BlueAir is a private airline that competes in the market based on its family-friendly policies. Infants below two do not need tickets if they can travel on their parents' laps, while children under 12 receive discounts of up to 50.
The airline assigns staff to help unaccompanied minors make connecting flights and offers special services for senior citizens as well. Though it is not the cheapest airline available, customers opt for it because of the services it offers. Which of the following strategies is BlueAir most likely using?
A) differentiation strategy
B) transaction strategy
C) diversification strategy
D) product development strategy
E) market penetration strategy
Question 2A(n) ________ refers to a product in which customers must purchase and use before they can fully understand its benefits.
A) complement
B) demerit good
C) experience good
D) substitute
E) independent good
Question 3Which of the following is an accurate description of a benefit leadership strategy?
A) creating new products and attempting to sell these to current customers, as well as expanding into new markets
B) producing at a lower cost per unit than competitors in order to charge a price that is lower than rivals' prices
C) providing a product that offers distinctive features that customers demand, and which are qualitatively different from the features of other companies' products
D) improving the ability of the company and its customers to complete transactions with fewer resources
E) two or more revenue-producing units working together such that their combined value is greater than it would be if these units worked independent of each other
Question 4Which of the following, if true, strengthens the argument that he should adopt a product development strategy?
A) Becky's has a monopoly on bakeries in the entire district.
B) At Becky's franchisees in other cities, Brett wants to introduce different flavors of pastries and desserts.
C) The demand for Becky's vanilla-flavored pastries has gone up after they were endorsed by a celebrity.
D) Brett wants to start targeting his competitors' customers.
E) Franchisee-owners in other towns want to extend their contracts because of the success of the brand.
Question 5Which of the following differentiates market development strategies from product development strategies?
A) In market development, a firm attempts to improve the ability of the company; whereas in product development, a firm chooses to sell new products in completely new markets.
B) In product development, the company leaders choose to continue selling more of their existing products; while in market development, the company attracts new customers from the same market to purchase its products.
C) In product development, the company creates new products and attempts to sell these to its current customers; while in market development, a firm chooses to adapt its current products to a new mission by modifying its products.
D) In market development, companies charge a price that is lower than their rivals; while in product development, the firm attempts to improve the convenience or the cost of transactions.
E) In product development, companies attempt to get the benefits of a low-cost strategy mixed with the benefits of a differentiation strategy; while in market development, companies provide products that offer distinctive features that are qualitatively different from other companies.
Question 6Which of the following, if true, strengthens the argument that he should adopt a diversification strategy?
A) Brett wants to open a franchisee in the neighboring city.
B) The demand for Becky's vanilla-flavored pastries has gone up after they were endorsed by a celebrity.
C) Brett wants to introduce ready-made cake mixes for Becky's newest franchisees outside Baltimore.
D) Brett wants to cater to health conscious customers who are demanding sugar free pastries.
E) After years of selling desserts, Brett wants to introduce his own line of kitchen tools and kitchenware in the same city.
Question 7Rapid Water Systems Co has developed a reverse osmosis water purifier that gets rid of water impurities and at the same time minimizes water wastage.
This feature is unlike any found in other purifiers and the customer demand for this product is high. However, the company plans to sell it at a cost lower than the average market price of other water purifiers. Which of the following market strategies is the company implementing?
A) diversification strategy
B) best-cost strategy
C) transaction strategy
D) market penetration strategy
E) product development strategy
Question 8When a company creates new products and attempts to sell these to its current customers, it is implementing the ________.
A) diversification strategy
B) market development strategy
C) differentiation strategy
D) best-cost strategy
E) product development strategy
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