Question 1

Why are businesses interested in the development of new products?
A) The federal government encourages every product manufacturer to spend 1 percent of revenue on new product development.
B) New products are necessary to stay in business.
C) New products keep the warranty and service departments busy.
D) New products provide the fun that marketing managers need.
E) Product development provides an opportunity for large tax write-offs.

Accepted Answer

Businesses are interested in the development of new products because it is necessary for their survival and growth. Without new products, businesses can become stagnant and lose market share to competitors who are offering newer and more innovative products.

Question 2

For many years, ServiceMaster focused on residential customers, but now it has added business and industry services. This is an example of
A) product mortality.
B) product positioning.
C) multiple product lines.
D) product differentiation.
E) the product mix.

Accepted Answer

ServiceMaster's addition of business and industry services is an example of multiple product lines. This means that the company has expanded its offerings to include products or services that are different from its original residential focus, in order to reach new markets and customers.

Question 3

Buildings, manufacturing equipment, computers, and desks are examples of ________ purchased by companies that make other goods.
A) impulse items
B) capital items
C) current expenses
D) fixed expenses
E) expense items

Accepted Answer

Buildings, manufacturing equipment, computers, and desks are examples of capital items, which are long-term assets purchased by companies to facilitate their production process. Impulse items, current expenses, fixed expenses, and expense items are not relevant in this context.

Question 4

Black & Decker makes toasters, vacuum cleaners, electric drills, and a variety of other appliances and tools. This is Black & Decker's
A) product blend.
B) product offering.
C) product mix.
D) product line.
E) multiple product lines.

Accepted Answer

Black & Decker offers a variety of appliances and tools, and therefore has a product mix.

Question 5

Advertisements for the Swatch Chrono watch remind consumers that they don't get just "real" features like shock and water resistance when they buy the product. This is an example of
A) the value package.
B) emotional advertising.
C) institutional advertising.
D) product differentiation.
E) focusing on the visible features of a product.

Accepted Answer

The value package refers to the combination of tangible and intangible benefits that a product offers. By highlighting features like shock and water resistance, the advertisement emphasizes the overall value and benefits of the watch, beyond just its basic functions.

Question 6

In which stage of the new product development process is a preliminary version of the product produced?
A) Product test run
B) Screening
C) Prototype development
D) Concept testing
E) Test marketing

Accepted Answer

A preliminary version of the product is produced during the prototype development stage of the new product development process. This is when the product concept is turned into a physical form or a working model for initial testing and evaluation.

Question 7

What is the purpose of the screening stage of the product development process?
A) To identify potential production problems
B) To identify the benefits which consumers want
C) To actively seek out ideas for new products
D) To eliminate all ideas that do not mesh with the firm's objectives, abilities, or expertise
E) To compare costs and benefits of the proposed product

Accepted Answer

The screening stage of the product development process aims to eliminate all ideas that do not align with the firm's objectives, abilities, or expertise. This stage helps to narrow down the pool of product ideas and ensures that only the most promising ones move on to the next stages of development.

Question 8

In which stage of product development does market research have a major role?
A) Prototype development
B) Commercialization
C) Business analysis
D) Product testing
E) Concept testing

Accepted Answer

Market research plays a major role in the concept testing stage to assess consumer response to a product idea before it is developed further.

Question 9

You are asked to come up with a new widget. What would your first step be?
A) Idea screening
B) Idea generation
C) Commercialization
D) Business analysis
E) Test marketing

Accepted Answer

The first step in creating a new widget would be idea generation. This involves brainstorming and creating a list of possible ideas for the widget. Once there are enough ideas, the next step would be to screen them to determine their feasibility, cost, and potential marketability. After idea screening, the next steps would typically be business analysis, test marketing, and commercialization.

Question 10

Mirror Corp. has just completed the "screening" phase of the new product development process. What should they do next?
A) Use input from the concept-testing phase to produce a preliminary version of the product
B) Conduct market research to solicit consumers' input about the benefits the proposed product must provide for consumers
C) Eliminate all product ideas that do not mesh with the firm's abilities, expertise, or objectives
D) Begin limited production of the product

Accepted Answer

The answer of Mirror Corp. has just completed the "screening"...

Question 11

It takes ________ new product ideas to generate just 1 new product that reaches the market, and then only ________ out of 10 new products on the market succeeds.
A) 100; 1
B) 200; 3
C) 50; 1
D) 30; 4
E) 20; 6

Accepted Answer

The answer of It takes ________ new product ideas to...

Question 12

Ford offers four different models of the Escort which run the gamut from the three-door sport model to the five-door sedan. This represents
A) a product offering.
B) multiple product lines.
C) a product line.
D) a product blend.
E) a product mix.

Accepted Answer

The different models of the Escort represent a product line, which is a group of related products offered by a company. A product mix refers to the entire range of products offered by a company, while multiple product lines would involve different categories of products. A product blend is not a recognized marketing term.

