MGT 245 Multiple Choice Q&A Quiz - Technological Entrepreneuship and Innovation

Question 1 1 points Save

Businesses that depend heavily on venture capital funding____.

find that the ownership share of the entrepreneur-owners is diluted

typically borrow money from the venture capitalists

are usually given latitude to manage their business without input from the venture capitalists

must structure themselves as C-corporations before they can accept venture capital investments

Question 2 1 points Save

Debt financing dilutes the equity share of entrepreneur-owners.

True

False

Question 3 1 points Save

Research shows that when venture capitalists attempt to determine whether a venture is worthy of their support, they focus on two things. One is the capabilities and experience of the core business team, and the other is:

the amount of cash the venture holds

whether the venture is being launched in an established market

the number of years since the venture was launched

the thoroughness and overall quality of the business plan

Question 4 1 points Save

Which of the following statements expresses a general truth about innovation?

If I come up with new ways of doing things, I am sure to beat my competitors

If it ain’t broke, don’t fix it (no need to innovate)

If you have a great invention, don’t expect the world to beat a path to your door

The best innovative solutions are those that outperform competitor products

Question 5 1 points Save

Process innovation does not focus on:

reducing production costs

speeding production

establishing new products to penetrate new markets

improving production quality

Question 6 1 points Save

An important way that large, well-established companies can take advantage of disruptive technologies is:

to purchase smaller companies that have pioneered disruptive technologies and are now earning a decent living from them

to invest heavily in disruptive technologies

to invest only in disruptive technologies that are guaranteed to be winners

to invest primarily in sustaining technologies

Question 7 1 points Save

For a society to establish strong technological capabilities, it must invest heavily in science.

True

False

Question 8 1 points Save

The creative problem-solving technique called attribute analysis tries to force people to think divergently by requiring them to assign unusual attributes to objects that are not normally associated with them.

True

False

Question 9 1 points Save

For an invention to qualify to be patented, it must “pass” three tests of patentability. Which of the following is not one of the three tests?

The invention must be useful

The invention must have scientific roots

The invention must be novel

The invention must not be obvious

Question 10 1 points Save

If Ajax Enterprises hold a French patent for a technology, and no other patent, then John Jones of the USA:

is infringing on the patent if he produces the technology in his Chicago factory

is not legally able to sell the technology in the USA

would not be able to export the technology to France legally without Ajax’s authorization

would not be able to use the technology in the USA for his own purposes

Question 11 1 points Save

Intrapreneurship focuses on:

making bureaucratic organizations function more entrepreneurially

identifying individuals who will promote entrepreneurship on teams

identifying profit targets that new ventures should strive to achieve

helping individuals tap into their innate entrepreneurial powers

Question 12 1 points Save

Counterfeiting is concerned with:

unauthorized use of copyrighted material

unauthorized use of patented technology

unauthorized use of trade marks

unauthorized use of trade secrets

Question 13 1 points Save

Which of the following statements regarding creativity is true?

Extraordinarily creative people tend to have exceptionally high IQs

Creative people are both imaginative and rooted in reality

Studies on determinants of creativity have found that personal suffering has been a necessary stimulant to creativity among most highly creative people

Creative people tend to be kooky

Question 14 1 points Save

Well-established successful companies are generally more interested in supporting sustaining technologies than disruptive technologies.

True

False

Question 15 1 points Save

Which of the following questions reflects market risk concerns?

At what point will breakeven occur?

Do we have the capability to produce a desired technology?

How should we price our new product?

Are we prepared to deal with changing regulations?

Question 16 1 points Save

The Linux operating system has had an enormous impact on software development and maintenance. From the perspective of technological entrepreneurship and innovation, an especially interesting feature of the development of Linux is:

it is rapidly replacing Microsoft as the principal provider of operating systems for personal computers

its development was funded by venture capital companies that normally support pharmaceutical ventures

it was developed almost entirely by employing newly emerging agile and iterative software development techniques

it is an open sourced product

Question 17 1 points Save

All innovations are rooted in science.

