Chapters 1-9 Gallaugher

Despite its good intentions, privacy regulations exposed the website PatientsLikeMe to significant fines and it was eventually forced to shut down. True False

False

Disney's MagicBand can be used both at their theme parks and with home computer applications. True False

False

Fixed costs vary according to production volume. True False

False

The larger and more active a wiki community, the more likely it is that information will be distorted and that errors will creep in. True False

False

The multiple-brain approach is best suited for problems of a linear nature. True False

False

The number of U.S. patent applications waiting approval has significantly declined in the past decade. True False

False

The process of separating out the densely packed materials inside tech products so that the value in e-waste can be effectively harvested is extremely skill intensive. True False

False

The strengthening of the euro relative to the dollar has insulated Zara against financial vulnerabilities. True False

False

Congestion effects often result when a key resource becomes increasingly scarce with the arrivals of more and more users. True False

True

Disruptive innovations don't need to perform better than incumbents; they simply need to perform well enough to appeal to their customers (and often do so at a lower price). True False

True

Every product or service subject to network effects fosters some kind of exchange. True False

True

Firms might not want to use ARM chips because they are incompatible with Intel chips. True False

True

Identifying and nurturing potentially disruptive technologies requires constant vigilance and relentless and broad environmental scanning. True False

True

If fast-lane access or bandwidth caps become commonplace, Netflix could suffer. True False

True

If there is the availability of a wide variety of undifferentiated commodity goods in a given market, and these products are available online, then bargaining power typically shifts to the buyer. True False

True

When firms see distribution partners as rivals, this is known as Channel Conflict. True False

True

While it may be possible for rivals to match technology, the true exploitable resource created and leveraged through collaborative filtering technology is the data asset. True False

True

While so many managers focus on what's changing in tech-fueled industries, Bezos feels that building strategy based on factors that are NOT going to change is critically important. True False

True

Within the DVD-by-mail segment, Netflix remained bigger than both Wal-Mart and Blockbuster. True False

True

Zara's clothing look like high fashion, but are comparatively inexpensive. True False

True

Zara's high fashion styles are inspired by customer tastes, with technology used to gather data on preferences at given store locations. True False

True

Zara's use of technology across the value chain allows the firm to manufacture more unique items than rivals H&M and Gap. True False

True

At the dawn of commercial mobile phone technology AT&T hired storied consulting firm McKinsey & Company to forecast US cellphone use. True False

True

The term _____ refers to computers that are among the fastest of any in the world at the time of their introduction. a.mainframes b.quantum computers c.supermini computers d.minisuper computers e.supercomputers

supercomputers

If electronics now travel half the distance to make a calculation, that means the chip is ____. a.half as big b.easier to keep cool c.twice as fast d.very expensive e.all of the above

twice as fast

The inherently _____ nature of feeds allows individuals to rapidly blast their activities to their contacts or "friends" and forward along posts they think may be of interest to others. a.static b.chronological c.viral d.serial e.decadent

viral

Netflix can send out any DVD it buys because of a Supreme Court ruling known as the _____. a.clickwrap agreement b.Betamax ruling c.fair use law d.First Sale Doctrine e.Copyright Directive

First Sale Doctrine

Which of the following statements about technology is true? a.Technology alone is enough to provide sustainable competitive advantage to a firm. b.Technology plays a marginal role in creating strategic differences. c.Technological improvements are not important in strengthening a firm's strategic advantages. d.Technological improvements can often be copied by rivals, leading to a profit-eroding arms race. e.Technology cannot be used by late entrants to gain a share of the industry.

Technological improvements can often be copied by rivals, leading to a profit-eroding arms race.

Some of the radical changes brought about by new technologies include: a.the stagnation of advertising. b.the proliferation of telecommunications into the hands of a few. c.an increase in computing costs owing to the growth of licensed software. d.a decrease in the standards of corporate ethics. e.the creation of an unprecedented set of security and espionage threats

e.the creation of an unprecedented set of security and espionage threats.

1 _____ = 1 billion bytes a.terabyte b.gigabyte c.megabyte d.petabyte e.zettabyte

gigabyte

A firm is said to be _____ when it attempts to match the benefits of a successful position while maintaining its existing position. a.switching b.straddling c.dovetailing d.streamlining e.vertically integrating

straddling

A(n) _____ refers to an Internet vandal and mischief-maker. a.sock puppet b.avatar c.gadfly d.troll e.poltergeist

troll

Free shipping can cost Amazon upwards of _____ million in a single quarter. a.16 b.6 c.60 d.160 e.600

600

Flash memory is slower (meaning it transfers data at a slower rate) than conventional disk-based hard drives. True False

False

If a firm's goods are highly differentiated, the Internet typically lessens the firm's bargaining power as a supplier. True False

False

In a market influenced by network effects, the winning product or service is often determined by its technical superiority, with technically strong newcomers able to unseat the dominant incumbents. True False

False

Like most open-source efforts, bitcoin was created by a consortium of for-profit corporations hoping to fuel adoption of a beneficial new standard. True False

False

RFID tags allow Zara staff to take in-store inventory less frequently than rivals, saving money on staffing. True False

False

A market dominated by a small number of powerful sellers is known as a(n) _____. a.oligopoly b.pure play c.short tail d.blue ocean e.greenfield

Oligopoly

If a new entrant hopes to attract customers from an established incumbent, the new entrant must ensure that the value they offer exceeds the incumbents' value in addition to any perceived _____. a.switching costs b.market depreciation c.brand benefits d.advertising expenses e.scale advantages

Switching costs

ARM provides logic in the majority of smartphones, including products by Apple and Samsung. True False

True

Amazon became the fastest firm in history to reach $100 billion in sales. True False

True

An instant-messaging standard is an example of a one-sided market. True False

True

As a testament to tech's global reach, China is home to several publicly traded Internet firms, as well as a firm that was considered the largest IPO of all time. True False

True

At Netflix, the majority of the DVD titles shipped are from back-catalog titles, not new releases. True False

True

By shifting to a streaming model, Netflix stands to eliminate shipping and handling costs. True False

True

Many disruptive firms were started by former employees of the disrupted giants. True False

True

Many firms attempt to enhance their network effects by creating a platform for the development of third-party products and services that enhance the primary offering. True False

True

Many firms choose not to implement operational components of ERP software and instead elect to create their own propriety solutions in part because they see their uniqueness in certain operations areas as key to creating difficult-to-imitate competitive advantages. True False

True

Many of the careers in marketing are highly tech-centric. True False

True

Modern supercomputing is typically done via a technique called massively parallel processing. True False

True

Moore's Law has impacted the camera industry such that the firms that sell the most cameras aren't camera companies, but phone manufacturers. True False

True

Regional anti-trust authorities may consider product bundling by dominant firms to be anticompetitive. True False

True

Citing Wikipedia as a reference is not considered a good practice because Wikipedia: a.offers limited content. b.leverages a neutral point of view. c.is proprietary in nature. d.hosts unopinionated entries. e.is not original source material, but rather a clearinghouse of information.

is not original source material, but rather a clearinghouse of information

_____ exist when consumers incur an expense to move from one product or service to another. a.Network effects b.Switching costs c.Economies of scale d.Competitive advantages e.Profit margins

Switching Costs

A(n) _____ is the symbolic embodiment of all the information connected with a product or service. a.trademark b.copyright c.patent d.brand e.advertisement

brand

Zara's clothing lines are designed: a.by star designers like Stella McCartney. b.in collaboration with celebrities and pop artists. c.by design school graduates to suit customer demand. d.by designers who win talent shows sponsored by Zara. e.mostly by foreign designers in European design hotspots of Paris and Milan.

by design school graduates to suit customer demand.

