Theme 2 - Research and development and innovation 0.0 / 5 ? EconomicsResearch and developmentASEdexcel Created by: becky.65Created on: 19-05-17 16:57 What is research and development? It refers to any activities that a firm undertakes to develop new products or processes, or improve existing products or processes 1 of 10 How can R&D lead to a competitive advantage? Through innovation as it is hard for businesses to compete with new and improved products, thus it will increase market power 2 of 10 How much of a company's revenue tends to be spent on R&D? 5% 3 of 10 What is product innovation? When a new or completely improved product or service is created; often the result of new technologies 4 of 10 What is process innovation? When new or improved production methods are used, enhancing efficiency and reducing costs 5 of 10 How can product innovation enhance competitiveness? New products create new, profitable markets and product improvement adds value 6 of 10 How can process innovation enhance competitiveness? Reduces costs and can create economies of scale 7 of 10 Why might the government intervene and help fund R&D It can contribute to competitiveness and the government wants lowest prices for the welfare of the state 8 of 10 What is the product life cycle? It shows the different stages a product passes through 9 of 10 What are extension strategies? Ways to increase sales by re-launching the product with a new image or by aiming it at a different market segment or by promoting it in new ways 10 of 10
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