MCQ

New Product Development & Product Life Cycle

1. The cost of new product development is great and the introduction of a new washing powder will
typically include which of the following investments?

a. Research and development. b. Market trials.

c. Consumer focus groups. d. Market research.

e. Time factors: it may take 2-10 years. f. All of the above.

Answer: f. All of the above

2. What features are normally associated with new product development?

a. Development of unique superior product features.

b. The need to trademark the product or process.

c. Variable time frames before a product is brought to market.

d. High investment costs.

e. All of the above.

Answer: f. All of the above

6. The buyer's approach to dealing with new products has to be put in the context of the level of
innovation within a market. This innovation can be categorised in three ways. Which of the following are
these three?

1)Continued innovation. 2) Continuous innovation. 3) Coordinated innovation.

4) Dynamically continuous innovation. 5) Discontinuous innovation.
a. 2,3,4, b. 2,4,5, c. 1,2,3, d. 3,4,5, Answer: b. 2,4,5,

7. Which of the following is a feature of continuous innovation?

a. Irregular innovation. b. Sporadic innovation. c. Latent innovation.

d. Concentrated innovation. e. Regular innovation. Answer: e. Regular innovation.

8. Organisations do not operate in a static environment. Changing technology, changing customer tastes
and preferences, and changing competitor product ranges should result in which of the following?

a. Human resource development. b. Financial development.

c. European marketing development. d. New product development.

e. New resources development. Answer: e. New resources development.

9. There are two main approaches to New Product Development. Which of the following are these
approaches?

1) Spontaneous. 2) Delayed. 3) Radical. 4) Reactive. 5) Proactive.

a. 2,3, b. 4,5, c. 1,2, d. 1,3, Answer: b. 4,5,

10. Which of the following is not a stage in the product life cycle?

a. Maturity. b. Withdrawal. c. Growth. d. Introduction.

Answer: b. Withdrawal.

11. The product life cycle describes the stages a new product goes through in the :

A. Introduction phase B. Test market C. Product development

D. Marketplace E. Diffusion stage Answer: D. Marketplace

12. During the introduction stage of the PLC, sales gradually increase and:
A. Competition becomes tough B. Profit is minimal

C. More investors are needed D. Sales people are brought to push the product

E. The promotion that is finished Answer: B. Profit is minimal

13. The marketing objective for the maturity stage of the PLC is to:

A. Maintain brand loyalty B. Stress differentiation C. Harvest

D. Deletion E. Gain awareness Answer: A. Maintain brand loyalty

14. The stage of the PLC where competitors appear is:

A. Introduction B. Decline C. Competition is always there D. Maturity

E. Growth Answer: E. Growth

15. Automobiles and TV's are in what stage of the PLC?

a. Introduction b. Growth c. Post-growth d. maturity e. decline

Answer: d. maturity

16. When a company retains the product but reduces marketing support costs it is in what stage of the
PLC?

a. decline b. maturity c. growth d. introduction e. all stages

Answer: a. decline

17. A company will follow one of two strategies to handle a declining product: deletion or:

a. modification b. harvesting c. enhancement d. strategic change

e. market change Answer: b. harvesting

18. How long does it take to go through a PLC?

a. 1 day to 365 days b. 1 year to 5 years

c. 1 year for consumer products and 5 years for industrial products

d. almost 2-3 years e. No set time Answer: e. No set time

19. A product life cycle that rises and falls several times is an indication of what product type?

a. fads b. fashion goods c. low learning products d. high learning products

e. all are the same cycle Answer: b. fashion goods

20. A PLC curve that rises rapidly then falls quickly is indication of a:

a. fashion product b. low learning product c. fad

d. high learning product e. all are the same cycle Answer: c. fad

21. The concept that explains how a product spreads through the population is called the:

a. acceptance rate b. diffusion of innovation c. infusion of sales d. entry rate

e. product acceptance cycle Answer: b. diffusion of innovation

22. Product managers are sometimes called________________

a. manager of goods b. consumer specialist c. brand manager d. product pusher

e. sales rep Answer: c. brand manager

23. The main benefit of branding to consumers is:

a. they save money b. they become more efficient shoppers c. they have more product choices

