Question 1

Which of these best illustrates a major innovation?

Accepted Answer

A)  An item not previously sold by a firm that has been marketed by others 
B)  A modification of an existing product or an innovation that the consumer perceives as meaningful 
C)  An alteration in or extension of a firm's existing products 
D)  An item not previously sold by any firm 
A)  An item not previously sold by a firm that has been marketed by others 
B)  A modification of an existing product or an innovation that the consumer perceives as meaningful 
C)  An alteration in or extension of a firm's existing products 
D)  An item not previously sold by any firm D

Question 2

During the maturity stage of the product life cycle, a firm should seek to attract innovators.

Accepted Answer

A) True 
 B)False  False

Question 3

Patentability is a major factor to consider in new-product screening because the use of patents

Accepted Answer

A)  eliminates potential competitors for a period of 12 years. 
B)  provides the firm with monopolistic powers to the extent that it precludes other firms from successfully competing with the patented product. 
C)  encourages a firm to have a monopolistic competition environment. 
D)  reduces the effect of cyclical factors on sales. 
A)  eliminates potential competitors for a period of 12 years. 
B)  provides the firm with monopolistic powers to the extent that it precludes other firms from successfully competing with the patented product. 
C)  encourages a firm to have a monopolistic competition environment. 
D)  reduces the effect of cyclical factors on sales. B

Question 4

Which statement concerning absolute and relative product failures is NOT correct?

Accepted Answer

A)  All absolute product failures are relative product failures. 
B)  A firm can consider a new product to be a relative product failure if it takes sales away from other products. 
C)  If a product makes a very small profit (that is less than planned), the product is a relative product failure but not an absolute product failure. 
D)  A product failure can be both a relative and an absolute product failure. 
A)  All absolute product failures are relative product failures. 
B)  A firm can consider a new product to be a relative product failure if it takes sales away from other products. 
C)  If a product makes a very small profit (that is less than planned), the product is a relative product failure but not an absolute product failure. 
D)  A product failure can be both a relative and an absolute product failure.

Question 5

In which situation will a product have a slow rate of adoption?

Accepted Answer

A)  Consumers have a high discretionary income. 
B)  Product importance is high. 
C)  The product represents low overall perceived risk. 
D)  Product attributes can be easily communicated. 
A)  Consumers have a high discretionary income. 
B)  Product importance is high. 
C)  The product represents low overall perceived risk. 
D)  Product attributes can be easily communicated.

Question 6

The primary device used in product screening is a checklist.

Accepted Answer

A) True 
 B)False

Question 7

The product manager for a pasta sauce has decided to name the new product Tuscan Flavor, to appeal to cooks concerned with fat content, and to position the product as healthy and easy to prepare. During which stage of the new-product planning process is the manager involved?

Accepted Answer

A)  Commercialization 
B)  Product development 
C)  Test marketing 
D)  Product screening 
A)  Commercialization 
B)  Product development 
C)  Test marketing 
D)  Product screening

Question 8

A manufacturer of traditional and cordless telephones has adapted technological advancements from other fields to produce a cordless telephone with a range up to a mile. The new cordless phone represents a minor innovation to the company.
True-False - Terminology/Concept

Accepted Answer

A) True 
 B)False

Question 9

As a firm changes its emphasis in product strategy from minor modifications to major innovations, the firm's

Accepted Answer

A)  new-product planning process becomes simplified. 
B)  research and development staff and marketing research staff requirements are substantially increased. 
C)  time period from the generation of an idea to commercialization decreases. 
D)  risks and investment requirements decrease. 
A)  new-product planning process becomes simplified. 
B)  research and development staff and marketing research staff requirements are substantially increased. 
C)  time period from the generation of an idea to commercialization decreases. 
D)  risks and investment requirements decrease.

Question 10

Absolute product failure occurs when a firm

Accepted Answer

A)  withdraws a product after test marketing. 
B)  is unable to regain its production and marketing costs. 
C)  does not meet its sales and/or profit expectations. 
D)  withdraws a product prior to commercialization. 
A)  withdraws a product after test marketing. 
B)  is unable to regain its production and marketing costs. 
C)  does not meet its sales and/or profit expectations. 
D)  withdraws a product prior to commercialization.

