Page 144 - BA1 Integrated Workbook STUDENT 2018

Subject E3: Strategic Management

4.3 PGC operates a chain of garden centres in the northern half of country H. It
dominates the market in this part of the country, while the southern half of
country H is dominated by one of its rivals – PPL.

Historically, whenever PGC has tried to open new garden centres in the
southern half of the country, PPL has reacted aggressively with heavy local
advertising, price cuts and promotions. This has tended to make the new PGC
garden centre uneconomic.

Which of the following options correctly identifies the type of competitor
response undertaken by PPL?

A Tiger

B Stochastic

C Selective

D Laid back

4.4 CCC manufactures motorbikes and is considering entering the market in
country Q. While CCC is very successful, it faces little competition in its home
country. Country Q already has a flourishing motorbike industry which is
experiencing high growth.

Which of the following options correctly identifies the dimension of
Porter’s diamond model that could cause CCC’s expansion into country Q
to fail?

A Demand conditions

B Factor conditions

C Related and supporting industries

D Strategy, structure and rivalry

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