MGF403: Quiz Questions

patent

When ReGen Pharmaceuticals released a new drug to treat insomnia, its chemical composition was disclosed at the back of the drug's cover. However, any attempts by competitors to copy the chemical composition would result in infringement of ReGen Pharmaceuticals intellectual property rights. Thus, the drug is protected by a

The consumer demand increases.

Which of the following is a feature of the growth stage of the industry life cycle?

the cost searching fo a contract manufacturer

Which of the following is an example of an external transaction cost?

Information asymmetry

______ is best described as a situation in which one party is more informed than another, because of the possession of private information.

large investment in designing a product while producing small quantities.

A new product often has a high price when it is launched because of a

ability to coordinate highly complex tasks to allow for specialized division of labor.

A primary advantage of organizing economic activity within firms is the

what range of products the firm should offer

Anita has been named CEO of a popular sports apparel company. As CEO, she is tasked with setting the firm's corporate strategy. Which of the following decisions is Anita most likely to make?

first-mover advantages

As the inventor of hypertension medication, OneSure Pharmaceuticals (OSP) Inc. was able to reap the benefits of economies of scale due to a large consumer demand for the drug. Even when competitors later developed similar drugs after the expiry of OSP's patents, regular users did not want to switch because they were concerned about possible side effects. Which of the following benefits does this scenario best illustrate?

vertical integration

Decisions relating to "what stages of the industry value chain to participate in" determine a firm's

by regularly introducing incremental improvements in its products

How has Apple been able to sustain its competitive advantage in the smartphone industry?

20 years

In the United States, the time period for the right to exclude others from the use of a patented technology is ________ from the filing date of a patent application.

growth stage

In which of the following stages of the industry life cycle is a standard first established?

principal-agent problem

Managers in a firm hired to improve the firm's profitability and ultimately the shareholders' value will add to the overall costs if they pursue their own self-interests. What does this best illustrate?

increase

The Martinez Legal Firm (MLF) recently acquired a smaller competitor, Miller and Associates, which specializes in issues not previously covered by MLF, such as land use and intellectual property cases. Given the increase in the firm's size and complexity, it is likely that its internal transaction costs will

lowering costs

There are many reasons why firms need to grow. Which of the following reasons is strongly influenced by economies of scale?

he transformation of an idea into a new product or process

What is an invention?

The first mover will be able to reduce costs through economies of scale.

Which of the following is a competitive benefit experienced by the first mover firm in an industry?