d. they get confused e. they like the new designs Answer: b. they become more efficient shoppers
24. An organization using a name, phrase, design, symbols, or combination of these to identify its
products is:

a. repositioning product lives b. forming family units c. trademarking products

d. patenting product e. branding products d. patenting product

Answer: e. branding products

25. Which of the following is a trade name?

A. Wheaties b. Campbell Soup Company c. Diet Dr. Pepper

d. Wheat-Thins e. Golden Grahams Answer: b. Campbell Soup Company

26. Examples of brands that have achieved consumer-brand resonance are:

a. Harley-Davidson, Apple, and Dr. Pepper b. Apple, Coke, and Palmolive

c. Harley-Davidson, IBM, and Coke d. Apple, Dr. Pepper, and Citizen

e. Harley-Davidson, Apple, and Coke Answer: e. Harley-Davidson, Apple, and Coke

27. No-brand products are also known as:

a. generic brands b. private brands. c. euro-brands d. mixed brands

e. multi-brands. Answer: a. generic brands

28.Warranties that are written statement of liabilities that are called:

a. full warranties b. implied warranties c. express warranties

d. limited coverage warranties e. strict liability warranties

Answer: c. express warranties

29. The product life cycle presents two major challenges. First, a firm must be good at

developing new products to replace aging ones. Second, a firm must be good at:

a. adapting its marketing strategies in the face of changing tastes, technologies,

and competition as products pass through life-cycle stages.

b. image building to ensure that products sell well.

c. primary demand forecasting so product winners can be chosen rather than

making poor investments with product losers.

d. acquisition of other companies since this is the only real way to ensure new

product success--go with what has worked in the past.

Answer: (a)

30. A firm can obtain new products in two ways. First, it can develop them by using its

own research and development department. Second, it can:

a. steal them. b. get them through acquisition.

c. transfer them between divisions. d. copy them. Answer: (b)

31. Original products, product improvements, product modifications, and new brands that

a firm develops through its own research and development efforts are called:

a. new products. b. concept products. c. altered products.

d. supplemental products. Answer: (a)

32. Why do so many new products fail? All of the following are reasons EXCEPT:
 (Select the LEAST LIKELY reason.)

a. the size of the market has been overestimated.

b. hostility on the part of the sales force.

c. the product may have been incorrectly positioned.

d. a high-level executive might have pushed a favorite idea.

Answer: (b)

33. If a new product has higher quality, new features, and higher value in use than its

competition, then it is called a(n):

a. unique superior product. b. synergistic product.

c. positioned product. d. pre-launch product. Answer: (a)

34. Which of the following would be a key success factor in developing new products?

a. a well-defined product concept

b. a product priced well below market or industry standards

c. a product that appeals to the late majority

d. a product that can be sold over the Internet with a minimum of explanation

Answer: (a)

35. To create successful new products, a company must understand consumers, markets,

and competitors and:

a. develop a great advertising campaign. b. have a strong Web site to push the product.
 c. adopt a push rather than pull promotional concept.

d. develop products that deliver superior value to consumers.

Answer: (d)

36. Which of the following best describes the first stage of the new-product development

process?

a. idea screening b. concept development and testing c. idea generation

d. business analysis Answer: (c)

37. The systematic search for new-product ideas is characteristic of which stage in the

new-product development process?

a. idea screening b. concept development and testing

c. idea generation d. business analysis Answer: (c)

38. After idea generation has occurred in the new-product development process, the

next stage is most likely to be:

a. ideation. b. idea screening. c. concept development and testing.

d. test marketing. Answer: (b)

39. For every 1,000 ideas, only _____ will have enough commercial promise to merit a

small-scale experiment.

a. 10 b. 50 c. 100 d. 300 Answer: (c)

40. The search for new-product ideas should be systematic rather than haphazard. One
 way to ensure that the process is systematic is to install a(n):

a. product planning committee. b. venture capital team.

c. idea management system. d. a Delphi idea system.

