Ch. 2 Pretest
What gives a business model the most credibility with outside investors?
A firm's management team
A wealthy individual who invests personal funds in a start-up in exchange for an equity stock in the business is referred to as a(n) ________.
Angel Investor
Which element of the business model refers to the presence of substitute products in the market?
Competitive Environment
(T/F) An asymmetry exists whenever all participants in a market have equivalent resources.
False
(T/F) Interactivity that enables product customization alters industry structure by increasing the threat of substitutes.
False
(T/F) Scale economies are efficiencies that result from flattening the hierarchy of an organization.
False
A ________ specifically details how you plan to find customers and to sell your product.
Market Strategy
A firm's ________ describes how a firm will produce a superior return on invested capital.
Revenue Model
What is the primary revenue model for an e-distributor?
Sales
________ technologies are technologies that enable the incremental improvement of products and services.
Sustaining
The existence of a large number of competitors in any one market segment may indicate:
The market is saturated
(T/F) A value proposition defines how a company's product or service fulfills the needs of a customer.
True
________ and ________ are typically the most easily identifiable aspects of a company's business model.
Value proposition; revenue model
Stickiness is an important attribute for which of the following revenue models?
Advertising revenue model
Which of the following is not considered a portal? -Amazon -Yahoo -MSN -Google
Amazon
Which of the following is not an example of the bricks-and-clicks e-tailing business model? -Sears -Bluefly -Staples -Walmart
Bluefly
What is an example of an unfair competitive advantage?is an unfair competitive advantage?
Brand name
________ create and sell access to digital markets.
E-procurement firms
(T/F) E-commerce has increased price competition in nearly all markets.
True
A strategy designed to compete within a narrow market or product segment is called a ________ strategy.
Focus
What involves a company giving away a certain level of product or services without charge, but then charging a fee for premium levels of the product or service?
Freemium Strategy
A perfect market is one in which:
There are no competitive advantages or asymmetries because all firms have equal access to all the factors to production
The basic value proposition of community providers is:
They offer a fast, convenient one-stop site where users can focus on their most important concerns and interests
The financial services, travel services, and job placement services industries typically use the ________ business model.
Transaction Broker
(T/F) Firms that fail to produce returns greater than alternative investments typically go out of business.
True
(T/F) Social technologies change industry structure by shifting programming and editorial decisions to consumers and creating substitute entertainment products.
True
Which type of investor typically becomes interested in a start-up company after it has begun generating revenue?
Venture Capital Investors
A ________ marketplace supplies products and services of interest to particular industries.
Vertical