Deck 12: Developing and Pricing Products

Question 1

Which of the following represents the group of products that are closely related or are sold to the same customer group?

A) Product line
B) Specialty product
C) Product mix
D) Convenience mix
E) Production mix

Answer 1

A
Explanation:A)A group of products that are closely related because they function in a similar manner or are sold to the same customer group who will use them in similar ways is a product line.

Question 2

Which of the following activities describes the development stage of commercialization?

A) Building a prototype
B) Testing the product to see if it meets performance requirements
C) Selling the product on a trial basis in limited areas
D) Beginning full-scale production and marketing
E) Testing consumer reaction to the product in limited areas

Answer 2

D
Explanation:D)Commercialization involves beginning full-scale production and marketing. This stage can be quite expensive, so it follows creation of a prototype, testing the product, and test marketing.

Question 3

Which of the following BEST describes product features?

A) All attributes and features of the product taken together
B) Tangible and intangible quality built into the product
C) Intangible benefits that increase customer satisfaction
D) Speed and convenience of a buyer interaction
E) Benefits that are used directly in the conversion of a process

Answer 3

B
Explanation:B)Product features are the qualities, tangible and intangible that a company builds into its products.

Question 4

In addition to cost, how are industrial products divided into product categories?

A) What area of the organization will use them
B) Competitive nature of acquiring the item
C) Availability
D) How they will be used
E) How easily the item can be turned into a consumable good

Question 5

A value package consists of an in-store advertisement that makes the product attractive and identifies features and benefits.

Question 6

A product's features may be intangible.

Question 7

A doctor's office buys a multifunction printer. This purchase is an example of a capital item.

Question 8

What type of consumer good is more expensive and therefore receives more evaluation of alternatives before the purchase is made?

A) Specialty goods
B) Production items
C) Shopping goods
D) Expense items
E) Capital items

Question 9

What happens when companies extend their horizons and identify opportunities outside existing product lines?

A) Disconnected product lines
B) Multiple product lines
C) Uniform product lines
D) Universal product lines
E) Tailored product lines

Question 10

What are products that are consumed rapidly and regularly classified as?

A) Industrial goods
B) Shopping goods
C) Specialty goods
D) Convenience goods
E) Production goods

Question 11

In which of the following ways is product development different for services than for physical goods?

A) Instead of gathering product ideas, the company goes immediately to the testing phase.
B) Instead of screening ideas, the company tests all of them, since no prototype is needed.
C) Instead of creating a prototype, the company develops a service process design.
D) The business analysis step is not needed, since there are no production costs with services.
E) The commercialization step is gradual for services, but rapid for physical goods.

Question 12

Which defining word or phrase below BEST captures the meaning of capital items?

A) Bulk loads
B) Directly used in the production process
C) To the consumer within a year
D) Longer lasting
E) Governmental purchase

Question 13

Shopping goods are purchased more often than convenience goods.

Question 14

How does a product mix differ from a product line?

Question 15

What can a company do to offset the consequences of slow sales in a product line?

A) Limit the use of capital items.
B) Diversify the product line.
C) Add convenience goods.
D) Increase the use of shopping goods available to consumers.
E) Reclassify specialty products as convenience products.

Question 16

What is the grouping of products available for sale by a company called?

A) Product line
B) Capital mix
C) Goods and services
D) Specialty goods
E) Product mix

Question 17

What are the benefits and features associated with a product called?

A) Product features
B) Benefits
C) Service
D) Convenience benefit
E) Value package

Question 18

When developing the marketing mix, what is the basis for any successful marketing strategy?

A) Customer needs and wants
B) Value packaging
C) Product mix offerings
D) Features and benefits
E) Offering the best product for the least amount of money

Question 19

How do expense items differ from capital items?

Question 20

Assuming a company has been gathering ideas for new products, what is the next step in the development process?

A) Test marketing
B) Prototype development
C) Business analysis
D) Concept testing
E) Screening

Question 21

On average, how many new product ideas are needed to generate one that reaches the consumer market?

A) 25
B) 50
C) 75
D) 100
E) 500

Question 22

During which step of the product development stage does a company conduct market research on benefits and prices?

A) Screening
B) Concept testing
C) Prototype development
D) Benefits analysis
E) Product idea

Question 23

Sears' Craftsman Tools is an example of a private brand.

Question 24

The process of product development begins with concept testing.

Question 25

A private brand is a brand name developed by a wholesaler or retailer for their product.

