Question 1

What kind of market will have the least obstacles for new entrants?

Options :

A : Monopolistic competition

B : Monopoly

C : Perfect competition

D : Oligopoly

Answer: C

Question 2

A supplier is working with a buyer who represents a large percentage of his business. Without this particular buyer, the supplier would likely go out of business. There has been a dispute in the last invoice which the buyer is not happy about. What technique should the supplier use when talking to the buyer about this?

Options :

A : Competing- the supplier needs to earn more money as they are struggling financially

B : Avoiding- the supplier should avoid talking with the buyer as this may result in conflict

C : Accommodating- the supplier should show a large degree of co-cooperativeness as the buyer is important to their survival

D : Accepting – the supplier should accept that conflict should sometimes occur in buyer: supplier relationships and work hard to avoid them

Answer: C

Question 3

To maintain their low-cost strategy, Company A’s top executives are redesigning their value chain. They think that each value chain activity does not affect the others. Is this a valid assumption?

Options :

A : Yes, because each activity is different from the others

B : Yes, the cost of each activity is independent of the others

C : No, because there are linkages between activities

D : No, because only primary activities are interrelated

Answer: C

Question 4

Lene Group plans to start a Supplier Development Programme (SDP) to help small and medium sized suppliers improve their performance and expand their business in key areas for the Group. Lara needs to discover the objectives and advantages of this programme for both the Group and the suppliers. What is a fact about supplier development programme?

Options :

A : The supplier development programme for developing suppliers should have measurable outcomes that benefit the business.

B : There is only one universal approach to supplier development

C : Only the buyer’s willingness is required for supplier development programme, which is a onesided activity.

D : All the Group’s suppliers must participate in a supplier development programme.

Answer: A

Question 5

To enhance its product quality, Company A wants to use a new technology called HPP that is patented by Company B. What does Company A need to get from Company B to use this technology?

Options :

A : A patent term

B : License

C : Copyright clause

D : Exclusion clauses

Answer: B

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