MCQs on Evaluating Strategic Options


When evaluating a strategy, management should consider whether an individual strategy involves an unacceptable amount of risk. If it does, it should be
MCQs on Evaluating Strategic Options | MCQs.CLUB

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MCQs on Evaluating strategic options

When evaluating a strategy, management should consider whether an individual strategy involves an unacceptable amount of risk. If it does, it should be eliminated from further consideration in the planning process. Here on MCQs.CLUB we have written helpful Multiple-Choice Questions (MCQs) on How to Evaluate Corporate Strategy, Evaluating strategic options that fully cover practice questions and quizzes on strategic options its tools,  framework, with examples and types, evaluation of strategic alternatives using SAF Strategy Model, the exit and product strategy options, business strategy options, Qualitative evaluation of strategic choice. These MCQ on Questions on Strategy Evaluation are also useful for competitive exams, business management exams and professional accountancy exams.

  1. Strategic choices are evaluated according to their:
    1. suitability (to the organisation and its current situation)
    2. feasibility (e.g. in terms of usefulness or competences)
    3. acceptability (e.g. to relevant stakeholder groups)
    4. All of the above
  1. A company should consider the overall important strategic issues when assessing the suitability of an option, such as:
    1. Does it fit with any existing strategies which the company is already employing, and which it wants to continue to employ?
    2. How well does the option actually address the company’s strategic issues and priorities?
    3. Will the option contribute to a sustainable competitive advantage for the company, in the light of the competitive environment?
    4. All of the above
  1. The acceptability of a strategy relates to whether it is acceptable to an organisation’s stakeholders. It is particularly important that any potential strategy is acceptable to these key stakeholders.
    1. True
    2. False
  1. Feasibility asks whether the strategy can in fact be implemented. Strategies which do not make use of the existing competences, and which therefore call for new competences to be acquired, might not be feasible.
    1. The above statement is correct
    2. The above statement is incorrect
  1. Which of the following is correct?
    1. Risk is sometimes used to describe situations where outcomes are not known, but their probabilities can be estimated.
    2. Uncertainty is present when the outcome cannot be predicted or assigned probabilities.
    3. Both A&B
    4. None
  1. Types of risk are:
    1. Physical risk, Economic risk, Financial risk
    2. Business risk, Political risk and Competitor risk
    3. Both A&B
    4. None
  1. If the primary financial target can be converted into a target rate of return for individual capital projects, how can risk be expressed in practical terms for decision makers?
    1. A premium for risk can be added to the target DCF rate of return.
    2. To protect cash flows, it might be made a condition of all new capital projects that the project should pay back within a certain period of time, say three to four years.
    3. Both A&B
    4. None
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