Ch.4 – Complete Test Bank – Environment, Innovation, and

Chapter 4: Environment, Innovation, and Sustainability

True/False

1. The general environment comprises the actual organizations, groups, and persons with whom an organization interacts and conducts business.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Offshoring is the return of jobs from foreign locations as companies establish new domestic operations.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Rising labor costs, higher shipping costs, and public criticisms about destroying local jobs can cause global firms to return to their home countries.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The legal-political conditions in the global business environment are uniform across all countries.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Internet censorship is the deliberate blockage and denial of public access to information posted on the Internet.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Inflation, income levels, and job outlook are part of the sociocultural conditions in the general environment.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Generational cohorts consist of people born within a few years of one another and who experience somewhat similar life events during their formative years.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Previous generations are “digital natives” who grew up in technology-enriched homes, schools, and friendship environments.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Digital natives are characterized with the ease of multitasking, desire for immediate gratification, continuous contact with others, and less concern with knowing things than with knowing where to find out about things.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. A sustainable business both meets the needs of customers and protects the natural environment for future generations.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Businesses do not consider natural environment conditions when creating products because consumer demand is lacking.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Stakeholders are the persons, groups, and institutions directly affected by an organization.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Competitive advantage is something that an organization does extremely well, that can be copied by its competitors, and help them gain an advantage.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Risk taking is a way to step forward and try new things.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Competitive advantage can be achieved through quality by finding ways and using technology to create products and services that are of consistently higher quality for customers than what is offered by one’s competitors.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Competitive advantage achieved through costs will help an organization earn profits with prices that one’s competitors have difficulty matching.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The more uncertain the environment, the easier it is to analyze environmental conditions and predict future states of affairs.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The number of different factors in the environment is referred to as the rate of change.

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The least challenging and certain situation is an environment of organizations that is both complex and dynamic.

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. High-uncertainty environments require an ability of decision makers to respond quickly as new circumstances arise and new information becomes available.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Innovation is a low priority when executives and leaders try to steer organizations through complex and uncertain environments.

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Product innovations result in better ways of doing things.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Business model innovations result in new ways of making money for the firm.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The initial step of assessing in the innovation process involves commercializing innovation by turning it into actual products, services, or processes that increase profits by improving sales or lowering costs.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The concept of reverse innovation got its start as global firms moved away from viewing innovation as a “home market” activity that creates new products and services for distribution to “foreign markets.”

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Environmental capital is the supply of natural resources that we use to sustain life and produce goods and services for society.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The executives of Dunes Inc. pay equal attention toward maximizing profits of the firm, maintaining the well-being of its employees, satisfying its customers, and preserving the environment. This indicates that Dunes Inc. uses the triple bottom line approach.

Learning Objective: 4.4

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. An organization that does not offerhealth insurance to employees can be categorized as one with poor human sustainability.

Learning Objective: 4.4

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Pfeffer’s concern on human sustainability focusses on the importance of employees as they are organizational stakeholders.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

Multiple Choice

1. _____ environment consists of economic, legal-political, sociocultural, technological, and natural environment conditions.
2. Specific
3. Task
4. General
5. Stakeholder
6. Customer

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following represents the economic conditions in the general environment?
2. Patents
3. Infrastructure
4. Internet access
5. Unemployment rate
6. Norms

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. A country faced severe recession that resulted in loss of jobs and low income levels, which in turn affected the lifestyles of the consumers. Which of the following conditions are influencing the environment of the country?
2. Political conditions
3. Legal conditions
4. Technological conditions
5. Sociocultural conditions
6. Economic conditions

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following involves outsourcing of jobs to foreign locations?
2. Reshoring
3. Offshoring
4. Repatriation
5. Nationalization
6. Backshoring

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is a criterion of a good economic condition in the general environment?
2. The rising income inequality among the working class
3. The low unemployment rate in the society
4. The introduction of new developments in the technological areas
5. The introduction of carbon neutral methods for sustainable development
6. The occurrence of long-term joblessness among the people of the society

