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Exam 14: Developing and Pricing Goods and Services

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Question 161

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The product life cycle model helps marketers realize that

A) consumers are always ready to try a new product if it is priced correctly.
B) different stages in the life cycle call for different marketing strategies.
C) sales and profit levels can be forecasted accurately.
D) careful product screening will increase profits over the life of a product.

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

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Question 162

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Low prices can often help retailers create an attractive total product offer.

A) True
B) False

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Question 163

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Which of the following statements about packaging is the most accurate?

What is a brand? What is a brand name? What is meant by brand equity?

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

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

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

Rosalita's and Antonio's are Mexican restaurant chains. Each restaurant offers similar items on their menus. However, Antonio's restaurants are positioned in the market as elegant establishments with high prices. Rosalita's, on the other hand, are located in middle-class neighborhoods, with a casual atmosphere that welcomes families with young children. The prices at Rosalita's are in the moderate range. When evaluating the marketing strategies used by these restaurants, we can conclude that

The benefits provided by a brand name for a buyer include reduced search time, prestige, and quality assurance.

Sales of generic products are decreasing because consumers prefer the higher quality of the nationally known brands.

Product testing is designed to reduce the number of new-product ideas that a firm works on at any one time.

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

The critical component of a total product offer is always a low price.

Sometimes a firm will lower prices below their costs in order to build a customer base.

While packaging innovations benefit the consumer, they have vastly increased the workload of retailers.

Product development is a key activity in any modern business, anywhere in the world.

Fast food restaurants must constantly monitor all sources of information for new-product ideas.

The ________ is a theoretical model that describes the sales and profit performance of a product class over time.

Eliza, a collector of fine art, particularly loves paintings. She has been looking for an original Jackson Pollack painting for months and has said that she is willing to go to extraordinary efforts to acquire this painting for her collection. Clearly this painting represents a ________ good for Eliza.

Cutter's Catering Services advertises that they are the "friendliest caterers in town." Though their prices are no lower than the rates of competitors, they put a great deal of emphasis on getting to know the needs of their customers. They tailor their efforts to meet these needs, providing a unique dining experience that exactly matches the customer's expectations. Cutter's Catering is likely to find that this approach is more effective in achieving its goals than the use of aggressive price cutting.