Which area of corporate law is connected to technology? a.Privacy b.Patents c.Piracy d.Intellectual Property e.All of the above

All of the above

A firm's financial performance that consistently outperforms its industry's peers is known as operational effectiveness. True False

False

A necessary criterion for a crowd to be "smart" is that it should be homogenous to reduce incidence of polarized insights. True False

False

Amazon does not open its website up to third-party sellers. True False

False

Amazon got its start selling games online. True False

False

Amazon today sells fewer electronic books overall than their print counterparts. True False

False

Amazon's success strategy is based on the focus on its quarterly results. True False

False

Netflix is now crunching and comparing user preferences across 75 nations, worldwide—a level of profile detail and user preferences that no one can come close to matching. True False

False

Netflix's decision to unbundle the single fee for its $10 base service into two separate $8 plans for DVD-by-mail and streaming over the Internet proved to be a welcome surprise to most customers. True False

False

One of the reasons Amazon has struggled to achieve profitability is because the firm has a negative cash conversion cycle. True False

False

Peer-produced services like Skype and BitTorrent leverage a central IT resource instead of users' computers to forward phone calls and video. True False

False

Slack, the enterprise networking platform, is designed to maximize email efficiency. True False

False

While blogs are effective for communicating with the public, firms shouldn't use blogs for internal communication since everyone can see them. True False

False

The U.S. Department of Justice needed to provide a special exemption to the Fair Factories Clearinghouse, and before doing so, had to be convinced that the effort wouldn't be used by buyers to collude and further squeeze prices from competitors. True False

True

The business of streaming video is radically different from DVD-by-mail in several key ways, including content costs, content availability, revenue opportunities, rivals and their motivation. True False

True

Steve Chen and Chad Hurley are credited as the founders of: a.Google. b.Zappos. c.Facebook. d.YouTube. e.Yahoo!

YouTube

Tony Hsieh served as CEO of _____, and eventually sold the firm to Amazon for $900 million. a.Zappos b.LinkExchange c.MyYearbook.com d.Napster e.Yahoo!

Zappos

As of 2018, bitcoin's highest daily transaction volume was approximately _____________. a.446 b.46,000 c.4.6 million d.440,000 e.none of the above

440,000

An estimated ________ hours of video are uploaded to YouTube each minute is a great example of the use and impact of social media. a.500 b.none of the above c.1500 d.50 e.150

500

Netflix has used the long tail in the DVD-by-mail business to its advantage, crafting a business model that creates close ties with film studios. What do film studios stand to gain from taking advantage of the Netflix model targeted at increasing the firm's long-tail offerings? a.Discounted fees for marketing some of the less-popular titles from the studios b.A cut of the subscription revenue from every disk sent out by Netflix c.Greater bargaining power with movie rental firms such as Netflix, Blockbuster, and Wal-Mart d.Lower costs related to screening movies in cinemas by releasing them straight on DVD e.An equal share of revenue from the digital distribution model through online streaming

A cut of the subscription revenue from every disk sent out by Netflix

Which of the following is an example of agency pricing? a.A department store gets a cut on the selling price of a product, which is set by the product's manufacturer. b.A retail store purchases merchandise from a manufacturer and sells the merchandise at whatever prices it wishes to charge. c.The government of a country sets the minimum price for certain agricultural products to cover the costs incurred by the farmers. d.A manufacturer and a retailer work in a collaborative manner to decide the price of the final product. e.The government of a country sets the maximum price for a certain product that retailers cannot exceed. Feedback

A department store gets a cut on the selling price of a product, which is set by the product's manufacturer.

How is scale important to Netflix streaming business? a.A larger firm with more customers can spend more on content licenses b.The firm can build larger data centers as it competes with the likes of Amazon Prime c.Netflix can continue to expand its network of nationwide distribution centers to overseas locations d.It will allow the firm to improve the marginal cost of its titles, which will also improve profitability e.All of the above

A larger firm with more customers can spend more on content licenses

_____ is a randomized group of experiments used to collect data and compare performance among two options studied. a.Bucket testing b.Multivariate testing c.A/B testing d.Choice modelling e.Web usability testing

A/B Testing

The fast food restaurant Chipotle pulled its app from Apple's app store when customer demand caused the firm's servers to crash. Which Amazon product could have provided Chipotle's technology staff with the computing resources needed to handle the massive, unprecedented demand? a.AWS b.The Kindle app store c.Simple Storage Solution d.BlueOrigin e.Azure

AWS

_____ represents an integrated solution that combines hardware, software, data, procedures, and the people who interact with and are impacted by the system. a.A neural network b.Artificial intelligence c.An information system d.Supercomputing e.Cloud computing

An information system

Tech firms are among the best performing firms in the world. According to the chapter, which firm is the most valuable firm in the United States, and has also posted some of the most profitable quarters of any business in any industry. a.Amazon b.Apple c.Google d.IBM

Apple

Which of the following is an example of a measure taken by a firm to encourage the development of complementary goods? a.Adobe giving away the Acrobat Reader for free b.Microsoft bundling new products into Windows, Internet Explorer browser, and other offerings c.The Twitter Fail Whale d.Apple offering a regular conference and online materials for its software developers, and an online app store where they can sell their products. e.Nintendo's Wii games targeted at families, women, and older age groups

Apple offering a regular conference and online materials for its software developers, and an online app store where they can sell their products.

The acronym API stands for: a.Access Programming Interface b.Application Processing Inquiry c.Access Processing Interface d.Application Programming Inquiry e.Application Programming Interface

Application Programming Interface

Technology that that super-imposes content, such as images and animation on top of real world images is called: a.Alternative imaging b.Strategic design c.Illustration editing d.Augmented reality e.Product placement

Augmented Reality

While Sony and Microsoft focused on the graphics and raw processing power favored by hard-core male gamers, Nintendo chose to develop a machine to appeal to families, women, and age groups that normally shunned violent games. The strategy adopted by Nintendo in this example is the _____ strategy. a.straddling b.customer engagement c.Blue Ocean d.mass customization e.convergence

Blue Ocean

By going public, Netflix encountered competition from the large, established firms Wal-Mart and Blockbuster. What aspect of Netflix going public lured these firms into the market? a.By going public, Netflix was required to disclose its financial position. b.By going public, Netflix was forced to reveal the Cinematch algorithm used to classify user ratings. c.Netflix's model of flat-rate monthly subscriptions was found to be more profitable than a per-disc rental fee model. d.Netflix's plan to enter the online movie streaming market alerted rivals to the possibility of losing their market share. e.The migration of Netflix services to cover the Blu-ray disc market opened up opportunities for rivals.

By going public, Netflix was required to disclose its financial position.

_____ are products or services that add additional value to the primary product or service that makes up a network. a.Quantum efforts b.Substitute components c.Complementary benefits d.Orthogonal gains e.Standby additions

Complementary benefits

You are at a packed stadium for the big game and you want to upload a photo of your team's touchdown using Instagram. Your mobile phone shows five bars of service, but you still can't access the Internet. This is likely an example of ______. a.The Osborne Effect b.Envelopment c.Network effects d.Congestion effects

Congestion effects

_____ occur(s) when increasing number of users lower the value of a product or service. a.Network internalities b.Market inflexibility c.Congestion effects d.Backward incompatibility e.Convergence

Congestion effects

Which of the following is true of Netflix streaming? a.Its content acquisition cost is fixed. b.Its competitors have been mostly vanquished. c.It has little appeal for new entrants. d.Content providers enjoy greater bargaining power as the sole source for unique titles unavailable from any other source. e.It provides very little opportunity for innovation. f.None of the above

Content providers enjoy greater bargaining power as the sole source for unique titles unavailable from any other source.

