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Exam 14: Developing and Pricing Goods and Services

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Question 151

True/False

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Federal legislation requires that the brand name of a product clearly identify the manufacturer of that product.

A) True
B) False

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Question 152

Multiple Choice

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Phar-out Pharmacy will advertise a price of an over-the-counter drug at or below their cost.The intended goal of this loss leader strategy is to:

A) achieve a target profit.
B) reduce the break-even quantity.
C) build traffic and increase the customer base.
D) create an upscale image.

E) B) and C)
F) A) and D)

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Question 153

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Gourmet Pets hopes to use its special packaging and extensive advertising to create a perception in the minds of consumers that Prime Cuts is a superior product,even though the actual quality of meat used in the product is virtually no different from competing brands.The company is attempting to develop:

A competition-based pricing strategy called __________ involves one or more dominant firms establishing the pricing practices that all competitors in an industry follow.

The combination of product lines offered by a manufacturer is called the firm's:

Successful firms maintain consistency in their marketing mix strategies throughout the product life cycle.

Papa's Market offers customers tissues,canned vegetables,napkins,and dishwashing detergent in basic packaging with no identified brand.These goods are popular with Papa's cost-conscious shoppers because they are significantly less expensive than nationally known brand names.These types of goods are examples of generic goods.

_________ is an important part of the total product offer for a product.

Firms utilize ________ when they attempt to add value to their product by offering service after the sale,product demonstrations,or interactive customer Web sites.

A high-low pricing strategy may condition consumers to avoid paying the regular prices by waiting for sale prices.

When people consider purchasing a good,they:

Gabe intends to visit a variety of retailers of sound equipment comparing features,quality,and prices of different brands at each store.This behavior indicates that for Gabe a sound system is a shopping good.

For most firms,price competition is the most important way to gain a competitive advantage over rivals.

Employees,not the firm's research and development department,are the number one source of ideas for new industrial products.

According to the Thinking Green box,Trident Seafood Company practices ______________.The company processes every part of the fish it catches,producing fish oil,fish meal,and other by-products.

Gourmet Pets feels its target market is more concerned with perceived quality than actual product cost.They also feel that the newness of this concept offers an opportunity to make high profits since they are the first firm to enter this market,so they face no direct competition.Their decision to charge a high price is consistent with the ________ strategy.

During the ________ stage of the product life cycle sales reach a peak,profits are declining,and the number of competitors starts to decrease.

In evaluating a total product offer,value enhancers such as service,guarantees,reputation of the seller,etc.are as important to customers as the basic product.

Brand managers are responsible for the marketing of a product after it has been developed and a clear promotional message has been identified.

A skimming price strategy involves a low pricing policy intended to attract price-sensitive customers from competitors.