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Adams Inc., an automobile corporation based in London, shifts its manufacturing activities to China in order to minimize its cost of production. Which strategy has is Adams Inc. adopted here?
2. Repatriation
3. Nationalization
4. Backshoring
5. Offshoring
6. Reshoring

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following would qualify as a reason for reshoring?
2. Low costs in the target country
3. Complicated logistics in the target country
4. Excellent customer service in the target country
5. Low shipping costs in the target country
6. Low labor costs in the target country

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Techni Asset, a software corporation based in the United States, used to operate from several countries with lower labor costs. When the firm started to incur high costs of production in the foreign countries and received complaints and criticisms about the loss of local jobs, the firm decided to return to its home country. This change made to the firm’s global strategy is an example of _____.
2. offshoring
3. outsourcing
4. nationalization
5. privatization
6. reshoring

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. The patent attorney of Rayon Inc. was accused of stealing the organization’s invention. This scenario is an example of the _____ conditions of the general environment.
2. natural
3. legal-political
4. technological
5. sociocultural
6. educational

Learning Objective: 4.1

Difficulty: Easy

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. The government of Floraine imposes certain rules and regulations regarding the interest rates and other transactions for its financial institutions. This is an example of the _____ conditions of the general environment.
2. natural
3. technological
4. sociocultural
5. legal-political
6. educational

Learning Objective: 4.1

Difficulty: Easy

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following examples illustrates the legal-political conditions in the general environment?
2. Bureaucratic decisions made in a nation
3. Financial market situation existing in a nation
4. Health and Nutritional values of a nation
5. Information technology systems or infrastructure of a nation
6. Population demographics of a nation

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Crayons Inc., a media corporation headquartered in California, has its operations across different nations. The activities of the firm are affected by the government policies and the ideologies of the legislative institutions existing in the host countries. Which of the following factors are affecting the firm’s operations?
2. Economic conditions
3. Sociocultural conditions
4. Legal-political conditions
5. Technological conditions
6. Natural environment conditions

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following is a part of the sociocultural conditions in the general environment?
2. Inflation
3. Financial markets
4. Government policies
5. Intellectual properties
6. Demographics

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Diversity issues relating to educational opportunity, access to technology, housing options, and so on are parts of the _____ conditions in the general environment.
2. economic
3. legal
4. technological
5. sociocultural
6. political

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The managers of Vortex Inc. stresses the importance of team norms, business ethics, and respect for human rights in the organization. This implies that the organization is working on the _____ conditions in the organizational environment.
2. economic
3. legal
4. sociocultural
5. technological
6. political

Learning Objective: 4.1

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. The marketing executives of Exphyne Inc. observes the demographics of the population at its different areas of operation. They work towards satisfying the needs and preferences of individuals belonging to various demographic groups. The factors that they analyze include age, ethnicity, income levels, and gender. This implies that Exphyne Inc. focuses on the _____ conditions in the general environment to make sales.
2. technological
3. legal
4. philosophical
5. sociocultural
6. political

Learning Objective: 4.1

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following aspects of demographics comprises of generational cohorts?
2. Income levels
3. Race
4. Age
5. Ethnicity
6. Gender

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Older generations are digital ____ because they have ____.
2. immigrants; grown up in technology-enriched homes, schools, and friendship environments
3. immigrants; had to learn technology to work, socialize, date, and think about what’s important in their lives
4. natives; grown up in technology-enriched homes, schools, and friendship environments
5. natives; had to learn technology to work, socialize, date, and think about what’s important in their lives

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following are characterized by ease of multitasking, desire for immediate gratification, continuous contact with others, and less concern with knowing things than with knowing where to find out about things?
2. digital immigrants
3. digital natives
4. generational cohorts
5. green job candidates
6. reputations managers

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Vane has the ability to multitask and maintain continuous contact with others. She believes in receiving immediate gratification. This implies that Vane is most likely a _____.
2. digital immigrant
3. digital native
4. generational cohort
5. reputation manager
6. green job candidate

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Finheat, a financial services organization, advertises its financial products and instruments on social networking sites and other Websites. This implies that the firm is utilizing the _____ conditions in the general environment.
2. natural
3. legal
4. technological
5. sociocultural
6. political

