CHAPTER 5

TRUE

competitive behavior is developed when the firm responds prositively to competition

FALSE

in time of success the firms could just fold their arms and forget about their rivals

TRUE

business laurels are gain through sustained efforts and consistent strategy of innovation

TRUE

the climate of investment must be transparent and above the board of corruptions

FALSE

firms with similar resources and capabilities are likely to have different strength and weaknesses

FALSE

cost strategy could easily be overtaken by rival as everyone is towards cost reduction

TRUE

to improve market position firms usually make the first move to innovate and introduce new products in the market

TRUE

the second movers usually spend less in research and development as they imitate and copy with modification of product of the first mover.

FALSE

product advertising is the byword in competitive strategy in spite of less quality

FALSE

the rivals in the market are affected by the speed of product positioning

Three important factors that affect market rivalry

Factors that determines the degree to which firms are competitors

The drivers of competitive behavior for individual firms

The likelihood that the competitor will attack or respond

Five strategies and advantage of small firms in competitive rivalry

Lower investment cost in research and development

Lower fixed and overhead expenses

Technology and resource base through imitation

Quicker and flexibility in action and response

Lower product price with new features

Enumerate the advantages of the first mover in the market.

Consumer’s loyalty to the product is developed

Satisfied customer became committed to the product