Even Where Imitation Is Possible,a Firm May Gain Advantage from Being

question 12

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 these.

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Definitions:

Expansionary Gap

A situation in macroeconomics where the actual output in an economy exceeds the potential output, traditionally leading to inflation.

Actual Price Level

The current market prices of goods and services, reflecting the real value of money and the purchasing power of consumers.

Recessionary Gap

The difference between real GDP when the economy is in a recession and the GDP at full employment, indicating underutilized resources.

Expected Price Level

The anticipated average cost of goods and services in the future, based on current trends, policies, and economic conditions.