True

False

Question 18 1 points Save

An example of a trademark that became generic is:

iPod

Cadillac

Xerox

Aspirin

Question 19 1 points Save

The common heritage of mankind argument holds that:

all humans are biologically the same and we should not confuse cultural differences among people with biological differences

knowledge belongs to everyone, and should not be treated as intellectual property

all people are entitled to express their views

all humans have origins in Africa

Question 20 1 points Save

Which of the following illustrates incremental innovation?

Invention of the light bulb

Establishing the world wide web

Releasing Version 2.0 of the Windows operating system

Invention of movable type by Guttenberg

Question 21 1 points Save

In the start up phase of the product life-cycle:

profits are negative

owners usually have pre-production contracts with potential buyers

risk is lowest

sales grow explosively

Question 22 1 points Save

Which of the following legal business forms is easiest to establish?

Sole proprietorship

General partnership

Limited liability company

Corporation

Question 23 1 points Save

According to Richard Foster, market leaders often become “losers” and are supplanted by a new generation of companies because:

they do not invest enough money in R&D

their marketing strategies become “old hat” and lose their impact

new companies are willing to invest more in R&D than well-established companies

they invest primarily in existing successful technologies that are near the end of their technology life-cycle

Question 24 1 points Save

Innovation________.

is another word for invention

applies solely to engineering advances

requires patenting of products that are produced

requires inventions to be employed practically

Question 25 1 points Save

You can publish a book titled The Godfather without violating copyright law.

True

False

Question 26 1 points Save

Creative destruction – where major companies are overwhelmed by innovation – is a natural consequence of capitalism.

True

False

Question 27 1 points Save

The primary goal of quality control charts is:

to show graphically the rate at which production quality improves

to anticipate changes in the cost of production

to determine whether goods produced lie within the range of tolerable variation

to document the number of products produced that conform to specifications

Question 28 1 points Save

Later stage financing of a burgeoning venture is often used for:

designing new products

establishing production capabilities

developing a detailed business plan

acquiring other companies in order to accelerate growth

Question 29 1 points Save

Piracy is concerned with:

unauthorized use of copyrighted material

unauthorized use of patented technology

unauthorized use of trade marks

unauthorized use of trade secrets

Question 30 1 points Save

Richard Foster’s concept of the defender’s paradox holds that:

by defending their existing successful innovations, companies are actually developing a good offensive strategy

companies that continue to invest heavily in their successful innovations find that at a certain point, the returns on their additional investment drop dramatically

when companies find their products being challenged by new market entrants, their best strategy is to strengthen their weakest products in order to throw the “attackers” off guard

when cornered, defenders can be stronger than their attackers

Question 31 1 points Save

Contrary to popular opinion, access to venture capital is not crucial to starting up a high tech business. Only one of the following high-impact ventures relied heavily on venture capital during its start-up stage. Which one?

Apple Computer

FireFox

PayPal

Flickr

Question 32 1 points Save

Gap analysis helps business planners:

identify gaps between revenues and profits

identify product gaps that can be filled by means of new product development

determine which departments contribute to business operations effectively and which do not

estimate the time between the conceiving a new product and actually delivering it

Question 33 1 points Save

Seed funding for new ventures most commonly comes from:

venture capital investors

commercial banks

angel investors

personal savings, family and friends

Question 34 1 points Save

Sometimes companies that produce less than stellar products win the innovation battle because of network externalities. With network externalities:

companies that possess strong network externalities win the competition because they have superior sales capabilities

companies that possess strong network externalities win the competition because they have superior production capabilities

companies that possess strong network externalities win the competition because they are able to tap into a an old boy “network,” where important luminaries in the industry support their products

companies that possess strong network externalities win the competition because they have a “network” of sales channels and support capabilities that make their products more attractive

Question 35 1 points Save

Open sourcing is forcing us to rethink the meaning and rationale of intellectual property.

True

False

Question 36 1 points Save

What inventions did Edison’s originally-patented light bulb incorporate?

