Question

1. Some companies change a competitive game successfully, so that they help their competitors as well as themselves. For example, Lending Club is among the new online lenders disrupting the consumer finance industry. But Lending Club is working with Citigroup—a traditional player in that market space—to extend the reach of both players into low-income borrowing markets. This approach is known as:

A) Co-opetition

B) a blue ocean strategy

C) a disruptive strategy

D) a red ocean strategy

2. The intensity of competition in a market can be low, moderate, or high. Which of the following conditions are NOT characteristic of markets with highly intense competition?

A) Rapidly escalating profits

B) Price wars

C) High advertising spending

D) Frequent new product introductions

3. True or false: In industries characterized by perfect competition, a firm can achieve maximum profitability.

4. True or false: A competitive advantage is considered sustainable when rivals cannot replicate it in the immediate future.

5. Which of the following is NOT an offensive competitive strategy?

A) Comparative advertising

B) First-mover advantage

C) Offering differentiation

D) Launching a fighter brand

6. The PARTS acronym is used to specify the components of a competitive game and provide a framework for analyzing that game. The S in PARTS stands for:

A) Segment

B) Strategy

C) Scope

D) Sustainable advantage

Answer 1

Solution:

1. Option A: Coopetion
   This is a phenomenon when two competitors work together using each other's resources to mutually benefit from the situation of the market. Hence, two or more firms participate to operate with the cooperation and work together to rip benefits mutually. Hence, Option A
   
2. Option A: Rapidly Escalating profits
   In perfect competition, the market is near-saturated and hence the firms mainly operate on the price to gain the customers. Also, in perfect competitive market earning rapidly escalating profits very unlikely because the market is saturated and gaining rapid profits unlikely. Hence, Option A
   
3. False
   In perfect competition, the market has many players competing in the market. Hence, the firms in perfectly competitive markets will not achieve maximum profitability because this scenario is highly unlikely. Hence, the statement is False.
   
4. False
   Sustainable competitive advantage is the advantage a firm has on its competitors for the long term and not short term. Hence, competitors may not be able to replicate the competitive advantage of the company for a longer time. Hence, the statement made is false.
   
   
   **Can answer only 4 as per Chegg Policy**