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Exam 14: Developing and Pricing Goods and Services

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Question 61

Multiple Choice

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For small businesses,product differentiation:

A) is more difficult than it is for larger firms because of the high cost of product research and development.
B) usually concentrates on the pricing component of the total product offer.
C) can be an important strategy to gain market share.
D) is less important than it is for big firms with multiple product lines.

E) All of the above
F) None of the above

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Question 62

Multiple Choice

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Which of the following is a characteristic of the decline stage of the product life cycle?

A) falling sales
B) price reductions
C) many new firms entering the market
D) increasing profits

E) None of the above
F) B) and C)

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Question 63

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One reason many large consumer-product companies make use of __________ is to have greater control over new-product development and product promotion.

Currently,which of the following products would most likely be considered in the growth stage of the product life cycle?

Whether a consumer thinks a product provides the best value depends upon:

Dutch owns and operates a small pizzeria that competes with a variety of other restaurants offering pizza on their menus.His largest competitors are large nationally known organizations.The small size of Dutch's business prevents him from successfully utilizing a product differentiation strategy.

Which of the following is a benefit of a brand name for a seller?

Carlotta owns and manages the Carlite Car Wash.She charges $8 per car wash.Her fixed costs are $600 per month,while her variable costs per car wash amount to $2.Carlotta must wash 60 cars to break even.

At the concept testing stage,factors such as packaging,branding,ingredients,etc.should be tested to ensure that a product is acceptable to potential consumers.

A pickup truck can be classified as either a consumer good or an industrial good.

Which of the following is consistent with the introduction stage of the product life cycle?

Break-even analysis determines profitability of a firm at various levels of sales.

New products often fail because they don't deliver to consumers their promised benefits.

"Create a better mousetrap and the world will beat a path to your door." This statement is consistent with the idea behind the commercialization of products.

While service providers offer product lines,they are unable to offer product mixes.

Firms use brand managers or brand teams to give them greater control over both new-product development and product promotion.

John needed transportation.Now that his new marketing job was "in the bag," it was time to go shopping."New" was probably going to be out of the question.He wasn't planning on going into debt with a fancy car! As he reviewed his options,he listed the kinds of things he wanted in a vehicle: the ability to carry some large things;a comfortable back seat for his two dogs;4-wheel drive for snow and ice;and economical on gas.Marketers know that today's consumers ___________________.

Target costing adds a profit margin to estimated cost of production to determine the optimal price.

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

_______ costs are those costs that increase as the level of production increases.