Chapter 5 LearnSmart

Which of the following describes how Amazon disrupted the traditional wholesale model for book publishers? - Amazon sold e-books at an inflated price because of their perceived value of portability - Amazon sold e-books for its e-reader device at a loss to promote sales of the e-reader - Amazon sold newly released best-sellers at a higher price than other hardcover books - Amazon sold all hardcover and paperback versions of the same title at the same price

Amazon sold e-books for its e-reader device at a loss to promote the sales of the e-reader

T/F The freemium business model can be considered an evolutionary variation on the razor-razor blade model.

True

A firm uses the __ business model when it sells a set of products that have different levels of demand for a price less than their total combined prices. wholesale bundling subscription razor-razorblades

bundling

When implementing the razor-razorblade strategy, companies make their profit from __. initial products razors subscription fees complementary goods

complementary goods

Managers implement the blueprint of their business model through which of the following? (Check all that apply.) culture voice memos structures processes

culture structures processes

When a company operates on a freemium model, premium services cost money but basic services are __.

free

With the growing popularity of the internet, the pay-as-you-go model is __. - difficult to apply outside its traditional functions - gaining momentum - becoming increasingly niche - dying out

gaining momentum

Which of following industries use a subscription model? (Check all that apply.) internet providers cellphone providers Zipcar-by-the-hour magazines

internet providers cellphone providers magazines

When a company offers video-game consoles at a steep discount, but charges customers high fees for games, they are operating on a(n) ____ - ____ business model.

razor-razorblades

The business model used by telecommunication companies when they provide a basic cell phone at no charge when the customer signs a two-year contract is a combination of which of the following types of business models? (Check all that apply.) subscription freemium pay-as-you-go razor-razor blade

subscription razor-razor blade

Wholesaling is considered a __ model for retail. groundbreaking revolutionary unsuitable traditional

traditional

Netflix had a successful business model based on a large library of streaming content but then achieved even more success by also producing and distributing original content. This is an example of the potential value of __. - revenue depreciation - overhead maximization modeling - consumer cost sharing - business model innovation

business model innovation