Chapter 11W – Technology, R&D, and Efficiency
57. Refer to the above data. Suppose the price of new product Z is $10 rather than $1. This
58. For a new product to be profitable, it must:
59. Suppose that a firm introduces a highly profitable new product. If this new product is
priced higher than existing substitute products, then the:
Chapter 11W – Technology, R&D, and Efficiency
60. Suppose that a firm introduces a highly profitable new product. If this new product offers
less marginal utility per unit to consumers than existing substitute products, then the:
61. Process innovation refers to:
62. Firm ABC designs and implements a lower-cost method of producing its product. This is
an example of:
Chapter 11W – Technology, R&D, and Efficiency
63. Process innovation causes an upward shift in a firm’s total product curve and:
64. Process innovation can be depicted as:
Chapter 11W – Technology, R&D, and Efficiency
65. Refer to the above diagram which relates to Firm A. Which of the following would shift
A’s average total cost curve from ATC1 to ATC2?
66. Refer to the above diagram which relates to Firm A. Which of the following would shift
Chapter 11W – Technology, R&D, and Efficiency
67. Refer to the above diagram that relates to Firm X. Which of the following would illustrate
process innovation by X?
68. Refer to the above diagram that relates to Firm X. Suppose X implements an innovative
new production method that shifts its total product curve from TP2 to TP1. Other things equal:
69. As it relates to R&D, the imitation problem is that:
Chapter 11W – Technology, R&D, and Efficiency
70. Gigantic Corporation follows a strategy of waiting for rivals to innovate, then quickly
imitating any successful innovations. This behavior is known as:
71. Fast-second strategies are more likely to be used by:
72. Other things equal, the prospect of imitation by others:
Chapter 11W – Technology, R&D, and Efficiency
73. All of the following increase the expected rate of return on R&D expenditures, except:
74. Legal protections against competitors producing and selling a product identical to the one
you invented are called _________; legal protections against competitors using your product’s
name are called __________.
75. Suppose that Marlen Fisher has legal protection against anyone producing and selling a
fishing lure identical to his unique-action “MarFish” lure, whatever the competitor might
name the lure. This legal protection is most likely to be a:
Chapter 11W – Technology, R&D, and Efficiency
76. Suppose that Marlen Fisher has legal protection against anyone producing and selling a
fishing lure specifically named “MarFish.” This legal protection is most likely to be a:
77. Suppose that Book-Cost Busters (BCB), without authorization, reproduced a best-selling
novel and placed it for downloading on the BCB pay-for-use website. This action would
violate the publisher’s:
78. Other things equal, patents:
Chapter 11W – Technology, R&D, and Efficiency
79. Other things equal, trademarks and brand names:
80. Suppose that a firm’s legal staff concludes that a new product that the firm is developing is
patentable. Graphically, this new information would shift the firm’s expected rate of return
curve on R&D to the:
81. Suppose that a firm’s legal staff concludes that a new production process which a firm is
developing is patentable. Graphically, this new information would shift the firm’s expected
rate of return curve on R&D to the:
Chapter 11W – Technology, R&D, and Efficiency
82. A patent on a new product benefits the firm securing it by:
83. Even where imitation is possible, a firm may gain advantage from being the first to
introduce an innovative product because of:
84. Which of the following supports the contention that pure competitors have a weak
incentive to engage in R&D?
Chapter 11W – Technology, R&D, and Efficiency
85. Which of the following supports the contention that pure competitors have a strong
incentive to engage in R&D?
86. Which of the following supports the contention that monopolistic competitors have a
strong incentive to engage in R&D?