MAN4720 FINAL EXAM UCF EXAM QUESTIONS AND ANSWERS
Innovation and Entrepreneurship - CORRECT ANSWER✅✅Session 6
---- is defined as the goal directed actions a firm takes to gain and sustain a competitive advantage -
CORRECT ANSWER✅✅Strategy
A --- occurs when a firm is able to generate ABOVE average results - CORRECT ANSWER✅✅Competitive
advantage
What are the 4 stages of the industry life cycle? - CORRECT ANSWER✅✅1. Introduction phase
2. growth stage
3. Shakeout stage
4. maturity stage
5. decline stage
Companies may use skimming pricing if competition is limited or penetration pricing in a competitive
market; low sales, high costs, focus on building awareness - CORRECT ANSWER✅✅Introduction stage
the company will set initial prices high, and only those consumers who feel especially excited about the
product will buy it - CORRECT ANSWER✅✅skimming
a payment the manufacturer makes to persuade the retailer to stock the item - CORRECT
ANSWER✅✅slotting fee; like a deposit on an apartment
Who are the buyers in the introduction stage? - CORRECT ANSWER✅✅innovators and early adopters
Rapid customer adoption and high advertising costs; dominant design emerges - CORRECT
ANSWER✅✅Growth Stage
Who are the buyers in the growth stage? - CORRECT ANSWER✅✅early majority
,intense competition forces weaker firms out; industry consolidates; price competition increases -
CORRECT ANSWER✅✅shakeout stage
Sales growth slows and eventually plateaus; cost leadership or differentiation strategies dominate;
industry consolidation - CORRECT ANSWER✅✅Maturity Stage
Who are the buyers in the maturity stage? - CORRECT ANSWER✅✅late majority
this is a key aspect of success in the maturity stage, particularly for those companies seeking to
differentiate their products as their source of competitive advantage - CORRECT ANSWER✅✅branding
a product design that becomes the accepted market standard, reducing variation and focusing
competition on price and efficiency - CORRECT ANSWER✅✅dominant design
Sales significantly drop due to various factors; reduced innovation and advertising; can exit, harvest,
maintain, or consolidate; high pricing power with less competition - CORRECT ANSWER✅✅Decline
stage
Who are the buyers in the decline stage? - CORRECT ANSWER✅✅laggards
products with a very short life cycle - CORRECT ANSWER✅✅fads
completely leaving the industry; liquidating assets and ceasing operations - CORRECT ANSWER✅✅exit
strategy
making very minimal investments in the SBU with the goal of milking whatever remaining profits or cash
flow can be extracted before eventual divestment (Dog in BCF matrix) - CORRECT ANSWER✅✅Harvest
strategy
, focus on protecting the existing market share and leveraging its profitability; invest enough cash to hold
position; low-growth market but high market share; stable earnings and cash flow; Cash Cow in BCG
matrix - CORRECT ANSWER✅✅Maintain
directly linked to Mergers and Acquisitions; can be a way to reduce competitive intensity, reduce costs,
and increase differentiation; aim to gain market share in a shrinking market - CORRECT
ANSWER✅✅consolidate
Competitive benefits gained by being the first to innovate, like experience curves, supplier lock-in, and
switching costs - CORRECT ANSWER✅✅first-mover advantage
What is the risk of being a first mover? - CORRECT ANSWER✅✅competitors can learn from your
mistakes and enter with improved products
What are the 4 types of innovation? - CORRECT ANSWER✅✅1. Architectural
2. Disruptive
3. Incremental
4. Radical
this innovation leverages existing technology into new markets; reconfigures existing tech in new ways
to serve new markets - CORRECT ANSWER✅✅architectural
leverages new technologies in existing markets; uses new tech to enter and eventually dominate
existing markets - CORRECT ANSWER✅✅disruptive
this innovation builds on an established knowledge base and usually results from steady improvements -
CORRECT ANSWER✅✅incremental
Why do incumbent firms focus on incremental innovation? - CORRECT ANSWER✅✅Due to economic
incentives, organizational inertia, and the constraints of the existing innovation ecosystem
