Question 1

__________ presents an idea for a new product to potential customers to test their reactions.

Accepted Answer

A)  Idea generation 
B)  Concept testing 
C)  Screening 
D)  Prototype development 
A)  Idea generation 
B)  Concept testing 
C)  Screening 
D)  Prototype development

Question 2

Webster Industries is one of the first producers of a unique consumer product.The company has chosen a low price strategy,hoping this will enable them to quickly attract many customers while discouraging potential competitors from entering the market.Webster's approach to pricing is a classic example of the skimming strategy.

Accepted Answer

A) True 
 B)False

Question 3

A firm's product line refers to all of the different geographic markets in which it sells the same good or service.

Accepted Answer

A) True 
 B)False

Question 4

Price,store surroundings,service,and brand name are all elements that consumers evaluate in a total product offer.

Accepted Answer

A) True 
 B)False

Question 5

The Internet allows customers to compare prices of many goods and services.This technology will likely:

Accepted Answer

A)  cause businesses to increase their focus on non-price aspects of their promotional message. 
B)  bring about more emphasis on demand-oriented pricing. 
C)  diminish in importance as quickly as other fads. 
D)  focus government attention on the collusive pricing practices of firms in specific industries. 
A)  cause businesses to increase their focus on non-price aspects of their promotional message. 
B)  bring about more emphasis on demand-oriented pricing. 
C)  diminish in importance as quickly as other fads. 
D)  focus government attention on the collusive pricing practices of firms in specific industries.

Question 6

Community Catering Services,Inc.advertises that they are the "friendliest caterers in town." Their prices are no lower than the rates charged by competing caterers,but they put a lot of emphasis on getting to know the needs of their customers.They tailor their efforts to meet these needs,providing a unique dining experience that exactly matches the customer's expectations.Community Catering is likely to find that this approach is more effective in achieving its goals than the use of aggressive price-cutting.

Accepted Answer

A) True 
 B)False

Question 7

Barker Brothers Pens utilizes a strategy of low priced pens to attract customers and discourage competition.This represents a _______ strategy.

Accepted Answer

A)  high-low 
B)  bundling 
C)  skimming 
D)  penetration 
A)  high-low 
B)  bundling 
C)  skimming 
D)  penetration

Question 8

Derek's company was bidding on the construction of a new penguin display at a world-famous zoo.When putting together his bid,Derek began by determining what the zoo would be willing to pay for the structure,and then subtracting a reasonable profit for the company.The result would be the cost of production.For example: If price to zoo = $6 million,and company profit margin = $2 million,the cost to produce cannot exceed $4 million.[$6 million - $2 million = $4 million.] The demand-based pricing strategy in this example is called __________.

Accepted Answer

A)  target costing 
B)  penetration pricing 
C)  cost-based pricing 
D)  volume pricing 
A)  target costing 
B)  penetration pricing 
C)  cost-based pricing 
D)  volume pricing

Question 9

Cost-based pricing adds a desired profit margin to the cost of producing a product.

Accepted Answer

A) True 
 B)False

Question 10

Pattie Bunz operates the Zestee Burgers restaurant.The cost of pickles,onions,buns,catsup,and meat patties would all be considered variable costs for her type of business.

Accepted Answer

A) True 
 B)False

Question 11

In the fall semester,Alex noticed that the plastic cola bottles in the vending machines at his university had changed shape.Upon further investigation,he realized that each bottle contained 2 ounces less beverage than previous bottles,even though he paid the same price as last semester.The pricing objective of the beverage company is to:

Accepted Answer

A)  Increase profits by reducing the amount provided in each bottle. 
B)  Build traffic at the vending machines by changing the shape of the bottle. 
C)  Undercut the competition by changing the shape of the bottle. 
D)  Increase market share by reducing the amount provided in each bottle. 
A)  Increase profits by reducing the amount provided in each bottle. 
B)  Build traffic at the vending machines by changing the shape of the bottle. 
C)  Undercut the competition by changing the shape of the bottle. 
D)  Increase market share by reducing the amount provided in each bottle.

Question 12

The best product development strategy for most firms is to:

Accepted Answer

A)  develop a small number of products that achieve market success and stick with them,because constantly changing old products (or introducing new ones)can confuse and frustrate customers. 
B)  maintain one product line while adding regularly to that product line over time to sustain customer interest. 
C)  constantly monitor consumer wants and needs and be willing to develop new products and adapt policies and services as those consumer needs begin to change. 
D)  focus on the actual product or service and don't worry too much about factors such as image,price,and service. 
A)  develop a small number of products that achieve market success and stick with them,because constantly changing old products (or introducing new ones)can confuse and frustrate customers. 
B)  maintain one product line while adding regularly to that product line over time to sustain customer interest. 
C)  constantly monitor consumer wants and needs and be willing to develop new products and adapt policies and services as those consumer needs begin to change. 
D)  focus on the actual product or service and don't worry too much about factors such as image,price,and service.

Question 13

Mystic Beverages,a producer of soft drinks,wants to differentiate its products from those of other soft drink providers.To implement this strategy successfully will require Mystic to create tangible differences in the physical product it offers.

