Which is an extension strategy for a product in the maturity stage?

changing the packaging or adding a new feature

withdrawing the product immediately

raising the price sharply with no reason

Why might promotion spending be high in the introduction stage?

to create awareness of the new product

because the product is already well known

because demand is always inelastic

to reduce the need for packaging

A business is most likely to use skimming pricing when the product is:

new and different with limited competition

sold in a very competitive market

targeted only at bargain hunters

Cost-plus pricing means the business sets price by:

matching the lowest competitor price

charging whatever customers want

One limitation of cost-plus pricing is that it:

ignores competitor prices and customer demand

cannot be used by manufacturers

Penetration pricing is most suitable when a business wants to:

enter a market quickly and gain market share

recover research costs fast from a few customers

sell only to loyal existing customers

Competitive pricing means a business bases its price mainly on:

the price charged by rival firms

how long the product has been sold

Promotional pricing is best described as:

a temporary price cut to boost sales

a pricing method based only on costs

charging different prices in different countries

If demand for a product is price elastic, a small rise in price will usually cause:

a larger fall in quantity demanded

If demand for petrol is price inelastic, this means consumers:

change quantity demanded only a little when price changes

buy much less when price rises slightly

are very sensitive to price changes

stop buying immediately when price rises

Why is price elasticity useful to a business?

it helps the business predict how sales may change if price changes

it tells the business how many workers to employ

it replaces the need for market research

One advantage of using wholesalers in a distribution channel is that they:

buy in bulk and help products reach many retailers

A business using a direct-to-consumer channel is most likely to benefit from:

more direct contact with customers

less control over customer service

automatic nationwide coverage in shops

One disadvantage of selling only through retailers is that the manufacturer may:

have less control over how the product is displayed

avoid paying any distribution costs

sell every product at a higher price

A small business making customised cakes for local customers should probably use:

a chain of international wholesalers

The main aim of promotion is to:

increase awareness and persuade customers to buy

guarantee customer satisfaction forever

Why must businesses consider cost-effectiveness when planning promotion?

because promotion should increase sales enough to justify its cost

because the biggest budget is always best

because all promotion is free online

because promotion has no link to profit

E-commerce is best defined as:

selling and buying products using electronic networks such as the internet

promoting only through television

One opportunity of e-commerce for businesses is that it can:

reach customers in wider markets

eliminate the need for stock control

One threat of e-commerce to consumers is:

risk of online fraud or data theft

Using social media for promotion can help a business because it:

allows quick interaction with customers and low-cost promotion

cannot target specific audiences

always replaces all other promotion

IGCSE Business 0450 - Unit 3.3 Marketing Mix

Authored by Stephen Whitehead

Business

9th - 12th Grade

Used 25+ times

IGCSE Business 0450 - Unit 3.3 Marketing Mix

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30 questions

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MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A business develops a new product mainly to:

reduce all competition immediately

meet changing customer needs and increase sales

avoid all marketing costs

guarantee customer loyalty

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which is most likely to be a cost of developing a new product?

research and development spending

instant higher market share

greater customer loyalty

free publicity

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A likely benefit of successfully launching a new product is:

lower customer awareness

higher sales revenue

less market research needed forever

no need for promotion

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A strong brand image often leads to:

lower customer loyalty

repeat purchases and stronger sales

less recognition in the market

customers ignoring quality

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is an important role of packaging?

to stop all competitors entering the market

to protect the product and attract customers

to remove the need for branding

to make promotion unnecessary

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The introduction stage of the product life cycle is usually characterised by:

high sales and many competitors

low sales and heavy promotion

falling sales and reduced demand

stable demand for many years

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

During the growth stage of the product life cycle, a business is most likely to see:

rising sales

negative cash flow only

the product being withdrawn

no customer awareness

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