Even Where Imitation Is Possible, a Firm May Gain Advantage

question 177

Multiple Choice

Even where imitation is possible, a firm may gain advantage from being the first to introduce an innovative product because of

• A)long-lasting brand-name recognition.
• B)a time lag between innovation and imitation by rivals.
• C)trade secrets that limit the ability of rivals to exactly imitate the product.
• D)all of the other answers are correct.

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Definitions:

GAAP

Generally Accepted Accounting Principles, a common set of accounting rules and standards used in the United States for financial reporting.

Detachable Warrants

Warrants issued with another security that can be separated from the security and sold independently.

Convertible Debt

A type of debt instrument that can be converted into a specified number of shares of the issuing company's stock at certain times during its life, usually at the discretion of the debt holder.

Common Stock

Equity securities that represent ownership in a corporation, providing voting rights and potentially dividends to shareholders.