1. From a value-creation perspective, is it more important for a company to know where to compete or how to compete? That is, is it more important to play in the right markets or to be the best player in your current (less attractive) market?

2. Why do firms in the pharmaceutical and biotechnology industries typically sustain higher ROICs than firms in the hardware and equipment industries?

3. Why are competitive advantages based on brands, as in the consumer goods industry, often more important for long-term value creation than advantages based on product quality or innovation? 4. Explain the difference between ROICs excluding and ROICs including goodwill for U.S. companies: what does this difference imply, and why has it increased so much over the past decade?