Question 1

There are many real estate offices in most locations.Some of them are small independent firms; some are larger and affiliated with national chains.Thus,the real estate sales industry is
A) fragmented.
B) vertically integrated.
C) homogeneous.
D) mature.
E) embryonic.

Accepted Answer

The fact that there are both small independent firms and larger national chains indicates that the real estate sales industry is fragmented, meaning there are many independent and competing entities within it.

Question 2

The growth stage of a product's life cycle is the
A) time when companies attempt to secure their grip over customers in existing market segments.
B) best time to explore horizontal merger opportunities.
C) time to plan an exit strategy.
D) opportunity to reduce investment in a product.
E) opportune moment to reduce advertising expenditures.

Accepted Answer

The growth stage of a product's life cycle is characterized by increasing demand for the product and rising sales. Companies focus on securing customer loyalty and expanding market share in existing market segments during this stage. Therefore, choice A is the best answer. Choices B, C, D, and E are not appropriate options for the growth stage.

Question 3

Factors leading to the slow growth of demand in embryonic industries include all of the following except the
A) poor quality of the first products.
B) lack of complementary products.
C) lack of venture capital for innovative products.
D) high production costs of the products.
E) lack of distribution channels for the products.

Accepted Answer

Lack of venture capital for innovative products is not a factor leading to slow growth in embryonic industries. Instead, it is a crucial factor that can help foster growth and development in such industries. The other factors listed - poor quality of first products, lack of complementary products, high production costs, and lack of distribution channels - can all contribute to slow growth in these industries.

Question 4

Which of the following customer groups is not very price sensitive?
A) Early adopters
B) Early majority
C) Innovators
D) Early adopters and early majority
E) Early adopters, early majority, and innovators

Accepted Answer

Innovators are not very price sensitive as they are more interested in trying out latest and innovative products regardless of the price. On the other hand, early adopters and early majority are usually more price sensitive as they are looking for value for money and may wait for discounts or offers before making a purchase.

Question 5

In some situations,pricing strategies can be used to
A) deter entry by other companies.
B) create exit barriers.
C) create emotional attachment to a product.
D) all of these choices.
E) none of these choices.

Accepted Answer

The answer of In some situations,pricing strategies can be used...

Question 6

Which of the following customer groups represents the leading wave or edge of the mass market?
A) Early adopters
B) Early majority
C) Innovators
D) Late majority
E) Laggards

Accepted Answer

The answer of Which of the following customer groups represents...

Question 7

Which of the following is not a characteristic of fragmented industries?
A) A large number of small competitors
B) Low economies of scale
C) Many custom-made or specialty firms
D) High barriers to entry
E) Low consolidation

Accepted Answer

High barriers to entry are not a characteristic of fragmented industries. Fragmented industries are typically characterized by a large number of small competitors, low economies of scale, many custom-made or specialty firms, and low consolidation. However, fragmented industries typically have low barriers to entry, which means that new competitors can easily enter the market and compete with existing firms.

Question 8

One strategy used to consolidate fragmented industries is
A) vertical mergers.
B) chaining.
C) product proliferation.
D) price signaling.
E) nonprice competition.

Accepted Answer

The answer of One strategy used to consolidate fragmented industries...

Question 9

Consumer demand for products of an embryonic industry is
A) high and ready to explode.
B) frequently limited at first.
C) nonexistent because consumers lack product information.
D) tentative for the first two years.
E) insatiable.

Accepted Answer

Consumer demand for products of an embryonic industry is frequently limited at first as consumers are not yet familiar with the new industry and its products. It takes time for them to become aware of the products, gain knowledge about the products, and become comfortable with them.

Question 10

Customers who have a practical interest in using a new technology in the future and who are willing to experiment and envision new uses for the technology are called
A) early adopters.
B) the early majority.
C) innovators.
D) laggards.
E) the late majority.

Accepted Answer

The answer of Customers who have a practical interest in...

Question 11

Which of the following factors that affect market growth rates refers to the degree to which a new product is perceived as difficult to understand and use?
A) Complexity
B) Relative advantage
C) Compatibility
D) Trialability
E) Observability

Accepted Answer

Complexity refers to the degree to which a new product is perceived as difficult to understand and use. This can be a barrier to adoption and can slow down the growth rate of a market. The other factors that affect market growth rates are relative advantage (how much better the new product is compared to existing options), compatibility (how well the new product fits with existing practices and values), trialability (how easy it is for customers to try the new product), and observability (how visible the benefits of the new product are to others).

Question 12

To compete in the fragmented restaurant industry,Red Lobster Corporation built and now operates hundreds of stores across the United States and Canada.Red Lobster is using which type of strategy?
A) Acquisitions
B) Horizontal mergers
C) Franchising
D) Diversification
E) Chaining

Accepted Answer

Red Lobster's strategy of building and operating hundreds of stores across the United States and Canada is an example of chaining, which involves the expansion of a company through the opening of new locations. This allows Red Lobster to establish a strong presence in the restaurant industry and compete with other chains and independent restaurants.

