Acca paper F1 fia diploma in Accounting and Business Accountant in Business (AB/fab) exam kit

Under which heading of Porter’s five forces model would this issue be included? 
A 
Barriers to entry 
B 
Power of suppliers 
C 
Threat of substitutes 
D 
Power of buyers 
(2 marks)
113 
X Co offers accountancy training courses. The market is growing quickly and X’s courses are 
significantly different to those offered by its rivals. Any new company wishing to teach 
accountancy courses must obtain accreditation by the various accountancy organisations – 
a process which can take several years. 
Based on the above information, which of the following statements can be made about 
X’s competitive environment? 
A 
Competitive rivalry is likely to be low 
B 
Supplier power is likely to be low 
C 
Barriers to entry are likely to be low 
D 
The threat of new entrants is likely to be low
 (2 
marks) 
114 High industry fixed costs would NOT be expected to be an issue within which one of 
Porter’s five forces? 
A 
Competitive rivalry
B 
Threat of substitutes
C 
Barriers to entry
D 
Power of customers
 (2 
marks) 
115 When considering Porter’s value chain analysis, outbound logistics is: 
A 
receiving, handling and distributing inputs to the production system 
B 
using rational approach to solving problems 
C 
informing customers about the products a company has to offer 
D 
distributing the products to the customer
 (2 
marks) 
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PRA CTICE OBJE CTIVE TEST QUESTIONS : 
SECTION 1 
K APLA N PUBLISH ING 
27 
116 
AAH Co buys cable from a number of manufacturers, cuts it into shorter lengths and sells it 
to various retailers. One of its departments is solely responsible for the cutting of the cable.