Question 1

Total fixed costs are those costs that change when the volume of production changes.

Accepted Answer

A) True 
 B)False

Question 2

A leading cause of new-product failure is:

Accepted Answer

A)  insufficient competition. 
B)  product promises that are not delivered. 
C)  the automation of the product development process. 
D)  excessive product differentiation. 
A)  insufficient competition. 
B)  product promises that are not delivered. 
C)  the automation of the product development process. 
D)  excessive product differentiation.

Question 3

Sales of generic products are decreasing because consumers prefer the higher quality of the nationally known brands.

Accepted Answer

A) True 
 B)False

Question 4

In the new-product development process,product analysis is completed prior to the product screening stage.

Accepted Answer

A) True 
 B)False

Question 5

Location is very important in the marketing of ________ because consumers desire to purchase these goods with a minimum of shopping effort.

Accepted Answer

A)  unsought goods 
B)  shopping goods 
C)  specialty goods 
D)  convenience goods 
A)  unsought goods 
B)  shopping goods 
C)  specialty goods 
D)  convenience goods

Question 6

Which of the following statements is the most accurate assessment of the role packaging plays in product offerings?

Accepted Answer

A)  The importance of packaging has diminished as the use of the Internet has grown. 
B)  While packaging plays an important role in marketing goods,it is not relevant to the marketing of services. 
C)  Effective packaging eliminates the potential of product liability suits. 
D)  The importance of packaging is greater now than ever. 
A)  The importance of packaging has diminished as the use of the Internet has grown. 
B)  While packaging plays an important role in marketing goods,it is not relevant to the marketing of services. 
C)  Effective packaging eliminates the potential of product liability suits. 
D)  The importance of packaging is greater now than ever.

Question 7

Despite the fact that microeconomic theory places a great deal of emphasis on price,marketers often try to find ways to compete on product attributes other than price.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following refers to a group of products offered by a firm that are physically similar or are intended for a similar market?

Accepted Answer

A)  Product matrix 
B)  Product line 
C)  Product mix 
D)  Total product offer 
A)  Product matrix 
B)  Product line 
C)  Product mix 
D)  Total product offer

Question 9

Carlotta owns and manages the Carlite Car Wash.She charges $8 per car wash.Her fixed costs are $600 per month,while her variable costs per car wash amount to $2.Carlotta must wash 60 cars to break even.

Accepted Answer

A) True 
 B)False

Question 10

Dealer (private)brands are products that do not carry the manufacturer's name,but rather carry the name of a distributor or retailer.

Accepted Answer

A) True 
 B)False

Question 11

The Connecting Across Borders box titled "What's in a Name?" explains:

Accepted Answer

A)  The importance of reality TV,and the various TV programs that have become international phenomena. 
B)  The procedure a business goes through to register its domain name. 
C)  How the positive appeal of a name can go a long way,all the way around the cyber-world. 
D)  How it is important for businesses to play a name game with its customers.A company should produce a product and give it a different name in each country where it is solD. 
A)  The importance of reality TV,and the various TV programs that have become international phenomena. 
B)  The procedure a business goes through to register its domain name. 
C)  How the positive appeal of a name can go a long way,all the way around the cyber-world. 
D)  How it is important for businesses to play a name game with its customers.A company should produce a product and give it a different name in each country where it is solD.

Question 12

Which of the following is consistent with the introduction stage of the product life cycle?

Accepted Answer

A)  Decreasing sales volume 
B)  Large number of competitors 
C)  Low profit levels or a potential loss 
D)  Minimum use of advertising 
A)  Decreasing sales volume 
B)  Large number of competitors 
C)  Low profit levels or a potential loss 
D)  Minimum use of advertising

Question 13

Operating in the southwestern states,Lancer Airlines hopes to avoid entering the price war that currently is taking place between several airlines on the east coast.The best strategy to avoid severe price competition is to:

Accepted Answer

A)  provide frequent travelers the added value of special fringe benefits. 
B)  cut costs and services in order to maintain profit margins. 
C)  reduce flights and in-flight services,and layoff employees. 
D)  determine the breakeven price and charge slightly more than that. 
A)  provide frequent travelers the added value of special fringe benefits. 
B)  cut costs and services in order to maintain profit margins. 
C)  reduce flights and in-flight services,and layoff employees. 
D)  determine the breakeven price and charge slightly more than that.

