Question 1

Although innovation strategies may not work in the long run, overriding short-term reasons compel firms to introduce new products and services.

Accepted Answer

A) True 
 B)False

Question 2

One of the key characteristics of brainstorming sessions is that bad ideas should be immediately rejected so the group can focus its attention on good ideas.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is true of profits in the maturity stage of the product life cycle?

Accepted Answer

A)   They are negative.
B)   They are low.
C)   They peak or are declining.
D)   They are rapidly rising.
E)   They are slowing rising.F) A) and D)
G) B) and E)

Question 4

All of the following are benefits of new product development to a firm except

Accepted Answer

A)   reducing the costs of production.
B)   satisfying the changing needs of current and new customers.
C)   avoiding market saturation from products that have been on the market for a long time.
D)   creating diversification and reducing risk.
E)   keeping up in a market with short product life cycles where sales come mostly from new products.F) A) and B)
G) A) and C) A

Question 5

Laptop computers, personal digital assistants, and cellular phones were all readily accepted and diffused in U.S. markets where business and personal lifestyles tend to be faster-paced, compared to many other areas in the world. These products offered ________ with consumers' needs and priorities.

Accepted Answer

A)   relative positioning
B)   compatibility
C)   observability
D)   complexity
E)   trialabilityF) B) and D)
G) A) and B)

Question 6

Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products, because they know that their customers crave the "latest and greatest" games. They use this information to create new products that primarily provide the benefit of

Accepted Answer

A)   keeping up in a market where sales come mostly from new products.
B)   satisfying the changing needs of former customers.
C)   avoiding market penetration from products that have been on the market for a long time.
D)   creating diversification and reducing risk.
E)   taking advantage of a long product cycle.F) C) and E)
G) A) and C)

Question 7

Which of the following adopter categories refers to the last large group of buyers to enter a new product market?

Accepted Answer

A)   late majority
B)   early majority
C)   laggards
D)   early adopters
E)   innovatorsF) A) and B)
G) All of the above

Question 8

By the time BMW got into the mini-SUV market, sales had leveled off and were even starting to decline. BMW had to target its marketing efforts toward the ________ adopters.

Accepted Answer

A)   innovator
B)   laggard
C)   late majority
D)   early majority
E)   early adopterF) B) and E)
G) A) and D)

Question 9

At the end of a brainstorming session, participants are often asked to

Accepted Answer

A)   identify the worst ideas.
B)   defer to management for the final decision.
C)   identify which ideas each person proposed.
D)   vote on the best ideas.
E)   propose one more new idea each.F) None of the above
G) A) and C)

Question 10

In the diffusion of innovation process, innovators enjoy taking risks and are regarded as highly knowledgeable. Marketers want to identify innovators because

Accepted Answer

A)   they prefer products from established market leaders.
B)   other consumers defer to their judgment, creating the opportunity for word-of-mouth referrals.
C)   they are especially price conscious.
D)   they are easily influenced by reminder advertising.
E)   they encourage competitors to enter the market.F) A) and B)
G) C) and E)

Question 11

As soon as she saw one, Hillary wanted a flat-screen television, but she was worried about making the wrong choice. She waited until there were alternatives in the market with lower prices and improved quality. Hillary is part of the ________ diffusion of innovation group.

Accepted Answer

A)   innovator
B)   laggard
C)   late majority
D)   early majority
E)   early adopterF) A) and E)
G) B) and D)

Question 12

In the United States, most consumer-packaged goods found in grocery and discount stores are already in the ________ stage of the product life cycle.

Accepted Answer

A)   growth
B)   pioneer
C)   introduction
D)   decline
E)   maturityF) None of the above
G) B) and D)

Question 13

Hollywood studios typically release movies targeted toward general audiences (G- or PG-rated movies)  during the summer when children are out of school. The timing of the release pertains to the product's

Accepted Answer

A)   premarket test.
B)   launch.
C)   evaluation.
D)   research and development.
E)   test marketing.F) A) and B)
G) B) and D)

Question 14

The introduction stage of the product life cycle is characterized by negative or low profits.

Accepted Answer

A) True 
 B)False

Question 15

When Dr. Putt invented his Eye-Over-the-Ball (EOB)  golf putting device, he knew during the introductory stage

Accepted Answer

A)   sales would rise quickly, profits would jump, and even laggards would buy his product.
B)   sales would level off, profits would decline, and mature golfers would be attracted to his product.
C)   sales would slow down, profits would peak, and early adopters of golf equipment would be his major customers.
D)   sales would be low and profits nonexistent, but he would attract golf equipment innovators.
E)   sales would be low, profits would be high, and all potential golfers would jump at the opportunity to buy his product.F) C) and D)
G) A) and B)

Question 16

________ involves taking apart a product, analyzing it, and creating an improved product that does not infringe on the competitor's patents.