Learning Objective: 4.1

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Jamie has a diverse collection of the latest video games. He also owns a mobile phone with a number of applications. His school is well equipped with Internet facilities. Which of the following terms applies to Jamie?
2. digital immigrant
3. digital native
4. generational cohort
5. green job candidate
6. reputation manager

Learning Objective: 4.1

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. InGen Inc. implements the use of social media, digital sharing of presentations, data, files, and holds regular virtual meetings. This indicates that the firm has reasonably well-equipped _____ conditions in the organizational environment.
2. natural
3. technological
4. legal
5. sociocultural
6. political

Learning Objective: 4.1

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following examples illustrates the technological conditions in the general environment?
2. Features and applications available on an individual’s phone
3. Income levels of an individual
4. Housing options for an individual
5. Job options for an individual
6. Educational opportunities for an individual

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Which of the following examples would qualify as a potential problem of the existing ever-present technological condition?
2. An organization advertising its products on social networking websites
3. An organization’s employees regularly engaging in online pastimes during work hours
4. An organization conducting regular virtual meetings with its clients
5. A musician promoting his debut musical project through media websites
6. An organization implementing digital sharing of files, presentations, and projects

Learning Objective: 4.1

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. A sustainable business:
2. is involved in risk-taking from position of performance difficulty.
3. has lack of information regarding what exists in the business environment and what developments may occur.
4. creates products or services that become so widely used that they largely replace prior practices and competitors.
5. meets the needs of customers as well as protects the natural environment for future generations.
6. is an organization motivated by desperation to escape existing difficulties.

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The _____ environment includes the people and groups with whom an organization interacts.
2. general
3. natural
4. specific
5. macro
6. external

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Stakeholders:
2. are described as employees who move to foreign locations to reduce costs to the organization.
3. are individuals who propose laws and regulations, government policies, and the philosophy and objectives of political parties.
4. are owners of organizations who take risks motivated by desperation to get out of bad situations.
5. refer to the employees who return from different host countries and help in establishing new domestic operations.
6. are the persons, groups, and institutions directly affected by an organization.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is true of stakeholders?
2. Members of the specific or task environment are often described as stakeholders.
3. Stakeholders are influenced by their stakes, but they are not allowed to influence it in return.
4. An organization’s performance does not affect the stakeholders.
5. All stakeholders belong to the generational cohort of Baby Boomers.
6. All stakeholders are “digital natives” who grew up in technology-enriched homes, schools, and friendship environments.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following falls on the positive side of risk-taking behavior of organizations?
2. Risk taking from position of performance difficulty
3. Risk taking motivated by desperation to get out of bad situation
4. Risk taking from hard time dealing with problems without losing focus
5. Risk taking with the ability to deal with problems as they arise
6. Risk taking from little staying power

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is true of value creation by businesses?
2. Businesses create value for customers through realized profits and losses.
3. Businesses create value for employees by wages earned and job satisfaction.
4. Businesses create value for competitors through the benefits of long-term business relationships.
5. Businesses create value for suppliers by the citizenship they display.
6. Businesses create value for local communities by stimulating markets and innovations that didn’t exist before.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Four Rollers Corp., an automobile company, benefits by spending less than its competitors on labor, operations, promotions, and features offered. This enables the firm to charge relatively lower prices on its goods from its customers. Which of the following is a competitive advantage of the firm?
2. High quality
3. Low costs
4. Flexibility
5. Delivery
6. Adaptability

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following examples illustrates a firm that has achieved competitive advantage through costs?
2. A firm that uses patented technology to deliver goods and services to customers on time
3. A firm’s ability to adjust and adapt to different demographic segments and satisfy their needs
4. A firm that invests only a small amount on promotion and maximizes profits by charging low prices
5. A firm’s technology that creates high quality products and services
6. A firm that specializes in developing timely new products

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Linkage Communications produces mobile phones, smart phones, and laptops. In terms of longevity and user-friendliness, the firm’s products are rated the best. Additionally, it offers applications and features with the latest technology. Which of the following has enabled Linkage Communications to achieve a competitive advantage over its competitors?
2. Quality
3. Costs
4. Flexibility
5. Delivery
6. Adaptability

