6. Process innovation refers to:

a. the development of a new service.
b. the development of a new product.
c. the implementation of a new or improved production method.
d. the development of new products or services.

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7. Innovation can help to provide a temporary competitive advantagewhen:

a. barriers to entry are high.
b. barriers to imitation are low and intellectual property rightsare difficult to enforce.
c. there are few other competitors.
d. barriers to entry are low.

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8. Following establishment of a dominant design in the productlife cycle, what would you expect to happen?

a. Emphasis on product innovation rather than processinnovation.
b. Emphasis on process innovation rather than productinnovation.
c. Competition to increase as new firms enter the industry.
d. Competition to decrease as more firms exit than enter theindustry.

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9. Established firms relative to new firms are better at:

a. all types of innovation.
b. innovation which is competence-enhancing.
c. innovation which is competence-destroying.
d. Innovation which is disruptive.

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10. In which markets are network effects likely?

a. Markets subject to increasing returns
b. 'Tippy' markets
c. Hi-tech product markets
d. All of the above