Answer: (c)

41. If an organization wishes to create an innovation-oriented company culture, it should

consider the ____________ approach.

a. product planning approach b. venture capital team c. idea manager

d. Delphi idea system Answer: (c)

42. ________________ is screening new-product ideas in order to spot good ideas and

drop poor ones as soon as possible.

a. Idea generation b. Concept development and testing c. Idea screening

d. Brainstorming Answer: (c)

43. One reason that idea screening is a critical stage in the new-product development

process is that:

a. product-development costs rise greatly in later stages and the company only wants

those products that can succeed.

b. competitors can quickly steal ideas so the company wants only those ideas that

can be protected with patents.

c. international competition and markets demand that all ideas be culturally sensitive.
 d. the Federal government carefully monitors each company’s idea screening process

to make sure no national security matters are at stake.

Answer: (a)

44. A _______________ is an idea for a possible product that the company can see

itself offering to the market.

a. product idea b. product image c. product concept

d. product feature Answer: (a)

45. A ___________________ is a detailed version of the idea stated in meaningful

consumer terms.

a. product idea b. product image c. product concept d. product feature

Answer: (c)

46. A ____________________ is the way consumers perceive an actual or potential

product.

a. product idea b. product image c. product concept d. product feature

Answer: (b)

47. If Toyota describes one of its cars of the future as being “a moderately priced

subcompact designed as a second family car to be used around town; the car is ideal

for running errands and visiting friends,” then the company has just stated a potential

new product in terms of a:

 a. product idea. b. product image. c. product concept. d. product feature.

Answer: (c)

48. Presenting new-product ideas to consumers in symbolic or physical ways to

measure their reactions occurs during which of the following stages?

a. idea generation b. concept testing c. marketing strategy d. screening

Answer: (b)

49. If a kitchen cabinet designer wished to test design concepts with customers, the

designer might wish to use a _______________ program that would show the

consumer how his or her kitchen would look and work if remodeled with the

company’s products.

a. color chart b. cartoon figure chart c. virtual reality

d. descriptive schematic Answer: (c)

50. Designing an initial marketing strategy for a new product based on the product

concept is called:

a. screening. b. business analysis. c. product development.

d. marketing strategy development. Answer: (d)

51. The marketing strategy statement consists of three parts. All of the following would

be among those parts EXCEPT:

a. description of the production flow diagrams.

 b. description of the target market.

c. the planning product positioning.

d. the sales, market share, and profit goals for the first few years.

Answer: (a)

52. The stage in the new-product development process in which the anticipated sales,

market share, and profit goals for the first few years are described is called:

a. idea generation. b. marketing strategy development.

c. business analysis d. product development. Answer: (b)

53. When a company reviews sales, costs, and profit projections for a new product to find

out whether these factors satisfy the company’s objectives, they are in which of the

following new-product development stages?

a. concept development and testing b. commercialization

c. business analysis d. marketing strategy development Answer: (c)

54. Looking at the sales history of similar products and surveying market opinion are

tools used at which stage in the new-product development process?

a. concept development and testing b. commercialization

c. business analysis d. marketing strategy development Answer: (c)

55. A company is in the ______________ stage of the new-product development process

when the company develops the product concept into a physical product in order to
 assure that the product idea can be turned into a workable product.

a. product development b. commercialization c. marketing strategy

d. business analysis Answer: (a)

56. R&D and engineering first produce the product concept into a physical product

during which of the following stages of the new-product development process?

a. concept development and testing b. marketing strategy

c. business analysis d. product development

Answer: (d)

57. One of the unique considerations during the product development phase of the new

product development process is that the _______________ developed during this

phase should have the required functional features and also convey the intended

psychological characteristics so consumer testing can be beneficial and meaningful.

a. program b. placebo c. prototype d. process Answer: (c)

