When Does a Firm Fall into the Large Competitive Chasm

question 60

Multiple Choice

When does a firm fall into the large competitive chasm between early adopters and early majority?

• A) When it cannot attract technological enthusiasts to try the beta versions of its products
• B) When it creates strong network effects during the growth stage
• C) When it fails to successfully launch a mass-market version of its product
• D) When the early majority create herding effects for its products

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Definitions:

Unused Capacity

The available production or service capacity that is not being used, often considered when planning production schedules and resource allocation.

Period Expense

Expenses that are not directly tied to the production process and are charged to the periods in which they are incurred.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead to individual products or job orders, based on a related activity (e.g., machine hours or labor hours).

Predetermined Overhead Rate

A predetermined rate for allocating manufacturing overhead to products or job orders, established prior to the period by forecasting both overhead expenses and activity volumes.