Deck 7: Testing and Experimenting in Markets

Question 1

Experiments need to have a clear purpose, be achievable and generate ______?

A)positive outcomes
B)product ideas
C)reliable results
D)action

Answer 1

C

Question 2

Why is experimentation required?

A)to meet the requirements of investors and loan officers
B)to generate ideas that can be used in further business development
C)to make sure that entrepreneurs have the right assumptions about meeting the demands of potential customers
D)to form hypotheses about customer behavior towards their product or service

Answer 2

C

Question 3

How did the founders of Parlor Skis test and finalize their custom product?

A)They had advanced simulation machines that tested the product.
B)They customized each pair for each customer who placed an order.
C)through four years of testing with family, friends, and " demo days."
D)by growing the business slowly so that corrections could be made

Answer 3

C

Question 4

What was the original hypothesis that the founder of Amazon tested?

A)There was a market for standard products, such as books, to be sold online.
B)The Internet could offer more books because there was no need to store the books.
C)Mail order products could be sold online.
D)Items from the top 10 items sold through mail order should be selected for online sales.

Question 5

Why is experimentation required?

A)to meet the requirements of investors and loan officers
B)to strengthen ideas
C)to help with inspiration
D)to form hypotheses

Question 6

An experiment begins with an assumption know as which of the following?

A)hypothesis
B)product
C)test idea
D)assumption

Question 7

Which of the following is an important benefit of experimentation?

A)It makes you get out from behind the desk.
B)Assumptions are validated or proven false.
C)It generates new ideas.
D)It generates new business plans.

Question 8

What assumption was proven untrue after the owners of Parlor Skis talked to customers?

A)the assumption that people would be willing to pay for high-end skis
B)the assumption that handmade skis would be seen as a positive selling point
C)the assumption that people purchased skis primarily in winter
D)the assumption that most people buying the skis would be expert skiers

Question 9

What is the last step of the scientific process?

A)analyze the data
B)run the experiment
C)assess the results of the data analysis
D)redesign the product or service

Question 10

Rather than just gathering data, an experiment matches an outcome to which of the following?

A)the hypothesis
B)the data collection method
C)the business problem
D)the business opportunity

Question 11

What was typical of the way the owners of Parlor Skis conducted experiments?

A)They concentrated on one big experiment, saving time in the development process.
B)They followed the tenets of affordable losses, using small scale experiments to guide them.
C)They used experimentation to support a "go-don't go" decision.
D)They used external resources to conduct experiments so that they could concentrate on running the business.

Question 12

In experimentation, an entrepreneur's goal should be to do which of the following?

A)Use continual iteration to test and shape ideas.
B)Create perfect experiments for perfect outcomes.
C)Use scientific rigor in the testing of his or her products.
D)Use the scientific method sparingly so as to save resources.

Question 13

If an experiment outcome indicates that the original hypothesis was incorrect, what should the entrepreneur do?

A)conduct another experiment
B)adapt the original assumption
C)move forward until there is another assumption to test
D)terminate the product or business concept

Question 14

Amazon conducted background research prior to placing books on sale.What did this background research consist of?

A)general questions and information that helped form a hypothesis
B)all of the information gathered during the course of the experiment
C)all of the information gathered before collecting data
D)the results of the experiment in a quantifiable format

Question 15

What did the founder of Amazon come to discover that encouraged him to begin the scientific process?

A)He read about the growth of online shopping on the Internet.
B)He read about the huge growth of Internet usage.
C)He read that bookstores were struggling to keep up with the costs of keeping book inventories.
D)He read that bookstores were experiencing a decline in sales.

Question 16

The first step of the scientific process for an entrepreneur is which of the following?

A)to conduct a thorough Internet search
B)to develop the hypothesis
C)to ask a lot of questions
D)to analyze the data

Question 17

What phase of design thinking is associated with experimentation?

A)inspiration
B)ideation
C)implementation
D)nonlinearization

Question 18

What best describes the pattern of experimentation?

