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1. The ability to develop successful new products is critical to a company’s sales, future growth, and long-term survival
potential.
a.
True
b.
False
ANSWER:
True
2. Ideas cannot be described as innovations.
a.
True
b.
False
ANSWER:
False
3. An innovation does not necessarily have to be new as long as consumers perceive it as new.
a.
True
b.
False
ANSWER:
True
4. Best Light Energy has started manufacturing Lo–Po bulbs, these bulbs are stated to save 70% more energy compared to
the conventional CFL bulbs. As Lo–Po bulbs are just the modified versions of conventional CFL bulbs, they will not be
considered an innovation.
a.
True
b.
False
ANSWER:
True
5. One way to characterize innovations is to describe the degree of change that they create in our consumption patterns.
a.
True
b.
False
ANSWER:
True
6. Like dynamically continuous innovations, discontinuous innovations often spawn a host of peripheral products and
associated innovations.
a.
True
b.
False
ANSWER:
True
7.
Innovations vary in how much behavioral change they require on the part of consumers.
a.
True
b.
False
ANSWER:
True
8. Functional innovations often rely on new technology that makes a product better than existing alternatives.
a.
True
b.
False
ANSWER:
True
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9. Cocreation is actively involving consumers in creating value through participation in new product development, among
other marketing activities
a.
True
b.
False
ANSWER:
True
10. Margaret refuses to upgrade her laptop to the latest version of the operating system because she is more comfortable
with the current version. This can be considered a symbolic innovation.
a.
True
b.
False
ANSWER:
False
11. With a low-effort hierarchy of effects, the time between awareness of an innovation and its trial or adoption may be
brief.
a.
True
b.
False
ANSWER:
True
12. Ronald sees a TV advertisement for the Omega Player, a media player that plays all known file formats. Though
Ronald likes the product, he decides to wait for a few months before buying it as he is not sure if the player is going to be
popular in the market. In this scenario, Ronald is considered an innovator.
a.
True
b.
False
ANSWER:
False
13. John is a successful attorney who refuses to adopt an electronic file system and instead keeps paper records. He fears
that if something is not written down it is not permanent. In this scenario, John is considered a laggard.
a.
True
b.
False
ANSWER:
True
14. Diffusion reflects the behaviors of an individual.
a.
True
b.
False
ANSWER:
False
15. Product diffusion and the product life cycle are related but different concepts.
a.
True
b.
False
ANSWER:
True
16. Consumers perceive that an innovation has value if it offers greater perceived benefits or lower perceived costs than
existing alternatives do.
a.
True
b.
False
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ANSWER:
True
17. Consumers are often more uncertain about the usefulness of a discontinuous (vs. a continuous) innovation.
a.
True
b.
False
ANSWER:
True
18. The more compatible an innovation is with consumers’ values, norms, and behaviors, the lesser the product diffusion.
a.
True
b.
False
ANSWER:
False
19. Studies indicate that the earlier someone adopts an innovation, the more prestige is associated with it.
a.
True
b.
False
ANSWER:
True
20. Legitimacy of an innovation refers to the legality of its channels of distribution.
a.
True
b.
False
ANSWER:
False
21. The characteristics of the social system in which an innovation operates affect resistance, adoption, and diffusion.
a.
True
b.
False
ANSWER:
True
22. Modernity refers to the extent to which consumers in the social system have positive attitudes toward change.
a.
True
b.
False
ANSWER:
True
23. Innovations are always good for society at large.
a.
True
b.
False
ANSWER:
False
24. Innovation can be defined as:
a.
an offering that is perceived as new by consumers within a market segment and that has an effect on existing
consumption patterns.
b.
the creation of value through customers’ participation in new product development, among other marketing
activities.
c.
the usage of technology to facilitate human togetherness, and reduce human separation.
d.
a concept that suggests that products go through an initial introductory period followed by periods of sales
growth, maturity, and decline.
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e.
the degree to which consumers influence each other in the diffusion of a new product.
