Product

Which two of the following are benefits to a business that operates in a competitive market of selling a differentiated product?

• High profits are guaranteed

• Sales volume will be always be higher than rival products

• Every customer will be happy to pay a high price for the product

• Increased chance of attracting more sales

• The possibility of setting a higher price

Which two of the following are risks to a business when developing a new product?

• Product success is not guaranteed

• New products can be protected through legal means

• The business has an advantage over competitors

• Development costs have to be met regardless of product success

• The business can always charge higher prices for a new product

When developing a new product, a business will consider how the product looks and feels. This would be classed as its:

• Function

• Aesthetics

• Cost

• Design mix

At which stage of the product life cycle are product sales most likely to be at their highest?

• Introduction

• Growth

• Maturity

• Decline

At which stage of the product life cycle is a business most likely to use an extension strategy?

• Introduction

• Growth

• Maturity

• Decline

At which stage of the product life cycle is sales growth likely to flatten out?

• Introduction

• Growth

• Maturity

• Decline

At which stage of the product life cycle is customer awareness likely to significantly increase and sales rise steeply?

• Introduction

• Growth

• Maturity

• Decline

A product at the introduction stage of the product life cycle is most likely to need:

• Low promotional spend

• No promotional spend

• High promotional spend

• Reduced promotional spend

Which of the following statements best describes the term aesthetics?

• Seeking to minimise costs wherever possible

• How well the product works for the customer

• Actions to prevent a product’s sales declining rapidly

• How the product appeals to the senses of a customer

Lucozade, originally a product for the sick, rebranded itself as an energy and sports drink. The most likely extension strategy used was:

• Changing the recipe of the drink

• Lowering the price

• Finding new uses for the product

• Raising the price