Which of the following is not true about the development of MyMagic+? a.The firm had the backing of executive leadership who also provided resources to support the complex and expensive project b.Many disparate teams were impacted by the project, presenting political challenges in a project so large c.It is estimated that Disney spent over $1 billion on these systems d.Contrary to what one would expect from Moore's Law, the cost of the MagicBands themselves actually rose past original per-unit estimates

Contrary to what one would expect from Moore's Law, the cost of the MagicBands themselves actually rose past original per-unit estimates

In exchange for a percentage of the DVD-by-mail subscription revenue for every disk sent out by Netflix, movie studios offer Netflix: a.online streaming rights free of cost. b.higher fees for marketing less-popular movies. c.DVD titles at a discounted or wholesale price. d.distribution rights to certain movies free of cost. e.strong bargaining power in negotiations for digital distribution rights.

DVD titles at a discounted or wholesale price

Which of the following criteria, according to James Surowiecki, is necessary for a crowd to be "smart"? a.Offer a wide range of verdicts b.Homogeneous c.Intellectually proximate d.Strongly opinionated e.Decentralized

Decentralized

_____ refers to removing an organization from a firm's distribution channel. a.Disbarment b.Repudiation c.Annulment d.Disintermediation e.Revocation

Disintermediation

Zara store staff gain as much as three hours in prime selling time to assist customers at stores. Which of Zara's practices is instrumental in these time savings? a.Concepts going from ideas to appearances in stores in fifteen days on an average. b.Three hundred member-strong design teams churning out up to thirty thousand items a year. c.Distribution centers ironing clothes in advance and packing them on hangers, with security and price tags affixed. d.Collecting data from customers on what kind of clothes to stock in stores, using PDAs. e.Tweaking shipping models through Air France-KLM Cargo to coordinate outbound shipments with return legs loaded with raw materials.

Distribution centers ironing clothes in advance and packing them on hangers, with security and price tags affixed.

Which of the following statements regarding the current electronic waste scenario is true? a.Electronic waste increases with the rise of living standards worldwide. b.The content of gold in a pound of electronic waste is lesser than that in a pound of mined ore. c.The process of separating densely packed materials inside tech products to effectively harvest the value in e-waste is skill intensive. d.Sending e-waste abroad can be much more expensive than dealing with it at home. e.E-waste trade is mostly transparent, and stringent guidelines ensure that all e-waste is accounted for.

Electronic waste increases with the rise of living standards worldwide.

Which of the following is not a data factor Amazon considers in delivering packages to customers? a.Weather b.Traffic c.Employee job satisfaction d.Fuel prices e.Fleet availability

Employee job satisfaction

_____ is said to occur when one market attempts to conquer a new market by making it a subset, component, or feature of its primary offering. a.Acquisition b.Greenfield investment c.Envelopment d.Market leapfrogging e.Monopolization

Envelopment

_____ refer to the multibillion dollar factories used to manufacture semiconductors. a.Grids b.Platforms c.Lecterns d.Fabs e.Kilns

Fabs

A blue ocean strategy often works best when combined with operational effectiveness. True False

False

A salesperson's ability to effectively bargain with his/her consumers is called viral marketing. True False

False

According to Michael Porter, the reason many firms suffer margin-eroding competition is because they have defined themselves according to strategic positioning rather than operational effectiveness. True False

False

Amazon Echo refers to Amazon's audiobook division, an especially lucrative business because of the company's text-to-speech expertise. True False

False

Amazon Web Services came out of Amazon's desire to make money from the firm's excess computing capacity. True False

False

Blog posts are listed in forward order of creation, making it easy to see the most recent content. True False

False

Brand and advertising are synonyms for the same concept. True False

False

Businesses benefit from economies of scale when the cost of an investment can be used in serving a niche customer base. True False

False

Corporations will want to be cautious about what is posted to wikis since wikis can be accessed by anyone. True False

False

David Karp, founder of the website Tumblr, sold the website to Google for $1.1 Billion True False

False

Despite Amazon's network expansion in recent years, it can still only service about fifty percent of the US with next-day or same-day delivery. True False

False

Despite the rise of messaging apps and other forms of social media, these efforts are focused on consumer efforts, with corporations yet to find a viable way to leverage these services in an organizational setting. True False

False

Disney's says the MagicBand and supporting systems have cut turnstile transaction time by 60%. True False

False

Firms are increasingly shifting spending from the Web to other media such as print, radio, and television as these are often easier to track and analyze. True False

False

Firms that constantly innovate do so to develop open standards for competitors to become compatible. True False

False

Founders should be wary of crowdfunding sites like Kickstarter, because these efforts require founders to give up large ownership stakes to a large number of contributors before they can raise funds to bring products to market. True False

False

Google, which runs several predictive markets, found that predictions were more accurate when users were geographically proximate, meaning folks in the same work group who sat near one another. True False

False

Grid computing, though faster and more efficient, is an expensive alternative to supercomputers. True False

False

Hard drive storage is considered to be solid state. True False

False

Initially, Amazon adopted the domain of a non-profit organization. True False

False

Instagram now has over 56,000 advertisers on its platform. True False

False

Large firms like Facebook and Amazon are powerful enough to get away with a "move fast, break things" attitude and chalk their missteps up to essential entrepreneurial experimentalism, while small startup firms are more closely scrutinized as they build their reputations. True False

False

Limited production runs ensure customers do not have to visit Zara's stores as often as they visit other stores, allowing the firm to save money through staff reductions when compared to peers. True False

False

Metcalfe's Law is used to explain the concept of switching costs. True False

False

Network externalities exist when a product or service becomes less expensive as more people use it. True False

False

One challenge that Netflix faced was that Blockbuster and Walmart were able to quickly extend their strong brands to also become synonymous with a DVD-by-mail subscription service. True False

False

Outsourcing the management of a firm's social media presence to a third party agency is generally considered an effective management practice as internal staff can focus on performance. True False

False

SEO and SEM are key tech industry acronyms that have become vital parts of the accounting professional's operating toolkit. True False

False

Social media and mobile phone use are decreasing expectations for corporate ethics and customer service. True False

False

Social proof is defined as the negative influence created when someone finds out that others are doing something. True False

False

Technology experts in the area of user-interface design specialize in technology for competitive advantage. True False

False

The United States has the best environmental legislation to cover e-waste and recycling standards. True False

False

The United States holds the number one ranking in home broadband access. True False

False

The use of Kiva robots has also allowed Amazon to radically reduce headcount, saving the firm additional money by cutting its workforce. True False

False

Twitter's purchase of iPhone app Tweetie and its subsequent transformation into the free "Twitter for iPhone" application signals that Twitter is unwilling to move into product and service niches motivated by profits. True False

False

Unlike Facebook friending, Twitter's default setting allows for symmetrical following. True False

False

Web 2.0 services are targeted at creating resources and sharing information based on transaction-focused storefront models. True False

False

While process redesign, supply chain management, and factory automation are all tech-centric operations, service operations are not. True False

False

Zara's IT expenditure, measured by IT workers as a percentage of total employees, is only slightly higher than the industry average. True False

False

Zara's dominance in the fashion industry is due to its horizontally integrated structure accompanied by a globally dispersed production model. True False

False

Zara's vertically integrated model is easier for rivals to copy compared to Dell's, as computing is more complex than clothing in terms of number of new models offered. True False

False

In 2019, longtime partner ________ was so unhappy with its Amazon relationship that it dropped the firm for both air and ground deliveries. a.UPS b.USPS c.FedEx d.Uber e.Lyft

FedEx

Firms like Blockbuster, Sotheby's, and Barnes & Noble were put at risk by operating under the following platitude: a.There is no "I" in team. b.Follow, don't lead. c.What's done is done. d.Better late than never. e.Work smarter, not harder.

