ModelLife Electronics Inc

question 106

Multiple Choice

ModelLife Electronics Inc.is a company that builds diagnostic devices.It was the first company to develop a compact MRI scanner by reconfiguring the components of the MRI technology.This smaller and user-friendly version of the huge MRI scanner created demand from small hospitals, nursing homes, and private practice doctors who were earlier dependent on the scanning machines in large hospitals.Which of the following types of innovations does this scenario best illustrate?

• A) Disruptive innovation
• B) Incremental innovation
• C) Radical innovation
• D) Architectural innovation

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Definitions:

Break-Even Point

The point at which total costs and total revenue are equal, meaning no net loss or gain, and the business is breaking even.

Contribution Margin

The contribution margin represents the portion of sales revenue that is not consumed by variable costs and can contribute to covering fixed costs and generating profit.

Variable Cost

Costs that change in proportion to the level of production or sales activity.

Units

Basic measures or quantities of product or service in business operations, often used in contexts such as inventory, production, and sales.