1. The globalization of markets and the importance of innovation are independent of one
another.
Answer: False
Difficulty: Easy
Page: 1
2. Flexible manufacturing technologies have increased the importance of production
economies of scale.
Answer: False
Difficulty: Easy
Page: 1
3. Innovation and new technology have led to longer product life cycles as better quality
products are being produced.
Answer: False
Difficulty: Moderate
Page: 2
4.. The increased pace of innovation has only had a negligible effect on market
segmentation and product obsolescence.
Answer: False
Difficulty: Easy
Page: 2
5. Slow innovation results in diminishing margins and product obsolescence.
Answer: True
Difficulty: Moderate
Page: 2
6. Technological innovation can have a positive impact on our quality of life through
improved goods and services.
Answer: True
Difficulty: Moderate
Page: 4
1-1
,7. Technology’s effects on society are always positive.
Answer: False
Difficulty: Easy
Page: 4
8. Technology in its purest form is not knowledge, but rather faith that things will get
better.
Answer: False
Difficulty: Easy
Page: 4
9. Firms that charge headlong into new product development usually have short
development cycles.
Answer: False
Difficulty: Moderate
Page: 4
10. Studies have revealed that innovation is a freewheeling process that is unconstrained
by rules and plans.
Answer: False
Difficulty: Easy
Page: 4
11. The majority of effort and money invested in technological innovation comes from
industrial firms.
Answer: True
Difficulty: Moderate
Page: 4
12. GDP does relate very directly to the amount of goods consumers can purchase.
Answer: True
Difficulty: Easy
Page: 4
13. Practically all innovative ideas become successful products.
Answer: False
Difficulty: Easy
Page: 5
1-2
, 14. If an idea can be shown to be technologically feasible, it is guaranteed to be
commercially successful.
Answer: False
Difficulty: Easy
Page: 5
15. According to the concept of the innovation funnel, one new idea is usually
responsible for several new products.
Answer: False
Difficulty: Moderate
Page: 5
Multiple Choice
16. As a result of the rapid pace of innovation, the time between a product’s introduction
and its withdrawal from the market
a. has become shorter.
b. has become more predictable.
c. has become longer.
d. has not changed at all.
Answer: a
Difficulty: Easy
Page: 2
17. While rapid innovation often benefits society, it often makes success for companies
a. more complicated as they strive to keep up with the latest innovations.
b. profitable as long as they do not innovate themselves, but rather use innovations of
others to their advantage.
c. easier since innovation always makes things simpler.
d. less likely because customers will not be willing to pay as much for goods and
services.
Answer: a
Difficulty: Moderate
Page: 2
18. After Yahoo! was introduced as an easy way to search the World Wide Web, it was
followed by other search engines, some of which had improved or faster ways to search
the web. This is an example of how one innovative idea can
a. ruin the business of someone else.
1-3
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