Follow, don't lead

Which of the following is a source of bargaining power of buyers? a.Greater choice of products b.High switching costs c.Loyalty programs d.Network effects e.Unique and highly differentiated products

Greater choice of products

_____ represent a method for organizing tweets where keywords are preceded by the # character. a.Twitter rolls b.Mash-ups c.Trackbacks d.Feeds e.Hashtags

Hashtags

Which of the following is true of disruptive technologies? a.The tech industry is the least fertile ground for disruptive technologies. b.Initially underperforming incumbents, over time their performance attributes improve to the point where they invade established markets. c.They come to market with a set of performance attributes that existing customers have demanded. d.Disruptive technologies and disruptive innovations are independent concepts. e.The term disruptive technologies is a simple one because few technologies are able to create market shocks and catalyze growth.

Initially underperforming incumbents, over time their performance attributes improve to the point where they invade established markets.

What is the likely implication of a large and active wiki community? a.It becomes more likely that content is up-to-date and errors are quickly corrected. b.It makes it easier to maintain a history of any changes so they can be compared and rolled back as needed. c.It becomes more difficult to track alterations made to data by users and errors can creep in owing to that. d.It removes boundaries between functional areas and flattens preexisting hierarchies between user classes. e.It becomes easier for most users to contribute without training or knowledge of arcane code or markup language.

It becomes more likely that content is up-to-date and errors are quickly corrected.

Which of the following is true of Amazon Web Services (AWS)? a.It only allows firms and not individual customers to rent industrial-strength computing capacity. b.It does not offer corporate-quality computing as a service. c.It doesn't provide services such as programming environments. d.It is a fool-proof system. e.It is just a single-digit percentage of Amazon's overall revenue

It is just a single-digit percentage of Amazon's overall revenue.

What is crowdsourcing? a.It is the process of selling products to people in the guise of conducting marketing research. b.It is the act of taking a job traditionally performed by a designated agent and outsourcing it to an undefined generally large group of people in the form of an open call. c.It is the act of moving a job from a group of ineffective employees to an efficient employee. d.It is the movement of employees from one department to another with the aim of improving their skill sets. e.It is the act where a group of people moves from one country to another while looking out for better work opportunities.

It is the act of taking a job traditionally performed by a designated agent and outsourcing it to an undefined generally large group of people in the form of an open call.

Which of the following is true of Amazon? a.Amazon made profits from the first year of its operation. b.It has limited its products to only electronic devices. c.Its cloud computing business is one of the largest players in that category. d.Its profitability has remained constant over the years and analysts continue to predict profits for the firm's future. e.Amazon concentrates more on its quarterly results and is inflexible on details about its vision.

Its cloud computing business is one of the largest players in that category.

Amazon was started by: a.Jeff Bezos. b.Catherine Cook. c.Shawn Fanning. d.Linus Torvalds. e.Kevin Rose.

Jeff Bezos

Yahoo! was started by _____ and _____. a.Sergey Brin; Larry Page b.Jerry Yang; David Filo c.Steve Chen; Chad Hurley d.Kevin Rose; Mark Zuckerberg e.Catherine Cook; Shawn Fanning

Jerry Yang and David Filo

Zara holds a competitive advantage over its rivals in spite of: a.refusing to implement technology in its operational model. b.conducting business only through online storefronts. c.its globally distributed contract manufacturing model. d.operating through fewer stores across the world than its closest rivals. e.Keeping large portions of its production processes in-house.

Keeping large portions of its production processes in-house

_____ is a technique in which computers are designed with many microprocessors that work together, simultaneously, to solve problems. a.Nanocomputing b.Quantum computing c.Grid computing d.Massively parallel processing e.Cloud computing

Massively parallel processing

_____ Law is said to be at play when the value of a product or service increases as its number of users expands. a.Amdahl's b.Turing's c.Zuckerberg's d.Metcalfe's e.Moore's

Metcalfe's

Netflix enjoys the triple scale advantage of the largest customer base, the largest selection, and the largest network of distribution centers. This can be attributed to: a.Netflix's specialized focus on advertising and marketing. b.Netflix's first-mover advantage. c.Netflix going public to generate funds for expansion. d.Netflix's effective and aggressive pricing strategy. e.the bargaining clout it exercises over movie studios and the government. Feedback

Netflix's first-mover advantage

Which statement best describes the relationship between network effects and innovation? a.Network effects decrease innovation within a standard but increase the number of innovative offerings that compete against a strongly established standard. b.Network effects increase innovation within a standard but decrease the number of innovative offerings that compete against a strongly established standard. c.More often than not, network effects foster innovation d.More often than not, network effects limit innovation

Network effects increase innovation within a standard but decrease the number of innovative offerings that compete against a strongly established standard.

_____ are critical for capturing sales data, and are usually linked to systems which manager a firm's inventory. a.Point-of-sale systems b.Legacy systems c.CRM systems d.Server farms e.Data aggregators

Point-of-sale systems

Large firms often find new markets attractive, but might not have products ready for delivery. What strategy do such firms use to get potential adopters to delay their purchasing decisions? a.Preannounce forthcoming efforts b.Make their new products compatible with the leading standard c.Spread costs across increasing units of production or in serving multiple customers d.Give away products for half of a two-sided market to seed the market e.Leverage customers of their other products to promote a new product

Pre-announce forthcoming efforts

How does the Internet typically impact price transparency and information asymmetry? a.Both price transparency and information asymmetry increase b.Both price transparency and information asymmetry decrease c.Price transparency increases while information asymmetry decreases d.Price transparency decreases while information asymmetry increases.

Price transparency increases while information asymmetry decreases

Consumers buying commodities are highly _____ since they have so many similar choices. a.quality-conscious b.price-focused c.brand-driven d.technologically discriminating e.loyal

Price-focused

Crowdsourcing tools and question-and-answer sites like _____ allow firms to reach out for expertise beyond their organizations. a.Quora b.Oculus VR c.Alibaba d.Twitter e.M-PESA

Quora

Some 75 to 80 percent of what people watch on the service comes from Netflix _________. a.searches b.original content c.DVD viewer suggestions d.recommendations e.all of the above

Recommendations

Identify the true statement. a.Agency pricing is illegal. b.Rivals colluding to set prices is illegal. c.Wholesale pricing is illegal. d.In agency pricing, the seller pays publishers for titles and then sells those titles at whatever price it wished. e.Wholesale pricing is also known as agency pricing.

Rivals colluding to set prices is illegal

The _____ is a piece of U.S. legislation that raises executive and board responsibility and ties criminal penalties to certain accounting and financial violations. a.Civil Rights Act b.Fair Labor Standards Act c.Sherman Antitrust Act d.Norris-LaGuardia Act e.Sarbanes-Oxley Act

Sarbanes-Oxley Act

Social media apps are taking the workplace by storm and creating billion-dollar firms. Which of the following tools has grown and is primarily known as a leading workplace productivity tool? a.Slack b.Secret c.Pew d.WhatsApp e.Tinder

Slack

A professional or student looking for guidance with a programing problem is likely to be best be served by posting questions to: a.Twitter. b.WhatsApp. c.Snapchat. d.Orkut. e.Stack Overflow.

