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Chapter 07 Business Strategy: Innovation and Entrepreneurship
Answer Key
Multiple Choice Questions
1.
How was Netflix able to outperform both Hulu and Amazon?
2.
Which of the following accurately describes how Netflix used innovation to gain a
competitive advantage?
3.
The typical four-step innovation process begins with
4.
A _____ is best described as a form of intellectual property that gives the inventor
exclusive rights to benefit from commercializing a technology for a specified time period in
exchange for public disclosure of the underlying idea.
5.
When TrueHeal Pharma Inc. released a new drug to treat insomnia, its chemical
composition was disclosed at the back of the drug's cover. However, any attempts by
competitors to copy the chemical composition would result in infringement of TrueHeal
Pharma's intellectual property rights. Thus, the drug is protected by a
6.
In the United States, the time period for the right to exclude others from the use of a
patented technology is _____ from the filing date of a patent application.
7.
_____ is best described as the commercialization of any new product, process, or the
modification and recombination of existing ones.
8.
As a research scholar, Ricardo had built a helicam as part of his project. The helicam could
capture aerial images. Realizing the potential use of this product in movie production and
military and rescue operations, he started a new venture where he could customize these
helicams to fit the specific needs of the buyers and sell them. Ricardo can be best
described as a(n)
9.
An intrapreneur is described as a person who
10.
A. G. Lafley at Procter & Gamble (P&G), had implemented an open-innovation model,
which had greatly benefitted the company. In the light of this information, we can conclude
that A. G. Lafley is a(n)
11.
Which of the following statements is
not
true about innovation?
12.
How has Apple been able to sustain its competitive advantage in the smartphone
industry?
13.
Which of the following is a competitive benefit experienced by the first mover firm in an
industry?
14.
The four-step innovation process ends with
15.
As the inventor of hypertension medication, OneSure Pharmaceuticals (OSP) Inc. was able
to reap the benefits of economies of scale due to a large consumer demand for the drug.
Even when competitors later developed similar drugs after the expiry of OSP's patents,
regular users did not want to switch because they were concerned about possible side
effects. Which of the following benefits does this scenario best illustrate?
16.
Which of the following statements accurately describes social entrepreneurs?
17.
Georgia Ray is the founder of the departmental stores chain, Ether Inc. She ensures that
the products in her stores are ethically and responsibly sourced. Most products are
therefore 100 percent organic and manufactured from recycled material. Also, her
company purchases handicrafts from nonprofit organizations supporting the aged.
Georgia's belief is that her company should be able to support the community at large.
Which of the following terms best describes Georgia Ray?
18.
After Jeff Bezos read about how the Internet was growing by 2,000 percent a month, he set
out to use the Internet as a new distribution channel and founded Amazon, which is now
the world's largest online retailer. This is clearly an example of a(n)
19.
The market for 3-D televisions is in the introduction stage of the industry life cycle. What
does this imply?
20.
The strategic objective of a first mover during the introduction stage of the industry life
cycle is to
21.
NextDoor is an instant messaging application for smartphones. New smartphone users
find it easier to connect with friends and relatives through this mobile app when compared
to other similar instant messaging applications. Hence, it has the largest user base in the
industry. Thus, NextDoor app's value has increased primarily due to its
22.
Dollar Shave Club is an ecommerce start-up that delivers razors by mail. By doing this,
Dollar Shave Club is using a(n) _____ to disrupt an existing market.
23.
In the context of industrial growth, which of the following statements is true of standards?
24.
In which of the following stages of the industry life cycle is a standard first established?
25.
Which of the following is a feature of the growth stage of the industry life cycle?
26.
Which of the following best illustrates a process innovation as opposed to product
innovation?
27.
Process innovation is more important than product innovation during the growth stage
because
28.
While cell phones with holographic keyboards are currently in the introduction stage of the
industry life cycle, tablet computers are in the growth stage. In the context of this
scenario, which of the following statements is true?
29.
Which of the following statements accurately brings out the distinction between the
introduction and growth stages of the industry life cycle?
30.
The key objective for firms during the growth phase is to
31.
Which of the following is a feature of the shakeout phase of the industry life cycle?
32.
To be successful and to survive the shakeout stage of the industry life cycle, a firm should