ANSWER:
a
25. Manson used to rent DVDs to watch movies. He has recently switched to downloading or streaming movies from the
Internet and watching them on his smartTV. This change in his media consumption method is due to:
a.
a personalized marketing method.
b.
the innovation in media technology.
c.
the diversity in consumption patterns.
d.
the packaging method of media.
e.
a change in the function of media.
ANSWER:
b
26. Phoenix Inc., a XYZ manufacturing company, introduces Numberator, a scientific calculator, that comprises a special,
high-quality chip. This chip helps the Numberator calculate faster than the traditional scientific calculators. In this
scenario, Numberator can be considered an innovation:
a.
only if its speed can be measured.
b.
only if it is perceived so by consumers.
c.
as long as the brand calls it an innovation.
d.
if it is a popular brand with a good brand image.
e.
only by the individuals who have purchased it.
ANSWER:
b
27. Countries such as Vesmeta and Aldarnia are considered to be Fourth World countries. Products like TVs and VCRs
are very new to the people who live there, even though most First World countries regard them as established products.
These products are considered to be innovations in these countries now because they:
a.
are better than the existing alternatives in the country.
b.
are regarded as new products in their country of origin.
c.
have strong brand images.
d.
are being marketed as new offerings.
e.
can only be purchased by the elite income groups.
ANSWER:
b
28. Marketers classify innovations in three main ways: (1) the degree of novelty, (2) the type of benefits offered, and (3)
the:
a.
styles available.
b.
features affected.
c.
breadth of innovation.
d.
length of time to adoption.
e.
size of potential market.
ANSWER:
c
29. Trackanddeliver.com is an online retail store that does not require a fixed delivery location and delivers goods to the
current location of the customer by tracking the customer’s cell phone location. This way customers need not be at home
when a package arrives nor have the package delivered to a neighbor. In this scenario, Trackanddeliver.com is considered
as a _____.
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a.
symbolic innovation
b.
discontinuous innovation
c.
radical innovation
d.
hedonic innovation
e.
functional innovation
ANSWER:
e
30. Which of the following is true of a continuous innovation?
a.
It has the ability to convey meaning about a consumer’s reference group.
b.
It has a limited effect on existing consumption patterns.
c.
It has a pronounced effect on our consumption practices.
d.
It has the potential to start a new product category.
e.
It has old associations but a new name.
ANSWER:
b
31. Shine&Lime Inc. has introduced a new sponge that has an antimicrobial polymer designed to kill bacteria and germs
and reduce the odors associated with wet sponges. This is best thought of as an example of a _____.
a.
dynamically discontinuous innovation
b.
continuous innovation
c.
dynamically continuous innovation
d.
discontinuous innovation
e.
hedonic innovation
ANSWER:
b
32. Which of the following is true of a dynamically continuous innovation?
a.
It has the ability to convey meaning about a consumer’s reference group.
b.
It has a limited effect on existing consumption patterns.
c.
It has a pronounced effect on consumption practices.
d.
It has the potential to start a new product category.
e.
It has the same usage as the products that came before it.
ANSWER:
e
33.
YapSnap.com is a social media website which allows its members to chat and send pictures to each other via private
messages. YapSnap can be considered to be a _____ because it changes the way one communicates with other people.
a.
dynamically discontinuous innovation
b.
continuous innovation
c.
dynamically continuous innovation
d.
discontinuous innovation
e.
hedonic innovation
ANSWER:
c
34. A discontinuous innovation is defined as:
a.
a product that pushes all similar products out of the market.
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b.
a product that disrupts consumers’ lives.
c.
a product that disrupts a firm’s marketing operations.
d.
a product that is so new that we have never known anything like it before.
e.
a product that has new social meanings carried by its use and ownership.
ANSWER:
d
35. Fly-Away Airlines is one of the earliest airline companies. It has received many awards due to the effect it has on
how, when, and where passengers travel. At the time when Fly-Away Airlines was introduced in the market, it was
regarded as a:
a.
symbolic innovation.
b.
continuous innovation.
c.
dynamically continuous innovation.
d.
discontinuous innovation.
e.
hedonic innovation.
ANSWER:
d
36. _____ are those that offer benefits in product performance over existing alternatives.
a.
Functional innovations
b.
Feature innovations
c.
Symbolic innovations
d.
