Question 1

Aggressive marketing is a key factor in jump-starting demand to get potential early adopters to bear the switching costs associated with adopting a new innovation.

Accepted Answer

A) True 
 B)False

Question 2

Marginal cost refers to the costs of:

Accepted Answer

A)   switching to a new technology.
B)   adhering to technical standards.
C)   producing one extra unit of product.
D)   product promotions.
E)   licensing new technology.F) A) and D)
G) B) and C)

Question 3

Which of the following is NOT true of high-technology industries?

Accepted Answer

A)   First movers have an advantage because their customers avoid switching costs.
B)   First movers have higher pioneering costs than later entrants.
C)   Later entrants can avoid the mistakes made by first movers.
D)   First movers that create a revolutionary product are in a monopoly position.
E)   First movers run the risk of building the wrong resources and capabilities.F) C) and D)
G) None of the above

Question 4

Which of the following will NOT help an established company in addressing the potential challenge of a disruptive technology?

Accepted Answer

A)   Access to knowledge about how disruptive technologies can revolutionize markets
B)   Investing in newly emerging technologies that may ultimately become disruptive technologies
C)   Separating out the disruptive technology and creating an autonomous operating division solely for this new technology
D)   Asking customers if they are interested in the new technology
E)   Understanding that a disruptive technology will require a radically different value chain with a different cost structureF) C) and D)
G) B) and D)

Question 5

It is important for a company to make sure that, in addition to the product itself, there is an adequate supply of complements to win a format war.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following strategies should a company NOT adopt if it wants to win a format war?

Accepted Answer

A)   Developing killer applications
B)   Developing complementary products
C)   Joining forces with other companies to develop new technologies
D)   Aggressively marketing to jump-start demand
E)   Charging extremely high license fee for the technologyF) C) and D)
G) A) and C)

Question 7

Technological paradigm shifts occur when new technologies revolutionize the structure of the industry, dramatically alter the nature of competition, and require companies to adopt new strategies to survive.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is a disadvantage of first movers?

Accepted Answer

A)   They cannot establish significant brand loyalty due to high costs.
B)   They cannot create switching costs for their customers, thus making it difficult to enter the market.
C)   They decrease sales volume compared to their rivals, and thus operate at a loss.
D)   They run the risk of building the wrong resources and capabilities.
E)   They do not have the power to exploit network effects and positive feedback loops.F) A) and E)
G) D) and E)

Question 9

The various strategies that companies should adopt to win format wars revolve around:

Accepted Answer

A)   getting the federal government to intercede.
B)   making network effects work in their favor and against their competitors.
C)   avoiding aggressive marketing and advertising strategies.
D)   curbing the supply of complementary products.
E)   charging high license fees.F) B) and C)
G) A) and E)

Question 10

Consider a cost curve with production volume on the horizontal axis and marginal costs on the vertical axis. What shape would the marginal cost curve most resemble in a high-tech industry?

Accepted Answer

A)   Upward at a 45-degree angle
B)   U-shape
C)   Straight and vertical
D)   J-shape
E)   Straight and flatF) B) and D)
G) B) and C)

Question 11

Which of the following is NOT a basic strategy for a first mover?

Accepted Answer

A)   Develop and market the innovation itself
B)   Develop and market the innovation jointly with other companies through a strategic alliance or joint venture
C)   License the innovation to others
D)   Discourage development of complementary assets
E)   Increase height of imitation barriersF) D) and E)
G) A) and B)

Question 12

An example of an important complementary asset is a state-of-the-art manufacturing facility.

Accepted Answer

A) True 
 B)False

Question 13

Microsoft's near monopoly substantially reduces the risks facing the makers of complementary products and the costs of those products.

Accepted Answer

A) True 
 B)False

Exam 7: Strategy and Technology

The various strategies that companies should adopt to win format wars revolve around:

Correct Answer
verified

Aggressive marketing is a key factor in jump-starting demand to get potential early adopters to bear the switching costs associated with adopting a new innovation.

Correct Answer
verified

Consider a cost curve with production volume on the horizontal axis and marginal costs on the vertical axis. What shape would the marginal cost curve most resemble in a high-tech industry?

Correct Answer
verified

Which of the following is a disadvantage of first movers?

Correct Answer
verified

Microsoft's near monopoly substantially reduces the risks facing the makers of complementary products and the costs of those products.

Correct Answer
verified

Which of the following is NOT true of high-technology industries?

Correct Answer
verified

Which of the following will NOT help an established company in addressing the potential challenge of a disruptive technology?

Correct Answer
verified

Technological paradigm shifts occur when new technologies revolutionize the structure of the industry, dramatically alter the nature of competition, and require companies to adopt new strategies to survive.

Correct Answer
verified

Marginal cost refers to the costs of:

Correct Answer
verified

Which of the following is NOT a basic strategy for a first mover?

Correct Answer
verified

Which of the following strategies should a company NOT adopt if it wants to win a format war?

Correct Answer
verified

An example of an important complementary asset is a state-of-the-art manufacturing facility.

Correct Answer
verified

It is important for a company to make sure that, in addition to the product itself, there is an adequate supply of complements to win a format war.

Correct Answer
verified

Exam 7: Strategy and Technology

The various strategies that companies should adopt to win format wars revolve around:

Correct AnswerverifiedShow Answer

Aggressive marketing is a key factor in jump-starting demand to get potential early adopters to bear the switching costs associated with adopting a new innovation.

Correct AnswerverifiedShow Answer

Consider a cost curve with production volume on the horizontal axis and marginal costs on the vertical axis. What shape would the marginal cost curve most resemble in a high-tech industry?

Correct AnswerverifiedShow Answer

Which of the following is a disadvantage of first movers?

Correct AnswerverifiedShow Answer

Microsoft's near monopoly substantially reduces the risks facing the makers of complementary products and the costs of those products.

Correct AnswerverifiedShow Answer

Which of the following is NOT true of high-technology industries?

Correct AnswerverifiedShow Answer

Which of the following will NOT help an established company in addressing the potential challenge of a disruptive technology?

Correct AnswerverifiedShow Answer

Technological paradigm shifts occur when new technologies revolutionize the structure of the industry, dramatically alter the nature of competition, and require companies to adopt new strategies to survive.

Correct AnswerverifiedShow Answer

Marginal cost refers to the costs of:

Correct AnswerverifiedShow Answer

Which of the following is NOT a basic strategy for a first mover?

Correct AnswerverifiedShow Answer

Which of the following strategies should a company NOT adopt if it wants to win a format war?

Correct AnswerverifiedShow Answer

An example of an important complementary asset is a state-of-the-art manufacturing facility.

Correct AnswerverifiedShow Answer

It is important for a company to make sure that, in addition to the product itself, there is an adequate supply of complements to win a format war.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

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verified

Correct Answer
verified

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verified

Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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