Exam 2 review

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core layer

A product has three distinct layers. The most basic level is the ________, which consists of all the benefits the product will provide for consumers or business customers

actual product

A product has three distinct layers. The second layer is the ________, which is the physical good or delivered service.

brand meaning

The concept of ________ encompasses the beliefs and associations that a consumer has about a brand

idea generation

The first phase of new product development is ________

product bundle pricing

Which of the following product mix pricing strategies involves pricing multiple products to be sold together

The product life cycle concept can be applied by marketers as a useful framework for describing how

a market responds to a product over time

fixed costs

are costs that do not vary with production or sales level

cost-plus pricing

involves adding a standard markup for profit

price

is the only element in the marketing mix that produces revenue

product modification

A ________ is a modification to an existing product

trade mark

A ________ is the legal term for a brand name, brand mark, or trade character

continuous innovation

A consumer doesn't have to learn anything new to use a(n)

12

A manufacturer has fixed costs of $100,000, a variable cost of $10 per unit of output, and break-even volume of 50,000 units. What should the manufacturer's unit cost be in order to break even

market-penetration pricing

Companies that set a low price for a new product in order to attract a large number of buyers and a large market share are using the ________ strategy

inelastic

If demand hardly changes with a small change in price, the demand is

decline

The final stage in the product life cycle is ________

maturity

The sales peak typically occurs during which stage of the product life cycle

licensing

Through ________, one firm sells another firm the right to use a legally protected brand name for a specific purpose for a specific period of time

laggards

are the last in the population to adopt a new product

Companies that adopt value-added pricing

attach value-added features and services to differentiate their offers and support their higher prices

A quantity discount is a price reduction for buyers who

buy merchandise in bulk

cost-based pricing

Which of the following processes does value-based pricing reverse

promotional

Low-interest financing and longer warranties are both examples of ________ pricing

everyday low pricing

Retailers such as Costco and Walmart charge a constant, daily low price with few or no temporary price discounts. This is an example of ________ pricing

by-product

Using ________ pricing, companies are able to turn their trash into cash, allowing them to make the price of their main product more competitive

customer perception of the product's value

What sets the ceiling for product prices

product costs

What sets the floor for product prices

promotional pricing

What type of pricing is being used when a company temporarily prices its product below the list price or even below cost to create buying excitement and urgency

good-value

When McDonald's and other fast food restaurants offer "value menu" items at surprisingly low prices, they are most likely using ________ pricing

competitors' pricing

When performing a break-even analysis, the manufacturer should consider all of the following EXCEPT

Diffusion refers to ________

how the use of a product spreads throughout a population

good-value

pricing refers to offering just the right combination of quality and gratifying service at a fair price

price elasticity

refers to a measure of the sensitivity of demand to changes in price

dynamically continuous innovation

A(n) ________ is a pronounced modification to an existing product that requires a modest amount of learning or change in behavior to use it

discontinuous innovation

Consumers must engage in a great amount of learning to use a(n) ________ because no similar product has ever been on the market

variable costs

Costs that change with the level of production are referred to as

good-value pricing

Which of the following involves introducing less-expensive versions of established, brand name products

competition based pricing

Which of the following involves setting prices based on a rival firm's strategies, costs, prices, and market offerings

facility rental payments

Which of the following is most likely a fixed cost

discount and allowance pricing

Which of the following price adjustment strategies involves reducing prices to reward customer responses such as volume purchases, paying early, or participating in sales-support programs

growth

Which stage in the product life cycle is characterized by rapidly increasing sales and increasing profits

packaging

________ involves designing and producing the container or cover for a product

cost-based pricing

________ involves setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk

high low

________ pricing involves charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items

customer-value based

________ pricing uses buyers' perceptions of value as the key to pricing

price

________ refers to the amount of money charged for a product or service

As production moves up, the average cost per unit decreases because

fixed costs are spread over more units

market skimming

when a company sets a high price for a new product with the intention of reducing the price in the future, it is using the ________ pricing strategy

target return pricing

which of the following is a cost-based approach to pricing

generic branding

which of the following is essentially no branding at all


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