium product design is probably wasted. In
fact, the premium price will likely drive customers away.
Question 20
1B1-W018
Enscribe Inc. is a small firm that provides specialized, industry-oriented
articles and features to medical publications. Founded and run by a team of
physicians, Enscribe is a highly respected vendor in the market and has a
dominant market share. However, the firm's market currently is undergoing a
rapid expansion owing to a proliferation of online medical Websites. The chief
executive officer of Enscribe—Dr. Elliot—sees this as a massive opportunity
for the firm. However, the chief editor—Dr. Cruz—believes that this
development is a threat. Which of the following, if true, would strengthen Dr.
Cruz's conclusion?
The firm has always struggled to find good-quality new hires.
The medical publishing industry has high entry barriers that discourage new entrants.
The firm has been identified as a cash cow in a BCG Growth Matrix developed by its parent
firm.
The firm lists organizational learning as one of its strengths.
This Answer is Correct
If the firm has struggled to find good new hires, it probably will find it difficult
to scale up its team to meet burgeoning market demand. This will convert the
opportunity into a threat as Enscribe is likely to lose market share to new
entrants.
Question 21
1B1-W014
Which of the following components is assessed in an internal capability
analysis of an organization?
Resources
Export
Stakeholder demands
Accounting practices
This Answer is Correct
Internal capability analysis helps to ensure that the organization has the
resources, skills, and processes to reach its strategic and tactical goals.
Question 22
tb.swot.007_1805
Which of the following statements concerning vision statements
is not correct?
An organization's vision statement is based on its mission statement.
A vision statement expresses an organization's success in terms of its contribution to society.
A vision statement results from an organization's strategic-planning process.
A vision statement guides an organization as it works toward future success and achievement.
You Answered Correctly!
A vision statement expresses an organization's success in terms of its
contribution to society while a mission statement provides a clear statement
about how the organization will work toward achieving its vision. This means
an organization's mission statement is based on its vision statement, not the
other way around; therefore, this is the correct answer.
Question 23
aq.swot.003_1802
Which of the following correctly orders the steps in the Strategic Planning
Process?
Vision and Mission, Environmental Scanning, Strategy Implementation, Strategy Design,
Evaluation and Control
Environmental Scanning, Vision and Mission, Strategy Design, Strategy Implementation,
Evaluation and Control
Vision and Mission, Environmental Scanning, Strategy Design, Evaluation and Control,
Strategy Implementation
Vision and Mission, Environmental Scanning, Strategy Design, Strategy Implementation,
Evaluation and Control
This Answer is Correct
This correctly orders the Strategic Planning Process.
Question 24
tb.swot.001_1805
A country's political environment will likely affect which of the following?
 Long-range planning but not budgeting
Budgeting but not long-range planning
Both budgeting and long-range planning
Neither budgeting, nor long-range planning
This Answer is Correct
Long-range planning requires a company to consider factors that will likely
impact the company over the long term, while budgeting typically covers
periods of one year or less. A country's political environment includes items
such as regulatory action and taxes. These items are likely to impact long-
range decisions more than short-run decisions. The political environment will
likely affect long-range planning but not budgeting; therefore, this is the
correct answer.
Question 25
1B1-W017
Metis Corp., a large software services company, has benefited in the past
from having a strong, centralized leadership. The top management makes
decisions and sets goals for the entire organization and tasks mid- and low-
level managers with implementing these in Metis's teams. Which of the
following, if true, indicates that a centralized leadership is now more likely to
be a weakness than a strength for Metis?
Metis's top management now consists almost entirely of engineers who have worked for Metis
for a long time and have a high degree of expertise in the services the company offers.
Metis recently won its first contract to provide software services to the U.S. government.
Metis recently changed its business to focus more on product development, and its teams of
product developers cherish creative freedom and autonomy.
Metis's offices are located primarily in countries where organizational hierarchies are
respected.
This Answer is Correct
A centralized leadership is less effective when teams cherish creative
freedom and autonomy.
Question 26
tb.swot.015_1805
Which of the following is not an internal factor that should be analyzed during
the strategic planning process?
