QUIZ 5 ECON 550 MBA page 1 of 3
Chapters 9 + 10 in Textbook 26 Questions
Chapter 9
1. With the case studies of airlines, how did seasonal time affect the business?
2. With the case studies of airlines, how did airline differentiate themselves?
3. With the case studies of airlines, when 1 airline increased their pricing but others did not, what happened and why?
4. With the case studies of airlines, what caused most of the airlines to increase their prices?
5. With the case study of the doughnut industry; Krispy Crème Doughnuts USA bases and Tim Horton’s Canadian company; what was their strategy to expand into each other geographic area?
6. With the 2 competing doughnut companies, how did they differentiate themselves to get a competitive advantage?
7. When entering a new market or a new geographic market area, what is ‘Cooperative Oligopoly Model’ (small number of large competitors)?
8. When entering a new market or a new geographic market area, what is ‘Non-Cooperative Oligopoly Model’?
9. With the case study of the German company of DHL trying to enter the US market with UPS/United Parcel Service & Fed X, USA companies, did the German company have to conform to and obey USA laws and regulations and how did this affect their success entering the USA market?
10. What is ‘Predatory Pricing’?
11. With the lawsuit case of the Japanese Electronic company Matsushita versus USA Zenith Electronic Company; even though Matsushita company was using ‘Predatory Pricing Strategy; the Japanese company won the USA law suit and gained market entry; why did the Japanese company win?
12. What is an ‘International Cartel’ and give example?
13. What is the problem with ‘Cartels’?
Page 2 of 3
14. What are the 3 things that need to happen with a Cartel for it to be successful?
15. Are ‘Cartels’ legal in the USA?
16. What is the biggest risk for a large company
usiness to increase their pricing hoping other similar companies will do the same?
Chapter 10
Math Example of 2 different methods to calculate pricing (Both have the same Cost)
You need to learn this for business.
(textbook pages XXXXXXXXXXsimplified for you)
Math Method A to calculate price and profit
$10. Cost + 10% profit margin = $11. Price
$11. Price - $10. Cost = $1. Profit
Vs.
Math Method B to calculate price and profit
$10. Cost = XXXXXXXXXX%) of X (the price)
10 = .90 of X
10 divided by .90 = X (price) (to solve for X the price, basic alge
a math)
$11.11 Price
$11.11 price - $10. Cost = $1.11 Profit
To get the same Profit amount using ‘Mark-up’ / same as ‘Cost Plus Method’ to calculate
You would need to do $10 + 11% profit margin = $11.11 price
Can you see the difference in the math of 2 different methods to calculate price & profit? Study this.
17. Of these math examples which one is ‘Mark-up/Cost Plus Pricing Method’?
Page 3 of 3
18. Of these math examples, which one is ‘Marginal Revenue Pricing Method’?
19. Of these math examples, which one has higher pricing?
20. Of these math examples, which one has the higher profit?
21. What is ‘Price Discrimination’ and give examples?
22. What is ‘Group Pricing Strategy’ and give examples?
23. What is ‘Versioning Pricing Strategy’ and give examples?
24. What is ‘Bundling Pricing Strategy’ and give examples?
25. What is ‘Promotional Pricing Strategy’ and give examples?
26. What is ‘Two-Part Pricing’ (same as quantity pricing) and give examples??
Microsoft Word - Strategic Entrepreneurship.doc
Strategic Entrepreneurship
Edited by: Michael A. Hitt, R. Duane Ireland, S. Michael Camp And Donald L. Sexton
CHAPTER ONE. Strategic Entrepreneurship:
Integrating Entrepreneurial and Strategic Management
Perspectives
Michael A. Hitt, R. Duane Ireland, S. Michael Camp and Donald L. Sexton
DOI: XXXXXXXXXX
XXXXXXXXXX00001.x
A new competitive landscape developed in the 1990s (Hitt, Ireland, and Hoskisson,
2001d). Filled with threats to existing patterns of successful competition as well as
opportunities to form competitive advantages through innovations that create new
industries and markets, this landscape was characterized by substantial and often frame-
eaking change, a series of temporary, rather than sustainable competitive advantages
for individual firms, the criticality of speed in making and implementing strategic
decisions, shortened product life cycles, and new forms of competition among global
competitors (Bettis and Hitt, 1995; Hitt, 2000; Hitt et al., 2001c; Hitt, Keats, and
DeMarie, 1998; Ireland and Hitt, 1999).
The essence of the new competitive landscape remains a dominant influence on firm
success in the twenty-first century. Indeed, the landscape's characteristics combine and
interact to create an environment in which revolutionaries (entrepreneurial actors) have
the potential to (1) capture existing markets in some instances while creating new ones in
others, (2) take market share from less aggressive and innovative competitors, and (3)
take the customers, assets, and even the employees of staid existing firms (Hamel, 2000).
In this setting, entrepreneurial strategies for both new ventures and established firms are
ecoming increasingly important as their link to firm success receives additional
validation (Bettis and Hitt, 1995; Hitt et al., 2001c; Ireland et al., 2001a). Entrepreneurial
strategies are the embodiment of what some view as an entrepreneurial revolution
occu
ing in nations across the globe, including some countries characterized as emerging
economies (Mo
is, Kuratko, and Schindehutte, 2001; Zahra, Ireland, and Hitt, 2000b).
