6650 chapter 7 quiz

_____ is best described as the process of transformation of an idea into a new product or process, or the modification and recombination of existing ones. Lean manufacturing Bootstrapping Direct imitation Invention

Invention

Most of ElectraWork.com's revenues are generated from a few popular electronic devices like notebook computers and MP3 players. Yet, the company offers a wide product portfolio that includes kitchen appliances, televisions, and watches. Low-cost virtual shelf space and nominal inventory investments allow the online retailer to increase perceived customer value by offering them unlimited choices under the same platform. This, in turn, allows the company to increase its revenues by selling smaller quantities of more products. Which of the following business models does this scenario best illustrate? Razor-razor-blade business model Pay-as-you-go business model Subscription-based business model Long tail business model

Long tail business model

General Electric (GE) Healthcare introduced a portable ultrasound device at a price of less than $30,000 in developing countries against the $250,000 high-end ultrasound machine used in developed economies. This initiative best illustrates a(n): progressive innovation. incremental innovation. radical innovation. disruptive innovation.

disruptive innovation.

In a typical industry life cycle, an industry immediately moves to the _____ after the introduction stage. shakeout stage growth stage decline stage maturity stage

growth stage

Jacob bought his laptop and smartphone when these products had just entered their respective growth stages. More than the technological sophistication of these products, it was the idea that these products would allow him to multitask and work when traveling that drove him to make his purchase decision. Which of the following customer segments does Jacob best represent? Technology enthusiasts Early adopters Late majority Laggards

Early adopters

_____ is best described as the process by which people undertake economic risk to innovate—to create new products, processes, and sometimes new organizations. Crowdsourcing Cannibalization Entrepreneurship Headhunting

Entrepreneurship

If a pharmaceutical company develops a first-of-its-kind vaccine to prevent HIV AIDS and thus creates a whole new market for the product (non-infected civilians), it would be a(n): disruptive innovation. radical innovation. architectural innovation. incremental innovation.

radical innovation.

According to the crossing-the-chasm framework, a firm's transition between the different parts of the industry life cycle is difficult because: there are frequent changes in the supply and demand sides of the market throughout the industry life cycle. there is a big gulf separating the early adopters from customer segments that make up the mass market. the number and size of competitors change throughout the industry life cycle. the firm tends to follow a predictable industry life cycle

there is a big gulf separating the early adopters from customer segments that make up the mass market.

Which of the following statements about patents is NOT true? A patent can be obtained when an invention is useful, novel, and non-obvious. A patent is a form of intellectual property. A patent can be enforced in court. A patent over a product translates into a permanent monopoly position.

A patent over a product translates into a permanent monopoly position.

_____ is best described as a firm's ability to understand external technology developments, evaluate them, and integrate them into current products or create new ones. Minimum efficient scale Market liquidity Absorptive capacity Technical efficiency

Absorptive capacity

Arnold is a marketing and sales employee at Vibgyor Foods Inc. He has invented a new way to process and pack the company's food products that would avoid the usage of chemical preservatives. Which of the following terms best describes Arnold? A category captain A franchised dealer A venture capitalist An intrapreneur

An intrapreneur

In 2007, RIM's dominance over the smartphone market began to erode quickly with the introduction of Apple's iPhone. What was the reason for this? Technology enthusiasts claimed that the iPhone was a superior product when compared to the BlackBerry based on technological criteria. Apple's iPhone was able to cater to the needs of the mass market, both the early and late majority, better than RIM's Blackberry. While Apple pursued a low-cost strategy for its products, Blackberry opted for a differentiation strategy. Apple's iPhones had superior and more reliable encrypted security software when compared to that of Blackberry.

Apple's iPhone was able to cater to the needs of the mass market, both the early and late majority, better than RIM's Blackberry.

Relive Electronics Inc. follows a business model in which the performance of the company is not only based on how much profits were generated, but also on how the community in general benefited from its operations. Thus, the company under its "Plant a Life" campaign promises to plant a tree with every customer purchase. Which of the following terms best describes the business model of Relive Electronics? Offshoring Corporate intrapreneurship Crowdsourcing Social entrepreneurship

Social entrepreneurship

While the industry for 3D televisions is in the introduction stage, the industry for LCD televisions is in the maturity stage. What does this imply? The 3D television industry will focus on process innovation, whereas the LCD television industry will focus on product innovation. The 3D television industry will focus on pursuing an integration strategy, while the LCD television industry will focus on pursuing a differentiation strategy. The LCD television industry is likely to focus on achieving market acceptance, while the 3D television industry is likely to focus on the harvest strategy The market for LCD televisions has reached its maximum size, whereas the market for 3D televisions is still small in size.

The market for LCD televisions has reached its maximum size, whereas the market for 3D televisions is still small in size.

Which of the following statements is true of the growth stage in the industry life cycle? The objective of firms during this stage is to pursue a harvest strategy. The type of buyers during this stage consists of the late majority. The basis of competition tends to move away from process innovations toward product innovations. The prices begin to fall during this stage when compared to the introduction stage.

The prices begin to fall during this stage when compared to the introduction stage.

Which of the following statements is typically true of early adopters? They make up the mass market together with the technology enthusiasts. They enter the market in the maturity stage of the industry life cycle. They enjoy using beta versions of products and providing free suggestions to companies. They appreciate new technology that can add value to their personal and professional lives.

They appreciate new technology that can add value to their personal and professional lives.

Which of the following is a disadvantage faced by first movers in an industry? They will have no access to intellectual properties such as critical patents. They cannot benefit from learning and experience curve effects like the late entrants. They cannot benefit much from network effects. They will have to find distribution channels and complementary assets.

They will have to find distribution channels and complementary assets.

In developed countries, the industry for flash drives is in the maturity stage, and the industry for floppy disks is in the decline stage. What does this imply? While the flash drive industry has reached its maximum market size, the market size for floppy disks is small and contracting. The industry structure for floppy disks is that of perfect competition, whereas the industry structure for flash drives is monopolistically competitive. The number of new entrants in the floppy disks industry will be more when compared to the industry for flash drives. While the buyers of floppy disks can be categorized under early majority, the customers of flash drives can be categorized under late majority.

While the flash drive industry has reached its maximum market size, the market size for floppy disks is small and contracting.

While the industry for tablet computers is in the growth stage, the laptop industry is in its shakeout stage. What does this imply? The number of competitors entering the laptop industry will be more than those entering the tablet computers industry. While the market demand for tablets will be high, the demand for laptops will be limited. The tablet industry is ahead of the laptop industry in the industry life cycle. While competition for the tablet industry is primarily based on price, it is not so for the tablet industry.

While the market demand for tablets will be high, the demand for laptops will be limited.

In the third step of the innovation process, a(n): new idea is presented in terms of abstract concepts. invention is imitated by competitors. invention is commercialized by entrepreneurs. new idea is expressed as findings derived from basic research.

invention is commercialized by entrepreneurs.