58. Introducing a new product and marketing program to more realistic market settings

following functional and consumer approval is carried out at which new-product

development stage?

a. idea generation b. screening c. marketing strategy d. test marketing

Answer: (d)

59. If a company wishes to test its positioning strategy, advertising, distribution, pricing,
 branding and packaging, and budget levels, it can do so during which of the following

stages of the new-product development process?

a. commercialization b. test marketing c. product development

d. marketing strategy development Answer: (b)

60. James Manufacturing would like to do test marketing on a new bicycle that it has

just developed, however, cost is a serious consideration. James Manufacturing has

just been approached by a firm called Simul-Shop that has offered to study the

bicycle market using a unique approach that will only cost about $25,000. Which of

the following innovative test marketing methods is James Manufacturing probably

considering?

a. virtual reality research b. sequential research c. simultaneous research

d. starch testing Answer: (a)

61. Introducing the new product into the market takes place in which stage of the new

product development process?

a. commercialization b. test marketing c. marketing strategy

d. product development Answer: (a)

62. The FIRST decision that must be reached by the company that is introducing a new

product is:

a. where to introduce. b. the distribution process. c. the timing of the introduction.

 d. the number of outlets to be included in the rollout. Answer: (c)

63. With respect to developing new products, if a company chooses to introduce its

new products city-by-city and region-by-region, then the company is probably using

which of the following methods for launching new products?

a. blitz b. blanket c. market rollout d. market blister Answer: (c)

64. When Colgate-Palmolive uses a ________________ strategy, they pick certain

countries for new-product introductions before general introduction to entire regions

or continents.

a. gray market b. primo country c. demand-based d. lead-country

Answer: (d)

65. A new-product development approach in which one company department works to

complete its stage of the process before passing the new product along to the next

department and stage is called:

a. sequential product development. b. retrograde product development.

c. simultaneous product development. d. reactive product development.

Answer: (a)

66. Overlapping steps in the new-product development process to save time and

increase effectiveness across the various departments involved is called:

a. sequential product development. b. retrograde product development.

 c. simultaneous product development. d. reactive product development.

Answer: (c)

65. The simultaneous approach to new-product introduction does have several

limitations. All of the following would be considered to be among those limitations

EXCEPT:

a. it is riskier than other forms of introduction. b. it is more costly in many instances.

c. it is too slow for many marketers d. it has increased organizational tension and
confusion. Answer: (c)

68. The course of a product’s sales and profits over its lifetime is called:

a. the sales chart. b. the dynamic growth curve. c. the adoption cycle.

d. the product life cycle. Answer: (d)

69. The ______________ is characterized by five distinct stages: product development,

introduction, growth, maturity, and decline.

a. adoption cycle b. fashion process c. product life cycle d. style curve

Answer: (c)

70. With respect to the product life cycle, the _____________ begins when the company finds and
develops a new-product idea.

a. product development stage b. introduction stage c. growth stage

d. maturity stage Answer: (a)

71. With respect to the product life cycle, the ______________ is a period of slow
 sales growth as the product is introduced in the market.

a. product development stage b. introduction stage

c. growth stage d. maturity stage Answer: (b)

72. With respect to the product life cycle, the _______________ is a period of rapid

market acceptance and increasing profits.

a. product development stage b. introduction stage

c. growth stage d. maturity stage Answer: (c)

73. With respect to the product life cycle, the ________________ is a period of slowdown in sales
growth because the product has achieved acceptance by most potential buyers.

a. product development stage b. introduction stage c. growth stage

d. maturity stage Answer: (d)

74. With respect to the product life cycle, the __________________ is the period when sales fall off and
profits drop.

a. decline stage b. introduction stage c. growth stage d. maturity stage

Answer: (a)

75. The product life cycle concept has many varied uses. The PLC can describe all of the following
EXCEPT:

a. a product class. b. a product form. c. a product shape. d. a product brand.

