Question 1

Total Quality Management is a business philosophy that tends to use quality improvement as a competitive advantage.

Accepted Answer

Total Quality Management emphasizes on continuous improvement in all aspects of the organization while considering customer satisfaction as the top priority. This focus on quality improvement helps organizations to gain a competitive advantage in the market.

Question 2

The XYZ group, in preparing a forecast for the upcoming sales period, is seeking the judgments of a group of managers.Which of the following is true?

Accepted Answer

The jury of executive opinion involves gathering insights from managers, is fast and effective, provides timely forecasts, but can be biased due to personal judgments.

Question 3

Hot 'n Serve Corporation has developed a new flavor of powdered soup.They are now giving free samples of the soup to every tenth customer who enters the local shopping mall.Those who get a packet of soup are asked to mail in their assessment of the soup by using an enclosed postage-paid card.Hot 'n Serve is 1-in the product evaluation and development stage. 2-employing the use testing method to assess their new product. 3-in the concept development stage.

Accepted Answer

Hot 'n Serve is in the product evaluation and development stage and is using the use testing method by giving free samples and collecting feedback.

Question 4

ABC Incorporated has developed a revolutionary concept for a new kind of typewriter.They are now in the process of testing the concept.To judge the potential of the concept, they should expose it to 1-chief executive officers in industrial organizations. 2-secretaries working in industrial organizations. 3-purchase officers in industrial organizations, since they will place the orders.

Accepted Answer

The concept should be exposed to all three groups because each group has a different perspective on the product. CEOs will be interested in the product's potential impact on the organization, secretaries will be interested in its ease of use, and purchase officers will be interested in its cost and durability.

Question 5

Which of the following is not always a required stage in the new product research process?

Accepted Answer

Test marketing the newly developed product is not always a required stage in the new product research process. Some products may skip this stage depending on the industry, the nature of the product, or the company's strategy.

Question 6

The XYZ Company solicited sales potentials and the probabilities of their occurrence from its salespersons.The data they received can be summarized as follows:  Based on the data, the expected level of sales for the upcoming period is

Accepted Answer

To find the expected level of sales, we need to multiply each sales potential by its probability and add up the results.

(150,000 x 0.25) + (175,000 x 0.35) + (200,000 x 0.30) + (225,000 x 0.10) = 37,500 + 61,250 + 60,000 + 22,500 = 181,250

Therefore, the expected level of sales for the upcoming period is $187,500 (closest to answer choice B).

Question 7

It is felt that exposing people to a concept is necessary in the evaluation and development stage.Which of the following is not one of the important research questions that need to be answered at this stage?

Accepted Answer

While the level of sales needed to break even is an important consideration in the development of a new concept, it is not directly related to the evaluation and development stage where the focus is on understanding the concept and determining its potential for success. Questions A, B, D are important research questions to answer at this stage, as they relate to how the concept is presented, who it is presented to, and how it compares to existing ideas or products. Therefore, the answer is C.

Question 8

Which of the following is not true of test marketing?

Accepted Answer

Test marketing is not a must for all products in today's competitive environment. While it can be a useful tool for gathering information and testing alternative marketing plans, not all products require it or can afford it. The decision to conduct test marketing should be based on factors such as the level of uncertainty surrounding the product's potential success, the cost of the marketing program, and the availability of resources.

Question 9

Which of the following lists all the stages of the new product research process?

Accepted Answer

B is correct because it comprehensively outlines the stages involved in the new product research process: generating new product concepts, developing and evaluating these concepts, developing and evaluating the actual products, and finally, testing the marketing program.

Question 10

XYZ Incorporated has developed a concept for a new kind of lathe machine.The improvement is a highly technical one, and although the operation of the lathe will remain as it is now, its reliability and energy consumption will improve.To test the concept, it should be exposed to 1-the production engineers of potential industrial buyers. 2-the quality control managers of potential industrial buyers. 3-workers on the shop floor, since they will be using the new lathe.

Accepted Answer

The production engineers and quality control managers are the ones who will decide whether the new lathe is worth their investment, so they need to be exposed to the concept. However, since the workers on the shop floor will be the ones using the new lathe, they should also be included in the testing process to ensure its functionality and user-friendliness. Therefore, the best choice is D, which includes both the production engineers and quality control managers, as well as the workers on the shop floor.