Stack Overflow

Select the accurate statement(s). 1) The world's most valuable retailer, China's Alibaba, also carries the world's largest product inventory. 2) Uber, the world's largest taxi service, owns no vehicles for hire. 3) Airbnb, the world's largest accommodation provider, owns several major hotel corporations 4) Facebook does not create media content. a.All are accurate b.Statements 2 and 4 are accurate c.Statement 4 is accurate d.Statement 1 is accurate

Statements 2 and 4 are accurate

Which of the following factors represents one of the sources of value derived from network effects? a.Congestion b.Price transparency c.Information symmetry d.Staying power e.Complementary costs

Staying power

High-end fashion house Prada's experiment of implementing the latest technology in its flagship store failed because: a.Prada targeted technology investment only at points in its value chain where it would have the most significant impact. b.The execution of the technological advancements was poor and didn't work well during customer interactions, so managers and staff stopped using it. c.The effort was unlike Prada's signature style, being more functional than fashionable. d.Prada skimped on spending with its IT expenditure being lesser than one-fourth the fashion industry average. e.The RFID technology used on items in the store were not state of the art and suffered from legacy system problems. Feedback

The execution of the technological advancements was poor and didn't work well during customer interactions, so managers and staff stopped using it.

What was considered the source of Mickey Drexler's inventory problems at Gap? a.He personally approved sweatshop-affiliated contract manufacturers b.He wrote the code for Gap's disastrously broken inventory system c.The firm guessed wrong about fashion, placing big bets on trends that consumers didn't want d.He led a botched merger with Disney in the hopes that combining technology with the Disney Store would create a super-efficient set of shopping mall destination stores.

The firm guessed wrong about fashion, placing big bets on trends that consumers didn't want

The acronym VoIP is considered by many to be a disruptive innovation. It refers to: a.The technology used in internet telephony b.Cloud computing c.Semiconductor manufacturing technology d.DWDM

The technology used in internet telephony

Which of the following is true of Amazon? a.Amazon's early warehousing was a model of efficiency and was critical to the firm being profitable from the start. b.Amazon is the last place most consumers shop online. c.The three pillars of Amazon's business are large selection, convenience, and lower prices. d.Amazon, only recently has started selling directly to customers. e.Amazon concentrates on niche customers, low brand assortment, and higher prices to gain competitive advantage.

The three pillars of Amazon's business are large selection, convenience, and lower prices.

Which of the following statements is true about microblogging? a.Their key use is as a tool for the creation and maintenance of open source and other software products. b.Their key use is to poll a diverse crowd and aggregate opinions to form a forecast of an eventual outcome. c.Their key use is to collaborate on common tasks or to create a common knowledge base. d.Their key use is to share ideas, obtain feedback, and mobilize a community. e.Their key use is to distribute time-sensitive information, share opinions, virally spread ideas, run contests and promotions, solicit feedback, provide customer support, track commentary on firms/products/issues, and organize protests.

Their key use is to distribute time-sensitive information, share opinions, virally spread ideas, run contests and promotions, solicit feedback, provide customer support, track commentary on firms/products/issues, and organize protests.

What is the purpose of Amazon Dash? a.To speed items throughout Amazon's warehouse b.To rapidly restock Amazon's fulfillment center shelves. c.To speed deliver to consumers using drones. d.To allow consumers to rapidly place orders with Amazon. e.To deliver products using autonomous, driverless cars.

To allow consumers to rapidly place orders with Amazon

_____ are the super tiny on-off switches in a chip that work collectively to calculate or store things in memory. a.Transistors b.Multicore processors c.Single-core processors d.Conductors e.Inductors

Transistors

A firm can benefit from high switching costs, even when rivals offer free products. True False

True

A major factor in Netflix's success is competitive advantage. True False

True

A vigorous community of commenters would help keep a blogger honest as they will quickly expose a blogger's errors of fact or logic. True False

True

Although sometimes referred to as "rental," Netflix's model is really a substitute good for conventional use-based media rental. True False

True

Amazon went seven whole years without turning a profit. True False

True

Amazon's digital publishing ambitions have extended beyond the printed word to include video content and video games. True False

True

Amazon's goal is to eventually use copter-style drones to deliver small packages to consumers in thirty minutes or less. True False

True

An information system consists of hardware, software, data, procedures, and the people who interact with and are impacted by the system. True False

True

Intuit has avoided disruption in the shift away from packaged software by developing products that leverage cloud computing, some of which are initially provided for free. True False

True

Low-margin retailers are interested in bitcoin because it may allow the elimination of fees associated with credit card transactions. True False

True

Making seasonal apparel decisions is a challenge because it often involves making predictions on what customers will be interested in, months in advance of clothing appearing on store shelves. True False

True

Multicore processors can run older software written for single-brain chips. True False

True

Netflix uses data to create tailored audience promotions. True False

True

Network effects do not influence all consumer products or services. True False

True

Nine of the world's top ten brands have engaged in some form of crowdsourcing. True False

True

Not all crowdsourcing efforts are financially motivated. True False

True

Once Netflix became a public company, the firm was required to disclose its financial position and reveal it was on a profit march. True False

True

Over 500 million tweets are sent each day—80 percent or more via smartphones. True False

True

Ownership of digital assets isn't always as it appears to consumers. Many Netflix original series like "House of Cards" are actually not own by Netflix, and other firms can license these titles, while Netflix may need to acquire additional rights to stream these titles overseas. True False

True

Palmer Luckey, the founder of Oculus, was able to get early funding for his product via Kickstarter, exceeding the fundraising goal set by his campaign without giving up a share of equity from this campaign. True False

True

Physical retailers are limited by shelf space and geography (meaning the density of customers around a particular location). True False

True

Pinterest pins and Twitter retweets are examples of earned media. True False

True

Profit margins for disruptive innovations are usually worse than those for incumbent technologies. True False

True

Reports suggest that Amazon cargo jets are flying full, but with lighter loads, cutting fuel costs. True False

True

Technological leapfrogging is offering a new technology that is superior to existing offering that the value overcomes the total resistance. True False

True

Technology has proliferated in Kenya and Somaliland, with text messages used to replace cash, creating mobile money use that, on a population percentage basis, exceeds any nation in the West. True False

True

The high degree of customer satisfaction that Netflix enjoyed is tightly linked with the firm's sized-based advantages. True False

True

The higher the value of a user's overall investment, the more they are likely to consider the staying power of any offering before choosing to adopt it. True False

True

The internet is largely seen as lowering the entry barrier for new entrants, but firms that enter may have little chance of success unless they have a competitive advantage over existing rivals. True False

True

The scale of technology investment required to run a business can act as a barrier to entry by discouraging new, smaller competitors. True False

True

The shift from atoms to bits is realigning nearly every media industry. True False

True

The three pillars of Amazon's business are large selection, convenience, and lower prices. True False

True

The unstructured nature of wikis is both a source of strength and weakness. True False

True

The use of public social networks within private organizations is growing, and many organizations are implementing their own, private, social networks. True False

True

The yearly cost to run a Netflix-comparable nationwide delivery infrastructure is about $300 million. True False

True

Timing and technology alone will not yield sustainable competitive advantage. True False

True

Today's job seekers are writing résumés with keywords in mind, aware that the first cut is likely made by a database search program, not a human being. True False

True

Uber is an example of a business model that has strengthened the bargaining power of suppliers (cab drivers) with respect to middlemen who took a cut of their services (e.g. cab companies). True False

True

The set of activities through which a product or service is created and delivered to customers is known as a(n) _____. a.marketing plan b.value chain c.inventory turnover d.strategic position e.pure play

Value chain

The term wiki refers to a(n): a.link in a blog post that refers readers back to cited sources. b.record of online journal entries, usually made in a reverse chronological order. c.type of short-message blogging, often made via mobile device and designed to provide rapid notification to their readership. d.online community that allows users to establish personal profiles and communicate with others. e.Website that can be modified by permitted users, from directly within a Web browser.

Website that can be modified by permitted users, from directly within a Web browser.