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following examples illustrates a firm that has achieved competitive advantage through technology?
2. A firm that has the leanest production processes
3. A firm that focuses on producing zero defect products
4. A firm that relies on experts to develop a product
5. A firm that reduces its advertising and promotional costs
6. A firm that caters to only a selected few customer needs

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following examples displays a firm with a competitive advantage achieved through quality?
2. An organization that is famous for its durable products
3. A corporation that reduces its expenses by finding new production processes
4. A firm that delivers goods and services faster than its competitors
5. An organization that gains profits by charging less prices
6. A company that tailors its goods and services to fit consumer needs and preferences

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. The Oomph Factor, an online retail firm, owns a patented technology that ensures that its goods and services reach customers on time. The firm also has the ability to develop timely new products. The firm has gained competitive advantage through _____.
2. quality
3. costs
4. flexibility
5. delivery
6. adaptability

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following illustrates a firm that has achieved competitive advantage through delivery?
2. A firm that uses technology to produce durable products
3. A firm that develops timely new products
4. A firm that has the flexibility to operate successfully in any business environment
5. A firm that makes small financial investments at the time of production
6. A firm that can adapt and change according to the needs of different customers

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Which of the following illustrates a firm that has achieved competitive advantage through flexibility?
2. A firm that creates customized products based on each of its customer’s preferences
3. A firm that produces goods by maintaining high quality standards
4. A firm that ensures speedy delivery of goods compared to its competitors
5. A firm that develops products with unique features that are not made available by any of its competitors
6. A firm that develops timely new products

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Competitive advantage can be achieved through _____ by finding ways and using technology to adjust and tailor products and services to fit customer needs in ways that are difficult for one’s competitor to match.
2. quality
3. costs
4. flexibility
5. delivery
6. durability

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is true of environmental uncertainty?
2. The less uncertain the environment, the harder it is to analyze environmental conditions and predict the future state of affairs.
3. The least challenging situation is an environment that is both complex and dynamic.
4. High-uncertainty environments require less flexibility in organizational designs and work practices as different circumstances arise every now and then.
5. High-uncertainty environments require people to make decisions gradually since new circumstances arise constantly.
6. The uncertainty of an organization can be analyzed using degree of complexity and rate of change.

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Innovation refers to the:
2. lack of information regarding what exists in the environment.
3. people and groups with whom an organization interacts.
4. process of taking a new idea and putting it into practice.
5. return of jobs from foreign locations as companies establish new domestic operations.
6. things that an organization does extremely well and that gives it an advantage.

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Brazen Inc. introduced a new line of deodorized clothes produced with natural ingredients such as flowers and fruits, to reduce the impact of the environmental hazards caused by the production of deodorants. This implies that Brazen Inc. was engaging in _____.
2. process innovation
3. business model innovation
4. product innovation
5. skimming
6. performance innovation

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following is an example of a product innovation?
2. A firm launching a new flavor to its existing range of candies
3. A firm allowing customers to mail the desired designs of goods
4. A firm introducing a new online shopping model
5. A firm introducing new technology to ease the installation process
6. A firm changing its line of business from manufacturing automobiles to producing music

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Footlore Inc. introduced a sophisticated new range of shoes that prevents any type of injury to the wearer’s feet. This is an example of a:
2. process innovation.
3. product innovation.
4. business model innovation.
5. social business innovation.
6. paradigm innovation.

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following forms of innovation focuses on better ways of doing things?
2. Product innovation
3. Process innovation
4. Business model innovation
5. Social business innovation
6. Paradigm innovation

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is an example of a process innovation?
2. A firm introducing parking-assist vehicles
3. A firm introducing a new social media site
4. A firm introducing one-click purchasing
5. A firm introducing premium services for a fee
6. A firm creating the world’s largest online marketplace

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Eureka Electronics Inc. offers computer programs and software programs including software drivers and plug-ins that can be self-installed easily. The firm’s introduction of programs that can be self-installed is an example of _____ innovation.
2. product
3. process
4. business model
5. reverse
6. social business

