The Key Idea Behind Diffusion of Innovation Is That

question 43

Multiple Choice

The key idea behind diffusion of innovation is that

• A) not all consumers accept a new product at the same time; adoption of a product spreads slowly throughout the population.
• B) once a product enters the market, the time span between awareness and purchase is incredibly short.
• C) the introduction of an entire new product class almost always diffuses the importance of its predecessor within a matter of months.
• D) adoption of a new product line does not change the diffusion rate of older lines in the market.
• E) the rate of adoption is independent of other product form innovations or competitive products in the marketplace.

---

Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing ownership interest.

Gross Margin Percentage

A financial metric that measures the proportion of money left over from revenues after accounting for the cost of goods sold, expressed as a percentage.

Gross Margin

The difference between revenue and the cost of goods sold, which indicates the profitability before administrative, sales, and other expenses.

Financial Leverage

A difference between the rate of return on assets and the rate paid to creditors.