Question 11

A major tennis manufacturer, after analysis of life style and demographic data, believes that by 1996, 60 percent of the women in America will be actively involved in sports.It has, therefore, started to develop a whole new line of sports equipment for women. The tennis manufacturer has identified a new need by

Accepted Answer

The tennis manufacturer analyzed life style and demographic data to identify social and environmental trends, which led them to believe that 60% of women in America would become actively involved in sports by 1996. This indicates that the manufacturer studied social and environmental trends to identify a new need.

Question 12

If a company decides to price its products at a point at which the profits are the greatest until the changes in the market conditions or supply costs dictate a price change, then the company follows a

Accepted Answer

This strategy is known as a profit-oriented strategy where the company focuses on maximizing profits by setting prices that will generate the highest possible profit until market conditions or supply costs change.

Question 13

Total Quality Management is restricted to the quality assurance and quality control departments in an organization.

Accepted Answer

Total Quality Management is a holistic approach that involves all departments and employees in an organization. It is a customer-focused strategy that aims to continuously improve the quality of products, services, and processes throughout the entire organization, not just the quality assurance and control departments.

Question 14

Competitive benchmarking is comparing the company's processes, practices, and products against the world's best companies, including those from other industries.

Accepted Answer

Competitive benchmarking involves comparing a company's performance against the best companies in the world, including those from other industries. This helps identify areas for improvement and best practices that can be adopted.

Question 15

Forecasts can differ by

Accepted Answer

Forecasts can differ by time periods (short-term vs long-term), objects (sales vs production), segments (geographic, demographic, psychographic), and product maturity (new vs established). Therefore, all of these options can affect the forecast and should be taken into consideration while making predictions.

Question 16

XYZ Incorporated is in the process of developing a new product.They currently have a verbal description and a rough idea of the brand name, packaging, and advertising approach.The next stage in the process would be

Accepted Answer

The next stage in the process would be to evaluate and develop the new product concept further. While a verbal description and rough idea of branding, packaging, and advertising are a good start, the product concept needs to be fully evaluated and developed before moving on to actual product development or test marketing.

Question 17

Which of the following statements about ASSESSOR is true?

Accepted Answer

- A) ASSESSOR provides results faster and at a lower cost as compared to traditional test markets, making it a cost-effective option.
- B) ASSESSOR allows for flexibility in the selection of marketing variables to be studied, making it customizable to specific research needs.
- C) ASSESSOR uses preference and purchase data to predict actual marketplace behavior, which is a valid methodology.
- D) ASSESSOR is not a laboratory test market method, as it doesn't involve a physical market setting. 
Thus, all of these statements are true about ASSESSOR.

Question 18

Which of the following are possible measurements for evaluating consumer product test markets?

Accepted Answer

All of the choices listed above are possible measurements for evaluating consumer product test markets. Warehouse withdrawals would indicate how many products were sold from the backroom inventory of the store. Store audits would show how much of the product is actually on the shelf and compare that to how much should be there. Shipments would indicate how much of a product is ordered by the store and comes in on a truck. Lastly, trial purchase measures the actual sales of the product to consumers. Therefore, all of these measurements are important for evaluating the success of a consumer test market.

Question 19

Which of the following is a problem with the use test method of evaluating a new product?

Accepted Answer

All of these are potential problems with the use test method of evaluating a new product. Respondents may not use the product correctly resulting in negative opinions, may give distorted impressions since they were given free samples and are part of a test, the decision environment of an actual purchase usually cannot be replicated resulting in misleading results, and repeat buying over a period of time usually cannot be assessed.

Question 20

Parker Foods has just developed a new product.What factors should Parker Foods consider in deciding whether to use a test market for the product?

Accepted Answer

All of these factors should be considered when deciding whether to use a test market for the new product. The potential for disruptive actions by competitors can affect the validity and reliability of the results, making it important to take precautions such as choosing a market where competitors are less likely to interfere. If the new product can be easily copied by competitors, a test market might reveal this and help the company determine whether to invest in patent protection or other strategies to protect the product's unique features. Finally, the cost of a test market compared to immediate commercialization should be weighed against the potential benefits, including insights into consumer preferences and potential demand for the product.

Quiz 23: Marketing-Mix Measures