Question 1

The purpose of break-even analysis is to determine the lowest price a firm can charge and still be able to cover its costs of production.

Accepted Answer

A) True 
 B)False

Question 2

The cost of raw materials used to produce a good or service represent the firm's ________ costs.

Accepted Answer

A)   fixed
B)   variable
C)   mixed
D)   uncontrollableE) All of the above
F) B) and C)

Question 3

The product analysis stage of the new-product development process considers the sales forecasts and cost estimates of a new-product idea.

Accepted Answer

A) True 
 B)False

Question 4

When consumer loyalty reaches the point of brand insistence,the product becomes a specialty good.

Accepted Answer

A) True 
 B)False

Question 5

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

Accepted Answer

A)   Consumer income
B)   Management style
C)   Employee personality
D)   PackagingE) A) and C)
F) None of the above

Question 6

Brand __________ refers to the loyalty,perceived quality,and emotions people associate with a given brand name.

Accepted Answer

A)   equity
B)   identification
C)   positioning
D)   ownershipE) A) and B)
F) B) and C)

Question 7

In the long run the market determines what the price will be.

Accepted Answer

A) True 
 B)False

Question 8

The four-stage theoretical model that describes the evolution of a product from birth to death is referred to as the:

Accepted Answer

A)   growth-share matrix.
B)   developmental life span analysis.
C)   product life cycle.
D)   product market progression index.E) All of the above
F) C) and D)

Question 9

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

Accepted Answer

A)   Falling sales
B)   Price reductions
C)   Many new firms entering the market
D)   Increasing profitsE) A) and C)
F) C) and D)

Question 10

Costs incurred regardless of the number of units of a product that are produced or sold are called:

Accepted Answer

A)   mixed costs.
B)   controllable costs.
C)   fixed costs.
D)   variable costs.E) A) and C)
F) A) and D)

Question 11

Chevrolet is an example of a generic name in the automobile market.

Accepted Answer

A) True 
 B)False

Question 12

Felicia wants to know how many units she must sell to cover all of her costs.She indicates to you that her selling price is $20 per unit,her fixed costs are $6,000,and the variable costs per unit are $15.What is her break-even point?

Accepted Answer

A)   300 units
B)   400 units
C)   1,200 units
D)   1,100 unitsE) B) and C)
F) A) and B)

Question 13

SnackAttack has found that an effective technique to generate ideas for new consumer products is to carefully listen to employees and suppliers.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is a stage in the product life cycle?

Accepted Answer

A)   Commercialization
B)   Decline
C)   Peak
D)   AcceptanceE) B) and D)
F) A) and B)

Question 15

__________ consists of major capital equipment such as new factories and heavy machinery.

Accepted Answer

A)   Accessory goods
B)   Specialty goods
C)   Installations
D)   Shopping goodsE) A) and B)
F) B) and C)

Question 16

Dewy,Cheatem,and Howe's promotional efforts are intended to increase the public's awareness of its new product's benefits and uses.This effort is consistent with the ________ stage of the product life cycle model.

Accepted Answer

A)   introduction
B)   growth
C)   maturity
D)   declineE) A) and D)
F) A) and C)

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

Entice-mint Breath Mints is a new brand of breath fresheners.The company realizes that product location is very important since consumers desire to buy this type product with a minimum of effort.Entice-mint mints represent a:

Accepted Answer

A)   shopping good.
B)   specialty good.
C)   convenience good.
D)   industrial gooD.E) A) and B)
F) None of the above

Question 19

Endorsements by sports or movie celebrities can help create a favorable brand association.

Accepted Answer

A) True 
 B)False

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 14: Developing and Pricing Goods and Services

The four-stage theoretical model that describes the evolution of a product from birth to death is referred to as the:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Felicia wants to know how many units she must sell to cover all of her costs.She indicates to you that her selling price is $20 per unit,her fixed costs are $6,000,and the variable costs per unit are $15.What is her break-even point?

Correct AnswerverifiedShow Answer

The cost of raw materials used to produce a good or service represent the firm's ________ costs.

Correct AnswerverifiedShow Answer

Dewy,Cheatem,and Howe's promotional efforts are intended to increase the public's awareness of its new product's benefits and uses.This effort is consistent with the ________ stage of the product life cycle model.

Correct AnswerverifiedShow Answer

Chevrolet is an example of a generic name in the automobile market.

Correct AnswerverifiedShow Answer

The purpose of break-even analysis is to determine the lowest price a firm can charge and still be able to cover its costs of production.

Correct AnswerverifiedShow Answer

In the long run the market determines what the price will be.

Correct AnswerverifiedShow Answer

Costs incurred regardless of the number of units of a product that are produced or sold are called:

Correct AnswerverifiedShow Answer

When consumer loyalty reaches the point of brand insistence,the product becomes a specialty good.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Brand __________ refers to the loyalty,perceived quality,and emotions people associate with a given brand name.

Correct AnswerverifiedShow Answer

SnackAttack has found that an effective technique to generate ideas for new consumer products is to carefully listen to employees and suppliers.

Correct AnswerverifiedShow Answer

Entice-mint Breath Mints is a new brand of breath fresheners.The company realizes that product location is very important since consumers desire to buy this type product with a minimum of effort.Entice-mint mints represent a:

Correct AnswerverifiedShow Answer

Which of the following is a stage in the product life cycle?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

__________ consists of major capital equipment such as new factories and heavy machinery.

Correct AnswerverifiedShow Answer

The product analysis stage of the new-product development process considers the sales forecasts and cost estimates of a new-product idea.

Correct AnswerverifiedShow Answer

Endorsements by sports or movie celebrities can help create a favorable brand association.

Correct AnswerverifiedShow Answer

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