1. For successful smaller businesses, market share may serve as a strategic cont

Question

1. For successful smaller businesses, market share may serve as a strategic control barometer, as some businesses may strategically plan to maintain a low market share.

True

False

2. Which of the following is not true about market share?

Some firms seek a high market share.

Some firms seek a low market share.

Increases in market share can enhance firm profitability.

Increases in market share limit the expansion of scale economies.

3. The informal organization

is static.

is flexible.

requires a mandate from top management in order to change.

All of the above.

4. Strategic control may be exerted by all of the following except

the firm’s vice presidents.

top managers of close competitors.

individuals outside of the top management team.

the CEO.

Some firms seek a high market share.

Some firms seek a low market share.

Increases in market share can enhance firm profitability.

Increases in market share limit the expansion of scale economies.

Explanation / Answer

1. True. The small market share may be strategic victory for a small business to survive in large competition

2. Increases in market share limit the expansion of scale economies.With increase in market share, more number of products need to be produced and thus will provide chances for higher scale economies.

3. is flexible. Compared to a formal organization which has more rules and rigid structure, informal roganization is flat and fluid.

4. top managers of close competitors. External macro factors influence strategic control, but individuals outside organization will have lesser or no control.

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