BA101 (Week 3) Chapter 12

Question 0

Product Mix

Answer 0

Assortment of products offered by firm. Normally diversify (expand, include more in business)

Question 1

Product Line

Answer 1

Set of Related Products or services offers by single firm (ex: Coke, Diet Coke, sprite)

Question 2

1. Product Life Cycle

2. List the phases

Answer 2

1. Typical set of phases over their lifetime.
   - Introduction
   - growth
   - maturity
   - decline

Question 3

1. Target Market

2. List 2 types

Answer 3

1. Individuals or groups w/similar traits who may purchase a particular product
2. Consumer market-various consumer products and services (ex: cameras, clothes & household items)
   Industrial market- (ex: steel & plastic)

Question 4

List factors of Target Markets

Answer 4

-Demographics 
(Age, race, interests)
-geography 
(Weather, tastes)
-Economic 
(Income)
-Social values
(Alcohol, cigarettes)

Question 5

Obsolete.

List 2 reasons

Answer 5

Less useful than in the past for 2 reasons:

• Fashion obsolescence
• technological obsolescence

Question 6

Steps to create a new product:

Answer 6

1. Develop a product idea
2. Assess the feasibility of product idea
3. Design & test the product
4. Distribute & promote the product
5. Post audit the product

Question 7

Product Differentiation

Answer 7

A firm’s effort to distinguish it’s product from competitor’s products to see the product is more desirable.

Question 8

Branding

Answer 8

Method identifying products and differentiating ten from competing products.
(Family vs Individual)

Question 9

List Types of Brands

Answer 9

Producer (manufacturer)
Store (retail store)
Generic (distribute products)
Co-branding (firms agree to offer a combination of two noncompeting products at a discounted price.

Question 10

Pricing Strategies, list 3.

Answer 10

1. Cost of Production
2. Supply of Inventory(ex: apple old vs. New model sale)
3. Competitors price

Question 11

List types of cost of production

Answer 11

1. cost-based pricing- estimating the per unit cost of producing a product and then adding a mark up.
2. High fixed cost- cost remain unchanged regardless of quantity produced.

Question 12

List types of competitors Price

Answer 12

• Penetration Pricing - set lower price than competitors to penetrate market. The success depend on price elasticity.
• Defensive Pricing - product’s price is reduced to defend (retain) market share
• Predatory Pricing - lower tier price to drive out new competitors that enter market
• Prestige Pricing - higher price if product intend to be the “best”

Question 13

Fixed Cost

Answer 13

Cost of production that remains unchanged

Question 14

Variable cost

Answer 14

Vary w/ quantity of items produced

Question 16

Product Differentiation variables

Answer 16

• Physical Form
• Functional Features
• Quality