A)controlling the environment, manipulating a single factor, assessing the results
B)forming a hypothesis, conducting a formal study, analyzing the data
C)taking action, learning from collected information, developing the next iteration
D)taking action, forming a hypothesis, acting on the hypothesis

Question 19

As an entrepreneur, one should think like a scientist and ______.

A)act like one as well
B)not put as much time or precision in experiments as a scientist would
C)conduct experiments with more precision since the results will be acted upon
D)use the same methods as a scientist

Question 20

What was the first step of experimentation that the founder of Amazon began using the process to assess online business opportunities?

A)He asked questions about shopping behavior and mail order shopping.
B)He browsed the Internet for online shopping sites.
C)He conducted a survey about interest in online shopping.
D)He tested product online, using someone else's website.

Question 21

Which of the following participant right is an ethical requirement when performing an experiment?

A)the right to informed consent
B)the right to review the results of the experiment
C)the right to be paid
D)none of these

Question 22

Which of the following is the main problem regarding experience in the role of decision making?

A)Times have changed since the experience was gained.
B)Some new ideas are better than convention or what we thought we knew.
C)The idea practiced in the past may have been wrong.
D)Experience rarely relates to the current situation.

Question 23

The customers who actually buy, use, and give feedback on your product are called which of the following?

A)real customers
B)end users
C)influencers
D)economic buyers

Question 24

Angelina makes all purchases of printers and small computers for her company, a company that employs over 1000 people.However, all purchases must be approved by her district vice president.The district vice president would be listed under which of the following customer types?

A)decision maker
B)saboteur
C)recommender
D)approver

Question 25

Which of the following is the main problem regarding intuition in the role of decision making?

A)People tend to lack sufficient experience.
B)It does not provide evidence to support the idea.
C)Few people have good intuition.
D)Intuition is not real and cannot be trusted.

Question 26

In general, how many different types of customers are there?

A)one
B)three
C)six
D)10

Question 27

The best way to conduct an experiment is to ______.

A)test the product, service, or idea in a controlled environment
B)test the product, service, or idea with family and friends
C)test the product, service, or idea with real customers
D)conduct the experiment in another location where you will not be using "real" customers

Question 28

A customer who delays or vetoes the purchasing decision is referred to as which of the following?

A)influencer
B)decliner
C)negator
D)saboteur

Question 29

The main problem with analyzing historical data is that ______.

A)There is never enough of it to provide reliable data.
B)The data collected was for another purpose than that addressed by the current issue.
C)Historical data can provide insight into past behaviors, but may not predict behavior in new environments.
D)Historical data was gathered on a different market segment.

Question 30

Customers who have the ability to approve large scale purchases are called which of the following?

A)recommenders
B)economic buyers
C)decision makers
D)end users

Question 31

Anthony is thinking of starting a small hot-dog cart that he will take to the beach area in San Diego, California.Before starting, he investigates city ordinances and talks to vendors in the beach area.He also talks to people at the local parks who sell hot dogs to find out what makes their business successful.Anthony is conducting what stage of the scientific process?

A)background research
B)experimentation
C)data analysis
D)testing the hypothesis

Question 32

What question is asked when an entrepreneur draws conclusions from the results of the data analysis?

A)What can be put into charts and graphs?
B)Can the results be communicated?
C)Do the results support the hypothesis?
D)How can the observations be summarized?

Question 33

People with a large following who can affect purchasing decisions are called ______.

A)recommenders
B)end users
C)influencers
D)decision makers

Question 34

Had sales been negatively affected by the reduced cost of the Subways foot-long sub, what would Subway have done?

A)not offered the $5 sub
B)not offered the $5 sub, but asked why it affected the sale of higher priced items
C)made all the items on the menu lower cost
D)increased the cost of the foot-long sub

Question 35

Customers who have the ability to approve the purchase others make are called which of the following?

A)recommenders
B)economic buyers
C)decision makers
D)end users

Question 36

How did Subway carry out their experiment to test the effect of $5 subs?

A)They lowered the price of the sub throughout the summer of 2008.
B)They tested the price of the sub at selected stores for a limited period of time.
C)They tested the price of the sub at their flagship store.
D)They conducted a survey to see if people would be willing to purchase the $5 sub.

