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Exam 14: Developing and Pricing Goods and Services

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Question 141

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Department store owner Brendan McGowan decided to make a gutsy move with his high-end Western Son stores. Rather than focus on the upscale, luxury market that the store attracted earlier in the decade, he focused on bringing in clothing with more mass appeal. The stores succeeded in turning around downward trending sales. In conjunction with your understanding of the product life cycle, which of the following statements summarizes the marketing strategy?

A) Western Son recognized that it was not competing well with its traditional higher income market. It decided to change its product offering and price to appeal to a broader market and increase sales and profits.
B) Western Son stores recognized several markets that it could reach with its upscale clothing lines.
C) Western Son positioned itself against, rather than with, the competition. It decided to adhere to its price leadership position.
D) Western Son knew that in order to re-invent itself, it was going to have to practice the same marketing strategy followed by Walmart and other discount stores. It would make all marketing decisions based on cost. The price on an item need only exceed what it cost to make and ship it. Falling prices became the norm.

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

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Question 142

Multiple Choice

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Today, packaging is:

A) the least important component of the marketing mix.
B) assuming an increasingly important role in the promotion of products.
C) exclusively intended to protect the product from damage.
D) the most expensive component of the production process.

E) B) and C)
F) All of the above

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Question 143

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Successful firms always try to maintain consistency in their short-run and long-run pricing objectives.

The company currently markets McDog T-bone, Lapdog Lunchtreats, Rover's Potroast, and Puppy Porterhouse in the dog food market. Prime Cuts will be an addition to the company's ________ in the dog food market.

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

New-product failures are most often caused by excessively high prices.

Consumer perceptions of product quality are affected by promotions and packaging, but not by the price of the product.

"It tastes better than candy!" is an advertising slogan for a new probiotic gummy. The manufacturer claims that their probiotics is of a higher quality and tastes better than any competing brand. These claims are part of the firm's strategy to achieve

Which of the following products would most likely be classified as a specialty good or service?

Brody asks you to calculate the break-even point for his firm. You respond that you will need the following information

Brand names can significantly impact consumer perceptions of a product.

The brand names that are used by producers that distribute products nationally are called

The ________ on packages were intended to improve inventory control for businesses.

The job performed by brand managers

Folgers's ________ allows customers to easily identify this product from other coffee products.

Operating in the southwestern states, PuddleJumper Airlines hopes to avoid entering the price war that currently is taking place between several airlines on the east coast. The best strategy to avoid severe price competition is to

Successful businesses develop a mix of price, product, place, and promotion that is consistently applied throughout a product's life cycle.

The strategy of first determining what the market is willing to pay, then subtracting a desired profit margin to determine a desired cost of production is called

The break-even point is that level of sales where total revenues equals total costs.

Miller Light Beer, Maxwell House Coffee, Jell-O brand gelatin, Kraft mayonnaise, and Marlboro Cigarettes were all at one time products of the Philip Morris Company. These products represented a part of the product line Philip Morris offered.