(p. 34)-Which of the following statements is true of geographical clustering?
A. The proximity of many competitors serving a local market leads to competition that
increases their pricing power in their relationships with both buyers and suppliers.
B. Close proximity of firms eliminates the likelihood of a firm’s competitors gaining
access to the firm’s proprietary knowledge.
C. Clustering invariably leads to lower concentration of pollution and inordinately low
housing costs.
D. Proximate firms have an advantage in sharing information that can lead to greater
innovation productivity.
(p. 37)-A variety of rice created by Biocrop Inc. through recombinant DNA technology
was found to be rich in both carbohydrates and proteins. After the success of this rice
variety, recombinant DNA technology was implemented by less-developed countries to
increase the nutrient levels of fruits, pulses, and greens in order to feed their
malnourished children. This is an example of _____.
A. technological dissonance
B. technological spillover
C. technological retardation
D. technological determinism
(p. 217)-Since larger companies tend to have more bureaucracy, fixed costs, and
commitments to large numbers of employees, customers, and suppliers than smaller
firms, you can expect it to _____.
A. gamble more on big changes
B. be less responsive to technological changes
C. find it much simpler to monitor employees and reward them for their effort or
success at innovation
D. experience higher rates of new product success
(p. 35)-The benefits firms reap by locating in close geographical proximity to each
other are known collectively as _____.
A. agglomeration economies
B. incubator economies
C. virtual economies
D. shadow economies
(p. 52-53)-In the context of s-curve in technological improvement, plotting performance
against time will result in the same characteristic curve as plotting performance against
effort only if:
A. speed, a function of performance, is relatively constant over time.
B. effort is relatively constant over time.
C. power, a function of performance, is relatively inconsistent over time.
D. effort varies over time.
(p. 195)-Which of the following can be protected by a copyright?
A. Familiar symbols
B. Names of people
C. An improvisational speech that has not been recorded
D. A novel
(p. 247)-Firms always make decisions about projects on the basis of marketing criteria.
(p. 220)-Which of the following statements is true of ambidextrous organizations?
A. They have uniform incentive plans for all employees within the organization.
B. They achieve long-term innovation, but not short-term efficiency.
C. They fail to tolerate varying cultures and different sets of behavior from employees.
D. They have a complex organizational form that is composed of multiple internally
inconsistent architectures.
(p. 85)-Which of the following statements is true of a monopoly cost curve?
A. Monopoly costs to market share curve is more s-shaped than network externality
returns to market share curve.
B. The steepness of the monopoly cost curve is largely a function of a firm’s
discretionary behavior.
C. It is not possible for a network externality returns curve to cross a monopoly cost
curve.
D. A firm choosing to exploit its monopoly power is flattening its monopoly costs
curve.
(p. 93)-Magnitude Inc. was the first company to introduce a video gaming console in
the market. However, consumers were uncertain about the product, and its high costs
discouraged consumers from purchasing it. Eventually, Magnitude withdrew the
product from the market. A few years later, Mantel Corp. and Adventura Inc. came up
with their respective gaming consoles and successfully established their products. In
this scenario, Mantel and Adventura would be considered:
A. pioneers.
B. early followers.
C. laggards.
D. late movers.
(p. 2)-Virtual Inc., a manufacturing company, has recently entered the cell phone
industry. This industry is characterized by rapid technological innovations. Which of the
following is most likely to be true for Virtual?
A. The life cycle of its cell phones will be very long.
B. It will face rapid product obsolescence.
C. It will face low market segmentation in the cell phone industry.
D. It will have a lower need for product differentiation.
(p. 2)-The _____ of an economy is its total annual output as measured by its final
purchase price.
A. balance of payment
B. gross domestic product
C. cash reserve ratio
D. net national income
(p. 293)-When Pearl Love Inc. introduced its new range of bodywash, consumers
switched from using its soaps, being sold under the same brand name, to using the
bodywash. As a result, the company experienced a sharp drop in its soap sales. This
scenario represents:
A. cannibalization.
B. the vampire effect.
C. the halo effect.
D. vaporware.
(p. 131)-_____ refers to the allocation of a finite quantity of resources over different
possible uses.
A. Systematic enrollment
B. Translational funding
C. Organizational appropriation
D. -Capital rationing
(p. 73)-Money Club and Money Ball are online platforms that allow their members to
get in touch with people from various businesses. They also facilitate business contracts
between their members. Money Club has 6,000 members, whereas Money Ball has
3,500 members. This indicates that:
A. Money Club has a larger installed base than Money Ball.
B. Money Club has a lower positive consumption externality than Money Ball.
C. Money Ball provides more complementary goods than Money Club.
D. Money Ball does not use a dominant design.
(p. 111)-Which of the following statements is true of Porter’s five-force model?
A. It states that the attractiveness of an industry is unaffected by the industry’s degree of
rivalry.
B. It fails to acknowledge the role of substitutes for customers.
C. It is often used in practice to assess a specific firm’s external environment.
D. It states that oligopolistic industries are less competitive if firms choose to engage in
price wars.