Answer: (c)

76. ______________ have the longest product life cycles.

 a. Product forms b. Product brands c. Product genres d. Product classes

Answer: (d)

77. In terms of special product life cycles, a _____________ is a basic and distinctive mode of
expression.

a. genre b. style c. fashion d. fad Answer: (b)

78. In terms of special product life cycles, a _________________ only lasts for a short time, is adopted
with a great deal of zeal, peaks early, and declines very fast.

a. genre b. style c. fashion d. fad Answer: (d)

79. Which of the following is characterized by a extremely peaked demand curve that rises rapidly and
declines rapidly in a short period of time?

a. a genre b. a style c. a fashion d. a fad Answer: (d)

80. A concentration on producing a basic version of a product by a firm and its competitors is typical of
which stage in the product life cycle?

a. product development stage b. introduction stage c. growth stage

d. maturity stage Answer: (b)

81. An increase in competition, attracted by the opportunities for profit, is typical of which stage of the
product life cycle?

a. decline stage b. introduction stage c. growth stage d. maturity stage

Answer: (c)

82. In the ___________ , a firm faces a trade-off between high market share and high current profit.

a. decline stage b. introduction stage c. growth stage

 d. maturity stage Answer: (c)

83. The stage of the PLC characterized by overcapacity, greater competition, and the eventual elimination
of weaker competitors is called the:

a. decline stage. b. introduction stage. c. growth stage. d. maturity stage.

Answer: (d)

84. In the maturity phase of the PLC, a marketing manager should consider:

a. dropping the product and moving on to the next product winner.

b. modifying the market, product, and marketing mix.

c. expanding R & D. d. pricing to penetrate the market.

Answer: (b)

85. The strategy used during maturity to attempt to increase the consumption of the current product is
called:

a. customer modification. b. market modification. c. product modification.

d. marketing mix modification. Answer: (b)

86. Cutting prices, using aggressive sales promotion, or launching a better advertising campaign, are all
typical elements of which strategy used during the maturity stages of the PLC?

a. customer modification b. market modification c. product modification

d. marketing mix modification Answer: (d)

87. Technological advances, shifts in consumer tastes, and increased competition, all of which reduce
demand for a product, are typical of which stage in the PLC?

a. decline stage b. introduction stage c. growth stage

 d. maturity stage Answer: (a)

88. As a product reaches its decline stage of the PLC, management may decide to __________ the
product, which means reducing various costs and hoping that sales hold up.

a. disengage b. drop c. harvest d. cultivate Answer: (c)

89. The stage in the product life cycle that focuses on using a cost-plus formula and creating product
awareness and trial is the:

a. decline stage. b. introduction stage. c. growth stage. d. maturity stage.

Answer: (b)

90. The stage in the product life cycle where the strategic focus is on market penetration and building
intensive distribution is the:

a. decline stage. b. introduction stage. c. growth stage. d. maturity stage.

Answer: (c)

91. The stage in the product life cycle where the strategic focus is on maximizing profit while defending
market share and pricing to match or best the competition is called the:

a. decline stage. b. introduction stage. c. growth stage.

d. maturity stage. Answer: (d)

92. The stage in the product life cycle where the strategic focus is on reducing expenditures and milking
the brand while cutting prices is called the:

a. decline stage. b. introduction stage. c. growth stage. d. maturity stage.

Answer: (a)

93_____ is the act of designing the company's offering and image to occupy a distinctive place in the
mind of the target market.
a. Imaging b. Targeting c. Positioning d. Segmenting

e. Branding Ans. C (Positioning)

94. Companies can gain a strong competitive advantage through having better-trained people. This is
called _____.

a. human resources parity b. personnel training c. product differentiation

d. personnel differentiation e. reputable personnel Ans. d. personnel differentiation

95. _____ pass through four stages: distinctiveness, emulation, mass fashion, and decline.

a. Fashions b. Styles c. Fads d. Product life cycles e. Features

Ans. a. Fashions

96. In a _____ pattern of the product life cycle, sales grow rapidly when the product is first introduced
and then fall to a "petrified" level.