Accepted Answer

A) True 
 B)False

Question 14

Mini-Case
Gourmet Pets is an innovative competitor in the billion-dollar pet food industry.In fact,two of its products,Kitty Sirloin and McDog T-bone,each claim over a 30% share in their market segments.The company has done detailed research and discovered that,for a growing number of pet owners,the family pet serves as a "baby substitute." These owners tend to pamper their pets,and are very discriminating in what they purchase.With this in mind,the company has put a great deal of effort into developing a new dog food: Prime Cuts.The new product is packaged in a resealable,microwaveable container and can be purchased in a variety of flavors (including Western BBQ,Teriyaki,Australian Outback,and Hickory Smoked. )Gourmet Pets promotes the product as far superior to "average" dog foods,even though the quality of meat and nutrient content of the food is virtually identical to many other brands.The company faces no competition in this market segment so it plans to charge a high price for the product.
-Gourmet Pets hopes to use its special packaging and extensive advertising to create a perception in the minds of consumers that Prime Cuts is a superior product,even though the actual quality of meat used in the product is virtually no different from competing brands.The company is attempting to develop:

Accepted Answer

A)  differential segmentation. 
B)  cognitive dissonance. 
C)  product differentiation. 
D)  pioneer marketing. 
A)  differential segmentation. 
B)  cognitive dissonance. 
C)  product differentiation. 
D)  pioneer marketing.

Question 15

Sears sells batteries under its own Diehard brand name even though another company actually produces these batteries.This is an example of a:

Accepted Answer

A)  knockoff brand. 
B)  generic brand. 
C)  dealer (private)brand. 
D)  brand association. 
A)  knockoff brand. 
B)  generic brand. 
C)  dealer (private)brand. 
D)  brand association.

Question 16

The concepts of product lines and product mixes apply to marketers of products and services.

Accepted Answer

A) True 
 B)False

Question 17

Successful firms maintain consistency in their marketing mix strategies throughout the product life cycle.

Accepted Answer

A) True 
 B)False

Question 18

The critical component of a total product offer is always a low price.

Accepted Answer

A) True 
 B)False

Question 19

Marketers use pricing,advertising,and packaging to differentiate their products from competitors' products even when actual differences are quite small.

Accepted Answer

A) True 
 B)False

Question 20

Most manufacturers hope that their brand names will become a generic name.

Accepted Answer

A) True 
 B)False

__________ presents an idea for a new product to potential customers to test their reactions.

A firm's product line refers to all of the different geographic markets in which it sells the same good or service.

Price,store surroundings,service,and brand name are all elements that consumers evaluate in a total product offer.

The Internet allows customers to compare prices of many goods and services.This technology will likely:

Barker Brothers Pens utilizes a strategy of low priced pens to attract customers and discourage competition.This represents a _______ strategy.

Cost-based pricing adds a desired profit margin to the cost of producing a product.

Pattie Bunz operates the Zestee Burgers restaurant.The cost of pickles,onions,buns,catsup,and meat patties would all be considered variable costs for her type of business.

The best product development strategy for most firms is to:

Mystic Beverages,a producer of soft drinks,wants to differentiate its products from those of other soft drink providers.To implement this strategy successfully will require Mystic to create tangible differences in the physical product it offers.

Sears sells batteries under its own Diehard brand name even though another company actually produces these batteries.This is an example of a:

The concepts of product lines and product mixes apply to marketers of products and services.

Successful firms maintain consistency in their marketing mix strategies throughout the product life cycle.

The critical component of a total product offer is always a low price.

Marketers use pricing,advertising,and packaging to differentiate their products from competitors' products even when actual differences are quite small.

Most manufacturers hope that their brand names will become a generic name.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding How Economics Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Adapting Organizations to Todays Markets

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employee-Management Issues and Relationships

Marketing: Helping Buyers Buy

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix A: Using Technology to Manage Information

Appendix B: Managing Risk

Filters

Exam 14: Developing and Pricing Goods and Services

__________ presents an idea for a new product to potential customers to test their reactions.

A firm's product line refers to all of the different geographic markets in which it sells the same good or service.

Price,store surroundings,service,and brand name are all elements that consumers evaluate in a total product offer.

The Internet allows customers to compare prices of many goods and services.This technology will likely:

Barker Brothers Pens utilizes a strategy of low priced pens to attract customers and discourage competition.This represents a _______ strategy.

Cost-based pricing adds a desired profit margin to the cost of producing a product.

Pattie Bunz operates the Zestee Burgers restaurant.The cost of pickles,onions,buns,catsup,and meat patties would all be considered variable costs for her type of business.

The best product development strategy for most firms is to:

Mystic Beverages,a producer of soft drinks,wants to differentiate its products from those of other soft drink providers.To implement this strategy successfully will require Mystic to create tangible differences in the physical product it offers.

Sears sells batteries under its own Diehard brand name even though another company actually produces these batteries.This is an example of a:

The concepts of product lines and product mixes apply to marketers of products and services.

Successful firms maintain consistency in their marketing mix strategies throughout the product life cycle.

The critical component of a total product offer is always a low price.

Marketers use pricing,advertising,and packaging to differentiate their products from competitors' products even when actual differences are quite small.

Most manufacturers hope that their brand names will become a generic name.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding How Economics Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Adapting Organizations to Todays Markets

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employee-Management Issues and Relationships

Marketing: Helping Buyers Buy

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix A: Using Technology to Manage Information

Appendix B: Managing Risk

Filters