Accepted Answer

A)   Reverse innovation
B)   Reverse engineering
C)   Selective dissection
D)   Redistribution
E)   Creative destructionF) C) and E)
G) A) and C) B

Question 17

During this stage of the product life cycle, profits rise rapidly, along with sales, and most adopters are characterized as early or early majority adopters.

Accepted Answer

A)   innovation
B)   introduction
C)   maturity
D)   early maturity
E)   growthF) None of the above
G) B) and E) E

Question 18

Many restaurants offer daily specials, appetizers, entrees, and desserts not listed on their standard menu. These daily specials primarily provide the new product benefit of

Accepted Answer

A)   keeping up in a market where sales come mostly from new products.
B)   satisfying the changing needs of current and new customers.
C)   avoiding market saturation from products that have been on the market for a long time.
D)   creating diversification and reducing risk.
E)   reduction in cost of ingredients.F) B) and D)
G) A) and D)

Question 19

The failure rate for new products is high.

Accepted Answer

A) True 
 B)False

Question 20

Early personal computer users remember the cumbersome, user-unfriendly DOS system. When Apple introduced System 1 and Microsoft introduced Windows, both of which were much easier to use, these new products diffused rapidly because of their

Accepted Answer

A)   relative advantage.
B)   compatibility.
C)   observability.
D)   associated services.
E)   trialability.F) A) and B)
G) B) and D)

Exam 12: Developing New Products

Although innovation strategies may not work in the long run, overriding short-term reasons compel firms to introduce new products and services.

Correct AnswerverifiedShow Answer

One of the key characteristics of brainstorming sessions is that bad ideas should be immediately rejected so the group can focus its attention on good ideas.

Correct AnswerverifiedShow Answer

Which of the following is true of profits in the maturity stage of the product life cycle?

Correct AnswerverifiedShow Answer

All of the following are benefits of new product development to a firm except

Correct AnswerverifiedA

Laptop computers, personal digital assistants, and cellular phones were all readily accepted and diffused in U.S. markets where business and personal lifestyles tend to be faster-paced, compared to many other areas in the world. These products offered ________ with consumers' needs and priorities.

Correct AnswerverifiedShow Answer

Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products, because they know that their customers crave the "latest and greatest" games. They use this information to create new products that primarily provide the benefit of

Correct AnswerverifiedShow Answer

Which of the following adopter categories refers to the last large group of buyers to enter a new product market?

Correct AnswerverifiedShow Answer

By the time BMW got into the mini-SUV market, sales had leveled off and were even starting to decline. BMW had to target its marketing efforts toward the ________ adopters.

Correct AnswerverifiedShow Answer

At the end of a brainstorming session, participants are often asked to

Correct AnswerverifiedShow Answer

In the diffusion of innovation process, innovators enjoy taking risks and are regarded as highly knowledgeable. Marketers want to identify innovators because

Correct AnswerverifiedShow Answer

As soon as she saw one, Hillary wanted a flat-screen television, but she was worried about making the wrong choice. She waited until there were alternatives in the market with lower prices and improved quality. Hillary is part of the ________ diffusion of innovation group.

Correct AnswerverifiedShow Answer

In the United States, most consumer-packaged goods found in grocery and discount stores are already in the ________ stage of the product life cycle.

Correct AnswerverifiedShow Answer

Hollywood studios typically release movies targeted toward general audiences (G- or PG-rated movies) during the summer when children are out of school. The timing of the release pertains to the product's

Correct AnswerverifiedShow Answer

The introduction stage of the product life cycle is characterized by negative or low profits.

Correct AnswerverifiedShow Answer

When Dr. Putt invented his Eye-Over-the-Ball (EOB) golf putting device, he knew during the introductory stage

Correct AnswerverifiedShow Answer

________ involves taking apart a product, analyzing it, and creating an improved product that does not infringe on the competitor's patents.

Correct AnswerverifiedB

During this stage of the product life cycle, profits rise rapidly, along with sales, and most adopters are characterized as early or early majority adopters.

Correct AnswerverifiedE

Many restaurants offer daily specials, appetizers, entrees, and desserts not listed on their standard menu. These daily specials primarily provide the new product benefit of

Correct AnswerverifiedShow Answer

The failure rate for new products is high.

Correct AnswerverifiedShow Answer

Early personal computer users remember the cumbersome, user-unfriendly DOS system. When Apple introduced System 1 and Microsoft introduced Windows, both of which were much easier to use, these new products diffused rapidly because of their

Correct AnswerverifiedShow Answer

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