Question 26

Why is speed to market critical to market demand?

A) It reduces overall cost of product development.
B) It allows more time for product recalls.
C) It allows the company to conduct more concept testing.
D) It produces stronger outcomes on the business analysis process.
E) It allows the company to become entrenched in the marketplace.

Question 27

After a new product is developed, about 9 out of 10 fail for what reason?

A) Cost
B) Minimal marketing efforts
C) Lack of significant difference
D) The product is to regional
E) Failure in FDA testing

Question 28

A company that buys products to use to produce or create other goods or services is a(n)

A) convenience buyer.
B) consumer.
C) industrial buyer.
D) capital buyer.
E) rebrander.

Question 29

What is frequently the most time-consuming stage of product development?

A) Testing
B) Market analysis
C) Design
D) Speed to market
E) Product idea

Question 30

What is the difference between a specialty good and a specialty service?

A) A specialty service is an intangible item.
B) A specialty good costs more than a specialty service.
C) A specialty service is often compared to other services before purchase.
D) A specialty good can be compared to other items using the Internet.
E) A specialty service is purchased regularly.

Question 31

Why do firms conduct product testing?

A) To determine potential profitability of the product
B) To allow for gradual commercialization over time
C) To ensure the prototype meets performance requirements
D) To determine how well the product fits in with the goals of the organization
E) To determine the potential reaction of consumers

Question 32

When a consumer knows what they want to buy and is not willing to accept a substitute, what type of consumer product is being sought?

A) Production goods
B) Shopping goods
C) Convenience goods
D) Expense goods
E) Specialty goods

Question 33

Speed to market increases the chance that a new product will survive.

Question 34

What is the next step in the product development process when test marketing is positive for a product?

A) Prototype development
B) Business analysis
C) Concept testing
D) Commercialization
E) Product diversification

Question 35

During what step of the product development stage does the firm consider how well a product or idea supports the firm's objectives?

A) Screening
B) Concept testing
C) Prototype development
D) Benefits analysis
E) Product idea

Question 36

Consumers often spend a great deal of time and money doing research to purchase a specific service. These consumer products are referred to as

A) production services.
B) specialty services.
C) convenience services.
D) industrial services.
E) shopping services.

Question 37

Most ideas for new products eventually reach the market.

Question 38

Which of the following includes the tangible and intangible features that characterize a service?

A) Process selection
B) Service process design
C) Product life cycle
D) Benefits
E) Service value package

Question 39

How can a company establish market leadership for a product?

A) Introduce the product with a lower price than competitors.
B) Do not introduce the product until success is certain.
C) Be sure the product supports the overall goals and strategies of the organization.
D) Introduce the product before competitors.
E) Introduce a product that supports the rest of the product line.

Question 40

Which of the following best describes production items?

A) Goods consumed within a year by an organization
B) Goods that are specific in nature and where no substitute will be accepted
C) Goods that are consumed rapidly and regularly
D) Goods used in the conversion process
E) Goods consumed within a year by the buyer

Question 41

Where do organizations get new product ideas?

Question 42

What is one of the key benefits to successful branding?

A) Brand extension
B) Brand loyalty
C) Preferred product placement
D) Ease of licensing
E) Ease in adaptation

Question 43

The marketing process to the consumer is significantly different than the marketing process for the industrial buyer.

Question 44

During the product life cycle, when do sales begin to slow down even though profit levels are high?

A) Decline
B) Maturity
C) Introduction
D) Growth
E) Promotion

Question 45

Discuss the difference between production items, expense items, and capital items.

Question 46

Which of the following indicated a firm sold the rights to put their name on a product not produced by them?

A) Asset brands
B) National brands
C) Licensed brands
D) Private brands
E) Private labels

Question 47

Consumers will often spend a great deal of time and money to find a specialty good and will generally not accept a substitute.

Question 48

In additional to social networking and viral marketing, how do firms successfully increase brand awareness?

A) Reintroduction
B) Globalization
C) Rebranding
D) Product placement
E) Packaging

Question 49

What is selling the rights to place a brand name on products such as t-shirts referred to as?

A) International branding
B) National branding
C) Private branding
D) Regional branding
E) Licensed branding

Question 50

What is involved in service process design?

Question 51

How can a firm increase the life of a product without involving product changes?

A) Product extension
B) Product adaption
C) Rebranding
D) New product placement
E) Reintroduction

Question 52

Which of the following best describes a private label brand?