Hedonic innovations
e.
Dynamic innovations
ANSWER:
a
37. Flapbox is a new type of tablet that does not require any hardware medium for input. It offers the benefit of portability
and additional functionality that desktop computers do not. Flapbox can be best classified as a(n) _____.
a.
functional innovation
b.
aesthetic innovation
c.
symbolic innovation
d.
attribute-based innovation
e.
serial innovation
ANSWER:
a
38. GreenMachine, a hybrid car, is considered to be more fuel-efficient and environment friendly than a traditional
gasoline-powered car. GreenMachine is an example of a(n) _____.
a.
functional innovation
b.
hedonic innovation
c.
symbolic innovation
d.
aesthetic innovation
e.
dynamic innovation
ANSWER:
a
39. Which of the following is true of hedonic innovations?
a.
They offer benefits in product performance over existing alternatives.
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b.
They appeal to our pleasure-seeking and/or sensory needs.
c.
They have new social meaning.
d.
They are only incremental improvements.
e.
They usually spawn other innovations and product forms.
ANSWER:
b
40. New forms of dance, new types of music, new clothing styles, and new types of food would all qualify as _____.
a.
functional innovations
b.
aesthetic innovations
c.
discontinuous innovations
d.
attribute-based innovations
e.
serial innovations
ANSWER:
b
41. Which of the following is true of symbolic innovations?
a.
They offer benefits in product performance over existing alternatives.
b.
They appeal to our pleasure-seeking and/or sensory needs.
c.
They have new social meaning carried by their use and ownership.
d.
They are only incremental improvements.
e.
They usually spawn other innovations and product forms.
ANSWER:
c
42. Jonathan always wore horned-rimmed glasses when he was in school and was always ridiculed because of them.
However, in college, he was praised for his smart and intelligent looking glasses even though he wore the same kind of
glasses. Horned- and wire-rimmed glasses were considered old-fashioned until they became associated with
intellectualism in the 1980s. From the above scenario, it can be understood that when Jonathan entered college his glasses
were perceived as a symbolic innovation because:
a.
the design of his glasses was observed as new.
b.
the features associated with his glasses were new.
c.
the brand name associated with his glasses was new.
d.
the meaning associated with his glasses was new.
e.
the technology associated with his glasses was new.
ANSWER:
d
43. Breadth of an innovation is defined as:
a.
the number of different ideas that goes into the invention of a new product.
b.
the rate of continuity of an innovation in the market.
c.
the rate of discontinuity of an innovation in the market.
d.
the degree to which people influence one another in the diffusion of a new product.
e.
the new and different uses of a particular product.
ANSWER:
e
44. Mark is a graphic designer. He has an aversion toward tablets. He refused to buy a tablet even when all his friends
bought one. He continued to refuse even when his boss pressured him to buy a tablet, as the company was to start doing
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all their design work on tablets. In the context of consumer behavior, Mark’s behavior is an example of:
a.
insistence.
b.
arbitraging.
c.
resistance.
d.
scheming.
e.
referencing.
ANSWER:
c
45. In the context of consumer behavior, resistance refers to:
a.
the degree of consumer anger over dangerous products.
b.
the difficulty faced by consumers while using hi-tech products.
c.
the slowness of marketing communications to build up a brand image.
d.
the desire to not buy an innovation, even in the face of pressure to do so.
e.
the refusal of consumers to remember the brand name of products bought on sale.
ANSWER:
d
46. Ying is known to read several online reviews, consult all his friends, and gather all the available information about a
product before purchasing it. From the given information, it is understood that Ying follows _____ while making
innovation adoption decisions.
a.
the high-effort hierarchy of effects
b.
the low-effort hierarchy of effects
c.
peripheral processing
d.
heuristic processing
e.
schema probing
ANSWER:
a
47. Which of the following is true of the low-effort hierarchy of effects?
a.
It is high priced but less interesting to the consumer.
b.
It involves less risk and fewer people in the buying decision.
c.
It is common in prevention-focused consumers.
d.
It takes a long time to be adopted but is always adopted by everyone.
e.
It takes a short time to be adopted but is only adopted by half the consumers.
