38) Porter defined ________ as the amount of money that a customer is willing to pay for a resource, product, or service.
A) margin
B) profit
C) price
D) value
39) Which of the following is true of a value chain?
A) It is a network of value-creating activities.
B) It consists of only primary activities.
C) It is specific to manufacturing industries.
D) It nullifies the importance of support activities.
40) A business that selects a differentiation strategy ________.
A) adds cost to an activity, provided it has a positive margin
B) provides essential functions at lowest costs
C) imitates rival companies' strategy and products
D) always tries to price its products' higher than its competitors' products
41) The difference between the value that an activity generates and the cost of the activity is called the ________.
A) equity
B) liability
C) overhead
D) margin
42) Which of the following primary activities describes collecting, storing, and physically distributing products to buyers?
A) customer service
B) sales and marketing
C) outbound logistics
D) operations/management
43) Which of the following primary value chain activities induce buyers to purchase a product and provide a means for them to do so?
A) inbound logistics
B) sales and marketing
C) outbound logistics
D) operations/management
44) Which of the following statements describes a customer service activity?
A) receiving and storing materials
B) transforming customers' inputs into the final product
C) inducing buyers to purchase the product
D) assisting customers with the use of the product
45) Which of the following is true of supporting activities?
A) Their contribution toward a product's value is negligible.
B) Their contributions to margin can be calculated easily.
C) Customer service is considered as a supporting activity.
D) Negotiation of prices is considered as a supporting activity.
46) Each stage of the value chain not only adds value to the product but also ________.
A) improves supplier relationships
B) accumulates costs
C) devalues the final product
D) attracts competitors
47) Which of the following is a primary activity in the value chain?
A) process of finding vendors
B) setting up contractual arrangements
C) negotiating prices
D) delivering products to consumers