Which of the following is true of Amazon's warehousing process? a.Autonomous robots are in charge of building an order from a warehouse's inventory without any human intervention. b.Amazon's items that produce the most sales volume are stocked on shelves, alphabetically, to speed selection and packing. c.Amazon's systems stamp names and addresses on boxes so they can be filled by pickers directly from shelves. d.When stacking shelves in its warehouses, Amazon ensures that no two similar products sit next to each other. e.Amazon's items that are heavily discounted and about to be written off as "unsellable inventory" are dropped in an area called "mass land" in one last-ditch effort to move under-performing warehouse stock.

When stacking shelves in its warehouses, Amazon ensures that no two similar products sit next to each other.

How does Zara differ from its competitors in converting ideas into products? a.Zara concepts appear in stores in fifteen days on average compared to rivals who receive new styles once or twice a season. b.Zara's ideas are inspired by social media, compared to the intrinsic design processes followed by its competitors. c.Zara's design and concept teams use data from customers to predict fashion trends many months into the future and stock up inventory accordingly, as opposed to its rivals. d.Collaborations with celebrities help Zara churn out a limited, yet profitable, volume of items every year, while rivals produce a higher volume of less fashionable items. e.By focusing on a smaller number of products than rivals like Gap, Zara manages to limit exposure to wrong guesses.

Zara concepts appear in stores in fifteen days on average compared to rivals who receive new styles once or twice a season.

Money owed for products and services purchased on credit to be paid at a later date is known as _____. a.accounts payable b.net profit c.pre-paid expense d.gross profit e.earnings before depreciation and tax

accounts payable

A firm can spend no money and time, yet expect to enhance its offerings, by: a.allowing other firms to contribute to its platform. b.going public through an initial public stock offering. c.outsourcing critical processes to third parties. d.adopting an envelopment strategy. e.preannouncing a forthcoming product to lower sales of current offerings.

allowing other firms to contribute to its platform

Marginal costs: a.are minor, insignificant costs. b.are associated with each additional unit produced. c.are the costs incurred as a result of choosing one option over another. d.are constant and do not vary according to production volume. e.are also known as overhead.

are associated with each additional unit produced

Technology experts in the area of process design: a.work to make sure systems are easy to use. b.leverage technology to make firms more efficient. c.specialize in technology for competitive advantage. d.focus on systems dealing with critical business data. e.provide direction on technology-related security issues.

b.leverage technology to make firms more efficient.

Two distinctly separate markets are said to undergo convergence when they: a.are dominated by a small group of powerful sellers. b.derive most of their value from two distinct categories of participants. c.offer products and services designed to target a specific industry. d.are characterized by many buyers, but a single, dominant seller. e.begin to offer similar features and capabilities.

begin to offer similar features and capabilities.

The firm's period between paying suppliers for products and collecting funds from customers who purchase these products is referred to as the _____. a.earnings cycle b.cash conversion cycle c.inventory turnover cycle d.liquidity period cycle e.trade cycle

cash conversion cycle

Moore's Law states that: a.magnetic disk storage density doubles annually. b.the cost per unit of useful light emitted by an LED falls by a factor of 10 every decade. c.the value of a telecommunications network is proportional to the square of the number of connected users of the system. d.chip performance per dollar doubles every eighteen months. e.the cost of a semiconductor chip fabrication plant is cut in half every four years.

chip performance per dollar doubles every eighteen months.

A low _____ is usually key to a firm's profitability because acquiring a customer is more expensive than keeping one. a.subscription fee b.inventory size c.churn rate d.switching cost e.opportunity cost

churn rate

Moving first pays off when the time lead is used to create: a.the latest technology at a firm's production plant. b.operational effectiveness to harness maximum profitability. c.critical resources for competitive advantage. d.high stock value to generate funds for expansion. e.market entry to ensure sustainable competitive advantage.

critical resources for competitive advantage.

Brands are built through _____. a.customer awareness b.data assets c.excessive advertising d.customer profiling e.customer experience

customer experience

Amazon's moves are largely motivated by: a.customer focus. b.cost cutting. c.the focus on making immediate supplier payments. d.internal leadership. e.technology advancements.

customer focus

In _____, the light inside fiber is split into different signal-carrying wavelengths in a way similar to how a prism splits light into different colors. a.polarization b.time-division multiplexing c.space-division multiplexing d.frequency hopping spread spectrum e.dense wave division multiplexing

dense wave division multiplexing

According to Porter, strategy is fundamentally about being _____. a.different b.efficient c.superior d.scalable e.profitable

different

Based on the author's take on e-waste management, a manager would do well to learn that: a.dealing with e-waste at home can be ten times cheaper than sending it abroad. b.disposal and recycling partners must be audited with the same vigor as suppliers and other partners. c.environmentalists target only the big firms as they can afford to compensate for any environmental damage wrought by their practices. d.it is simple enough for firms to monitor and track e-waste management through international agencies such as Fair Factories Clearinghouse. e.appointing environmentalists like Al Gore to the firm's board of directors helps avoid legal action and brand tarnishing due to bad e-waste management practices.

disposal and recycling partners must be audited with the same vigor as suppliers and other partners.

In retail in general and fashion in particular, having _____ is considered the kiss of death. a.excess inventory b.storefronts in expensive districts with costly rents c.a large labor force d.limited production runs e.dispersed production facilities

excess inventory

The _____ problem exists when rivals watch a pioneer's efforts, learn from their successes and missteps, and then enter the market quickly with a comparable or superior product at a lower cost. a.late entrant b.early starter c.first mover d.intellectual property e.fast follower

fast follower

Adobe gives away the Acrobat Reader to build a market for the sale of software that creates Acrobat files. This is an example of: a.one market attempting to conquer a new market by making it a subset, component, or feature of its primary offering. b.firms giving away products for half of a two-sided market to seed the market. c.markets, once considered distinctly separate, beginning to offer similar features and capabilities. d.firms taking advantage of complementary products developed for a prior generation of technology. e.firms spreading costs across increasing units of production or in serving multiple customers.

firms giving away products for half of a two-sided market to seed the market.

Netscape, which once controlled more than 80 percent of the market share in Web browsers, lost its dominant position when customers migrated to Internet Explorer, Microsoft's Web browser. Internet Explorer was easy to install and had no significant differences in terms of usability. This example serves to illustrate that: a.fast-following smaller firms are always ready with newer and possibly superior products. b.customers of technology companies are becoming increasingly savvy and more demanding. c.the open source nature of technology ensures that no firm can expect to monopolize a market. d.firms need to employ increasingly stringent intellectual property norms to guard against infringements from smaller, competitive rivals. e.firms with low switching costs can sometimes be rapidly overtaken by strong rivals with additional competitive advantages.

firms with low switching costs can sometimes be rapidly overtaken by strong rivals with additional competitive advantages.

Apple, which controls over 75 percent of digital music sales, was able to dictate song pricing for years, despite the tremendous protests of the record labels. This implies that: a.despite the presence of network effects, the music industry is not dominated by any single leader. b.the presence of multiple new entrants forces leading firms to drop prices of their offerings. c.firms with strong market dominance can enjoy substantial bargaining power over partners. d.a dominant market share does not necessarily translate to greater profitability for a firm. e.there were cross-side network effects between the various music labels.

firms with strong market dominance can enjoy substantial bargaining power over partners

_____ is a term used to describe others taking advantage of a user or service without providing any sort of reciprocal benefit. a.Hijacking b.Astroturfing c.Free rider problem d.Fast follower problem e.Showboating

free rider problem

The video game console market offers important lessons for the strategist. The video game console market is a network market in which Sony's PlayStation 2 (PS2) dominated over Microsoft's Xbox offering. This has been possible due to: a.the low pricing of Xbox which eroded users' confidence in the product. b.game developers favoring PS2 for its larger user base obtained because the PS2 was launched months before the Xbox. c.the presence of several cheap, rival imitations which ate into Xbox's market share. d.PS2's technical superiority over the Xbox. e.the straddling strategy adopted by Microsoft to expand in both video game and DVD player markets.

game developers favoring PS2 for its larger user base obtained because the PS2 was launched months before the Xbox.