Question 14

Brand names help sellers with new-product introductions and create an opportunity for higher prices.

Accepted Answer

A) True 
 B)False

Question 15

Restaurants,like other businesses,often find that the best way to succeed in the market is to:

Accepted Answer

A)  listen to customers and adapt products to their needs. 
B)  create a product for which he could charge an exceptionally high price. 
C)  create a winning combination of advertising and personal selling for all of the stores in the chain. 
D)  open more stores in a single year than other foodservice operators. 
A)  listen to customers and adapt products to their needs. 
B)  create a product for which he could charge an exceptionally high price. 
C)  create a winning combination of advertising and personal selling for all of the stores in the chain. 
D)  open more stores in a single year than other foodservice operators.

Question 16

A trademark is a brand that has been given exclusive legal protection for both the brand name and the pictorial design.

Accepted Answer

A) True 
 B)False

Question 17

The Procter & Gamble Company is a major producer of bar soaps.In fact,Procter & Gamble produces Ivory,Camay,Lava,Safeguard,Zest,and Coast bar soaps that all claim a variety of benefits.These products are part of Procter & Gamble's __________ in bar soaps.

Accepted Answer

A)  product mix 
B)  product concentration 
C)  product store 
D)  product line 
A)  product mix 
B)  product concentration 
C)  product store 
D)  product line

Question 18

Competition-based pricing is a strategy based on what all the other competitors are doing.

Accepted Answer

A) True 
 B)False

Question 19

Price leadership occurs when one or more dominant firms set pricing practices that other firms in the market follow.

Accepted Answer

A) True 
 B)False

Question 20

One way a small firm can succeed against larger competitors is to:

Accepted Answer

A)  determine their break-even point price. 
B)  add value to their product offering. 
C)  eliminate the fringe benefits offered to frequent customers. 
D)  use break-even segmentation. 
A)  determine their break-even point price. 
B)  add value to their product offering. 
C)  eliminate the fringe benefits offered to frequent customers. 
D)  use break-even segmentation.

Exam 14: Developing and Pricing Goods and Services

Total fixed costs are those costs that change when the volume of production changes.

A leading cause of new-product failure is:

Sales of generic products are decreasing because consumers prefer the higher quality of the nationally known brands.

In the new-product development process,product analysis is completed prior to the product screening stage.

Location is very important in the marketing of ________ because consumers desire to purchase these goods with a minimum of shopping effort.

Which of the following statements is the most accurate assessment of the role packaging plays in product offerings?

Despite the fact that microeconomic theory places a great deal of emphasis on price,marketers often try to find ways to compete on product attributes other than price.

Which of the following refers to a group of products offered by a firm that are physically similar or are intended for a similar market?

Carlotta owns and manages the Carlite Car Wash.She charges $8 per car wash.Her fixed costs are $600 per month,while her variable costs per car wash amount to $2.Carlotta must wash 60 cars to break even.

Dealer (private)brands are products that do not carry the manufacturer's name,but rather carry the name of a distributor or retailer.

The Connecting Across Borders box titled "What's in a Name?" explains:

Which of the following is consistent with the introduction stage of the product life cycle?

Operating in the southwestern states,Lancer Airlines hopes to avoid entering the price war that currently is taking place between several airlines on the east coast.The best strategy to avoid severe price competition is to:

Brand names help sellers with new-product introductions and create an opportunity for higher prices.

Restaurants,like other businesses,often find that the best way to succeed in the market is to:

A trademark is a brand that has been given exclusive legal protection for both the brand name and the pictorial design.

The Procter & Gamble Company is a major producer of bar soaps.In fact,Procter & Gamble produces Ivory,Camay,Lava,Safeguard,Zest,and Coast bar soaps that all claim a variety of benefits.These products are part of Procter & Gamble's __________ in bar soaps.

Competition-based pricing is a strategy based on what all the other competitors are doing.

Price leadership occurs when one or more dominant firms set pricing practices that other firms in the market follow.

One way a small firm can succeed against larger competitors is to:

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

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