Question 1

Generally, the product life-cycle consists of five stages: development, introduction, growth, maturity, and decline.

Accepted Answer

False

Question 2

A narrow product mix allows a firm to gain stability by concentrating on just a few markets.

Accepted Answer

A narrow product mix can increase risk as the firm relies heavily on a limited number of products and markets, making it vulnerable to market changes and competition.

Question 3

Some firms set an annual percentage ROI (return on investment) as their pricing goal.

Accepted Answer

Some firms aim to achieve a specific annual percentage ROI, using it as a benchmark to set prices that will help them meet their financial objectives.

Question 4

A store that sells all of its men's gloves for $9.95 and $15.00 is practicing price lining.

Accepted Answer

Price lining is a strategy where a store sells products at a limited number of price points, such as $9.95 and $15.00 for men's gloves.

Question 5

A consumer product for which buyers will expend effort or planning, that is purchased infre-quently, and that is usually purchased only after being compared with competing products is a __________ product.
A) luxury
B) specialty
C) convenience
D) shopping
E) business

Accepted Answer

A shopping product is one that consumers purchase infrequently and only after comparing it with competing products, often involving effort and planning.

Question 6

A group of similar products that differ only in relatively minor characteristics is called a
A) product.
B) product line.
C) generic product.
D) product differentiation.
E) product mix.

Accepted Answer

A product line is a group of similar products that differ only in relatively minor characteristics.

Question 7

If a company needs to obtain cash quickly to pay its bills, it may opt for a pricing strategy that achieves which goal?
A) Market share increase
B) Status quo
C) ROI target
D) Maximization of profit
E) Survival

Accepted Answer

The survival pricing strategy is used when a company needs to generate cash quickly to cover immediate expenses, even if it means sacrificing profits.

Question 8

A manufacturer of cameras and film may price a camera at a low price to attract customers, but price the film at a relatively high price because customers must continue to purchase film in or-der to use their cameras. This type of pricing strategy is known as
A) captive pricing.
B) premium pricing.
C) price lining.
D) special-event pricing.
E) customary pricing.

Accepted Answer

This strategy is known as captive pricing, where the main product is sold at a low price, but the complementary product (which is necessary for the main product to function) is sold at a higher price.

Question 9

A "2/10, net 30" invoice feature is an example of a __________ discount.
A) trade
B) cash
C) preferential
D) uniform
E) quantity

Accepted Answer

The answer of A "2/10, net 30" invoice feature is...

Question 10

A product's classification largely determines the appropriate marketing strategy.

Accepted Answer

A product's classification, such as convenience, shopping, specialty, or unsought goods, influences the marketing strategy, including pricing, distribution, and promotion, to effectively reach the target audience.

Question 11

The most important element in the success of a branded product is consumers' confidence in the product.

Accepted Answer

Consumer confidence is crucial as it influences purchasing decisions, brand loyalty, and word-of-mouth promotion, all of which are vital for a branded product's success.

Question 12

If a firm is using cost-based pricing, it considers costs and revenue secondary to competitors' prices.

Accepted Answer

Cost-based pricing primarily focuses on covering costs and achieving a desired profit margin, rather than prioritizing competitors' prices.

Question 13

Competition-based pricing results in a high price when product demand is strong and a low price when demand is weak.

Accepted Answer

Competition-based pricing is determined by competitors' prices rather than demand. Demand-based pricing would adjust prices based on demand levels.

Question 14

All of the following are characteristics of the decline stage of the product life-cycle except
A) a sharp decrease in sales volume.
B) a decline in the number of competing firms.
C) increased consumer awareness of the product.
D) the removal of less profitable versions from the product line.
E) increased importance of production and marketing costs in determining profit.

Accepted Answer

Increased consumer awareness of the product is not a characteristic of the decline stage; it is more typical of earlier stages like growth or maturity.

Question 15

To maintain an effective product mix, a firm often must eliminate some products. This process is called
A) quality modifications.
B) functional modifications.
C) aesthetics.
D) product deletion.
E) product modification.

Accepted Answer

Product deletion is the process of removing a product from the product mix when it is no longer profitable or aligned with the company's strategy.

Question 16

A product with no brand at all is called a
A) discount product.
B) factory second.
C) maverick product.
D) generic product.
E) plain-package product.

Accepted Answer

A product with no brand at all is referred to as a "generic product." These products are typically sold without a brand name and are often less expensive than branded products.

Question 17

Non-price competition can be used effectively when a seller does all but which one of the fol-lowing?
A) Makes distinctions in product quality
B) Differs in customer service
C) Uses an attractive promotional strategy
D) Creates an appealing package
E) Lowers prices

Accepted Answer

Non-price competition focuses on factors other than price, such as product quality, customer service, promotion, and packaging. Lowering prices is a form of price competition, not non-price competition.

Question 18

A Product by Any Name
-In the next five minutes, list as many names as you can think of that fit each criterion.
a. Easy to say, spell, and recall
b. Communicates major product benefits
c. Suggests product uses or special features
d. Distinctive enough to set the product apart from competing brands

Accepted Answer

The answer of A Product by Any Name
-In the next...

Question 19

How Should We Price It?
-In the time allotted to you, identify the pricing strategies used in each of the situations described below.
a. Hyundai prices its newest model lower than the price of competing brands.
b. A high-quality men's shirt has a suggested retail price of $59.95 instead of $60.
c. A restaurant lowers the price of its corned beef and cabbage plate during the week before St. Patrick's Day.
d. For years, the price of a candy bar was 25 cents and rarely did a manufacturer charge more.
e. A supermarket prices its eggs, bread, and milk below cost.

Accepted Answer

The answer of How Should We Price It?
-In the time...

Quiz 12: Creating and Pricing Products That Satisfy Customers

Generally, the product life-cycle consists of five stages: development, introduction, growth, maturity, and decline.

A narrow product mix allows a firm to gain stability by concentrating on just a few markets.

Some firms set an annual percentage ROI (return on investment) as their pricing goal.

A store that sells all of its men's gloves for $9.95 and $15.00 is practicing price lining.

A consumer product for which buyers will expend effort or planning, that is purchased infre-quently, and that is usually purchased only after being compared with competing products is a __________ product.

A group of similar products that differ only in relatively minor characteristics is called a

If a company needs to obtain cash quickly to pay its bills, it may opt for a pricing strategy that achieves which goal?

A manufacturer of cameras and film may price a camera at a low price to attract customers, but price the film at a relatively high price because customers must continue to purchase film in or-der to use their cameras. This type of pricing strategy is known as

A "2/10, net 30" invoice feature is an example of a __________ discount.

A product's classification largely determines the appropriate marketing strategy.

The most important element in the success of a branded product is consumers' confidence in the product.

If a firm is using cost-based pricing, it considers costs and revenue secondary to competitors' prices.

Competition-based pricing results in a high price when product demand is strong and a low price when demand is weak.

All of the following are characteristics of the decline stage of the product life-cycle except

To maintain an effective product mix, a firm often must eliminate some products. This process is called

A product with no brand at all is called a

Non-price competition can be used effectively when a seller does all but which one of the fol-lowing?

A Product by Any Name -In the next five minutes, list as many names as you can think of that fit each criterion. a. Easy to say, spell, and recall b. Communicates major product benefits c. Suggests product uses or special features d. Distinctive enough to set the product apart from competing brands