Question 1

One function of effective packaging is to protect the goods inside during handling and storage, as well as deter product tampering and theft.

Accepted Answer

A) True 
 B)False

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

Some goods can be classified as either consumer goods or as industrial goods.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

Marketers use pricing, advertising, and packaging to differentiate their products from competitors' products even when actual differences are quite small.

Accepted Answer

A) True 
 B)False

Question 6

Spokes sells high-quality bicycles and accessories. The store is known for a pleasant environment, friendly salespeople, and an excellent service department. All of these elements are part of the ________ offered by Spokes.

Accepted Answer

A)  total product offer 
B)  product line 
C)  competitive environment 
D)  marginal utility package 
A)  total product offer 
B)  product line 
C)  competitive environment 
D)  marginal utility package

Question 7

Competition-based pricing is a strategy based on what all the other competitors are doing.

Accepted Answer

A) True 
 B)False

Question 8

Gabriella strongly prefers a specific brand of gourmet coffee. Since there is only one store in her area that sells her brand, she makes an extra effort to purchase this item. Gabriella's purchasing behavior indicates for her this product is a specialty good.

Accepted Answer

A) True 
 B)False

Question 9

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 10

Louis expects to visit a variety of retailers and websites to compare features, quality, and prices of different speaker equipment brands. This behavior indicates that for Louis a speaker system is a shopping good.

Accepted Answer

A) True 
 B)False

Question 11

One way a small firm can succeed against larger competitors is to

Accepted Answer

A)  determine their break-even point price. 
B)  add value to their product offering. 
C)  eliminate the fringe benefits offered to frequent customers. 
D)  use break-even segmentation. 
A)  determine their break-even point price. 
B)  add value to their product offering. 
C)  eliminate the fringe benefits offered to frequent customers. 
D)  use break-even segmentation.

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

Dealer (private) brands are products that do not carry the manufacturer's name, but rather carry the name of a distributor or retailer.

Accepted Answer

A) True 
 B)False

Question 14

PharmaSave 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

Accepted Answer

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

Question 15

________ uses price points to establish prices that help create the impression that the product is less expensive than it is.

Accepted Answer

A)  High-low pricing 
B)  Everyday low pricing (EDLP) 
C)  Bundling 
D)  Psychological pricing 
A)  High-low pricing 
B)  Everyday low pricing (EDLP) 
C)  Bundling 
D)  Psychological pricing

Question 16

Which of the following is a potential problem with a high-low pricing strategy?

Accepted Answer

A)  It confuses and frustrates customers. 
B)  It places too much emphasis on nonprice competition. 
C)  It teaches customers to wait for sales, and therefore reduces profits. 
D)  It is difficult to implement. 
A)  It confuses and frustrates customers. 
B)  It places too much emphasis on nonprice competition. 
C)  It teaches customers to wait for sales, and therefore reduces profits. 
D)  It is difficult to implement.

Question 17

A self-portrait of a celebrated photographer sold at a Christie's auction for about $4 million dollars. According to Christie's, this was the highest price ever received for a photograph in the history of the auction business. As a student of marketing, you would classify this photo and other rare items sold through Christie's as

Accepted Answer

A)  unsought for goods. 
B)  specialty goods. 
C)  intangible goods. 
D)  shopping goods. 
A)  unsought for goods. 
B)  specialty goods. 
C)  intangible goods. 
D)  shopping goods.

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

Unsought goods and services are purchased on impulse and provide no added value to consumers.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements regarding convenience goods and services is accurate?

Accepted Answer

A)  Shoppers will exert lots of effort to obtain the product. 
B)  Consumers purchase the product on an infrequent basis. 
C)  Consumers buy only after carefully comparing quality and value. 
D)  Brand awareness and image are important in marketing these products. 
A)  Shoppers will exert lots of effort to obtain the product. 
B)  Consumers purchase the product on an infrequent basis. 
C)  Consumers buy only after carefully comparing quality and value. 
D)  Brand awareness and image are important in marketing these products.

Exam 14: Developing and Pricing Goods and Services

One function of effective packaging is to protect the goods inside during handling and storage, as well as deter product tampering and theft.

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

Some goods can be classified as either consumer goods or as industrial goods.

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

Marketers use pricing, advertising, and packaging to differentiate their products from competitors' products even when actual differences are quite small.

Spokes sells high-quality bicycles and accessories. The store is known for a pleasant environment, friendly salespeople, and an excellent service department. All of these elements are part of the ________ offered by Spokes.

Competition-based pricing is a strategy based on what all the other competitors are doing.

Gabriella strongly prefers a specific brand of gourmet coffee. Since there is only one store in her area that sells her brand, she makes an extra effort to purchase this item. Gabriella's purchasing behavior indicates for her this product is a specialty good.

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

Louis expects to visit a variety of retailers and websites to compare features, quality, and prices of different speaker equipment brands. This behavior indicates that for Louis a speaker system is a shopping good.

One way a small firm can succeed against larger competitors is to

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

Dealer (private) brands are products that do not carry the manufacturer's name, but rather carry the name of a distributor or retailer.

PharmaSave 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

________ uses price points to establish prices that help create the impression that the product is less expensive than it is.

Which of the following is a potential problem with a high-low pricing strategy?

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

Unsought goods and services are purchased on impulse and provide no added value to consumers.

Which of the following statements regarding convenience goods and services is accurate?

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding Economics and How It Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Structuring Organizations for Todays Challenges

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemanagement Issues

Marketing: Helping Buyers Buy

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix: Working Within the Legal Environment

Appendix: Using Technology to Manage Information

Appendix: Managing Risk

Appendix: Managing Personal Finances

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