Exam 7: Strategy and Technology

The law of diminishing returns states that marginal costs fall as a company tries to expand output.

Describe the advantages and disadvantages of being a first mover or a follower in a high-tech industry.In your opinion,which strategy is preferable,and why?

Even if they are constrained by a lack of capital,research shows that new entrants should avoid partnering with a larger company.

An adequate supply of complements to a product results in:

Which of the following is an advantage of first movers?

Consumers will bear the costs of switching technologies if:

A technical standard helps to guarantee compatibility between products and their complements.

Technical standards in high-technology industries are:

With reference to high-technology industries,which of the following statements is true about technical standards?

Which of the following statements is true about new entrants in the context of a technological paradigm shift?

Switching costs,in the context of technology industries,refer to the costs that:

There is a set of fixed specifications for turbine blades for jet engines.The specifications include the material that needs to be used to manufacture the blades and also the specific dimensions that they need to have; the same specifications are used by all manufacturers.In this scenario,the specifications for jet blades can be referred to as:

When two or more companies are competing with each other to get their technology adopted as a standard in an industry,and when network effects and positive feedback loops are important,the company that wins the format war will be the one whose strategy best exploits positive feedback loops.

Switching costs are the costs that consumers must bear to switch from a product based on one technological standard to a product based on another technological standard.

Which of the following statements is true of technology in industries?

Format wars,in the context of high-technology industries,refer to:

Cellular phone service providers often sell the phone itself at very low prices and then charge a relatively high fee for usage.This illustrates:

Technological paradigm shifts occur when new technologies revolutionize the structure of the industry,dramatically alter the nature of competition,and require companies to adopt new strategies to survive.

When standards are part of the public domain,they can be used:

Antibody Solutions is a company that specializes in cell-bank storage,and producing antibodies for bacterial and viral infections.It is not considered a high-tech company since it is not technically in the computer or software industry,which is typically considered high-tech.