As new products that are better than the existing generation of products are introduced, sales normally increase because the new products provide consumers increased value or worth. This process, which is called ________, stimulates economic activity, which is a good thing for the economy.
A) creative destruction
B) repetitive destruction
C) iterative replacement
D) inventive replacement
E) iterative destruction

Question

Quizplus · Accepted Answer

The process described in the question is known as creative destruction. This term was coined by economist Joseph Schumpeter to describe the cycle of innovation in which old products and ways of doing things are replaced by new, better ones, leading to increased economic activity and growth.

As New Products That Are Better Than the Existing Generation