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Question 1. 1. (TCO A) Which of the following will probably have the least influence on organizational creativity? (Points : 5) The creativity of the individuals in the organization The organizational structure Incentives provided for creativity Location of the organization Question 2. 2. (TCO A) The CEO of an automobile manufacturer directed her R&D department to come up with a radical innovation. Which of the following ideas best fits the bill? (Points : 5) A door that is unlocked by recognizing the fingerprints of the owner. Seats that vibrate to massage the backs of passengers. A windshield that tints in sunlight and lightens in darkness automatically. A car that drives itself to the nearest exit if the driver is incapacitated by a medical emergency. Question 3. 3. (TCO B) eBay uses an online payment system called PayPal, which accepts credit cards or electronic funds transfers. The payment system is heavily secured using encryption technology. According to the Kim and Mauborgne model, PayPal is offering simplicity, convenience, and _______ utility levers. (Points : 5) cost fun and image environmental friendliness risk Question 4. 4. (TCO B) As complementary technologies develop for an innovation, that innovation will (Points : 5) become less attractive because the market is now too cluttered. become more attractive to other firms. decline in sales as buyers will not want to buy complementary technology due to the cost. lose status because now it is easier to use. Question 5. 5. (TCO C) Which of the following would be an example of a tacit resource? (Points : 5) An odds maker who works for a large casino in Las Vegas and is correct 95% of the time. A highly effective and efficient distribution network throughout the continental United States. A retail shoe chain that has prime locations in 200 malls across the country. A flashy ad campaign for a malt liquor. Question 6. 6. (TCO C) Mountain Home University realized that due to the War on Terrorism, some potential students were joining the military and others were choosing technical training. It could be said that the military and technical training were _____. (Points : 5) opposites imitations substitutes complements Question 7. 7. (TCO D) Since a large company tends to have more bureaucracy, fixed costs, and commitments to employees and customers, you can expect it to be _______. (Points : 5) more responsive to change less responsive to change oblivious to change unaffected by change Question 8. 8. (TCO D) Red Hat Systems is a small company started by two computer programmers who have come up with a medical diagnosis software program that is truly amazing. They can try to market it themselves, but there are only two of them, and they have very little money for mass marketing efforts as well as no contacts in the medical field. They have heard that other companies are developing similar products. They have decided to form an alliance with United Medical Systems. What would seem to be the major reason for doing so? (Points : 5) To gain rapid access to the market To maintain control of the product To reduce the potential level of competition To challenge itself to develop the necessary capabilities Question 9. 9. (TCO E) In constructing new product development teams, (Points : 5) the larger the team, the easier it is to foster a shared sense of identity among team members. as the size of the team increases, the potential for social loafing increases. cross-functional communication can lead to a poor fit between product attributes and customer requirements. the diversity of team members helps avoid homophily. Question 10. 10. (TCO E) Jasbar Industries has developed a product with a very short product development cycle. Which of the following results can it expect? (Points : 5) Sales will be slow as consumers will already be committed to other products. Jasbar will be able to provide complementary goods to enhance the attractiveness of its product. Jasbar will be unable to fully amortize the fixed costs of development before the product becomes obsolete. Jasbar will not be able to upgrade its product. Question 11. 11. (TCO F) When Sports Paradise saw yet another sports bar open up across the street, it knew that it would have to lower its price again to stay in business. The city already had too many sports bars, and Sports Paradise intended to being one of those left after the inevitable shake-out. Sports Paradise will be following a _______ pricing strategy. (Points : 5) penetration skimming survival predatory Question 12. 12. (TCO F) Mallard Prosthetics was a leader in the prosthetic arm market and profits from its prosthetics were very high. Mallard developed a computerized prosthetic arm and has been advised by a consulting firm to “embrace cannibalization.” This means that the company should (Points : 5) introduce the new technology right away and increase its market lead while taking away profits from its present product. introduce the new technology and hope that it “eats up” the competition. use up most of its financial resources in promoting the new prosthetic arm. only offer the new prosthetic arm in certain isolated markets (islands of the market). Page: 1 Page 2 Question 1.1. (TCO A) Lately, computer users have been using USB jump drives to copy and store files. These are also called thumb drives, pen drives, and other names. These are small drives you can attach to a key chain and plug into any USB port and have the utility of a hard drive. The size of their memory varies from 16 kilobytes to several gigabytes. Assume you are the CEO of the Ajax Thumb Drive Company. How might you use the S-curve model to predict when to switch to a new technology? What would be the limitations of this approach? (Points : 40) Question 2.2. (TCO B) Joseph had an idea that he could speed up a floor buffing machine by putting a different motor on it. After about 25 tries, he was able to make a buffer run much faster with a new motor and started his own company. Other companies began making competing products that were similar to Joseph’s design, but they were unable to improve their designs as fast as Joseph. Why might this be the case? (Points : 40) Question 3.3. (TCO C) Advent Systems is a very successful medical instrument company. Recently, the company was approached by a smaller company, New Pancreas, Inc., which is developing and selling a device that acts as an artificial pancreas for diabetics. Explain how Advent might use the corporate venture capital structure to support this company and the reasons why it would do such a thing. (Points : 40) Question 4.4. (TCO D) Gerusa is a company of former Soviet scientists who have developed a method of killing cancer cells with light in a process called Photodynamic Therapy (PDT). While the scientists have the medical knowledge, they are short on equipment, money, and marketing know-how. As a consultant, what would you advise Gerusa to do? (Points : 40) Question 5.5. (TCO E) What is a project charter and a contract book? Explain their purpose and how they are related to each other. (Points : 40) Question 6.6. (TCO F) The CEO of Cromwell Electronics has put together an autonomous new product development team. Now he is trying to decide what type of a leader to appoint to head the team. What should he look for in the leader of this team to improve its chances of success? (Points : 40) Page: 1 2