Question 37

How have large businesses traditionally gauged customer tastes and preferences?

A)by analyzing large amounts of historical data
B)by conducting short market experiments
C)by surveys and questionnaires
D)by asking employees

Question 38

Anthony is thinking of starting a small hot dog cart that he will take to the beach area in San Diego, California.Before starting, he asks an ice cream vendor if he can offer hot dogs using his stand for a small rental fee.He will only need to use space for one day.Anthony is conducting what stage of the scientific process ?

A)testing the hypothesis by running an experiment
B)implementation of the plan
C)developing a hypothesis
D)carrying out background research

Question 39

The owner of Amazon.com developed a site for a relatively low cost and offered books on the site. What stage of the scientific process was the owner executing by doing this?

A)testing the hypothesis by running an experiment
B)implementation of the plan
C)developing a hypothesis
D)carrying out background research

Question 40

What hypothesis did Subway marketers make during the 2008 recession?

A)Sales would improve if there were fewer stores.
B)Selling foot-long subs at the reduced price of $5 would increase sales.
C)More foot-long subs would sell if more expensive items were removed from the menu.
D)Subway sales would improve after the recession were over.

Question 41

What do the authors suggest about using data that was not specifically gathered to test the hypothesis?

A)It can be discarded as it will not address the issue at hand.
B)It should not be ignored.Keep track of everything.
C)It should be kept if it is positive information.
D)Discard it unless there is a minimum of six pieces of information saying the same thing.

Question 42

What are analytical experiments?

A)hypothesis tested using large stores of existing data
B)experiments conducted by experts in the field
C)experiments that use reasoning and advanced methods in determining the value of the data
D)experiments that involve the summary of data in statistics

Question 43

What issue did Andrew Reid discover about the flaw of market research practices?

A)Companies used old, historical data in their analysis.
B)Companies monitored what customers did, but not why they did it.
C)Companies failed to form reasonable hypotheses.
D)Companies conducted far too many studies.

Question 44

A prototype is described as which of the following?

A)a pilot test
B)an initial version of a product or service designed for use in experimentation
C)the first set of a manufactured product
D)a non-working model of an upcoming product

Question 45

Which of the following was the most significant advantage Rent the Runway had in conducting the experiments with customers rather than using traditional market research methods?

A)They were able to handle all of the research themselves.
B)They enlisted early customers, launching the website with an established customer base.
C)They learned a great deal about the experimental method.
D)They were able to able to get the experiments done in less than a year.

Question 46

A storyboard is classified as what category of business development tools?

A)drawings
B)prototyping
C)beta tests
D)pilots

Question 47

Rent the Runway conducted three experiments prior to starting the company.What did the first experiment reveal?

A)that women would rent a designer dress and return it in good condition
B)that clothes rented better if people could try the clothes on
C)that designer closes rented better if they were from top designers
D)that the Internet was a good marketing source for the fashion designers

Question 48

In designing experimentation opportunities, on which of the following should the entrepreneur focus?

A)partners
B)customers
C)distributors
D)all of these

Question 49

Why do some organizations discourage experimentation?

A)Their product or service is already optimized.
B)They lack the skills required for experimentation.
C)They no longer have the time to engage in experimentation.
D)They fear failure of incurring short-term loss.

Question 50

A high-level view of thoughts and ideas displayed in sequence through drawings, sketches, or illustrations is called a ______.

A)process flow
B)high view
C)storyboard
D)pictogram

Question 51

In Rent the Runway's second experiment, what was the added information the company gained about its potential service?

A)People would rent the clothing even if they were not able to try the clothing on first.
B)People would not rent clothing that they could not try on.
C)People were not interested in renting clothes that were not officially designer clothing.
D)It determined the size of the market by seeing what percentage of women would prefer to rent online.

Question 52

Steve Jobs said, "You can't connect the dots looking forward." Which of the following describes what he meant by this statement?