A) A retailer uses packaging as a form of advertising.
B) A retailer develops a brand name and has a manufacturer put it on a product.
C) A manufacturer puts its name on an unrelated product for a fee.
D) A brand name is used throughout a series of products made by the same manufacturer.
E) A brand is reintroduced in a new, often global, market.

Question 53

Using symbols and names to communicate the qualities of a product is a function of what?

A) Awareness
B) Reintroduction
C) Product adaptation
D) Product extension
E) Branding

Question 54

Why is new product development expensive?

Question 55

Why is speed to market so important?

Question 56

When a wholesaler or retailer develops a brand name and has the manufacturer place that name on the product, what is that product name called?

A) National brand
B) Private brand
C) Luxury brand
D) Licensed brand
E) Manufacturer brand

Question 57

How do customers most benefit from packaging design?

A) Increased utility
B) In-store advertisements
C) Less spoilage
D) Reduced risk of dames
E) Less theft of the product

Question 58

Packaging can serve as an in-store advertisement that makes the product attractive, displays the brand name, and identifies features and benefits.

Question 59

Which of the following best describes product placement?

A) Placing products on the shelf where they receive the most attention
B) Identifying specific products for viral marketing campaigns
C) Placing products in movies and television shows
D) Placing a national brand next to a store brand for better comparison
E) Determining if a product should be sold only online or only in brick and mortar shops

Question 60

During the product life cycle, when do sales begin to climb and the product begin to show profit?

A) Ascending
B) Mature
C) Initial
D) Growth
E) Accelerated

Question 61

The product life cycle describes the commercial life of services as well as goods.

Question 62

After a product has been in the maturity stage for a few decades, marketers must accept that the product will begin to decline.

Question 63

Which of the following gives the correct formula for calculating markup percentage?

A) Sales price/markup
B) Sales price/fixed costs
C) Fixed costs/variable costs
D) Markup/sales price
E) Sales price/variable costs

Question 64

Which of the following costs refers specifically to those that are unaffected by the quantity of a product sold or produced?

A) Annual costs
B) Variable costs
C) Fixed costs
D) Marginal costs
E) Market-adjusted costs

Question 65

Product X is just beginning to generate a profit for the first time as the manufacturer lowers prices slightly and sees a significant increase in sales. At what stage in the product life cycle is Product X?

Question 66

Which of the following best defines fixed costs?

A) Costs that are needed to acquire a fixed market share
B) Costs that are needed to acquire fixed profits
C) Costs that are unaffected by the number of goods sold by the firm
D) Costs that remain the same from year to year
E) Costs that remain the same across all products

Question 67

Which of the following best describes pricing objectives?

A) The need for the company to compete
B) An indication of the company's social and ethical concerns
C) A reflection of the company's image
D) The ability of a firm to generate revenue
E) The goals of the seller achieved by pricing products

Question 68

In the screening stage of product development, companies use market research to get consumers input about benefits and prices.

Question 69

Which of the following terms refers to the monetary amount added to a product's cost to the seller in order to sell it at a target profit?

A) Profit margin
B) Breakeven cost
C) Revenue
D) Revenue margin
E) Markup

Question 70

For many companies, speed to market with a product is as important as care in developing it.

Question 71

With product adaptation, the product is modified for greater appeal in different countries.

Question 72

The sales price of a product is given as the product's cost to the seller plus which of the following quantities?

A) Breakeven price
B) Revenues
C) Variable price
D) Fixed point
E) Markup

Question 73

Describe the three types of brand names and give an example of each.

Question 74

What is branding? Explain what branding is and give an example of branding.

Question 75

Describe three ways to extend a product's life as it nears the end of the maturity stage.

Question 76

Which of the following costs refers specifically to those that change with the quantity of a product sold or produced?

A) Annual costs
B) Variable costs
C) Fixed costs
D) Marginal costs
E) Market-adjusted costs

Question 77

Which pricing objective has the goal of establishing market share?

A) Market penetration
B) E-business
C) Brand recognition
D) Brand licensing
E) Profit-maximizing

Question 78

Product placement includes showing actors on television shows using a name-brand product.

Question 79

How do companies achieve continuous sales of more units and higher profits, even with lower unit prices?

A) Market penetration
B) E-business
C) Profit-maximization strategies
D) Market domination
E) Market share

Question 80

Companies who price their product low enough to attract a large number of buyers are most likely pursuing which of the following objectives?

A) Stable market pricing
B) High profits
C) Stable market activity
D) Low market volatility
E) High market share