Question 1. 1. (TCO A) Which of the following will probably have the least influence on organizational creativity? (Points : 5)

The creativity of the individuals in the organization
The organizational structure
Incentives provided for creativity
Location of the organization

 

Question 2. 2. (TCO A) The CEO of an automobile manufacturer directed her R&D department to come up with a radical innovation. Which of the following ideas best fits the bill? (Points : 5)

A door that is unlocked by recognizing the fingerprints of the owner.
Seats that vibrate to massage the backs of passengers.
A windshield that tints in sunlight and lightens in darkness automatically.
A car that drives itself to the nearest exit if the driver is incapacitated by a medical emergency.

 

Question 3. 3. (TCO B) eBay uses an online payment system called PayPal, which accepts credit cards or electronic funds transfers. The payment system is heavily secured using encryption technology. According to the Kim and Mauborgne model, PayPal is offering simplicity, convenience, and _______ utility levers. (Points : 5)

cost
fun and image
environmental friendliness
risk

 

Question 4. 4. (TCO B) As complementary technologies develop for an innovation, that innovation will (Points : 5)

become less attractive because the market is now too cluttered.
become more attractive to other firms.
decline in sales as buyers will not want to buy complementary technology due to the cost.
lose status because now it is easier to use.

 

Question 5. 5. (TCO C) Which of the following would be an example of a tacit resource? (Points : 5)

An odds maker who works for a large casino in Las Vegas and is correct 95% of the time.
A highly effective and efficient distribution network throughout the continental United States.
A retail shoe chain that has prime locations in 200 malls across the country.
A flashy ad campaign for a malt liquor.

