Product - meaning, features, attributes, product mix, product life cycle, new product planning and development, pricing policies and strategies - Question Bank

1. The decision to add new product lines, discontinue existing ones, or change the depth of product lines relates to the company's:
A) Promotional strategy
B) Distribution strategy
C) Product mix strategy
D) Pricing strategy
2. Which of the following is a potential risk of 'penetration pricing'?
A) Low market share.
B) Difficulty in raising prices later.
C) Higher production costs.
D) Lack of customer interest.
3. A company decides to sell its premium coffee makers at $199, while a competitor sells similar ones for $150. This pricing is likely influenced by:
A) Cost-plus pricing
B) Penetration pricing
C) Value-based pricing
D) Psychological pricing
4. Which pricing strategy is often used for products with high perceived value and limited competition, especially in the early stages of the PLC?
A) Penetration pricing
B) Skimming pricing
C) Going-rate pricing
D) Cost-plus pricing
5. The strategy of offering multiple brands in the same product category is called:
A) Multibrands
B) Brand extension
C) Line extension
D) New brands
6. Using an established brand name to introduce a new product in a new category is known as:
A) Line extension
B) Brand extension
C) New brand
D) Flanker brand
7. When a company introduces a product with a new brand name in an existing product category, it is called:
A) Line extension
B) Brand extension
C) New brand
D) Multibrand
8. What is a 'product line extension'?
A) Introducing a completely new product category.
B) Adding new versions or variations to an existing product line.
C) Discontinuing an existing product.
D) Increasing the price of all products in a line.
9. A strategy to extend the 'Maturity' stage of the PLC often involves:
A) Increasing the price significantly.
B) Reducing product quality.
C) Finding new uses for the product or targeting new markets.
D) Stopping all advertising.
10. In the 'Growth' stage of PLC, companies typically focus on:
A) Market share defense and brand building.
B) Cost reduction and efficiency.
C) Product innovation and feature enhancement.
D) Eliminating the product from the market.
11. Which of the following is a key challenge in the 'Introduction' stage of the PLC?
A) Oversupply and excess inventory.
B) High customer awareness and demand.
C) Low product differentiation and intense competition.
D) Significant costs for product development and promotion.
12. The process of generating, evaluating, and selecting new product ideas is part of:
A) Product differentiation
B) New product development
C) Market segmentation
D) Brand positioning
13. A product that is identical to existing products from competitors and offers no unique features is likely in which stage of its life cycle?
A) Introduction
B) Growth
C) Maturity
D) Development
14. The 'augmented product' includes:
A) Only the core benefit.
B) The actual product plus additional services and benefits that differentiate it from competitors.
C) The product's manufacturing cost.
D) The product's market share.
15. What is the 'actual product' in marketing terms?
A) The core benefit plus all associated services.
B) The physical product with its features, brand name, and packaging.
C) The potential benefits a product might offer in the future.
D) The product's price and promotional activities.
16. The 'core benefit' of a product refers to:
A) The physical attributes of the product.
B) The brand name and logo.
C) The fundamental service or benefit the customer is buying.
D) The packaging and design.
17. When a company offers a discount for buying multiple products together, it is using:
A) Penetration pricing
B) Bundle pricing
C) Skimming pricing
D) Cost-plus pricing
18. What is 'promotional pricing'?
A) Setting high prices for premium products.
B) Temporarily reducing prices to increase short-run sales.
C) Pricing products based on their perceived value.
D) Using a consistent pricing strategy over time.
19. A strategy where a company prices a whole series of related items at different price points is called:
A) Product bundle pricing
B) Optional-product pricing
C) Product line pricing
D) Captive-product pricing
20. Pricing of low-value by-products to get rid of them or make money from them is known as:
A) Captive-product pricing
B) By-product pricing
C) Product line pricing
D) Promotional pricing
21. Which pricing strategy is used when a company prices products that must be used with a main product?
A) Captive-product pricing
B) Product bundle pricing
C) By-product pricing
D) Optional-product pricing
22. A company sells the same product in two different regions at different prices. This is an example of:
A) Product line pricing
B) Geographical pricing
C) Optional-product pricing
D) By-product pricing
23. An example of psychological pricing is setting a price like $9.99 instead of $10.00. This is often referred to as:
A) Bundle pricing
B) Odd-even pricing
C) Promotional pricing
D) Geographical pricing
24. What is 'psychological pricing'?
A) Setting prices based on market research.
B) Using prices that appeal to consumers' emotional buying tendencies.
C) Calculating prices based on production costs.
D) Adjusting prices based on demand fluctuations.