a. cycle-recycle b. scalloped c. growth-slump-maturity d. petrified

e. fashion Ans : c. growth-slump-maturity

97. The _____ stage is marked by a rapid climb in sales.

a. introduction b. growth c. maturity d. decline e. pioneer

Ans : b. growth

98. During the _____ stage sales slow down creating over-capacity in the industry, which leads to
intensified competition.

a. Introduction b. Growth c. Peak d. Maturity e. Decline

Ans : d. Maturity
99. During the _____ stage sales and profits decline and some firms withdraw from the market.

a. End b. Introduction c. Growth d. Maturity e. Decline

Ans : e. Decline

100. _____ calls for gradually reducing a product and business's costs while trying to maintain sales.

a. Maintaining b. Harvesting c. Reduction d. Divestment

e. Banishing Ans : b. Harvesting

101. If a new product sells well, new firms will enter the market, ushering in a(n) _____ stage.

a. product-growth b. market-growth c. emergence d. maturity

e. market consolidation Ans : b. market-growth

102. Eventually, when competitors cover and serve all the major market segments the market enters the
_____ stage.

a. product-growth b. market-growth c. maturity

d. market fragmentation e. market consolidation Ans : b. market-growth

103. A company may follow the strategies of deletion, harvesting, or contracting in the _______ stage.

a. Maturity b. Introduction c. growth d. growth slump e. decline

Ans : e. decline

104. _____ are members of a group that are relieved of their other duties to develop a specific product or
business for the company.

a. Customer-driven engineers b. Intrapreneurs c. New product managers

d. Product managers e. Skunkworks Ans : b. Intrapreneurs

105. A ________ is an elaborated version of the idea expressed in consumer terms.

a. "beta" version b. "alpha" product c. product idea

d. product concept e. test brand Ans : d. product concept

106. In _____ individuals list all the normal assumptions about an entity and then reverse them.

a. attribute listing b. reverse assumption analysis c. mind-mapping

d. morphological analysis e.forced relationships Ans : b product concept

107. With _____, individuals start with a thought, write it down on paper, then think of the next thought
and link it to the first thought. This continues as each new association is linked with the previous one.

a. mind-mapping b. morphological analysis c. reverse assumption analysis

d. attribute listing e. forced relationships Ans : a. mind-mapping

108. Which of the following is most closely related with the organic growth of an organization?

a. developing new products from within b. entering new market places

c. increasing the operational profitability d. increasing productivity of employees

e. acquiring a product or service brand Ans : a developing new products from within

109. Identify a shortcoming of giving the responsibility of new product development to the product
managers of a company.

a. They would not be familiar with the industry standards.

b. Product managers would not have an operational focus.

c. Product managers are less likely to use participative management.

d. Product managers are often busy managing existing lines

e. They will find it difficult to gain support from employees.

Ans : d. Product managers are often busy managing existing lines

110. In _____, consumers who initially try the product at no cost are reoffered the product, or a
competitors' product, at slightly reduced prices.

a. sales-wave research b. simulated test marketing c. test markets

d. commercialization e. controlled test marketing Ans : a. sales-wave research

111. _____ calls for finding 30 to 40 qualified shoppers and questioning them about brand familiarity and
preferences in a specific product category.

a. Test marketing b. Focus group research c. Simulated test marketing

d. Sales-wave research e. Controlled test marketing Ans : c. Simulated test marketing

112. The ultimate way to test a new consumer product is to put it into full-blown _____.

a. controlled test marketing b. commercialization c. test markets

d. sales-wave research e. screening Ans : c. test markets

113. Your firm has chosen a few representative cities, and the sales force tries to sell the trade on
carrying the product and giving it good shelf exposure. The company puts on a full advertising and
promotion campaign. Total costs exceed $1 million dollars. Your firm has decided to conduct a

a. business analysis. b. commercialization. c. test market

d. controlled test market e. sales-wave research. Ans : c. test market

114. What are the two ways that a company can obtain new products?

a. service development and product extension b. internal development and merger

c. new-product development and acquisition

d. market mix modification and research and development

e. line extension and brand management Answer: c new-product development and acquisition