ANSWER:
b
48. With low-effort hierarchy of effects, attitudes are based on:
a.
first impression.
b.
attractive advertising.
c.
trial experience.
d.
peer pressure.
e.
hedonic desires.
ANSWER:
c
49. The _____ are visionaries in the product category, and they admire a technologically new product for its abilities to
create a revolutionary breakthrough in how things are done.
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a.
laggards
b.
innovators
c.
early adopters
d.
late-majority consumers
e.
early-majority consumers
ANSWER:
c
50. The _____ are pragmatists, seeking innovations that offer incremental, predictable improvements on an existing
technology.
a.
laggards
b.
innovators
c.
early adopters
d.
late-majority consumers
e.
early-majority consumers
ANSWER:
e
51. The _____ are more conservative, wary of progress, and rely on tradition.
a.
laggards
b.
innovators
c.
early adopters
d.
late-majority consumers
e.
early-majority consumers
ANSWER:
d
52. The _____ are the slowest group to adopt an innovation, and are considered skeptics.
a.
laggards
b.
innovators
c.
early adopters
d.
late-majority consumers
e.
early-majority consumers
ANSWER:
a
53. If an innovation is to spread through the market, it:
a.
must appeal to every adopter group.
b.
only needs to appeal to innovators.
c.
only needs to appeal to early-majority consumers.
d.
must first appeal to the lower classes.
e.
must first appeal to the middle classes.
ANSWER:
a
54. Innovators adopt innovations independent of the opinions of other people, and they tend to:
a.
be easily influenced by their reference group.
b.
be easily influenced by their peer group.
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c.
be ignorant about new products.
d.
be more receptive to information about new products.
e.
be less receptive to information about new products.
ANSWER:
d
55. By virtue of their experience with the innovation, innovators may:
a.
have a greater degree of resistance to an innovation.
b.
be price sensitive and more favorable to competitors.
c.
be more easily influenced by a reference group.
d.
be less receptive to information about new products.
e.
exact normative and informational influence on others.
ANSWER:
e
56. Identify a characteristic of innovators.
a.
They have little social influence.
b.
They tend to be opinion leaders.
c.
They tend to be followers.
d.
They are highly collective in thought.
e.
They are risk averse.
ANSWER:
b
57. Which of the following is true of innovators?
a.
They are known to plan carefully.
b.
They deliberate for a long time.
c.
They do less planning and deliberation.
d.
They engage in attribute-based decision making.
e.
They use whole evaluations while making decisions.
ANSWER:
c
58. Cook Wave is one of the first microwave ovens in the market. Initially, the adoption rate of Cook Wave ovens was
very slow. The adoption rate increased dramatically as consumers became more aware and knowledgeable of microwave
technology and as more products compatible with microwave technology came into the market. The diffusion pattern for
this product is likely to be:
a.
linear.
b.
S-shaped.
c.
exponential.
d.
U-shaped.
e.
bell-shaped.
ANSWER:
b
59. Which of the following is true of a diffusion curve?
a.
It reflects the time period during which a product was launched.
b.
It reflects the total sales of a product in dollar value.
c.
It reflects the total sales of a product in percentages.
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d.
It reflects the percentage of the population who have adopted a product.
e.
It reflects the total number of people who have adopted a product.
ANSWER:
d
60. The _____ starts out quickly, with a large percentage of the market purchasing as soon as possible.
a.
bell-shaped diffusion curve
b.
S-shaped diffusion curve
c.
exponential diffusion curve
d.
linear diffusion curve
e.
M-shaped diffusion curve
ANSWER:
c
61. _____ is the degree to which consumers influence each other in the diffusion of a new product.
a.
Trialability
b.
Complexity
c.
Contagion
d.
A fashion
e.
A fad
ANSWER:
d
62. A successful innovation that has a moderately long and potentially cyclical product life cycle is known as a(n) _____.
a.
fashion
b.
fad
c.
prototype
d.
blip
e.
exemplar
ANSWER:
a
63. The _____ is a concept that suggests that offerings go through an initial introductory period followed by periods of
sales growth, maturity, and decline.
a.
needs hierarchy
b.
balance scorecard
c.
contingency theory
d.
inclusive value measurement
e.
product life cycle
ANSWER:
e
64. The product life cycle deals with the:
a.
sales of the product over time.
b.
influence of individuals in the diffusion of the product.
c.
percentage of sales volume generated by the product.
d.
rate of the product’s obsolescence.
e.
percentage of the market that has adopted the product.