Improved vacuum process and carbonized filament

Response a above, plus platinum lead-in wires

Response b above, plus method for securing filament in place

Response c above, plus method to integrate components in a glass bulb

Question 37 1 points Save

In his studies of highly creative people, Mihaly Czikszentmihalyi found for highly creative people to have an impact, it is not enough for them to be gifted. For creativity to take root and thrive, there must also be a well-defined domain of knowledge and ____.

underlying process of creative destruction

a high need-to-achieve (n-ACH)

field of accomplishment

need for affiliation (n-AFF)

Question 38 1 points Save

Flickr and CraigsList are examples of “accidental” ventures – they did not start out with a view of producing the products that ultimately made them big.

True

False

Question 39 1 points Save

An important characteristic of inventions is that they have practical applications.

True

False

Question 40 1 points Save

A significant consequence to technological innovation and entrepreneurship arising from the financial meltdown of 2008 is:

intellectual property protection decreased

investment capital dried up

support for entrepreneurship education decreased

the currency exchange rates for all countries decreased

Question 41 1 points Save

Creative thinking techniques try to strengthen convergent thinking.

True

False

Question 42 1 points Save

Inventions and innovations are basically the same thing.

True

False

Question 43 1 points Save

If you pay a contractor to write an article titled “The Evolution of the Domestic Dog,”

the contractor owns the copyright since he/she produced it, unless he/she enters into an agreement to transfer ownership to you

ownership has not been determined, so it is necessary to enter into an agreement defining ownership rights

the contractor owns the copyright, but you have free access to the copyrighted material and can use it at will

you own the copyright because it is a work for hire, unless you enter into an agreement with the contractor to transfer ownership to him/her

Question 44 1 points Save

Which of the following products established a dominant design for a product line?

Sanyo’s most advanced flat-panel television monitor

Compaq’s transportable computer, based on the IBM PC design

The internal combustion engine automobile that ran on gasoline

The electric pencil sharpener

Question 45 1 points Save

Which of the following is a purely scientific discipline?

Electronics

Physics

Chemical engineering

Astrology

Question 46 1 points Save

With business process reengineering (BPR):

companies should seek dramatic changes in their business processes

companies should seek gradual changes in their business processes

companies are basically changing their organizational charts

companies must be careful not disrupt established business operations

Question 47 1 points Save

When thinking about the traits of entrepreneurs, the prevailing feeling among experts is that great entrepreneurs are born, not made.

True

False

Question 48 1 points Save

Clayton Christensen’s book, the Innovator’s Dilemma, is one of the most important management books written in the past twenty years. In it, Christensen maintains that:

companies can go out of business by adhering closely to their important customers’ demands

the surest way to lose business is to contradict the customer – the customer is always right

it is not necessary to be innovative, because companies can copy the innovative efforts of other companies without going through the hassle and expense of conducting original R&D

strictly speaking, there are no true innovations, because “there is nothing new under the sun.”

Question 49 1 points Save

The dream of most venture capitalists is to have the companies they invest in “go public” through an IPO.

True

False

Question 50 1 points Save

Which of the following schools of entrepreneurship would most likely support the view that studying for the MBA is helpful (though not absolutely necessary) to promote entrepreneurship?

Psychological school of entrepreneurship

Classical school of entrepreneurship

Managerial school of entrepreneurship

Great person school of entrepreneurship

Question 51 1 points Save

A review of the history of business confirms that if you build a better mousetrap, the world will beat a path to your door.

True

False

Question 52 1 points Save

At the time the electric light bulb was invented by Edison, a major challenge he faced in selling them was:

fighting a lawsuit by Westinghouse Corporation, claiming his light bulb patent infringed one they held

dealing with competition from overseas

handling claims by his partners that they were entitled to half the profits derived from light bulb sales

the absence of electric power distribution systems in American communities

Question 53 1 points Save

Let’s say a four-legged chair is patented by Susan. John can add a fifth leg to the chair and get a patent on it.

