MCQs on New Product Development and Product

Life Cycle Strategies Learning

7. One source estimates that 80 percent of new

consumer packaged goods products fail. Which of the
following categories accounts for most of those
failures?

1. The products such as "VHS tapes" are examples of

A product classes
B product forms
C branding
D product perception
2. The competitors in the introductory stage of
product life cycle are.
A few
B growing number
C stable but begins declining
D declining number
3. In the 'growth stage of product life cycle' the cost
per customer is.
A high
B low
C average
D moderate
4. In product life cycle, the stage in which sales are
zero is said to be
A product development stage
B maturity stage
C growth stage
D decline stage
5. The sales in maturity stage of product life cycle are
A low sales
B rapidly rise in sales
C peak sales
D decline in sales

6. As discussed in the text, all of the following have

been new product innovations used by Gillette to
retain its leadership position in a number of industries
EXCEPT:
A
B
C
D

Satin Care shaving gel for women.

Duracell Ultra line of batteries.
Gillet Burnaway for Men Hair Removal Cream
Mach 3 Turbo razor for men.

A
B
C
D

Brand extensions.
Cost reductions.
Line extensions.
Positioning or repositioning of new products.

8. The first step in the new-product development

process is thought to be:
A
B
C
D

Idea generation.
Idea screening.
Concept development and testing.
Product development.

9. Major sources of new-product ideas include all of

the following EXCEPT:
A
B
C
D

Competitors.
Government.
Internal sources.
Customers.

10. The way consumers perceive an actual or

potential product is called the:
A
B
C
D

Product image.
Product idea.
Product form.
Product concept.

11. Which of the following would be considered to

be among the issues that would be covered in the first
part of a marketing strategy statement?
A
B
C
D

Packaging strategy.
Dealer strategy.
Target market strategy or description.
Advertising strategy.

12. A consumer takes a tour of a new proposed store

via his or her computer screen. The consumer can
make suggestions as to design themes that would be
attractive and he or she can also suggest merchandise
options from a list provided by the Web site. Which of
the following would be the form of testing that has
just been described?
A
B
C
D

Store-based testing.
Producer sponsored testing.
Virtual reality test marketing.
Focal test marketing.

13. If a company were to decide to use team-based

or collaborative product development, the form that
the company would have chosen would be called:
A
B
C
D

Sequential product development.

Dual product development.
Simultaneous product development.
Pyramidal product development.

14. Considering a product from the time it is

conceived to the time it is abandoned, the
______________ phase is characterized by zero sales
and a place where the company's investment costs
mount.
A
B
C
D

decline
introduction
maturity
product development

15. Considering that some products have special life

cycles, a ___________ has a cycle showing several
periods of renewed interest.
A
B
C
D

fashion
style
theme
fad

16. During which stage of the product life cycle does

sales growth slow or level off?
A
B
C
D

Introduction.
Maturity.
Decline.
Growth

17. During which phases of the product life cycle are

costs thought to be low on a per customer basis?

A
B
C
D

Maturity and Decline.

Product Development and Introduction.
Introduction and Growth.
Growth and Maturity.

18. Profits are normally highest in which of the

following stages or phases of the product life cycle?
A
B
C
D

Maturity.
Growth.
Decline.
Introduction.

19. During which stage of the product life cycle does

the company attempt to maximize market share?
A
B
C
D

Introduction.
Maturity.
Growth.
Decline.

20. During which stage of the product life cycle does a

company seek to build selective distribution?
A
B
C
D

Maturity.
Introduction.
Growth.
Saturation.

21. In considering an observed price, consumers often

compare it to an internal price called a(n) _____ price.
expected
perceived
reference
psychological
tolerated
22. _____ pricing is used to maximize the company's
market share.
Survival
Market skimming
Market penetration
Reference
Leadership
23. _____ costs do not vary with production or sales
revenue.
Open Hint for Question 3 in a new window.
Variable
Fixed
Expected
Total
Net
24. _____ cost is the cost per unit at that level of
production.
Fixed
Total
Average
Variable
Net
25. In _____ pricing the firm bases its price largely on
competitors' prices.
high-low
competitive
target-return
markup
going-rate
26. In _____ pricing the company decides how to
price its products to different customers in different
locations and countries.
discriminatory

regional
geographical
demographic
adaptive
27. The direct exchange of goods, with no money and
no third party involved, is called a(n) _____.
barter
compensation deal
buyback agreement
offset
trade
28. When PepsiCo sells its cola syrup to Russia for
rubles and agrees to buy Russian vodka at a certain
rate for sale in Canada, this is called _____.
barter
compensation deal
buyback agreement
offset
trade
29. _____ occurs when a company sells a product or
service at two or more prices that do not reflect a
proportional difference in costs.
Price differentiation
Price discrimination
Psychological pricing
Geographical pricing
Non-proportional pricing
30. Coca-Cola carries a different price depending on
whether it is purchased in a fine restaurant, fast-food
restaurant, or a vending machine. This is called _____
pricing.
channel
image
location
customer-segment
product-form
31. The first step in setting pricing policy is:
determining demand
estimating cost
selecting the pricing objective
selecting a pricing method
analyzing competitor's costs

32. Companies pursue _____ as their major price

objective if they are plagued with overcapacity,
intense competition, or changing consumer wants.

French
sealed-bid
Yahoo! or eBay

survival
maximum market share
maximum profit share
market penetration
market skimming

38. A British aircraft manufacturer sold planes to

Brazil for 70 percent cash and the rest in coffee. This
type of practice is called a(n) _____.

33. If demand hardly changes with small changes in

price the demand is _____.
unitary
sensitive
elastic
inelastic
neutral
34. The decline in the average cost with accumulated
production is called the _____.
demand curve
supply curve
variable cost
accumulated cost
learning curve
35. A company charging fairly low prices for highquality goods is practising _____ pricing.
value
perceived-value
auction-type
quality
competitive
36. In a(n) _____ auction the auctioneer announces a
high price for a product and then slowly decreases the
price until a bidder accepts the price.
English
Dutch
French
sealed-bid
Yahoo! or eBay
37. In a(n) _____ auction would be suppliers can
submit only one bid and cannot know the other bids.
English
Dutch

barter
compensation deal
buyback arrangement
offset
trade
39. One method of increasing prices is using _____,
where the company maintains its price but removes
or prices separately one or more elements that were
part of the former offer.
escalator clauses
delayed quotation pricing
demand pricing
unbundling
unitary pricing
40. In _____ pricing the company does not set a final
price until the product is finished and delivered.
anticipatory
delayed quotation
time-delayed
set-point
guerilla
41. A market leader can respond directly to a
competitor's aggressive price-cutting strategies by :.
maintaining price and adding value
cutting costs
changing the packaging
using a different distribution channel
going out of business
42. When the local museum charges different
customer groups different prices for admission, this is
known as:
product form pricing
image pricing
customer-segment pricing
location pricing
time pricing