Question 1

Charging high prices to earn large profits during a time when there is little competition represents a ________ strategy.

Accepted Answer

A) penetration 
B) bundling 
C) skimming 
D) cost-based 
A) penetration 
B) bundling 
C) skimming 
D) cost-based

Question 2

When people consider purchasing a good,they:

Accepted Answer

A) are responding to the market forces of supply and demand. 
B) are most influenced by the price of the product or service. 
C) will not consider goods that require them to make a special effort to purchase. 
D) may evaluate and compare a variety of factors. 
A) are responding to the market forces of supply and demand. 
B) are most influenced by the price of the product or service. 
C) will not consider goods that require them to make a special effort to purchase. 
D) may evaluate and compare a variety of factors.

Question 3

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 4

Attracting attention,describing contents,explaining benefits and identifying the uses of a product are all functions of:

Accepted Answer

A) target marketing. 
B) Universal Product Codes. 
C) packaging. 
D) market segmentation. 
A) target marketing. 
B) Universal Product Codes. 
C) packaging. 
D) market segmentation.

Question 5

Karen is a collector of fine art,particularly paintings.She has been looking for an original Lady Molly painting for months and has said that she is willing to go to extraordinary efforts to acquire this painting for her collection.Clearly this painting represents a __________ good for Karen.

Accepted Answer

A) shopping 
B) specialty 
C) unsought 
D) luxury 
A) shopping 
B) specialty 
C) unsought 
D) luxury

Question 6

One of the reasons why companies create the position of brand manager is to:

Accepted Answer

A) have greater control over new-product development and promotion. 
B) cut expenses associated with the marketing of products. 
C) limit the amount of market research expenses products required. 
D) identify and prosecute firms that violate trademark protection. 
A) have greater control over new-product development and promotion. 
B) cut expenses associated with the marketing of products. 
C) limit the amount of market research expenses products required. 
D) identify and prosecute firms that violate trademark protection.

Question 7

Supermarkets and discount stores often advertise products at prices at or below their cost to attract people to the store.These products represent:

Accepted Answer

A) market leaders. 
B) price leaders. 
C) revenue enhancers. 
D) loss leaders. 
A) market leaders. 
B) price leaders. 
C) revenue enhancers. 
D) loss leaders.

Question 8

Profits peak during the maturity stage of the product life cycle.

Accepted Answer

A) True 
 B)False

Question 9

Phar-out Pharmacy will advertise a price of an over-the-counter drug at or below their cost.The intended goal of this loss leader strategy is to:

Accepted Answer

A) achieve a target profit. 
B) reduce the break-even quantity. 
C) build traffic and increase the customer base. 
D) create an upscale image. 
A) achieve a target profit. 
B) reduce the break-even quantity. 
C) build traffic and increase the customer base. 
D) create an upscale image.

Question 10

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.

Question 11

The combination of all the factors that consumers evaluate when deciding whether or not to buy a good or service is called a:

Accepted Answer

A) total product offer. 
B) product mix. 
C) product differentiation. 
D) product package. 
A) total product offer. 
B) product mix. 
C) product differentiation. 
D) product package.

Question 12

Knockoff brands are ________ copies of national brand-name goods.

Accepted Answer

A) exact 
B) Web-based 
C) illegal 
D) licensed 
A) exact 
B) Web-based 
C) illegal 
D) licensed

Question 13

Costs incurred regardless of the number of units of a product that are produced or sold are called:

Accepted Answer

A) mixed costs. 
B) controllable costs. 
C) fixed costs. 
D) variable costs. 
A) mixed costs. 
B) controllable costs. 
C) fixed costs. 
D) variable costs.

Question 14

The term product line describes the combination of product mixes offered by a manufacturer.

Accepted Answer

A) True 
 B)False

Question 15

Small firms often rely on non-price competition when competing against larger firms.

Accepted Answer

A) True 
 B)False

Question 16

A bank's product line may include safety deposit boxes,car loans,and traveler's checks.

Accepted Answer

A) True 
 B)False

Question 17

__________ involves designing a product so that it satisfies customers and meets the profit margins desired by the firm.

Accepted Answer

A) Price discrimination 
B) Price leadership 
C) Target costing 
D) Cost-based pricing 
A) Price discrimination 
B) Price leadership 
C) Target costing 
D) Cost-based pricing

Question 18

Non-branded products that sell below the price of national brands,have very basic packaging,and are backed with little or no advertising are called:

Accepted Answer

A) universal goods. 
B) distributor brands. 
C) house brands. 
D) generic goods. 
A) universal goods. 
B) distributor brands. 
C) house brands. 
D) generic goods.

Question 19

A product line is a group of products that are physically similar or are intended for a similar market.

Accepted Answer

A) True 
 B)False

Question 20

Chevrolet is an example of a generic name in the automobile market.

Accepted Answer

A) True 
 B)False

Exam 14: Developing and Pricing Goods and Services

Charging high prices to earn large profits during a time when there is little competition represents a ________ strategy.

When people consider purchasing a good,they:

The best product development strategy for most firms is to:

Attracting attention,describing contents,explaining benefits and identifying the uses of a product are all functions of:

Karen is a collector of fine art,particularly paintings.She has been looking for an original Lady Molly painting for months and has said that she is willing to go to extraordinary efforts to acquire this painting for her collection.Clearly this painting represents a __________ good for Karen.

One of the reasons why companies create the position of brand manager is to:

Supermarkets and discount stores often advertise products at prices at or below their cost to attract people to the store.These products represent:

Profits peak during the maturity stage of the product life cycle.

Phar-out Pharmacy will advertise a price of an over-the-counter drug at or below their cost.The intended goal of this loss leader strategy is to:

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

The combination of all the factors that consumers evaluate when deciding whether or not to buy a good or service is called a:

Knockoff brands are ________ copies of national brand-name goods.

Costs incurred regardless of the number of units of a product that are produced or sold are called:

The term product line describes the combination of product mixes offered by a manufacturer.

Small firms often rely on non-price competition when competing against larger firms.

A bank's product line may include safety deposit boxes,car loans,and traveler's checks.

__________ involves designing a product so that it satisfies customers and meets the profit margins desired by the firm.

Non-branded products that sell below the price of national brands,have very basic packaging,and are backed with little or no advertising are called:

A product line is a group of products that are physically similar or are intended for a similar market.

Chevrolet is an example of a generic name in the automobile market.

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

Bonus A: Using Technology to Manage Information

Bonus B: Managing Risk

Bonus C: Managing Your Personal Finances

Appendix: Working Within the Legal Environment

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