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following scenarios best describes a process innovation?
2. A firm launching a new car model with basic features and systems
3. A restaurant where customers are allowed to order dishes after taking a sample
4. A footwear manufacturer introducing a unique range of shoes
5. A firm introducing a new software to protect computers from viruses
6. A firm changing its line of business from manufacturing eyewear to producing watches

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. A business model innovation results in:
2. new ways for firms to make money.
3. better ways of doing things.
4. introduction of new or improved goods.
5. the creation of new services.
6. environmental uncertainty.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Celluloid Inc., a photography firm, entered into other activities such as cinematography, advertisement creations, and short-film making, to make more money for the firm. This implies that Celluloid Inc. had engaged in a _____ innovation.
2. product
3. process
4. business model
5. reverse
6. pricing

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following is an example of a business model innovation?
2. A firm introducing a new model of its smartphone
3. A firm introducing “ready to install” software
4. A firm introducing a range of meals that can be cooked instantly
5. A firm introducing its new range of accessories to go with its clothesline
6. A firm introducing a new social networking website to connect with its customers

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Comprehension

1. Garsynth Corporation specializes in preparing eco-friendly products out of solid waste, old newspapers, and waste plastic. The firm employs individuals belonging to the weaker economic sections of the city. The company has engaged in _____ innovation.
2. product
3. red ocean
4. reverse
5. breakthrough
6. social business

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following is an example of a social business innovation?
2. An organization working on maintaining cleanliness in the cities
3. A firm specializing in producing customized bags based on preferences of the purchasers
4. A firm introducing a range of meals that can be cooked instantly
5. A firm removing the use of intermediaries to deal with customers directly
6. A record label using an exclusive process to record music albums

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Microcredit lending is an example of _____ innovation.
2. reverse
3. social business
4. disruptive
5. environmental
6. green

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following steps in the innovation process involves thinking about new possibilities?
2. Imagining
3. Experimenting
4. Assessing
5. Designing
6. Scaling

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following steps in the innovation process involves building initial models, prototypes, or samples?
2. Imagining
3. Experimenting
4. Assessing
5. Designing
6. Scaling

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. A group of employees of Smithson Inc., a software firm, were analyzing the practicality and feasibility of a software program by releasing a few samples of the program on the Internet for a month. Which of the following steps of the innovation process were the employees engaging themselves in?
2. Imagining
3. Experimenting
4. Assessing
5. Designing
6. Scaling

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Red Sun Inc., an automobile manufacturer, developed a new car model. The firm worked on identifying the strengths and weaknesses of the new model, the costs that would be incurred in its manufacture, and its target markets. Which of the following steps of the innovation process was the firm involved in?
2. Imagining
3. Experimenting
4. Assessing
5. Designing
6. Scaling

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following steps in the innovation process consists of implementing what has been learned and commercializing new products or services?
2. Scaling
3. Experimenting
4. Assessing
5. Designing
6. Imagining

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Animo Inc., a firm that specializes in animation, released its latest patented animation software in the market to increase its profits by improving sales. Which of the following steps of the innovation process was executed by the firm?
2. Imagining
3. Experimenting
4. Assessing
5. Designing
6. Scaling

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following is the final step wheel of innovation?
2. Imagining
3. Experimenting
4. Assessing
5. Designing
6. Scaling

Learning Objective: 4.3

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is true of reverse innovation?
2. It taps the potential for innovation existing at higher organizational levels.
3. It emphasizes recognition of innovations developed in well-established markets.
4. It recognizes innovations existing in diverse settings or locations.
5. It involves a lack of complete information regarding what exists in the environment.
6. It focuses on identifying strengths and weaknesses, and potential costs and benefits.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following concepts got its start as global firms moved away from viewing innovation as a “home market” activity that creates new products and services for distribution to “foreign markets”?
2. Disruptive innovation
3. Product innovation
4. Reverse innovation
5. Incremental innovation
6. Social business innovation

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. _____ innovation pulls new products and services from settings, where they are often created under pricing constraints, and pushes them into use elsewhere.
2. Disruptive
3. Reverse
4. Luxurious
5. Product
6. Business model

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following creates products or services that become so widely used that they largely replace prior practices and competitors?
2. Disruptive innovation
3. Sustainability
4. Sustaining innovation
5. Transformational innovation
6. Incremental change

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Rhapsody Inc. created a new line of cameras that work on solar energy. These solar cameras reduced the demand for digital cameras and gradually replaced the use of digital cameras and ended competition. Which of the following is prominent in this instance?
2. Positioning innovation
3. Incremental change
4. Process improvement
5. Disruptive innovation
6. Process innovation

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

97. The commitment to protect the rights of present and future generations as co-stakeholders of present-day natural resources is termed as _____.

