Patterns of Entrepreneurship Management 4th Edition by Kaplan - Test Bank

Chapter 2: The Art of Innovation

True/False

1.     The frameworks in which a sustainable, high-profit company is constructed are called business models.

Ans: True                                                        Page: 26

2.     Unfortunately, North America has one of the lowest percentages of people with Internet access.

Ans: False                                                       Page: 27

3.     Geographical location no longer provides any significant advantage for access to major sources of capital.

Ans: True                                                        Page: 29

4.     A product life cycle is the time that a product is able to command a high profit margin in the market before it becomes obsolete or develops intense competition.

Ans: True                                                        Page: 29

5.     Product development times have increased from 200 days three years ago to an average of 225 days now.

Ans: False                                                       Page: 29

6.     Fortunately, it is becoming easier for a company to build around a single product idea without strong patent protection.

Ans: False                                                       Page: 30

7.     The first step for any entrepreneur is to generate an idea for a new business.

Ans: True                                                        Page: 39

8.     Asking the right questions and preparing the business plan are components of phase 3 in the five phases to success.

Ans: True                                                        Page: 41

9.     To eliminate receiving questionable data, you should train and monitor survey recorders and telephone interviews to ensure consistent results.

Ans: True                                                        Page: 44

10.  The final phase of the five step model of success is “Develop the Plan.”

Ans: False                                                       Page: 46

Short Answer / Fill in the Blank

11.  Successful ____________ is the use of new technological knowledge, and/or new market knowledge, employed within a business model that can deliver a new product and/or service to customers who will purchase at a price that will provide profits.

Ans: innovation                                              Page: 31

12.  The ___________ is often used to illustrate the difference in which the performance achieved by new innovation is plotted against time.

Ans: S-curve                                                   Page: 32

13.  Usually, improvements can be made with ____________ innovations, pushing the original curve higher.

Ans: incremental                                             Page: 32

14.  The term _______________ is often used to describe innovations that disrupt the status quo.

Ans: disruptive innovation                             Page: 33

15.  ___________ are sources of ideas.

Ans: Patents                                                    Page: 39

16.  Many new companies are built around a radical or ____________ technology.

Ans: breakthrough                                          Page: 40

17.  A window of opportunity is a __________________ during which opportunities exist before something else happens to eliminate them.

Ans: time horizon                                           Page: 42

18.  ________________ are the value of benefits lost when one decision or idea alternative is selected over another.

Ans: Opportunity costs                                   Page: 42

19.  A(n) _______________ charts the current and future components of the business in about thirty to forty pages.

Ans: business plan                                          Page: 45

20.  Sufficient ___________ is required to sustain the company for a specific length of time, possibly a one- or two-year period.

Ans: capital                                                     Page: 46