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ANSWER:
a
65. The SoundBoy was a portable radio targeted toward children in the 1970s. It came in different colors and shapes and
was one of the most popular products in its time. Portable radios have slowly been replaced by smartphones, tablets and
other gadgets. From the above scenario, it can be stated that the SoundBoy is currently in the _____ stage of the product
life cycle.
a.
growth
b.
decline
c.
introduction
d.
contagion
e.
maturity
ANSWER:
b
66. A _____ is a successful innovation that has a very short product life cycle.
a.
blip
b.
flash
c.
fad
d.
fashion
e.
classic
ANSWER:
c
67. In the 1980s, almost everybody owned a novelty called a Sound Boxer. This product was a musical device that played
a musical note at the press of a button. The sales of this product rapidly grew and just as rapidly fell. In terms of the
Product Life Cycle, the Sound Boxer was a:
a.
classic.
b.
fashion.
c.
fad.
d.
contagion.
e.
laggard.
ANSWER:
c
68. A _____ is a successful innovation with a lengthy product life cycle.
a.
blip
b.
flash
c.
spat
d.
fashion
e.
classic
ANSWER:
e
69. In Aldmur, warmth of food is associated with freshness. CheesyPies is trying to sell frozen pizzas in Aldmur.
CheesyPies would likely face difficulties in the market because of the:
a.
adoption speed of the innovation.
b.
incompatibility with the existing consumer values and norms.
c.
low trialability of the product.
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d.
collectivist nature of the community.
e.
socioeconomic status associated with the product or service.
ANSWER:
b
70. Among factors that influence resistance, adoption, and diffusion, _____ is the extent to which an innovation is
consistent with one‘s needs, values, norms, or behaviors.
a.
compatibility
b.
fungibility
c.
periodicity
d.
trialability
e.
complexity
ANSWER:
a
71. Among factors that influence resistance, adoption, and diffusion, _____ refers to the extent to which an innovation
follows established guidelines for what seems appropriate in the category.
a.
simplicity
b.
adaptability
c.
legitimacy
d.
fungibility
e.
guidability
ANSWER:
c
72. _____ refers to the extent to which an innovation can foster new styles.
a.
Simplicity
b.
Adaptability
c.
Legitimacy
d.
Fungability
e.
Guidability
ANSWER:
b
73. Which of the following characteristics of a social system could result in the slowing of an innovation’s diffusion?
a.
A high degree of modernity
b.
A high degree of homophily
c.
A high degree of physical distance between members
d.
A high degree of trialability of the innovation
e.
A high degree of compatibility of the innovation
ANSWER:
c
74. Discuss innovations from a marketing viewpoint.
ANSWER:
Responses will vary.
75. Describe the various types of innovation as characterized by their degree of novelty.
ANSWER:
Responses will vary.
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76. Discuss the use of cocreation in innovation.
ANSWER:
Responses will vary.
77. Explain the potential benefits of cocreation in innovation.
ANSWER:
Responses will vary.
78. Describe how high-effort and low-effort adoption decisions differ
ANSWER:
Responses will vary.
79. In the context of innovation, discuss the five consumer adopter categories and their characteristics.
ANSWER:
Responses will vary.
80. Discuss the ways in which adopter group characteristics can be researched by marketers.
ANSWER:
Responses will vary.
81. Identify the differences between adoption and diffusion of an innovation.
ANSWER:
Responses will vary.
82. Discuss and give examples of the two types of diffusion curves.
ANSWER:
Responses will vary.
83. Discuss the relation between diffusion and the product life cycle.
ANSWER:
Responses will vary.
84. Identify the influences on the rates of diffusion of an innovation.
ANSWER:
Responses will vary.
85. Discuss the positive and negative effects of innovations on society.
ANSWER:
Responses will vary.