A)You must learn and experience what you can and trust that you will gain from it in the future.
B)It is easier to reflect on your life than to predict it.
C)Things need to be connected in the present or they will not serve you in the future.
D)Only history makes sense.

Question 53

The ability to make connections, expand our knowledge, and become more innovative is often the result of which of the following?

A)formal in-depth study
B)gaining experience in a particular industry or profession
C)trying out new experiences and learning new skills
D)hours of work in a particular area

Question 54

A pilot test ______.

A)is a small-scale study conducted to assess the feasibility of a product or service
B)is a study restricted to the field of aviation
C)is a the launch of a single, "solo" product
D)is a prototype of a product

Question 55

In Rent the Runway's final experiment, what was the added information the company gained about its potential service?

A)People would rent the clothing even if they were not able to try the clothing on first.
B)People would not rent clothing that they could not try on.
C)People were not interested in renting clothes that were not officially designer clothing.
D)It determined the size of the market by seeing what percentage of women would prefer to rent online.

Question 56

Dholakia and Durha conducted an experiment to assess businesses effect on consumers.What was the researchers' hypothesis?

A)Non-Facebook users would use Facebook if invited.
B)Customers would follow businesses on Facebook.
C)Only Facebook users would follow a business on Facebook.
D)They did not have a hypothesis.

Question 57

Taking apart products and putting them together again can be thought of as experimentation because doing so ______.

A)generates ideas about how we can make our products or services work better
B)gives us important information about how products are made
C)increases creativity as one imagines how to put the parts together again
D)increases general creative capacities that can transfer to other projects

Question 58

What is necessary for a prototype to be effective?

A)It must be a working model of the product or service.
B)It must communicate what our ideas look like, behave like, and how they work.
C)It must be the same as the model that will be launched at the start of the business.
D)It must include engineering models or, for a service, an operational plan.

Question 59

Why is it important to try out new experiences?

A)Those who try out new experiences are more likely to generate new business ideas.
B)New experiences tend to keep the mind sharp.
C)New experiences give you the opportunity to copy what others have done.
D)New experiences help entrepreneurs relax and refresh.

Question 60

Scott Cook, founder of Intuit, reasons which of the following about failure?

A)Failure is the result of poor experimentation.
B)Failure is key to creating evidence.
C)Failure is caused by using intuition.
D)Failure only tells you about your mistakes; it doesn't tell you how to correct them.

Question 61

Paula, an author, is delighted when a blogger posts his praises about her new book.The blogger has a large following.The blogger is what kind of customer?

A)a recommender
B)an influencer
C)an end user
D)a decision maker

Question 62

Daijah creates a prototype that demonstrates all of the features her product will have in the next 10 years.Yet, she will not be able to launch this version for quite some time due to the technical issues with manufacturing.However, using the futuristic prototype, she assesses interest in the product and believes that, with these results, she can launch the product.What would you caution Daijah?

A)The prototype is adequate for this assessment both now and for the future.
B)The prototype does not communicate what the product looks like or how it works at launch, thus, is invalid for the current launch.
C)Prototypes do not need to be working modes, so the prototype is fine for the short term.
D)Customers will be excited that they are participating in the evolution of the product.

Question 63

Sean is thinking about creating an automatic cat feeder similar to one that he created for dogs.He talks to several cat owners to find out what they dislike about feeding their cats.He also takes a look at current cat feeders and asks the same cat owners what they like and don't like about the feeders.What is this action called?

A)asking questions and a pilot study
B)asking questions and hypothesis testing
C)asking questions and background research
D)asking questions and prototyping

Question 64

A city is suggesting that homeowners participate in a mandatory recycle program.Which of the following would most likely be sketched as the problem (remember that storyboards are from the customer's perspective)?

A)overflowing landfills
B)people not paying the bill
C)recycling bins placed near the curb
D)overflowing trash cans and resident not knowing what to do with a bottle that says 'recycle'

Question 65

Sean is thinking about creating an automatic cat feeder similar to one that he created for dogs.He believes that cats eat several times a day.He also believes that cats can be trained to come to the sound of a slight ding, indicating that a new tray of food has been opened.He has several friends set out small trays of food, sounding a ding to see if cats will associate the sound with curiosity about the food.This action is called ______.