Question 13

Which of the following strategies for fragmented industries grants the right to use the parent's name,reputation,and business model in a particular location or area in return for a fee and often a percentage of the profits?
A) Chaining
B) Horizontal merger
C) Vertical merger
D) Franchising
E) B2B

Accepted Answer

Franchising grants the right to use the parent company's name, reputation, and business model in a particular location or area in return for a fee and often a percentage of the profits. This is a common strategy used in fragmented industries such as fast food, hospitality, and retail.

Question 14

Which of the following factors that affect market growth rates refers to the degree to which the results of using and enjoying a new product can be seen and appreciated by other people?
A) Complexity
B) Relative advantage
C) Compatibility
D) Trialability
E) Observability

Accepted Answer

Observability refers to the degree to which the results of using and enjoying a new product can be seen and appreciated by other people.

Question 15

Which of the following best describes an industry that consists of many small firms?
A) Mature
B) Growth
C) Fragmented
D) Declining
E) Diverse

Accepted Answer

A fragmented industry is one with many small firms, each having a relatively small market share. This is in contrast to a concentrated industry, which is dominated by a few large firms.

Question 16

At the growth stage of an industry,
A) ongoing technological progress makes a product easier to use.
B) key complementary products are developed.
C) companies in the industry find ways to reduce costs.
D) demand for the product increases.
E) all of these.

Accepted Answer

All of these options are typical characteristics of the growth stage of an industry. Ongoing technological progress can lead to improvements in the product and make it easier for customers to use. Key complementary products, such as accessories or software, may be developed by other companies to enhance the overall product ecosystem. Companies in the industry often find ways to reduce costs as production and distribution processes become more streamlined. As demand for the product increases, sales revenues and profits also tend to grow during this stage.

Question 17

In a harvest strategy,a company
A) increases its investment in a business.
B) decreases its investment in a business.
C) enhances the assets it uses in a business.
D) expands the number of stores or properties.
E) all of these.

Accepted Answer

In a harvest strategy, a company decreases its investment in a business. This can be done by reducing expenses, selling off assets, or cutting back on marketing and research and development costs. The goal is to maximize short-term profits and cash flow, rather than investing for long-term growth. Harvest strategies are often used for businesses that have reached maturity and are not expected to grow significantly in the future.

Question 18

Which of the following factors tends to accelerate customer demand for a product?
A) The product's relative advantage
B) The product's compatibility
C) The simplicity of the product's use
D) The degree to which a product can be experimented with
E) All of these

Accepted Answer

All of these factors tend to accelerate customer demand for a product. The relative advantage refers to how much better the product is compared to other alternatives. Compatibility refers to how well the product fits with customers' existing habits and values. The simplicity of use refers to how easy the product is to use, and the degree of experimentation refers to how easily customers can try the product without significant investment or risk. All of these factors can contribute to a faster adoption rate and increased demand for a product.

Question 19

Which of the following factors that affect market growth rates refers to the degree to which a new product is perceived as better at satisfying customer needs than the product it supersedes?
A) Complexity
B) Relative advantage
C) Compatibility
D) Trialability
E) Observability

Accepted Answer

Relative advantage refers to how much better a new product is at satisfying customer needs than the product it is replacing. This factor can have a significant impact on market growth rates, as customers are more likely to adopt a new product that they perceive as being better than what they currently use.

Question 20

The first group of customers to enter the market for a new product are called
A) early adopters.
B) first users.
C) innovators.
D) adventurers.
E) initial customers.

Accepted Answer

The first group of customers to enter the market for a new product are called innovators, as they are the ones who are willing to take risks and try out new and untested products. They make up only a small percentage of the total market, but their adoption of the product can be critical in determining its success or failure. Early adopters, first users, adventurers, and initial customers may also be terms used to describe the same group, but innovators is the most widely recognized term in marketing literature.

Quiz 6: Business-Level Strategy and the Industry Environment

There are many real estate offices in most locations.Some of them are small independent firms; some are larger and affiliated with national chains.Thus,the real estate sales industry is

The growth stage of a product's life cycle is the

Factors leading to the slow growth of demand in embryonic industries include all of the following except the

Which of the following customer groups is not very price sensitive?

In some situations,pricing strategies can be used to

Which of the following customer groups represents the leading wave or edge of the mass market?

Which of the following is not a characteristic of fragmented industries?

One strategy used to consolidate fragmented industries is

Consumer demand for products of an embryonic industry is

Customers who have a practical interest in using a new technology in the future and who are willing to experiment and envision new uses for the technology are called

Which of the following factors that affect market growth rates refers to the degree to which a new product is perceived as difficult to understand and use?

To compete in the fragmented restaurant industry,Red Lobster Corporation built and now operates hundreds of stores across the United States and Canada.Red Lobster is using which type of strategy?

Which of the following strategies for fragmented industries grants the right to use the parent's name,reputation,and business model in a particular location or area in return for a fee and often a percentage of the profits?

Which of the following factors that affect market growth rates refers to the degree to which the results of using and enjoying a new product can be seen and appreciated by other people?

Which of the following best describes an industry that consists of many small firms?

At the growth stage of an industry,

In a harvest strategy,a company

Which of the following factors tends to accelerate customer demand for a product?

Which of the following factors that affect market growth rates refers to the degree to which a new product is perceived as better at satisfying customer needs than the product it supersedes?

The first group of customers to enter the market for a new product are called