Lesson 3.9.2

3.9.2 Assessing innovation Quiz: AQA Business, Unit 9

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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Lesson 3.9.2, Assessing innovation: 20 multiple choice questions for the AQA Business (7132), Unit 9: Strategic methods: how to pursue strategies, written with Revision Ninja.

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The 20 questions

  1. What is product innovation?

    • Copying the products of rivals so that the business can match their features at a lower price
    • Developing new or significantly improved goods or services that customers can buy
    • Reducing the number of products in the range so that the business can focus on its core lines
    • Changing the methods used to make existing goods so that they are produced at lower cost

  2. What is process innovation?

    • Introducing new or improved methods of production or operations that change how goods are made
    • Changing the brand name of a product to appeal to a different group of customers in the market
    • Introducing new products for customers that have never been sold by any business in the market before
    • Changing the packaging of an existing product to make it more attractive to shoppers in stores

  3. What is kaizen?

    • A way of protecting intellectual property through a formal registration process with the government
    • A philosophy of continuous small improvements involving all employees in the business
    • A system of rewarding employees with a share of profit each year as a reward for innovation
    • A method of rapidly introducing a single major new product into the market in a single launch

  4. What is intrapreneurship?

    • Employees acting like entrepreneurs within an organisation to develop new ideas and products
    • A government programme that gives grants to new businesses in the early stages of their development
    • A method of financing innovation through borrowing from banks at a fixed rate of interest each year
    • A business owner setting up a new firm outside any existing organisation to sell products to customers

  5. What is benchmarking?

    • Comparing a firm's processes and performance against the best practice of other organisations
    • Recording the number of hours each employee spends on training during the course of a year
    • Measuring the total value of a firm's assets at the end of each financial year for reporting
    • Setting the price of a product at the same level as the average price charged by all rivals

  6. Which form of intellectual property protection is most suitable for a new invention?

    • An informal agreement with employees not to reveal the invention to any rival business or outsider
    • A loyalty card scheme, which rewards customers who keep buying the product from the business
    • A patent, which gives legal protection against others making or selling the invention for a set period
    • A copyright, which protects the expression of a creative work such as a book, music or software code

  7. Which form of protection suits a piece of original creative writing or music?

    • A patent, which gives protection to any product that performs a useful function in the market
    • A franchise, which allows a business to sell its creative works through a network of licensed operators
    • A quota, which limits the number of copies of a creative work that can be sold in any given year
    • Copyright, which protects the owner's rights in original works of literature, music and similar creations

  8. Which of the following is a pressure to innovate?

    • A long period of stable demand with no competitors and no change in technology in the market
    • A decision by management to keep all existing processes and products unchanged for many years
    • Rapidly changing customer tastes and intense competition from rivals offering new products
    • A fall in the price of raw materials that stays unchanged for many years in a row

  9. Which is a value of innovation for a business?

    • It guarantees that the business will never face any risk from its rivals or from changes in its markets
    • It can create a competitive advantage and support higher margins and market share over time
    • It removes the need for marketing, because a truly new product sells itself without any promotion at all
    • It reduces the need for skilled staff, because innovation is always achieved by machines rather than people

  10. A business spends 5% of its 20 million pounds revenue on research and development. What is the R&D budget?

    • 500,000 pounds
    • 4 million pounds
    • 1 million pounds
    • 5 million pounds

  11. A process innovation cuts unit cost from 12 pounds to 9 pounds on 200,000 units a year. What is the annual saving?

    • 200,000 pounds
    • 2,400,000 pounds
    • 600,000 pounds
    • 1,800,000 pounds

  12. Which of the following is an example of process innovation?

    • Introducing an automated warehouse system that picks and packs orders with fewer staff
    • Launching a new flavour of a snack that has never been sold by the business before
    • Changing the logo and colour scheme of an existing range of goods to appeal to younger buyers
    • Opening a new retail outlet in a city centre location that has never had a store before

  13. What is the main risk of an innovation strategy?

    • High research costs and a significant chance that the innovation fails to earn a return
    • An obligation to report the innovation to government regulators before any sales can take place
    • A guarantee that the business will earn lower profits in every year from the innovation it launches
    • A certainty that competitors will copy the innovation immediately without any cost or delay in the market

  14. Evaluate the value of kaizen compared with radical innovation.

    • Kaizen builds steady improvement with low risk, but it may not deliver the breakthrough gains that radical innovation can achieve
    • Radical innovation is always cheaper than kaizen, so firms should use it for every improvement they make
    • Kaizen always produces larger gains than radical innovation, so radical innovation is never worth the investment
    • Kaizen has no value because small changes never make any difference to the performance of a business

  15. Why might a patent be of limited value to a firm?

    • It gives the owner perpetual protection, so the firm can rely on it indefinitely without any further action
    • It only protects the invention for a fixed period, and details are disclosed, which can help rivals design around it
    • It requires no fee to obtain or maintain, so protection costs the business nothing at all in practice
    • It stops all competition in the market for ever, because no rival can enter with any similar product

  16. How does an innovation strategy affect the marketing function?

    • It removes the need for marketing because new products always sell themselves to customers without advertising
    • It has no effect on marketing because innovation only affects the factory and not the sales function
    • It means marketing must stop all promotion of existing products so that resources can go to new projects
    • It requires marketing to communicate the benefits of new products and to find customers for them

  17. A business finds that a rival's process is much more efficient. What does benchmarking allow it to do?

    • Identify the gap in performance and explore how to close it through improved practices
    • Ignore the rival's practices, because benchmarking only works when a firm has no competitors in its market
    • Copy the rival's entire business model without any analysis, which will guarantee a rise in profit at once
    • Set its prices at a level that eliminates the rival from the market altogether through a price war

  18. Which feature is most likely to help a business become innovative?

    • A decision to limit all communication between departments, so that each one works independently and in secret
    • An open culture that encourages staff to suggest and test new ideas without fear of failure
    • A rigid hierarchy in which all ideas must be approved by a single manager before any action can be taken
    • A policy of avoiding any spending on research, so that costs stay low in every year of trading

  19. Which is the most accurate evaluation of a business investing heavily in research and development?

    • It only affects the finance function, so the marketing and operations departments are not involved in the outcome
    • It can produce valuable new products, but spending is uncertain in return and may strain cash flow if projects fail
    • It is never useful for a business, because research only benefits competitors who copy the results
    • It always guarantees higher profit within a year, so the investment carries no real risk for the business

  20. A firm considers whether to keep a product idea secret or to seek protection. Which is the most important factor to weigh?

    • Whether legal protection can be obtained, and how long it lasts, compared with the risk of imitation by rivals
    • Whether the firm's accountants can calculate the depreciation of the product's design over its life
    • Whether the product idea is popular with the chief executive, who has no interest in its commercial value
    • Whether the product name is short enough to fit on the packaging used by the firm in its markets

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