Question 11

Test marketing generally involves tradeoffs between a desire for secrecy and an interest in determining a product's long-term sales potential.

Accepted Answer

A) True 
 B)False

Question 12

The introduction stage of the traditional product life cycle is characterized by

Accepted Answer

A)  high total and unit profits. 
B)  substantial competition. 
C)  an expanding product line. 
D)  a product mix consisting of one or two basic models. 
A)  high total and unit profits. 
B)  substantial competition. 
C)  an expanding product line. 
D)  a product mix consisting of one or two basic models.

Question 13

In relative product failure, a new product

Accepted Answer

A)  takes sales away from existing products. 
B)  has a net loss. 
C)  does not meet its sales and/or profit expectations. 
D)  is withdrawn during the introduction stage of the product life cycle. 
A)  takes sales away from existing products. 
B)  has a net loss. 
C)  does not meet its sales and/or profit expectations. 
D)  is withdrawn during the introduction stage of the product life cycle.

Question 14

a.	Differentiate between a minor innovation and a major innovation.
b. Describe the advantages and disadvantages of using each as an important part of a firm's new-product planning process.

Accepted Answer

a. A minor innovation refers to small in

Question 15

Modifications, minor innovations, and major innovations represent what type of strategy?

Accepted Answer

A)  Market penetration 
B)  Diversification 
C)  Product development 
D)  Market development 
A)  Market penetration 
B)  Diversification 
C)  Product development 
D)  Market development

Question 16

If a firm withdraws marketing support prematurely, it may create a self-fulfilling prophecy.

Accepted Answer

A) True 
 B)False

Question 17

Commercialization involves implementing the total marketing plan and full production of a product.

Accepted Answer

A) True 
 B)False

Question 18

Which product life-cycle stage corresponds with the use of late majority and laggard groups as target markets?

Accepted Answer

A)  Maturity 
B)  Decline 
C)  Fad 
D)  Bust 
A)  Maturity 
B)  Decline 
C)  Fad 
D)  Bust

Question 19

A firm seeking to attract consumers in the first stage of the adoption process should stress the development of a favorable attitude towards the product.

Accepted Answer

A) True 
 B)False

Question 20

Test marketing is the first stage in the new-product planning process where potential consumers are directly questioned about a new product's viability.

Accepted Answer

A) True 
 B)False

Exam 13: Conceiving, Developing, and Managing Products

Which of these best illustrates a major innovation?

During the maturity stage of the product life cycle, a firm should seek to attract innovators.

Patentability is a major factor to consider in new-product screening because the use of patents

Which statement concerning absolute and relative product failures is NOT correct?

In which situation will a product have a slow rate of adoption?

The primary device used in product screening is a checklist.

The product manager for a pasta sauce has decided to name the new product Tuscan Flavor, to appeal to cooks concerned with fat content, and to position the product as healthy and easy to prepare. During which stage of the new-product planning process is the manager involved?

A manufacturer of traditional and cordless telephones has adapted technological advancements from other fields to produce a cordless telephone with a range up to a mile. The new cordless phone represents a minor innovation to the company. True-False - Terminology/Concept

As a firm changes its emphasis in product strategy from minor modifications to major innovations, the firm's

Absolute product failure occurs when a firm

Test marketing generally involves tradeoffs between a desire for secrecy and an interest in determining a product's long-term sales potential.

The introduction stage of the traditional product life cycle is characterized by

In relative product failure, a new product

a. Differentiate between a minor innovation and a major innovation. b. Describe the advantages and disadvantages of using each as an important part of a firm's new-product planning process.

Modifications, minor innovations, and major innovations represent what type of strategy?

If a firm withdraws marketing support prematurely, it may create a self-fulfilling prophecy.

Commercialization involves implementing the total marketing plan and full production of a product.

Which product life-cycle stage corresponds with the use of late majority and laggard groups as target markets?

A firm seeking to attract consumers in the first stage of the adoption process should stress the development of a favorable attitude towards the product.

Test marketing is the first stage in the new-product planning process where potential consumers are directly questioned about a new product's viability.

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