Chapter 4 Product and Price Planning

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Chapter 4: Product and Price Planning

Fill-in-the-Blanks
1. trademark grants a business the exclusive right to use a brand name,
symbol, or design.
2. The product line is a group of closely related products with slight
variations developed by the same business.

3. A(n) product line is a well-known brand owned by one company that is

sold for use by another company.

4. The introduction, growth, maturity, decline
is a sequence of stages that a new product goes through
during its time on the market.
5. brand extension is a marketing strategy that allows a business to use one of its
well-known brand names in a new product category.
6. planned obolescences occurs when a product is out of date, no longer wanted, or
unusable.

7. price skimming
involves setting a high price to emphasize the uniqueness of a
product and to recover the product development costs quickly.
penetrating pricing
8. pricing involves setting a low price for new products to gain a
larger market share rapidly.

9. When the demand of a product is affected by its price, the product has
quanity demand
10. A(n) product differentiationcompetition strategy tries to distinguish a product or service
from competing products based on design, quality, and workmanship instead of price.

True/False Questions
t 11. The cost of introducing a new product to the marketplace is inexpensive.
f 12. The product bundle includes all of the different products a business sells.

t 13. An extended product can include the services or discounts that a car dealership
offers with the purchase of a new automobile.
t 14. The product line width refers to the number of product lines a business offers.

f 15. The final stage of the product life cycle is the maturity stage.
t 16. The two main functions of a product's package are protection and promotion.
f 17. Typically, maturity is the shortest stage in the life cycle of a product.
t 18. Intensive distribution involves selling a product at as many locations as possible
during the maturity stage of the product life cycle.

t 19. The point at which demand and supply are equal is called the price equilibrium.
t 20. Trade credit is made available by retailers to assist consumers in making
purchases.

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