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Exam 13: A: Creating and Pricing Products That Satisfy Customers

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Question 101

Multiple Choice

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Renee collects antique Fabergé eggs. For most of these eggs, only one or a few were created of each design. These eggs would best be classified as ____ products.

A) specialty
B) convenience
C) business
D) shopping
E) luxury

F) C) and D)
G) A) and D)

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Question 102

Multiple Choice

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Arm & Hammer launches a campaign to extend the life of its baking soda products through improved packaging and new uses in products such as toothpaste and cat litter. These new uses of products and other modifications are generally created during the ____ phase of the product life-cycle.

A) growth
B) introduction
C) maturity
D) extension
E) decline

F) A) and E)
G) C) and D)

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Question 103

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Identify and discuss the three major ways that a product mix can be improved.

A major drawback of price competition is that

The number of units that must be sold for the total revenue to equal the total cost is called the ____ quantity.

When price helps Josh decide to purchase a Mini Cooper Coupe instead of a Mercedes CLS-Class Coupe because he also wants a Harley-Davidson motorcycle, price serves the function of

Would a new car equipped with a bumper jack, jack handle, spare tire, and warranty be the same product as the same car without these features? Explain.

How does product differentiation allow a firm to exert some control over a product's price?

Would Coca-Cola be a generic brand? Why or why not? How would you expect the package and label of a generic product to look?

The sum of the fixed costs and the variable costs of producing a certain number of units is called the

Products that are designed to be similar to and compete with existing products of other firms are called

Hallmark cards develops a new line of cards that have a total cost of $200,000 and a price of $3 each. If it sells 20,000 cards the first month, what is its total revenue?

Click It, Inc. Travis is a salesperson for Click It, Inc. Click It does not sell products with its own brand name. Instead, its products are created for different retail stores and carry the store brand. Travis thought that several changes needed to be made to a particular product, but Click It management reminded him that the stores, not Click It, owned the brand. However, because Click It had been concerned about dropping sales, management listened to Travis's concerns about the company's pricing. He suggested using a different pricing strategy. More specifically, he felt that the company should incorporate a multiple-unit pricing strategy because it would then allow Click It to set a single price for multiple units. This had the potential of increasing sales and therefore profits, so management agreed to consider Travis's suggestion. -Refer to Click It, Inc. Because Click It sells its products under different brand names, each product is a

____ competition is competition based on factors such as product quality, promotion, customer service, and packaging.

Brand names such as Tide, Surf, Biz, and Wisk are effective names because they

Your Way, Inc. Eric buys companies that are small or companies in financial trouble. He helps these companies turn around and develop a competitive advantage. The company that he recently purchased is called Your Way, Inc. The company sells men's clothing and accessories. Your Way keeps the sewing machines for clothes manufacturing at a separate production facility so that the store location space can be reserved for display and selling. After looking over the different products available, Eric realized that the company's previous owner was not aware of the product life-cycle because the company kept items that were obviously too old and out of date. Also, because of the high turnover, employees did not have good knowledge of the different product lines and did not know the difference between a product line and a product mix. To move the company forward, Eric thought of the following two measures: first, developing a new product to incorporate into the product mix; and second, eliminating the out-of-date products. -Refer to Your Way, Inc. Which of the following descriptions should Eric use to best explain the difference between the product line and product mix?

____ become(s) a part of the physical product and consist(s) of either finished items ready for assembly or products that need little processing before assembly.

A wrench used to make adjustments to machinery that produces copper wire is classified as

Bread, gasoline, and ____ are examples of convenience products.

The strategy of charging the highest possible price for a product during the introduction stage of its life-cycle is known as