An entrepreneurial mindset is required for firms to compete successfully in the new
competitive landscape through use of carefully selected and implemented entrepreneurial
strategies. An entrepreneurial mindset denotes a way of thinking about business and its
opportunities that captures the benefits of uncertainty. These benefits are captured as
individuals search for and attempt to exploit high potential opportunities that are
commonly associated with uncertain business environments (McGrath and MacMillan,
2000).
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b28
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b28
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b9
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b22
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b27
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b29
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b29
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b31
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b21
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b9
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b27
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b32
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b47
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b22
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b45
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b45
The twenty-first century's competitive landscape and the vital entrepreneurial strategies
for competitive success demand effective strategic and entrepreneurial actions (Ireland et
al., 2001a; Kuratko, Ireland, and Hornsby, 2001; Porter, XXXXXXXXXXStrategic actions are
those through which companies develop and exploit cu
ent competitive advantages
while supporting entrepreneurial actions that exploit opportunities that will help create
competitive advantages for the firm in the future. A competitive advantage results from
an enduring value differential in the minds of customers between one firm's good o
service and those of its rivals (Duncan, Ginter, and Swayne, XXXXXXXXXXEntrepreneurial
actions are actions through which companies identify and then seek to exploit
entrepreneurial opportunities rivals have not noticed or fully exploited (Ireland et al.,
2001a). Entrepreneurial opportunities are external environmental conditions suggesting
the viability of introducing and selling new products, services, raw materials and
organizing methods at prices exceeding their production costs (Casson, 1982; Shane and
Venkataraman, XXXXXXXXXXRelying on earlier arguments (e.g., Casson, 1982; Kirzner, 1973),
Alvarez and Barney XXXXXXXXXXargue that entrepreneurial opportunities surface when actors
have insights about the value of resources or a combination of resources that are
unknown to others.
Strategic entrepreneurship is the integration of entrepreneurial (i.e., opportunity-seeking
actions) and strategic (i.e., advantage-seeking actions) perspectives to design and
implement entrepreneurial strategies that create wealth (Hitt et al., 2001c). Thus, strategic
entrepreneurship is entrepreneurial action that is taken with a strategic perspective.
Venkataraman and Sarasvathy XXXXXXXXXXrefe
ed to such activity as Romeo (entrepreneur)
on the balcony (strategy).
Integrating entrepreneurial and strategic actions is necessary for firms to create maximum
wealth (Ireland et al., 2001a). Entrepreneurial and strategic actions are complementary,
not interchangeable (McGrath and MacMillan, 2000; Meyer and Heppard, 2000).
Entrepreneurial action is designed to identify and pursue entrepreneurial opportunities.
Thus, it is valuable in dynamic and uncertain environments such as the new competitive
landscape because entrepreneurial opportunities arise from uncertainty. Entrepreneurial
action using a strategic perspective is helpful to identify the most appropriate
opportunities to exploit and then facilitate the exploitation to establish competitive
advantages (hopefully ones that are sustainable for a reasonable period of time).
Because of its value to firms competing in a competitive landscape characterized by
uncertainty, discontinuities, and rapid change, this book focuses on strategic
entrepreneurship. Several domains important to both strategic management and
entrepreneurship are examined herein. Individual chapters identify entrepreneurial
strategies and how they can be effectively implemented to create new ventures (eithe
independent startups or new units within established organizations) that produce
enhanced wealth. Herein, outstanding entrepreneurship and strategic management
scholars advance novel and path-
eaking ideas that have the potential to meaningfully
contribute to both fields and inform our understanding of wealth creation in organizations.
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b32
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b32
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b37
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b50
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b15
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b32
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b32
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b12
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b55
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b55
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b12
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b36
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b3
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b27
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b58
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b32
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b45
http:
www.blackwellreference.com/subscribe
uid=1050/tocnode?id=g9780631234104_chunk_g XXXXXXXXXX#b46
Our book begins with two chapters in which the intersections and inte
elationships
etween the entrepreneurship and strategic management fields are examined. Following
these chapters is one presenting different perspectives about entrepreneurial strategies.
Entrepreneurship and Strategic Management
Entrepreneurs create goods and services and managers seek to establish a competitive
advantage with the goods and services created. Thus, entrepreneurial and strategic actions
are complementary and can achieve the greatest wealth when integrated. In their chapter,
Meyer, Neck, and Meeks explain the intersection between entrepreneur-ship and strategic
management while simultaneously emphasizing the differences. They suggest, fo
example, that entrepreneurship focuses on creation while strategic management focuses
on building a competitive advantage (firm performance). Additionally, they note that the
entrepreneurship and strategic management fields have had different foci in the size of
firms. Entrepreneurship has largely examined small businesses while strategic
management concentrates on large businesses. However, they emphasize that the primary
interface is creation-performance. In the framework presented earlier, the creation-
performance relationship involves both opportunity-seeking and advantage-seeking
actions, the integration of which we refer to as strategic entrepreneurship. Meyer et al.
also suggest that two other intersections requiring further study are corporate
entrepreneurship and the strategies and resulting performance of small and medium-sized
usinesses. Important issues, both are explored in other chapters in this book.
Michael, Storey, and Thomas's chapter also examines the intersection of strategic
management and entrepreneurship. Reaching a conclusion that differs from that of Meye
et al., they suggest that strategic management represents the “unrecognized union”
etween two fields – one concentrating on coordination and prevention of loss and the
other focusing on the creation of future businesses. They refer to these fields as
administrative management and entrepreneurial