Personal digital assistants are: a.transaction processing systems that capture customer purchases. b.small chip-based tags that wirelessly emit a unique identifying code for the item that they are attached to. c.systems that provide rewards and usage incentives, typically in exchange for a method that provides a more detailed tracking and recording of customer activity. d.handheld computing devices meant largely for mobile use outside an office setting. e.artificial intelligence systems that leverage rules or examples to perform a task in a way that mimics applied human expertise.

handheld computing devices meant largely for mobile use outside an office setting.

Solid state components are less likely to fail because they: a.are driven by precise sets of software instructions. b.have the capability to both enable and inhibit the flow of electricity. c.have no moving parts. d.are composed of germanium instead of silicon. e.contain storage that retains data even when powered down.

have no moving parts

The patent system is often considered to be unfairly stacked against startups because: a.bigger multinational firms enjoy patent protection in all countries as opposed to startups, which are domestic firms that do not get such protection for the most part. b.the intellectual property laws are not adequate to protect the interests of smaller firms from infringements. c.the patent system grants patents for innovations on a differential basis, with bigger firms getting precedence over start-ups. d.high litigation costs coupled with a few months of litigation can sink an early stage firm. e.patents are granted by the patent system on an ad hoc basis wherein firms that have been in business longer get patent protection for longer periods of time.

high litigation costs coupled with a few months of litigation can sink an early stage firm.

Which of the following is not a benefit achieved through Zara's integration of technology throughout the firm? a.limited product runs of many unique products b.higher markdowns c.fewer write-offs d.less need for advertising

higher markdowns

Zara's staff members regularly collect data from customers at its stores. This data is used to: a.decide the designs and styles of Zara's products for the next few seasons. b.determine the in-store soundtrack and layout. c.inform designers on customer preferences and staff on store sales results. d.determine where future Zara stores should be located. e.identify the products that customers would like to buy through discounted sales.

inform designers on customer preferences and staff on store sales results

Worldwide auction leader eBay started operations in Japan just five months after Yahoo! launched its Japanese auction service. But eBay was never able to mount a credible threat and ended up pulling out of the market. This example shows that: a.online auction markets are characterized by constant shifts in market dominance. b.market dominance in the global marketplace translates to an equivalent position in national markets. c.national markets tend to be influenced by factors that are not necessarily localized. d.it's imperative to move first in markets influenced by network effects. e.firms should always subsidize initial adoption of their products and make them cheaper than their competitor's products.

it's imperative to move first in markets influenced by network effects.

Which of the following is considered one of the three "pillars" critical to Amazon's business success? a.Large selection b.Niche customers c.Inimitable technology d.Dynamic pricing e.Firm-owned brands

large selection

When firms enjoy economies of scale they: a.have a greater share of liquid assets than rivals. b.have bigger production facilities than their competitors. c.have a wider employee base than their competitors. d.leverage the cost of an investment across increasing units of production. e.leverage investment costs to decrease their subscriber acquisition costs.

leverage the cost of an investment across increasing units of production.

Staying power refers to the: a.relative abilities of parties in a situation to exert influence over each other. b.energy demands required to run a product or service. c.ability of a firm to produce a good or service at a lower opportunity cost than a rival. d.long-term viability of a product or service. e.ability to take advantage of complementary products developed for a prior generation of technology.

long-term viability of a product or service

What differentiates microcontrollers from general-purpose computers? a.Microcontrollers have no processor, memory, or input/output. b.Microcontrollers are composed of several tiny chips. c.Microcontrollers have no operating system. d.Microcontrollers are faster than general-purpose computers. e.None of the above.

microcontrollers have no operating system

The _____ is the part of a computer that executes the instructions of a computer program. a.software b.flash memory c.DWDM d.random-access memory or RAM e.microprocessor

microprocessor

Collaborative filtering is a classification of software that: a.is used to gather user ratings and calculate a gross average user rating for each movie. b.provides Netflix users with parental controls and other options while streaming movies online. c.selectively sorts movies based on their censor ratings and delivers age-appropriate search results. d.monitors trends among customers to personalize an individual customer's experience. e.collates user ratings for a movie and creates a ranked list of movies most liked by users.

monitors trends among customers to personalize an individual customer's experience.

Users who edit Wikipedia content in a manner that is biased and opinionated are said to be violating Wikipedia's stated policy of: a.political correctness. b.what you see is what you get. c.neutral point of view. d.respect for universal human rights. e.public disclosure.

neutral point of view

Contract manufacturers used by the apparel industry are often criticized because: a.they hike up the costs of producing goods. b.firms cannot maintain high profit margins by employing them. c.they charge exorbitant labor costs that drive down sales. d.they are known to grossly overprice their services. e.of poor working conditions.

of poor working conditions

An internal team at Netflix developed a prototype set-top box to enable the direct streaming of content to customers' television sets. However, the idea of offering it to Netflix customers was dropped because: a.the market for online streaming was nascent and unprofitable. b.all major US cable firms built Netflix streaming into their set-top boxes. c.the Blu-ray standard requires streaming features, as well. d.of the brutally competitive nature of the consumer electronics business. e.the entire software team was recruited by TiVo after LinkedIn made it easy to target and poach rival talent.

of the brutally competitive nature of the consumer electronics business.

The e-commerce strategy that blends online and offline sales is called _____________. a.sales channel b.betterline c.omnichannel d.blended sales e.omniline

omnichannel

Advertisement and sponsorships are components of: a.peer production. b.unearned media. c.earned media. d.social media. e.paid media.

paid media

Operational effectiveness refers to: a.the implementation of technology in a business context. b.performing the same tasks better than rivals perform them. c.the number of times inventory is sold or used during the course of a year. d.performing different tasks or the same tasks in different ways. e.matching the benefits of a successful position while maintaining an existing position.

performing the same tasks better than rivals perform them.

The third wave of computing was characterized by the introduction of _____. a.personal computers b.mainframe computers c.minicomputers d.Internet computing e.laptops

personal computers

A prediction market involves: a.trading on essential goods and services with a view of making a profit by hiking prices at a time of high demand. b.making calculated estimates on the prices of goods and services based on the speculation of a group of experts. c.polling a diverse crowd and aggregating opinions to form a forecast of an eventual outcome. d.leveraging customers to virally promote a firm's products or services. e.aggregating the opinions of a specialized group of experts who analyze a problem and suggest solutions.

polling a diverse crowd and aggregating opinions to form a forecast of an eventual outcome.

Multicore processors are formed by: a.connecting identical processors in a parallel combination and drawing power from the same source. b.putting two or more lower power processor cores on a single chip. c.connecting a series of high powered processors through a single power source. d.slicing a flat chip into pieces and reconnecting the pieces vertically. e.connecting a combination of parallel and series-connected processors to a single larger processor to supplement its functioning.

putting two or more lower power processor cores on a single chip

Churn rate is a term that refers to the: a.average number of recommended titles in a user's queue. b.rate at which the demand for a product or service fluctuates with price change. c.number of movie titles that are difficult to assign reliable user ratings. d.rate at which customers leave a product or service. e.number of new users that each existing user attracts through word-of-mouth and social sharing.

rate at which customers leave a product or service

Price elasticity refers to the: a.change in the demand for a good in response to a change in income. b.rate at which product prices vary in response to changes in customer demand. c.range of production costs that change as a direct function of the availability of raw materials. d.rate at which demand for a product or service fluctuates with price change. e.numerical measure of the responsiveness of the supply of a product to a change in its production cost.

rate at which demand for a product or service fluctuates with price change.

