Question 1

"What does the industry look like?," "Is the industry growing?," and "Where are the opportunities?" are examples of the questions that should be answered when conducting

Accepted Answer

These questions are typical of an industry analysis, which aims to evaluate the economic, political, and market factors that influence the way an industry develops. This includes understanding the industry's growth, opportunities, and overall landscape.

Question 2

Identification of the _____ and the first customer is one of the most important tasks that needs to be undertaken during the feasibility analysis for a new business.

Accepted Answer

Identifying the primary market is crucial during the feasibility analysis for a new business as it helps in understanding the target customer base and market demand, which are essential for the success of the business.

Question 3

Due to the rise of digital media, many print newspapers have gone out of print or have reduced circulation. The newspaper industry is in the _____ stage of the industry life cycle.

Accepted Answer

The newspaper industry is in the decline stage of the industry life cycle due to the reduction in print circulation and the shift towards digital media, indicating a decrease in demand for traditional print newspapers.

Question 4

Which of the following is a goal of market research for a new company?

Accepted Answer

Market research for a new company aims to identify and profile the first customer, estimate potential demand from that customer, and identify subsequent customer segments for future growth. All these activities are crucial for understanding the market and planning the company's strategy.

Question 5

The North American Industry Classification System (NAICS) code consists of _____ digits where the first two digits designate _____.

Accepted Answer

The NAICS code consists of six digits, where the first two digits designate a major economic sector.

Question 6

Which of the following is NOT part of an ethnographic approach to customer observation?

Accepted Answer

Developing a plan is not part of an ethnographic approach to customer observation. Ethnographic research involves observing and understanding the behavior of people in their natural environment, without imposing any preconceived ideas or plans.

Question 7

There are generally three types of competitors for a product or service: direct, indirect or substitute, and

Accepted Answer

Emerging or potential competitors are those that are not currently in the market but could enter and compete in the future.

Question 8

Providing more opportunity for clarification and discussion, the observation of nonverbal communication, and the high response rate are all advantages of

Accepted Answer

The answer of Providing more opportunity for clarification and discussion,...

Question 9

The _____ represents an unserved niche that enables an entrepreneur to enter a market with no direct competition for a time.

Accepted Answer

The first customer represents an unserved niche that enables an entrepreneur to enter a market with no direct competition for a time, as it signifies the initial market entry point where a unique need is being met.

Question 10

Which of the following is NOT one of the key questions to be asked to discover your first customer?

Accepted Answer

The answer of Which of the following is NOT one...

Question 11

Which of the following is NOT one of the steps in the process for gathering market data?

Accepted Answer

Determining the market's strengths, weaknesses, opportunities, and threats is part of a SWOT analysis, which is a strategic planning tool, not a step in the process of gathering market data.

Question 12

Good competition is defined as companies that are

Accepted Answer

The answer of Good competition is defined as companies that...

Question 13

The _____ stage of the industry life cycle is an expensive period for most companies because they need to deploy extensive resources while developing critical partnerships to establish their position in the industry.

Accepted Answer

The answer of The _____ stage of the industry life...

Question 14

The ethnographic approach for entrepreneurs to observe their customers consists of _____ steps.

Accepted Answer

The ethnographic approach for entrepreneurs to observe their customers typically consists of five steps. These steps are designed to help entrepreneurs understand their customers' behaviors, needs, and preferences by closely observing them in their natural environment.

Question 15

In the context of costs involved in producing a product by an industry, _____ means that an industry's costs  to produce have declined relative to the price of its goods and services.

Accepted Answer

Economies of scale refer to the cost advantage experienced by a firm when it increases its level of output. The advantage arises due to the inverse relationship between per-unit fixed cost and the quantity produced. The greater the quantity of output produced, the lower the per-unit fixed cost. This can lead to a decline in the costs to produce relative to the price of goods and services, making the firm more competitive.

Question 16

Emerging, growth, differentiation, shakeout, maturity, and decline are all stages of the _____ life cycle.

Accepted Answer

These stages describe the industry life cycle, which outlines the progression of an industry from its inception to its eventual decline.

Question 17

Understanding how an industry operates is fundamental to shaping effective _____ and growth strategies and to determining the potential for profitability.

Accepted Answer

Understanding how an industry operates is crucial for formulating effective entry strategies, as it helps businesses identify the best ways to enter the market, understand the competition, and assess the potential for profitability.

Question 18

In the customer discovery hierarchy, _____ are those individuals or companies that hold the key to reaching particular customers; they control the flow of information.

Accepted Answer

Gatekeepers are those individuals or companies that control access to particular customers or markets, often by controlling the flow of information or the decision-making process. They can significantly influence whether a product or service reaches its intended audience.

Question 19

One of the weakest portions of any feasibility analysis or business plan is the

Accepted Answer

Competitive analysis is often one of the weakest portions because it can be difficult to accurately assess competitors' strategies, strengths, and weaknesses, and it may rely on assumptions or incomplete information.

Question 20

_____ means new entrants to an industry face existing products and services with loyal customers who are not likely to switch easily to something new.

Accepted Answer

Brand loyalty means that customers are committed to a particular brand and are not likely to switch to a competitor, making it difficult for new entrants to attract these loyal customers.

Quiz 4: Analyzing the Industry and Market