115. Which of the following is not a potential cause of the failure of a new product?

a. a poorly designed product b. an incorrectly positioned product

c. an underestimated market size d. higher than anticipated costs of product development

e. ineffective advertising Answer: C. an underestimated market size

116. The creation of a successful new product depends on a company's understanding of its ________
and its ability to deliver ________ to customers.

a. competitors, distributors, and employees; new styles

b. customers, brands, products; product images

c. customers, competitors, and markets; superior value

d. product life cycle, legal responsibilities, and social responsibilities; innovations

e. product, marketing mix, and marketing strategy; functional features

Answer: C. customers, competitors, and markets; superior value

117. Executives, manufacturing employees, and salespeople are all examples of ________.

a. new-product committee members b. external sources for new-product ideas

c. internal sources for new-product ideas d. core members of innovation management systems

e. research and development team members Answer: C. internal sources for new-product ideas
118. Which of the following is perhaps the most important external source of new-product ideas?

a. Competitors b. a. distributors and suppliers c. trade magazines, shows, and seminars

d. customers e. engineers Answer: d. customers

119. Your firm wants to use external sources for new product ideas. After consulting with a friend you
learn that all of the following are common external sources except ________.

a. Customers b. the firm's executives c. trade shows and magazines

d. competitors e. suppliers Answer: b. the firm's executives

119. GrayBerry Gifts has just brainstormed a large number of ideas for adding new products and services
after visiting several buying fairs. The owners will begin the first idea-reducing stage, called ________ ,
to arrive at a realistic number to adopt.

a. idea screening b. idea generation c. idea dissemination d. product concept

e. concept development Answer: a. idea screening

8. A detailed version of a new idea stated in meaningful customer terms is called a ________.

a. product proposal b. product movement c. product image

d. product idea e. product concept Answer: e. product concept

120. An attractive idea must be developed into a ________.

a. test market b. product strategy c. product image d. product idea

e. product concept Answer: e. product concept

121. In the concept testing stage of new-product development, a product concept in ________ form is
presented to groups of target consumers.
a. physical or symbolic b. prototype c. final d. commercial

e. market-tested Answer: a. physical or symbolic

122. After concept testing, a firm would engage in which stage in developing and marketing a new
product?

a. business analysis b. product development c. test marketing

d. idea screening e. marketing strategy development Answer: e. marketing strategy development

123. The second part of the marketing strategy statement outlines the product's planned price,
distribution, and ________ for the first year.

a. Positioning b. Advertising c. marketing budget d. target market

e. promotion Answer: C. marketing budget

124. During which stage of new-product development is management most likely to estimate minimum
and maximum sales to assess the range of risk in launching a new product?

a. test marketing b. business analysis c. marketing strategy development

d. concept testing e. product development Answer: b. business analysis

125. In the ________ stage of new-product development, products often undergo rigorous tests to make
sure that they perform safely and effectively or that consumers will find value in them.

a. business analysis b. concept development and testing c. product development

d. marketing mix e. idea generation Answer: c. product development

126. Under what circumstances might it be wise for a company to do little or no test marketing?

a. When the product has no substitutes and is new in its category.

b. When a new product requires a major investment.

c. When management is not sure of the marketing program.

d. When management is not sure of the product.

e. When the costs of developing and introducing the product are low.