True

False

Question 54 1 points Save

Schumpeter’s concept of creative destruction holds that:

when entrepreneurs take over a business, they should strive to dismantle the way the business used to be run and implement new innovation-friendly processes

a natural feature of capitalism is that established businesses cannot keep up with economic changes and entrepreneurial forces drive them out of business

creative managers need to reinvent themselves constantly

creative processes in the arts, sciences, and social systems entail rethinking how things should work

Question 55 1 points Save

According to William Abernathy’s perspective on corporate innovation, for a company to break the stranglehold of doing business the same old way, it should:

focus R&D efforts on improving its existing products in order to make them more attractive in the market

strive to strengthen the processes it employs to produce its products

increase its R&D budget

strive for de-maturation

Question 56 1 points Save

When looking at the histories of successful real world ventures, we come across cases where a successful venture was spun off from a larger technical effort. Examples include:

CraigsList

Firefox and Alexa Internet

PayPal and Flickr

Apple Computer

Question 57 1 points Save

Which of the following situations characterizes a high level of transilience?

Working with an innovation that has major impact on how the organization approaches production in an environment of stable markets

Working with an innovation that has major impact on how the organization approaches production and addresses changing markets

Moving quickly from R&D efforts to production efforts

Moving quickly from R&D and production into the market introduction of a new product

Question 58 1 points Save

Which of the following questions reflects financial risk concerns?

At what point will breakeven occur?

Do we have the capability to produce a desired technology?

How should we price our new product?

Are we prepared to deal with changing regulations?

Question 59 1 points Save

Although they apply their knowledge to different areas, scientists and engineers basically have the same backgrounds and share the same values.

True

False

Question 60 1 points Save

New high tech ventures come in many shapes and sizes. There are not many generalizations that can be made about them because there are so many routes entrepreneurs and technologies can follow. One exception is:

they usually are funded by venture capital

they usually emerge from university initiatives

they often entail collaboration between a technical champion and a business champion

they are usually based on carefully devised plans

Question 61 1 points Save

Process innovation can contribute directly to a company’s profits by:

reducing production costs

identifying market niches that have not yet been exploited

employing state-of-the-art equipment

establishing the foundation for effective marketing and sales

Question 62 1 points Save

An innovation is approaching the end of its technology life when:

it is at the top portion of its S-curve

it is at the middle portion of its S-curve

it is at the bottom portion of its S-curve

when its S-curve shifts downward

Question 63 1 points Save

Which of the following is not a feature of a LLC?

Company income is treated as personal income for tax purposes

Outside investors can assume ownership shares of the company

The company experiences limited liability protection

The company must register with the Security Exchange Commission

Question 64 1 points Save

With basic science:

scientists pursue their research effort without concern for practical results

scientists must justify their research budgets by demonstrating how the research can yield practical results

scientists must establish and test hypotheses

scientists doing the research must have doctoral degrees

Question 65 1 points Save

As a product enters the maturity phase of its product life-cycle, one way to extend its life is to engage in incremental innovation.

True

False

Question 66 1 points Save

In the maturity phase of the product life-cycle, revenues continue to grow.

True

False

Question 67 1 points Save

Good science requires that members of the scientific community continually question the outcomes of scientific research efforts – no effort is so worthy that it cannot be challenged. Which of Robert Merton’s norms of science captures this principle?

Communalism

Universalism

Disinterestedness

Organized skepticism

Question 68 1 points Save

In order to maintain control over your copyrighted material, you need to put a copyright notice mark (e.g., © 2012 Jones Corp.) onto works you write and publish.

True

False

Question 69 1 points Save

According to William Abernathy’s innovation life-cycle, during which stage is product innovation most prominent?

Early stage

Transition stage

Maturity stage

Post-maturity stage

Question 70 1 points Save

Which of the following items is not a standard characteristic of a disruptive technology?

It is generally viewed as a second-rate technology when compared to leading technologies

Because it is lower tech than prevailing technologies, companies that invest in it find that their technology portfolio has been weakened

It tends to have lower profit margins than leading technologies

It is risky, because it is largely untried