A)testing the hypothesis
B)forming a hypothesis
C)analyzing data
D)assessing results

Question 66

What is the advantage of storyboarding that makes it so effective?

A)It is shorter.
B)it provokes discussion.
C)The visual element gets the idea across quickly.
D)all of these

Question 67

Sabrina just received a toy for her seventh birthday.She is describing all the things she likes and dislikes about the new toy.What type of customer is Sabrina?

A)engaged user
B)end user
C)early adapter
D)decision maker

Question 68

In storyboarding, who or what is at the center of the story?

A)the company
B)the customer
C)the manufacturer
D)the viewer

Question 69

Sabrina just received a toy from her mother for her seventh birthday.The toy was recommended by her elementary school teacher for its educational value.The teacher has been conducting lectures on educational toys for children.Sabrina's teacher is what kind of customer?

A)decision maker
B)recommender
C)influencer
D)economic buyer

Question 70

What are the elements in a four-quadrant framework of storyboarding?

A)problem, solution, resulting action, outcome
B)solution, approval, action, result
C)problem, organization, product, result
D)problem, service or product, effect on organization, outcome

Question 71

A city is suggesting that homeowners participate in a mandatory recycle program.Which of the following would most likely be sketched as the benefit (remember that storyboards are from the customer's perspective)?

A)overflowing landfills
B)people not paying the bill
C)neat recycling bins placed near the curb and a happy resident
D)overflowing trash cans

Question 72

Sean has created an automatic cat feeder that will release small amounts of wet food at times set by the owner.He hopes that the unit will solve the problem of having to feed the cat multiple times a day or having to throw out food that has gone dry.He builds seven crude but serviceable units and asks friends with cats to test the product.He then attains their feedback.What is this action called?

A)a pilot
B)a prototype
C)a dry run
D)an operational test

Question 73

How does one formulate a hypothesis?

A)One simply states what one thinks would happen as a result of the experiment.
B)by asking questions, conducting background research, and creating theories of what might work
C)by considering the potential outcomes of the experiment
D)by studying the business and determining why things work the way they do

Question 74

What does one hope the storyboard will do when presented?

A)generate questions
B)gain approval
C)encourage people to invest in the idea
D)answer all questions

Question 75

Who is credited with developing the idea of storyboarding?

A)Warner Brothers
B)Walt Disney
C)Bell Laboratories
D)U.S.Steel

Question 76

Maurice works for a company that stores all information from online shopping.Daily, he produces reports that test the effectiveness of online campaigns, using information that has been gathered.He can also see where people linked from into the website and links from other sites that land on a specific page or item.What is the name of what Maurice does?

A)analytical experiments ?
B)database management
C)field studies
D)asking questions

Question 77

Shelisa, an author, is on a TV show talking about her latest book.The host of the TV show holds up her book and says "This is a must read for all of my readers." What kind of customer is the TV show host?

A)a recommender
B)an influencer
C)an end user
D)a decision maker

Question 78

Sabrina just received a toy from her mother for her seventh birthday.She is describing all the things she likes and dislikes about the new toy.What type of customer is Sabrina's mother?

A)decision maker
B)end user
C)intermediary
D)economic buyer

Question 79

Kristin is a buyer for a local Costco.She is interested in having your line of one-of-a-kind jewelry displayed during a weekend promotion.However, her supervisor, Dave, says they have had too many unsuccessful jewelry displays lately and he does not want to present the idea to the store manager.What type of customer is Dave?

A)a saboteur
B)an economic buyer
C)an end user
D)a decision maker

Question 80

Kristin is a buyer for a local big box store.She is interested in having your line of one-of-a-kind jewelry displayed during a weekend promotion.She suggests that she talk with Larry French who is in charge of all the company's big box stores on the West Coast.What type of customer would Larry French be?

A)a decision maker
B)an economic buyer
C)a saboteur
D)an end user