Question 13

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

Accepted Answer

The next step in the development process after gathering ideas is to screen them. Screening involves filtering out the unfeasible, unprofitable or unsuitable product ideas before moving forward with the development process. This step helps the company to save time, money and resources by focusing only on the most promising product ideas. Once the screening process is complete, the company can move on to concept testing, business analysis, prototype development and test marketing in order to bring the new product to market.

Question 14

Which of the following is correct regarding the product mix and product line concepts?
A) A product line is broader than a product mix.
B) The product mix refers to the group of products a company has available for sale.
C) The product line concept applies to physical products, while the product mix concept applies only to services.
D) A product line focuses on convenience goods, while a product mix focuses on shopping goods.
E) A product line is almost always more expensive than a product mix.

Accepted Answer

The product mix refers to the group of products a company has available for sale, while the product line is a subset of the product mix that refers to a specific category of related products. The product mix can include multiple product lines.

Question 15

Which of the following is correct with regard to the concept of a "product"?
A) The product is made up of the visible features and benefits.
B) When consumers buy a product, they are also buying an image and a reputation.
C) Products are normally classified into two basic groups: those that are consumed in a short period of time and those that last a long time.
D) The value package is the objective features of the product.
E) For a computer, most items in the value package are tangible.

Accepted Answer

When consumers buy a product, they are not only buying its visible features and benefits, but also its image and reputation, which may affect their perception and experience of using the product. Therefore, option B is correct as it reflects the comprehensive nature of a product. Options A, C, D and E either do not fully capture the concept of a product or provide incorrect information about its characteristics.

Question 16

Light bulbs, pencils, pads of paper, and lubricating oils for machines are examples of ________ purchased by companies that make other goods.
A) capital items
B) fixed expense goods
C) expense items
D) depreciation goods
E) impulse items

Accepted Answer

These items are considered expense items because they are consumed during the production process and do not become a permanent part of the final product. Capital items are long-term investments in machinery or equipment, while fixed expense goods and depreciation goods refer to specific types of expenses and accounting concepts. Impulse items are products that are purchased on a whim by consumers, not by companies.

Question 17

You are asked to justify market research for a new product. You explain that it is required
A) to determine if the product will meet performance requirements.
B) to ensure that the new product will mesh with the firm's objectives.
C) to identify future production problems.
D) to identify benefits to be provided by the product.
E) to determine whether there will be a market for the product.

Accepted Answer

The answer of You are asked to justify market research...

Question 18

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) Permanent
E) Governmental purchase

Accepted Answer

The word "permanent" best captures the meaning of capital items as they are durable and considered long-term investments, unlike other goods that are consumed or used up quickly.

Question 19

Suppose you work for a firm that manufactures and sells pet accessories. As part of your job, you frequently visit city parks and observe how people interact with their pets. You also talk to the staff members of veterinary clinics to discover how people relate to their pets. This activity is consistent with the ________ phase of new product development.
A) idea generation
B) business analysis
C) prototype development
D) screening
E) product testing

Accepted Answer

The activity described in the scenario is focused on gathering ideas and understanding consumer behavior, which aligns with the idea generation phase of new product development.

Question 20

In which stage of the product development process does the firm eliminate all product ideas that do not mesh with the firm's abilities, expertise, or objectives?
A) Product ideas
B) Screening
C) Concept testing
D) Test marketing
E) Prototype development

Accepted Answer

Screening is the stage in which a firm evaluates the product ideas generated and eliminates the ones that do not align with the firm's abilities, expertise, or objectives. This helps the firm to focus on the ideas that have the potential to be successful in the marketplace.

Quiz 12: Understanding Marketing Principles and Developing Products

Why are businesses interested in the development of new products?

For many years, ServiceMaster focused on residential customers, but now it has added business and industry services. This is an example of

Buildings, manufacturing equipment, computers, and desks are examples of ________ purchased by companies that make other goods.

Black & Decker makes toasters, vacuum cleaners, electric drills, and a variety of other appliances and tools. This is Black & Decker's

Advertisements for the Swatch Chrono watch remind consumers that they don't get just "real" features like shock and water resistance when they buy the product. This is an example of

In which stage of the new product development process is a preliminary version of the product produced?

What is the purpose of the screening stage of the product development process?

In which stage of product development does market research have a major role?

You are asked to come up with a new widget. What would your first step be?

Mirror Corp. has just completed the "screening" phase of the new product development process. What should they do next?

It takes new product ideas to generate just 1 new product that reaches the market, and then only out of 10 new products on the market succeeds.

Ford offers four different models of the Escort which run the gamut from the three-door sport model to the five-door sedan. This represents

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

Which of the following is correct regarding the product mix and product line concepts?

Which of the following is correct with regard to the concept of a "product"?

Light bulbs, pencils, pads of paper, and lubricating oils for machines are examples of ________ purchased by companies that make other goods.

You are asked to justify market research for a new product. You explain that it is required

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

In which stage of the product development process does the firm eliminate all product ideas that do not mesh with the firm's abilities, expertise, or objectives?