A manager in charge of new product development can hire engineers and market researchers. The annual salary of an engineer is $40,000, while a market researcher receives $20,000. The marginal contributions of engineers and market researchers are:

Engineers (E) Market Researchers (R)
Worker Additional Worker Additional
New Products New Products
1st 240 1st 80
2nd 200 2nd 70
3rd 160 3rd 60
4th 100 4th 50
5th 40 5th 40

How should a manager with an annual budget of $140,000, allocate this budget in order to maximize the number of new products developed?

a. Hire one engineer and five market researchers
b. Hire two engineers and three market researchers
c. Hire three engineers and one market researcher
d. Hire four engineers and four market researchers

While cell phones with holographic keyboards are currently in the introduction stage of the industry life cycle, tablet computers are in the growth stage. in the context of this scenario, which of the following statements is true? a. the industry for cell phones with holographic keyboards will face greater competition than the tablet industry. b. while the industry for cell phones with holographic keyboards will focus more on product innovation, the tablet industry will focus more on process innovation. c. while the industry for cell phones with holographic keyboards can reap the benefits of economies of scale, the tablet industry will experience no such benefits. d. the industry for cell phones with holographic keyboards will face price competition, whereas, in the tablet industry, the mode of competition will be non-price.