25. Which pricing strategy involves setting prices slightly below, at, or slightly above competitors' prices?
A) Cost-plus pricing
B) Value-based pricing
C) Competitive pricing
D) Promotional pricing
26. What is 'bundle pricing'?
A) Selling individual products at discounted rates.
B) Offering a package of products at a single, reduced price.
C) Pricing each item in a bundle separately.
D) Setting a high price for a product bundle.
27. A pricing strategy where a company adds a standard markup to the cost of the product is called:
A) Value-based pricing
B) Going-rate pricing
C) Cost-plus pricing
D) Promotional pricing
28. Setting prices based on the perceived value of the product by the customer is known as:
A) Cost-plus pricing
B) Value-based pricing
C) Penetration pricing
D) Skimming pricing
29. Which pricing strategy involves setting prices primarily based on competitors' prices?
A) Cost-plus pricing
B) Value-based pricing
C) Going-rate pricing
D) Dynamic pricing
30. What is the primary goal of 'penetration pricing' strategy?
A) To capture a large market share quickly by setting a low initial price.
B) To maximize profits from a niche market.
C) To charge different prices to different customer segments.
D) To recover research and development costs rapidly.
31. A pricing policy where a company sets a relatively high price for a new product to maximize revenue from early adopters is called:
A) Penetration pricing
B) Skimming pricing
C) Psychological pricing
D) Bundle pricing
32. What is the main objective of 'business analysis' in new product development?
A) To create marketing slogans.
B) To review sales, costs, and profit projections for a new product.
C) To design the product's packaging.
D) To identify potential competitors.
33. The final stage of new product development, involving full-scale production, distribution, and promotion, is known as:
A) Product development
B) Market testing
C) Commercialization
D) Idea generation
34. Which phase of new product development involves introducing the product and its marketing program into realistic market settings?
A) Concept development
B) Business analysis
C) Market testing
D) Commercialization
35. The stage where a new product idea is translated into a testable physical form is called:
A) Concept development and testing.
B) Product development.
C) Market testing.
D) Business analysis.
36. What is the primary purpose of the 'idea screening' stage in new product development?
A) To develop a detailed marketing plan.
B) To evaluate new product ideas and eliminate those that are not viable.
C) To conduct market research on potential customers.
D) To create a prototype of the product.
37. New product planning and development typically begins with:
A) Product design and testing.
B) Commercialization and market launch.
C) Idea generation and screening.
D) Business analysis and strategy development.
38. Which PLC stage is marked by declining sales and profits, and companies may reduce marketing support or discontinue the product?
A) Introduction
B) Growth
C) Maturity
D) Decline
39. In the 'Maturity' stage of the PLC, sales typically:
A) Grow at an increasing rate.
B) Peak and then start to decline.
C) Remain stable or grow at a decreasing rate.
D) Are at their lowest point.
40. During the 'Growth' stage of the PLC, what is a common characteristic?
A) Sales start to decline rapidly.
B) Profits begin to rise as production costs fall and demand increases.
C) Intense price competition emerges.
D) The product is withdrawn from the market.
41. Which stage of the Product Life Cycle (PLC) is characterized by high marketing costs, low sales, and often negative profits?
A) Growth
B) Maturity
C) Introduction
D) Decline
42. The degree to which the various product lines are related in end use, production requirements, distribution channels, or some other way is known as:
A) Width
B) Length
C) Depth
D) Consistency
43. What does the 'length' of a product mix refer to?
A) The total number of items across all product lines.
B) The number of product lines the company has.
C) The number of variations within a single product line.
D) The average price of products in the mix.
44. The number of versions of each product in a product line (e.g., different sizes, flavors) is referred to as the product mix's:
A) Width
B) Length
C) Depth
D) Variety
45. Which dimension of the product mix refers to the number of different product lines the company carries?
A) Width
B) Length
C) Depth
D) Consistency
46. What does the 'product mix' of a company represent?
A) A single product line offered by the company.
B) The total number of employees in the product development department.
C) All the products and product items a company offers for sale.
D) The marketing budget allocated to product promotion.
47. In marketing, what does the term 'attribute' of a product refer to?
A) The price of the product.
B) The physical characteristics and benefits offered by the product.
C) The packaging and labeling.
D) The distribution channels used.
48. Which of the following is NOT a typical feature of a product?
A) Tangibility
B) Serviceability
C) Ownership
D) Exclusivity
49. What is the fundamental definition of a product in marketing?
A) Only a physical good offered for sale.
B) Any tangible item or intangible service that can be offered to a market for acquisition, use, or consumption.
C) A brand name or logo associated with a service.
D) A promotional campaign designed to increase sales.