Dynamic pricing: a.refers to pricing that shifts over time based on conditions associated with product supply and demand. b.refers to pricing that is always a notch higher than competition. c.refers to pricing strategies that focuses on consistency even if environmental conditions fluctuate wildly. d.is also known as the bargaining power of customers. e.refers to pricing that is always a notch below competition.

refers to pricing that shifts over time based on conditions associated with product supply and demand.

Many telecom firms began digging up the ground and laying webs of fiberglass to meet the growing demand for Internet connectivity. However, rivals and startups began to imitate these firms and soon these new assets were not so rare and each day they seemed to be less valuable. It can be inferred from this example that: a.resource-based thinking can help avoid the trap of carelessly entering markets simply because growth is spotted. b.the telecommunications market is only big enough to support one or two major players. c.the immense scale advantages enjoyed by major firms can help them fight off competition from newer entrants. d.technology assets that require high investment and maintenance are liable to becoming obsolete much quicker than others. e.the scale of technology investment required to run a business is not a huge enough factor to act as a barrier to entry for new, smaller competitors.

resource-based thinking can help avoid the trap of carelessly entering markets simply because growth is spotted.

ROI is a term used to represent the: a.return on information b.rate of information-generated c.regular order intake d.return on investment e.relay-ordered inventory

return on investment

Internet retailers serve a larger geographic area with comparably smaller infrastructure and staff. This fact suggests that Internet businesses are more _____. a.churn-prone b.asymptotic c.capitalized d.vertically integrated e.scalable

scalable

Netflix offered its subscribers a selection of over one hundred thousand DVD-by-mail titles, while other video rental firms can only offer as much as three thousand. This presents a significant _____ for Netflix over its rivals. a.marginal cost b.price advantage c.variable cost d.studio preference e.scale advantage

scale advantage

Moore's Law kicked in during the 1970s for the _____________, and minicomputers were a hit. a.first wave b.second wave c.third wave d.big corporations e.government

second wave

While the size of the tail in the long tail phenomenon is disputable, one fact that is critical to remain above this debate is that: a.traditional brick and mortar retailers offer selections that cannot be rivaled by Internet pure-plays. b.energy costs and worker wages drive up the costs of running stores like Netflix. c.selection attracts customers, and the Internet allows large-selection inventory efficiencies that offline firms can't match. d.the turnover rate of obscure titles in traditional video rental stores is only slightly higher than those for Internet pure-plays. e.the cost of store maintenance and real estate makes stores such as Netflix unattractive.

selection attracts customers, and the Internet allows large-selection inventory efficiencies that offline firms can't match.

Grid computing is a type of computing in which: a.special software is installed on several computers enabling them to work together on a common problem. b.computers are designed with many microprocessors that work together, simultaneously, to solve problems. c.quantum properties, such as superposition and entanglement, are used to represent data and perform operations on these data. d.microprocessors with two or more (typically lower power) calculating processor cores are fabricated on the same piece of silicon to solve multiple problems. e.computer software seeks to reproduce or mimic human thought, decision making, or brain functions.

special software is installed on several computers enabling them to work together on a common problem.

Businesses benefit from economies of scale when the cost of an investment can be: a.spread across increasing units of production. b.used in serving a niche and loyal customer base. c.used to build a brand image for products through advertising. d.leveraged to recruit consumers to promote a product or service. e.diverted to implementing technology upgrades in the business model.

spread across increasing units of production

_____ refers to performing different tasks than rivals or the same tasks in a different way. a.Straddling b.Operational effectiveness c.Strategic positioning d.Vertical integration e.Scale advantage

strategic positioning

A firm's financial performance that consistently outperforms its industry's peers is known as _____. a.comparative advantage b.absolute advantage c.sustainable competitive advantage d.first mover advantage e.operational efficiency advantage

sustainable competitive advantage

Many firms have developed and deployed innovative information systems, only to see these systems go unused by key staff members. How has Zara helped ensure its systems will be used by staff? a.employees are monitored by in-store cameras b.employee time on information systems is recorded each time the system is engaged c.system use drives store success and as much as 70 percent of salaries are tied to sales performance d.all employees must have a Fair Factories Clearinghouse account, which is used to log and report employee activity e.systems were designed by employees, who feel a sense of ownership in the technology deployed

system use drives store success and as much as 70 percent of salaries are tied to sales performance

Yahoo!'s mobile team didn't have an executive champion to protect and nurture the team during the pioneering phase when financial results couldn't be realized. It couldn't show substantial results, so managers were reassigned. This is an example of: a.social engineering b.the Creosote Bush effect c.overspending on unproven projects d.the options portfolio of innovation

the Creosote Bush effect

Zara's use of RFID tags can be considered an example of: a.Kryder's law b.the IoT c.volatile memory d.Carver Meade's Corollary

the IoT

Crowdsourcing is: a.a phenomenon whereby firms can make money by offering a near-limitless selection. b.the act of taking a job traditionally performed by a designated agent and contracting it out to an undefined generally large group of people in the form of an open call. c.a classification of software that monitors trends among customers and uses this data to personalize an individual customer's experience. d.the removal of an organization from a firm's distribution channel. e.an industry practice whereby content is available to a given distribution channel for a specified time period or 'window,' usually under a different revenue model.

the act of taking a job traditionally performed by a designated agent and contracting it out to an undefined generally large group of people in the form of an open call.

Many pundits assumed Amazon would fail. Why? a.the firm was losing money and competing against established, well known, offline brands who were going online. b.Amazon was too short-term focused. c.the firm was based in Seattle, rather than Silicon Valley. d.Amazon sales were not increasing. e.all of the above.

the firm was losing money and competing against established, well known, offline brands who were going online.

The long tail nature of the blogging phenomenon is demonstrated by: a.most popular blogs offering cutting-edge news and commentary on a wide range of political, social, and economic topics. b.the higher valuation of many top-ranked blogs compared to that of publicly traded papers. c.top blogs operating on shoestring budgets yet snaring several hundred thousand dollars a month in ad revenue. d.the niche content that is discoverable through search engines and that is often shared via other types of social media. e.many blogs, which are more popular than most mainstream media publications.

the niche content that is discoverable through search engines and that is often shared via other types of social media

According to an independent study, Zara books some 85 percent of its products at full price compared to the industry average markdown ratio of 50 percent. This is made possible by: a.keeping a major part of the production processes under direct proprietary control. b.coordinating the outbound shipments of all Inditex brands with return legs loaded with return materials and half-finished items. c.applying data analytics to purchase trends. d.the practice of having limited production runs of its designs. e.leveraging contract manufacturers to produce only staple items with longer shelf-lives, which account for one-eighth of dollar volume.

the practice of having limited production runs of its designs.

Big firms fail to see disruptive innovations as a threat because: a.they primarily focus on the bottom line. b.they fail to listen to customer needs. c.they overestimate the impact of these innovations. d.they don't indulge in playing catch-up. e.they concentrate only on future financial performance.

they primarily focus on the bottom line

Peer production refers to: a.the process of tracking and responding to online mentions of a product, organization, or individual. b.users collaboratively working to create content, products, and services. c.content that is more complex than simple text or photos and includes animation, audio, and video. d.programming hooks, or guidelines published by firms that tell other programs how to get a service to perform a task such as send or receive data. e.graphical editing tools, such as those found in a wiki, page layout program, or other design tool.

users collaboratively working to create content, products, and services.

In an industry where nearly every major player outsources manufacturing to low-cost countries, Zara is highly _____, keeping huge swaths of its production process in-house. a.privatized b.vertically integrated c.publicly traded d.subsidized e.autonomous

vertically integrated

Leveraging consumers to promote a product or service is known as _____. a.straddling b.affiliating c.long tailing d.crowdsourcing e.viral marketing

viral marketing