 

Question 6. 6. (TCO C) Mountain Home University realized that due to the War on Terrorism, some potential students were joining the military and others were choosing technical training. It could be said that the military and technical training were _____. (Points : 5)

opposites
imitations
substitutes
complements

 

Question 7. 7. (TCO D) Since a large company tends to have more bureaucracy, fixed costs, and commitments to employees and customers, you can expect it to be _______. (Points : 5)

more responsive to change
less responsive to change
oblivious to change
unaffected by change

 

Question 8. 8. (TCO D) Red Hat Systems is a small company started by two computer programmers who have come up with a medical diagnosis software program that is truly amazing. They can try to market it themselves, but there are only two of them, and they have very little money for mass marketing efforts as well as no contacts in the medical field. They have heard that other companies are developing similar products. They have decided to form an alliance with United Medical Systems. What would seem to be the major reason for doing so? (Points : 5)

To gain rapid access to the market
To maintain control of the product
To reduce the potential level of competition
To challenge itself to develop the necessary capabilities

 

Question 9. 9. (TCO E) In constructing new product development teams, (Points : 5)

the larger the team, the easier it is to foster a shared sense of identity among team members.
as the size of the team increases, the potential for social loafing increases.
cross-functional communication can lead to a poor fit between product attributes and customer requirements.
the diversity of team members helps avoid homophily.

 

Question 10. 10. (TCO E) Jasbar Industries has developed a product with a very short product development cycle. Which of the following results can it expect? (Points : 5)

Sales will be slow as consumers will already be committed to other products.
Jasbar will be able to provide complementary goods to enhance the attractiveness of its product.
Jasbar will be unable to fully amortize the fixed costs of development before the product becomes obsolete.
Jasbar will not be able to upgrade its product.

 

Question 11. 11. (TCO F) When Sports Paradise saw yet another sports bar open up across the street, it knew that it would have to lower its price again to stay in business. The city already had too many sports bars, and Sports Paradise intended to being one of those left after the inevitable shake-out. Sports Paradise will be following a _______ pricing strategy. (Points : 5)

penetration
skimming
survival
predatory

 

Question 12. 12. (TCO F) Mallard Prosthetics was a leader in the prosthetic arm market and profits from its prosthetics were very high. Mallard developed a computerized prosthetic arm and has been advised by a consulting firm to “embrace cannibalization.” This means that the company should (Points : 5)

introduce the new technology right away and increase its market lead while taking away profits from its present product.
introduce the new technology and hope that it “eats up” the competition.
use up most of its financial resources in promoting the new prosthetic arm.
only offer the new prosthetic arm in certain isolated markets (islands of the market).

 

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Page 2

Question 1.1. (TCO A) Lately, computer users have been using USB jump drives to copy and store files. These are also called thumb drives, pen drives, and other names. These are small drives you can attach to a key chain and plug into any USB port and have the utility of a hard drive. The size of their memory varies from 16 kilobytes to several gigabytes. Assume you are the CEO of the Ajax Thumb Drive Company. How might you use the S-curve model to predict when to switch to a new technology? What would be the limitations of this approach? (Points : 40)

 

Question 2.2. (TCO B) Joseph had an idea that he could speed up a floor buffing machine by putting a different motor on it. After about 25 tries, he was able to make a buffer run much faster with a new motor and started his own company. Other companies began making competing products that were similar to Joseph’s design, but they were unable to improve their designs as fast as Joseph. Why might this be the case? (Points : 40)

 

Question 3.3. (TCO C) Advent Systems is a very successful medical instrument company. Recently, the company was approached by a smaller company, New Pancreas, Inc., which is developing and selling a device that acts as an artificial pancreas for diabetics. Explain how Advent might use the corporate venture capital structure to support this company and the reasons why it would do such a thing. (Points : 40)

 

Question 4.4. (TCO D) Gerusa is a company of former Soviet scientists who have developed a method of killing cancer cells with light in a process called Photodynamic Therapy (PDT). While the scientists have the medical knowledge, they are short on equipment, money, and marketing know-how. As a consultant, what would you advise Gerusa to do? (Points : 40)

 

Question 5.5. (TCO E) What is a project charter and a contract book? Explain their purpose and how they are related to each other. (Points : 40)

 

Question 6.6. (TCO F) The CEO of Cromwell Electronics has put together an autonomous new product development team. Now he is trying to decide what type of a leader to appoint to head the team. What should he look for in the leader of this team to improve its chances of success? (Points : 40)

 

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