Study Questions 5.

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1. Changing customer preferences changes demand, which changes seller supply, which in turn changes _______________. a) The market b) Company competitiveness c) Company profitability d) Customer preferences and demand D 2. You take the variation in demand across all consumers and cluster it into segments where demand _________________. a) Varies relatively little between consumers in a segment and varies a lot between segments b) Varies a lot between consumers in a segment and varies little between segments c) Varies relatively little between consumers in a segment and varies little between segments d) Varies a lot between consumers in a segment and varies a lot between segments A 3. The traditional way of segmenting is by using: a) Theory b) Past experience c) Senior management guidance d) Trial and error D 4. Conventional wisdom is that you try which of the following in segmenting a market? a) Geographic criteria b) Demographic criteria c) Pyschographic criteria d) Behavioral criteria e) All of the above E 5. Which of the following is not a major, actionable segmentation criterion? a) Profitability segmentation b) Demographic segmentation c) Benefit-feature segmentation d) Channel segmentation e) All are actionable segmentation criteria (actionable segmentation is only mentioned in this question but not in the text, however, all of these types of segmentation are mentioned.) E 6. Which of the following is not a psychographic segment variable? a) Life styles b) Passions c) Channel loyalty d) Personality e) Social class f) All of the above C 7. The conventional way to evaluate segment criteria is by ____________. a) Profitability, accessibility and fit b) Substantiality, profitability and fit c) Substantiality, accessibility and fit d) Profitability, accessibility and fit C 8. The direct determinant of customer profitability is: a) Customer purchases of high margin products and services

b) The sheer quantity of purchases made per year (size of the customer) c) Low selling costs to the customer, low delivery costs and after sales service costs d) All of the above are determinants D

Study Questions 5.2

1. All products and services are _________ to achieve an end? a) Means b) Instruments c) Tools d) All of the above D 2. Which of the following is not a new desired state that products and services create? a) Metaphysical b) Emotional c) Intellectual d) Spiritual e) All of the above are A 3. Which of the following drinks are most preferred by students to relieve a headache? a) Coffee b) Tea c) Milk d) Cola e) Non-cola B 4. New _________ are often created in a market by benefit-feature innovation. a) Demand b) Customers c) Segments d) All of the above D 5. The basic benefits sought ________ as the automobile replaced the horse and cart. a) Changed b) Evolved c) Did not change d) Transformed C 6. The Nintendo Wii has apparently got more game than its Microsoft and Sony competitors. Which of the following benefits-features does it not possess? a) Superior, almost virtual-like graphics b) Greater user involvement in the game c) Physical stretching and exercise A

Study Questions 5.3

1. QFD stands for? a) Quality function determinants b) Quality feature determinants c) Quality feature deployment d) Quality function deployment D

2. QFD is the deployment of _____________so the design features of a product or service deliver the desired customer benefits and satisfaction. a) Quality b) Technology c) Resources d) All of the above D 3. QFD also involves seamlessly connecting product specifications to the ___________. a) Appropriate manufacturing and production process b) Customer c) Customer benefits sought d) Corporate mission C 4. A QFD specification matrix helps managers convert benefits desired into _________________. a) Profitability b) Customer satisfaction c) Features desired d) Unique product positioning C 5. A strong correlation between a benefit and a feature in the QFD matrix is indicated by a(n) _________________. a) Triangle b) Circle c) Asterisk d) Box A 6. Comparing consumer perception measures with engineering measures identifies ________________. a) A product design positioning problem b) A product image positioning problem c) Whether a product has an image positioning problem or a design positioning problem d) None of the above C 7. When applying a QFD matrix to a different segment, what changes? a) The benefit and their importance b) The product specifications or design attributes c) Everything d) Nothing B 8. Competitor Ys quality/utility score is: a) 14 b) 28 c) 40 d) 42 e) 50 E 9. Competitor Xs quality/utility score is: a) 15 b) 50 c) 56 d) 60 e) 64 C

10. The old Writesharps (current) quality/utility score is: a) 16 b) 50 c) 56 d) 58 e) 60 D

Study Questions 7.6

1. A negative aspect of price promotions in a mature market is: a) That they can reduce the degree of brand loyalty in the market b) That they cause buyers to switch to non-promoted brands c) The lack of competition that results d) That brand switching decreases e) None of the above A 2. Price promotions: a) Lead to a transfer of positive feelings to the product or brand b) Are typically superior to free sample promotions c) Work best with mature brands d) Have strong reinforcing effects and train shoppers to become deal-seeking shoppers e) None of the above D or E 3. Many price discounts are wasted because: a) About two in three are not supported by special point-of-purchase displays b) About 30 percent are not passed on to consumers c) They are not noticed by buyers d) They are automatically given to all consumers e) Both B and D E 4. Research suggests that compared to price promotions, consumers may have a more positive feeling about: a) An equivalent price reduction made in the base price b) Coupons and rebates c) None of the options are true B 5. Which of the following statements is true? a) The timing of promotion isnt an important tactical decision b) In the fashion world, promotions running late in the season are designed to reduce inventory carrying costs and the risk of fashion obsolescence c) Retailers dont manage the promotions by scheduling their manufacturer orders d) Providing an early promotion will not attract buyers who would buy later at the usual higher price B 6. Which of the following scenarios described in the price module best represents the advantage of differentiation over price promotion? a) Procter & Gambles patented innovation Pert Plus b) Grind-yourown gourmet coffee beans by entrepreneurial firms c) Maxwell House coffee d) Both A and B D

7. What are the possible underlying implications when companies rely on price promotions to sell their mature product? a) Companies dont have innovative strategies b) The product- development process is broken c) The product-development process needs to be fixed d) All of the above D 8. What can be done to discourage price promotions? a) Operate close to production capacity b) Salesforce incentives should be based on sales volume c) No need to discourage price promotions d) None of the above A

Study Questions 7.7

1. Transfer pricing is a) The price you charge transfer companies for a product or service b) The price you charge another unit or subsidiary of your company for a product or service c) The price you charge an overseas subsidiary of your company for a product or service d) The price you pay transfer companies for a product or services B 2. The most efficient transfer price is: a) The market price of the goods and services that the subsidiary faces b) The price that minimizes overall taxes c) The price that minimizes taxes of the selling subsidiary d) The price that minimizes taxes of the buying subsidiary A 3. Transfer prices are most often adjusted because of: a) Tax implications b) Currency fluctuations c) The personalities involved d) The organizational politics involved A 4. Which of the following statements is true? a) If a company can, and it is legal, it will keep most of the profits earned in the country with the highest corporate income tax on profits b) If a company can, and it is legal, it will keep most of the profits earned in the country with the lowest corporate income tax on profits c) Financial accountants are likely to use the market price as a starting point and make a taxation consideration adjustment d) Both B and C e) None of the above D 5. It is likely that the internal buyer will suggest that the transfer price should be the market price: a) Less half the cost savings in sales commissions and distribution that result from selling to a subsidiary (an internal buyer) b) Less the cost in sales commissions and distribution that result from selling to a subsidiary (an internal buyer) c) Plus half the cost savings in sales commissions and distribution that result from selling to a subsidiary (an internal buyer) d) Plus the cost in sales commissions and distribution that result from selling to a subsidiary (an internal buyer) B

6. In addition to economic efficiency and tax arguments, most of the rest of transfer pricing is about: a) Organization politics b) Power plays c) Pushing the legal and ethical limits of tax-based transfer pricing d) All of the above D