Concept of the Diffusion of Innovation Shows How a Product

question 106

Multiple Choice

concept of the diffusion of innovation shows how a product "diffuses" or spreads through the population over time.The consumer population is divided into five categories of product adopters based on when they adopt (i.e.,first buy) a new product.Each product adopter category has a unique profile.Consumers who have a fear of debt and depend on neighbors and friends as their information sources are called __________.

• A) innovators
• B) early adopters
• C) early majority
• D) late majority
• E) laggards

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Definitions:

Net Present Value

The difference between the present value of cash inflows and outflows over a period of time, used to assess the profitability of an investment.

Compound Interest

This refers to the calculation of interest on both the initial amount deposited or borrowed as well as on the interest that has already been accumulated over previous periods.

Desired Rate of Return

The minimum percentage of gain or profit expected by an investor from an investment.

Compound Interest

Interest earning mechanism in which the calculation includes interest on the original principal and on all previously earned interest of a loan or deposit.