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BA499- Week 4 Quiz - Chapters 7 and 8

Question 1

4 / 4 pts

Private synergies are unique to the acquired and acquiring firms and could not be developed by combining either firm's assets with another company.

Correct!

True

False

Question 2

0 / 4 pts

An investor is analyzing two firms in the same industry which are basically identical. She is looking for long-term performance from her investment. Both firms are undergoing restructuring. One firm is involved in substantial downsizing, and the other firm is undertaking aggressive downscoping. The investor should invest in the:

You Answered

downscoping firm because the higher debt load will discipline managers to act in shareholders' best interests.

Correct Answer

downscoping firm because this will cause the firm to refocus on its core business.

downsizing firm because it will be making decisions based on tactical strategies.

downsizing firm because it is eliminating employees who are essentially "dead weight" and are dragging down the firm's profitability.

Question 3

4 / 4 pts

Research has shown that approximately what percent of mergers and acquisitions, while not clear failures, produce disappointing results?

20

35

Correct!

60

75

Question 4

4 / 4 pts

In the current global landscape, firms from North America and Europe use the acquisition strategy more frequently than firms from other nations.

True

Correct!

False

Question 5

4 / 4 pts

Synergy is created by the efficiencies derived from economies of scale and economies of scope and by sharing resources across the businesses in the newly created firm’s portfolio.

Correct!

True

False

Question 6

4 / 4 pts

A licensing agreement:

results in two firms agreeing to share the risks and the resources of a new venture.

is the best way to protect proprietary technology from future competitors.

Correct!

allows a foreign firm to purchase the right to manufacture and sell a firm's products within a host country.

can be greatly impacted by currency exchange rate fluctuations.

Question 7

4 / 4 pts

International associations such as the European Union, the Organization of American States, and the North American Free Trade Agreement encourage regionalization strategies rather than globalization.

Correct!

True

False

Question 8

4 / 4 pts

All of the following are reasons why firms use international strategic alliances EXCEPT:

sharing of risks and resources.

alliances facilitate the development of new capabilities.

learning new competencies particularly those related to technology.

Correct!

strategic alliances are easy to manage.

Question 9

4 / 4 pts

RoserOpp Corp. has begun to increase its commitment to international diversification. Stakeholders should expect an initial decrease in returns, followed by a quick increase as RoserOpp learns how to manage its increased geographic diversification.

Correct!

True

False

Question 10

4 / 4 pts

A fundamental reason for a country's development of advanced and specialized factors of production is often its:

Correct!

lack of basic resources.

monetary wealth.

small workforce.

protective tariffs.


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