1. disruptive innovation
2. sustainability
3. environmental uncertainty
4. reverse innovation
5. scaling

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following is true of sustainability?
2. It is a lack of information regarding what exists in the environment and what developments may occur.
3. It is a system by which an organization is directed or controlled.
4. It refers to the relationship between an organization’s management, its employees, its stakeholders, and the government.
5. It is a commitment to live and work in ways that protect the rights of both the present and the future generations.
6. It does not apply to the non-living things present on earth.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The process of using environmental resources to support societal needs today while also preserving and protecting them for future generations is referred to as _____.
2. triple bottom line experiment
3. global warming
4. sustainable development
5. scaling
6. greenhouse effect

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The supply of natural resources which sustain life and produce goods and services for society is referred to as _____.
2. global warming
3. environmental capital
4. green innovation
5. triple bottom line
6. greenhouse effect

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following holds true regarding sustainable businesses?
2. A sustainable business operates with nature by exploiting it.
3. A sustainable business strives for a win-lose outcome where the environment gains and the organization loses.
4. A sustainable business creates products or services that become so widely used that they result in the exhaustion of the resources.
5. A sustainable business can result in an environmental uncertainty.
6. A sustainable business works by meeting the needs of customers while advancing the well-being of the natural environment.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Which of the following would qualify as one of the main goals of a sustainable business?
2. Carbon reduction
3. Profit maximization
4. Global warming
5. Scaling
6. Greenhouse effect

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Black Corporation focuses on providing maximum support to its employees as it considers them its most important organizational stakeholders. The firm has a system of flexible working hours to reduce the stress of employees and zero-day notice periods. It permits employees to work from home through its virtual network. From this information, it can be inferred that Black Corporation:
2. has a high rate of sustainable innovation.
3. focuses on the differences of generational cohorts.
4. highlights the importance of the triple bottom line.
5. has a high rate of human sustainability.
6. focusses on the ideals of environmental capital.

Learning Objective: 4.4

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. In a country, the web access through mobile devices doubled each year since 2009 and during 2010, on an average, 2 million people used Facebook each day. Which of the following environmental condition does this information portray?
2. Economic condition
3. Legal-political condition
4. Natural condition
5. Socio-cultural condition
6. Technological condition

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. The government of Klayoland introduces a new program whereby it initiated all its business enterprises to adopt “green values”, and minimize and recycle its waste disposal. Which of the following conditions has the government taken care of by this decision?

A. Economic

B. Sociocultural

C. Political

D. Natural

E. Technological

Learning Objective: 4.1

Difficulty: Moderate

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Cufflinks, an outstanding house for tailored suits, has always had satisfied customers owing to their ingenuity in facilitating top fashion trends. It is innovative in adapting to changing vogues and demands of its customers.. Through which of the following ways does Cufflinks gain a competitive advantage?
2. Costs
3. Flexibility
4. Delivery
5. Quantity
6. Profits

Learning Objective: 4.2

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. The R&D department of Meredith Inc., a tire manufacturing, discovers a new material to be used as an alternative to rubber that brings down the manufacturing costs. This allows the company to offer its products at a price lower than the market price. The newly discovered material is the company’s:

A. disruptive innovation.

B competitive advantage.