Innovation and Entrepreneurship - CORRECT ANSWER✅✅Session 6
---- is defined as the goal directed actions a firm takes to gain and sustain a competitive advantage -
CORRECT ANSWER✅✅Strategy
A --- occurs when a firm is able to generate ABOVE average results - CORRECT ANSWER✅✅Competitive
advantage
What are the 4 stages of the industry life cycle? - CORRECT ANSWER✅✅1. Introduction phase
2. growth stage
3. Shakeout stage
4. maturity stage
5. decline stage
Companies may use skimming pricing if competition is limited or penetration pricing in a competitive
market; low sales, high costs, focus on building awareness - CORRECT ANSWER✅✅Introduction stage
the company will set initial prices high, and only those consumers who feel especially excited about the
product will buy it - CORRECT ANSWER✅✅skimming
a payment the manufacturer makes to persuade the retailer to stock the item - CORRECT
ANSWER✅✅slotting fee; like a deposit on an apartment
Who are the buyers in the introduction stage? - CORRECT ANSWER✅✅innovators and early adopters
Rapid customer adoption and high advertising costs; dominant design emerges - CORRECT
ANSWER✅✅Growth Stage
Who are the buyers in the growth stage? - CORRECT ANSWER✅✅early majority
,intense competition forces weaker firms out; industry consolidates; price competition increases -
CORRECT ANSWER✅✅shakeout stage
Sales growth slows and eventually plateaus; cost leadership or differentiation strategies dominate;
industry consolidation - CORRECT ANSWER✅✅Maturity Stage
Who are the buyers in the maturity stage? - CORRECT ANSWER✅✅late majority
this is a key aspect of success in the maturity stage, particularly for those companies seeking to
differentiate their products as their source of competitive advantage - CORRECT ANSWER✅✅branding
a product design that becomes the accepted market standard, reducing variation and focusing
competition on price and efficiency - CORRECT ANSWER✅✅dominant design
Sales significantly drop due to various factors; reduced innovation and advertising; can exit, harvest,
maintain, or consolidate; high pricing power with less competition - CORRECT ANSWER✅✅Decline
stage
Who are the buyers in the decline stage? - CORRECT ANSWER✅✅laggards
products with a very short life cycle - CORRECT ANSWER✅✅fads
completely leaving the industry; liquidating assets and ceasing operations - CORRECT ANSWER✅✅exit
strategy
making very minimal investments in the SBU with the goal of milking whatever remaining profits or cash
flow can be extracted before eventual divestment (Dog in BCF matrix) - CORRECT ANSWER✅✅Harvest
strategy
, focus on protecting the existing market share and leveraging its profitability; invest enough cash to hold
position; low-growth market but high market share; stable earnings and cash flow; Cash Cow in BCG
matrix - CORRECT ANSWER✅✅Maintain
directly linked to Mergers and Acquisitions; can be a way to reduce competitive intensity, reduce costs,
and increase differentiation; aim to gain market share in a shrinking market - CORRECT
ANSWER✅✅consolidate
Competitive benefits gained by being the first to innovate, like experience curves, supplier lock-in, and
switching costs - CORRECT ANSWER✅✅first-mover advantage
What is the risk of being a first mover? - CORRECT ANSWER✅✅competitors can learn from your
mistakes and enter with improved products
What are the 4 types of innovation? - CORRECT ANSWER✅✅1. Architectural
2. Disruptive
3. Incremental
4. Radical
this innovation leverages existing technology into new markets; reconfigures existing tech in new ways
to serve new markets - CORRECT ANSWER✅✅architectural
leverages new technologies in existing markets; uses new tech to enter and eventually dominate
existing markets - CORRECT ANSWER✅✅disruptive
this innovation builds on an established knowledge base and usually results from steady improvements -
CORRECT ANSWER✅✅incremental
Why do incumbent firms focus on incremental innovation? - CORRECT ANSWER✅✅Due to economic
incentives, organizational inertia, and the constraints of the existing innovation ecosystem