Answer: e. When the costs of developing and introducing the product are low

127. The major purpose of test marketing is to provide management with the information needed to make
a final decision about ________.

a. which market to compete in b. how to compete in the market

c. how long to compete in the market d. whether to launch the new product

e. how to develop a market strategy Answer: d. whether to launch the new product

128. Which of the following costs is most likely associated with the commercialization stage of new-
product development?

a. identifying target markets b. paying groups of target consumers for product feedback

c. building or renting a manufacturing facility d. developing a prototype of the product

e. determining the product's planned price, distribution, and marketing budget

Answer: c. building or renting a manufacturing facility

129. Which of the following is necessary for successful new-product development?

a. an innovation management system and sequential product development

b. a holistic and sequential product development approach

c. a market pioneer mindset and a holistic approach

d. a team-based, innovation-management approach

e. a customer-centered, team-based, systematic approach

Answer: e. a customer-centered, team-based, systematic approach

130. ________ is a new-product development approach in which one company department works to
complete its stage of the process before passing the new product along to the next department and stage.

a. Product life-cycle analysis b. Sequential product development c. Micromarketing

d. Simultaneous product development e. Team-based product development

Answer: b. Sequential product development

131. The team-based new-product development approach is faster because departments work closely
together through _______.

a. the help of a consultant b. cross-functional teams c. departmentalization

d. a step-by-step process e. team efforts Answer: b. cross-functional teams

132. Which of the following is a disadvantage of a team-based approach to new-product development?

a. It takes longer to get the right products to market.

b. Levels of risk can be more easily controlled.

c. products. d. The development effort is not as effective because of team members' lack of expertise.

e. Organizational confusion and tension can be a part of the process.

Answer: e. Organizational confusion and tension can be a part of the process.

134. The search for new-product ideas should be ________ rather than haphazard.

a. strategically planned b. systematic c. seldom

d. intermittent e. segmented Answer: b. systematic

135. Increasing profits will most likely occur at which stage of the PLC?

a. Introduction b. Maturity c. Decline d. product development

e. growth Answer: e. growth

136. Which of the following cannot be described by the PLC concept?

a. product image b. brand c. product class d. product form

e. styles Answer: a. product image

137. The PLC concept can be applied by marketers as a useful framework for describing how ________.

a. products and markets work b. to forecast product performance

c. product ideas are developed d. to develop marketing strategies

e. concept testing is conducted Answer: a. products and markets work

138. In the ________ stage, the firm faces a trade-off between high market share and high current profit.

a. Growth b. Decline c. Commercialization d. Maturity e. Introduction

Answer: a. Growth

139. In which stage of the PLC will promotional expenditures be high in an attempt to react to increasing
competition?

a. Introduction b. Growth c. Decline d. product development

e. maturity Answer: b. Growth

140. Which stage in the PLC normally lasts longer and poses strong challenges to the marketing
managers?
a. phase-in b. maturity c. decline d. growth

e. introduction Answer: b. maturity

141. Most products in the marketplace are in the ________ stage of the product life cycle.

a. Maturity b. Introduction c. Growth d. Development

e. Decline Answer: a. maturity

142. Sales decline in the decline stage of the PLC because of technological advances, increased
competition, and ________.

a. new market pioneers b. marketing mix modifications

c. shifts in unemployment d. shifts in the economy

e. shifts in consumer tastes and preferences

Answer: e. shifts in consumer tastes and preferences

143. A manufacturer with a product in the decline stage of the product life cycle might decide to
________ if it has reason to hope that competitors will leave the industry.

a. maintain the product without change b. search for replacements

c. harvest the product d. delay planning

e. drop the product Answer: a. maintain the product without change

144. The advantages of standardizing an international product include all of the following except
________.

a. the development of a consistent image b. decreased manufacturing costs

c. lower marketing costs d. the adaptation of products to different markets

e. lower product design costs Answer: d. the adaptation of products to different markets

145. Schmidt Steel Corporation lacks the confidence, capital, and capacity to launch its new steel product
into full national or international distribution. Even though test market results look promising, what will
be management's next step?

a. seek the help of a nationally known consultant b. develop a planned market rollout over time

c. retest the product in additional markets d. secure a loan to provide confidence, capital, and capacity

e. develop a prototype Answer: b. develop a planned market rollout over time

146. Mattel's Barbie is an example of an age-defying product. Barbie, simultaneously timeless and
trendy, is in the ________ stage of the PLC.

a. Growth b. Adoption c. Introduction

d. Maturity e. Decline Answer: d. Maturity