C. natural capital.

D. environmental capital.

E. competitive environment.

Learning Objective: 4.2

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Comtrot, a mobile application developer, outsourced the development of an application to a cheaper location in another country. The application would notify users about their blood pressures twice a week. The final product was marketed in the country of Comtrot’s origin. Which of the following does this situation demonstrate?
2. Disruptive innovation
3. Sustainability
4. Reverse innovation
5. Social business innovation
6. Process innovation

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Pandemonium, a software enterprise, introduced a new gaming console in a small way with stimulating features. In six months’ time its popularity and its sales increased manifold. The major players in the business were overshadowed by this new gaming console. Which of the following best describes this situation?
2. Environmental capital
3. Sustainable development
4. Sustainable innovation
5. Reverse innovation
6. Disruptive innovation

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Fredrick comes up with an innovative range of watches. He has built a prototype and has given it to his friends for checking its feasibility and examining its practical use. According to the Hamel’s ‘wheel of innovation’, which of the following step has Fredrick undertaken?
2. Assessment
3. Scaling
4. Imagining
5. Experimenting
6. Designing

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Lewang has decided to launch an innovative product that would help the blind access their mails through a voice application. He has finished designing the product and accessing the costs and its market applicability. Keeping in mind Hamel’s “wheel of Innovation”, what is the next step that Lewang should ideally undertake?
2. He should check for its sustainability.
3. He should initiate the process of scaling.
4. He should implement reverse innovation.
5. He should increase the price of the product.
6. He should access the rate of change in environment.

Learning Objective: 4.3

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Food Chow, a grocery retail business, stopped the use of plastic bags and encouraged the use of reusable bags. This indicates that the firm is practicing _____.
2. sustainable business
3. triple bottom line
4. scaffolding
5. competitive advantage
6. reverse innovation

Learning Objective: 4.4

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

1. Which of the following is an example of human sustainability?

A. Glenneth & Co., a pharmaceutical company, recruits employees on a temporary basis.

B. Margaret works every day for eleven hours as a receptionist in a law firm.

C. Carmel Works, a software company, provides ample health insurance coverage for its employees as well as their dependents.

D. Preacher & Abel, a cosmetic company, cut down on the wages of its employees to reduce cost of production.

E. Brent Inc. takes the initiative of planting trees across the town in which it operates.

Learning Objective: 4.4

Difficulty: Hard

AACSB: Application of knowledge

Bloom’s Taxonomy: Application

Essay

1. Describe the most important aspects of each dynamic force that surrounds and influences the general environment of an organization.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. What are the dimensions of environmental uncertainty?

Learning Objective: 4.2

Difficulty: Moderate

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. What are the three types of innovation? What do they result in?

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Describe the five steps of the wheel of innovation.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

Text Entry

1. The ____ environment consists of economic, legal-political, sociocultural, technological, and natural environment conditions in which the organization operates.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. ____ is the outsourcing of jobs to foreign locations.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. ____ is the movement of jobs from foreign locations back to domestic ones.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Internet ____ is the deliberate blockage and denial of public access to information posted on the Internet.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Generational ____ consist of people born within a few years of one another and who experience somewhat similar life events during their formative years.

Learning Objective: 4.1

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The specific ____ includes the people and groups with whom an organization interacts.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Stakeholders are the persons, groups, and institutions _____ affected by an organization.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Environmental ____ is a lack of information regarding what exists in the environment and what developments may occur.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Competitive ____ is something that an organization does extremely well, is difficult to copy, and that gives it an advantage over competitors in the marketplace.

Learning Objective: 4.2

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. ____ is the process of taking a new idea and putting it into practice.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. _____ innovations result in new or improved goods or services.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Process innovations result in ____ ways of doing things.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. ____ innovation is launched from lower organizational levels and diverse locations, including emerging markets.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Disruptive ____ creates products or services that become so widely used that they largely replace prior practices and competitors.

Learning Objective: 4.3

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. ______ is a commitment to protect the rights of present and future generations as co-stakeholders of the world’s resources.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. Sustainable development uses environmental resources to support ____ needs today while also preserving and protecting them for future generations.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The triple ____ line assesses the economic, social, and environmental performance of organizations.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. The 3 P’s of organizational performance are ______, people, and planet.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge

1. A(n) ____ business operates in ways that meet the needs of customers while protecting or advancing the well-being of our natural environment.

Learning Objective: 4.4

Difficulty: Easy

AACSB: Analytical thinking

Bloom’s Taxonomy: Knowledge