A new administration's attitude toward anti-trust regulation
The ability of a company's manufacturing equipment to handle an increase in volume from
expanding into a new geographic region
The ability of a company to fund an expansion with operating cash flow
The ability of a tax return company to prepare returns that are error-free and on-time
This Answer is Correct
An organization needs to analyze internal factors that could have an impact
on its ability to achieve its goals and objectives as part of the strategic
planning process. These internal factors help ensure the organization has the
resources, skills, and processes in place to achieve its goals and objectives.
Internal factors can be strengths or weaknesses of the organization. While a
new administration's attitude toward anti-trust regulation likely impacts the
company's ability to achieve its goals and objectives, this is an external
factor, not an internal factor; therefore, this is the correct answer.
Question 27
tb.swot.002_1805
Which of the following will likely affect budgeting but not long-range
planning?
A presidential election
A spike in sales at Christmas
Speculation that a new small company will be a major competitor in three years
Plans to expand production in two years
You Answered Correctly!
Since budgets typically cover periods of one year or less, a company needs to
take into consideration factors likely to impact the company over the next
year or less when preparing budgets. When a company makes long-range
plans, it needs to take into consideration factors likely to impact the company
over the long run. A spike in sales at Christmas would impact the company
over a short period of time but not over a longer period of time. That means it
would likely affect budgeting and not long-range planning. Therefore, this is
the correct answer.
Question 28
aq.swot.004_1802
Which of the following is the appropriate time frame for a strategic plan?
Always short-term
Commonly short-term but it depends on the industry
Commonly long-term but it depends on the industry
Always long-term
This Answer is Correct
Strategic plans are more commonly long-term, but depending on the industry,
sometimes strategic plans are shorter in term.
Question 29
aq.swot.009_1802
Which of the following is not an example of an external factor in SWOT
analysis?
The economy
Financial resources
Future technology trends
Competitive forces
You Answered Correctly!
This is not an example of an external factor in SWOT analysis.
Question 30
MQ2904
Which of the following statements properly defines “environmental
scanning”?
A form of benchmarking for companies that need to determine the best location for achieving
a competitive advantage by leveraging unique resources
A process in which an organization continuously gathers and evaluates information that could
impact its ability to compete
A process of seeking competitive ways to achieve sustainability by seeking to enhance
 products, processes, labor, and other resources as a way to acquire distinctive competencies
A strategy of constantly looking for ways to achieve a competitive advantage by finding new
ways of exploiting their distinctive competencies
This Answer is Correct
Environmental scanning is a process in which an organization continuously
gathers and evaluates information that could impact its ability to compete.
Question 31
aq.swot.006_1802
Which of the following is not one of the aspects or features of an
organization's environment?
Companies in the same geographical region that will never be customers or competitors
Suppliers and other stakeholders who may partner with the organization, including local
governments and community groups
The world in which the organization operates, which involves economic trends, government
and legal mandates, and demographic factors
The organization's internal structure, comprising employees, physical assets, financial
resources, intellectual property, etc.
You Answered Correctly!
This is not one of the aspects or features of an organization's environment.
Question 32
tb.swot.013_1805
Which of the following is not an external factor that should be analyzed
during the strategic planning process?
A new administration's attitude toward anti-trust regulation
The ability of a company's manufacturing equipment to handle an increase in volume from
expanding into a new geographic region
The availability of high-speed wireless access on customers’ ability to access your product
A company acquiring your largest competitor and investing money in the company
You Answered Correctly!
An organization needs to analyze external factors that could have an impact
on its ability to achieve its goals and objectives as part of the strategic
planning process. These external factors can create opportunities or threats
to the organization. While the ability of a company's manufacturing
equipment to handle an increase in volume from expanding into a new
geographic region likely impacts the company's ability to achieve its goals
and objectives, this is an internal factor, not an external factor; therefore, this
is the correct answer.
Question 33
tb.swot.008_1805
Which of the following statements concerning mission statements
is not correct?
An organization's mission statement is based on its vision statement.
A mission statement expresses an organization's success in terms of its contribution to society.
A mission statement should answer the question “Why are we in business?”
A mission statement results from an organization's strategic planning process.
You Answered Correctly!
A mission statement provides a clear statement about how the organization
will work toward achieving its vision. A vision statement, not a mission
statement, expresses an organization's success in terms of its contribution to
society; therefore, this is the correct answer.