(p. 256)-Additive manufacturing refers to:
A. printing a design by laying down thin horizontal cross sections of material.
B. manually printing a new design that converges with an old design by adding details.
C. constructing a model by injection molding.
D. constructing a model by machining a mold.
(p. 29)-In 2001, Shanghai’s municipal government set aside 13 square kilometers of
land near the Huangpu River for university laboratories and start-up firms in
microelectronics, digital technology, and life sciences. The project aimed to foster
research in microelectronics, the development of a technologically advanced labor pool,
and the creation of new industries in Shanghai. This project would be best termed a
_____.
A. complementor
B. strategic unit
C. science park
D. free trade area
(p. 23)-Which of the following is a characteristic of most successful inventors?
A. They specialize solely in a single field rather than several fields simultaneously.
B. They are curious and more interested in solutions than in problems.
C. They blindly accept the assumptions made in previous works in their field.
D. They seek global solutions rather than local solutions.
(p. 245)-Which of the following statements is true of partly parallel development
processes?
A. It enhances the probability that R&D will design products that are difficult to
manufacture.
B. It requires costly iterations between design stages.
C. It shortens overall cycle time.
D. It initiates product design after concept development is complete.
(p. 269)-Which of the following is an advantage typically associated with
cross-functional teams?
A. A cross-functional interface ensures that cross-fertilization of ideas is reduced.
B. Cross-functional teams allow a project to draw on a wider mix of information
sources in the environment.
C. Cross-functional teams usually reduce coordination and communication costs.
D. Cross-functional teams are most efficient in eradicating homophily.
(p. 194)-The difference between copyrights and trademark protection is that:
A. trademark is an indicator used to distinguish the source of a good.
B. trademarks are a form of protection granted to works of authorship.
C. copyrights are established by the legitimate use of a product.
D. copyrights can last as long as the copyright is in use.
(p. 2)-As a result of the rapid pace of innovation:
A. product life cycles have become short.
B. product development cycles have become significantly longer.
C. market segmentation has reduced.
D. product obsolescence has slowed down.
(p. 215)-Altair Inc., a large firm in the electronics market, is facing stiff competition
from a relatively smaller firm, Cygnus Corp. Which of the following is an advantage
that Cygnus has over Altair due its size?
A. Larger fixed-asset bases
B. More layers of administration
C. More flexible and entrepreneurial culture
D. Greater bureaucratic inertia due to well-developed policies and procedures
(p. 48)-A bicycle manufacturing company adopted a new type of inventory
management system. This inventory system improved the productivity of its
manufacturing unit and the quality of its bicycles. This is an example of _____
innovation.
A. virtual
B. regressive
C. archaic
D. process
(p. 118)-Which of the following would be an example of a tacit resource?
A. An oddsmaker who works for a large casino in Las Vegas and is correct 95 percent
of the time
B. Hand-woven fabrics made by local shops
C. Chipset manufacturing machine bought by an electronics company
D. A distiller used to make malt liquor
(p. 2)-Which of the following is true of technological innovations?
A. Technological innovations help increase a country’s gross domestic product.
B. Technological innovations decrease the amount of output achievable from a given
quantity of labor and capital.
C. Technological innovations slow down product obsolescence and lengthen the
product development cycles.
D. Technological innovations increase production costs and reduce product
differentiation.
(p. 53)-Digital cameras replaced film cameras. Therefore, digital cameras are an
example of _____.
A. modular innovation
B. incremental technology
C. component innovation
D. discontinuous technology
(p. 58)-A marketing research company categorized Jane as an early adopter. Which of
the following would be true of Jane in this context?
A. She does not adopt an innovation until she feels pressure from her peers.
B. She is well integrated into her social system.
C. She has a skeptical attitude toward new ideas.
D. She has a low potential for opinion leadership.
(p. 3)-Which of the following is most likely to create a positive externality for its
neighboring community members?
A. A coal mine
B. An organic farm
C. A petroleum refinery
D. A dye manufacturing company
(p. 20)-Erison Group, an advertising company, wants to hire someone as its creative
head. Who among the following would be best suited for this position?
A. An individual who completely adheres to the existing logic and paradigms and has
extensive knowledge of the field
B. An individual who has low tolerance for ambiguity and avoids taking risks
C. An individual who has a moderate degree of knowledge of the field but is
intrinsically motivated
D. An individual who prefers to look at problems in conventional ways
(p. 133)-The discounted cash inflows of a project minus the discounted cash outflows is
referred to as the _____.
A. internal rate of return
B. net present value
C. real option
D. -screening value
(p. 100)-A delayed entry into a market with a new technology is preferred if:
A. support by complementary goods providers is high.
B. enabling technologies are less mature.
C. customer uncertainty is low.
D. the scope for improving over previous technologies is high.
(p. 47)-The path a technology follows through time is termed as _____.
A. technology map
B. technology trajectory
C. technology cluster
D. technology transfer