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Homework answers / question archive / 1)Even if a product's potential is extremely high, its sales may not materialize due to insufficient marketing effort

1)Even if a product's potential is extremely high, its sales may not materialize due to insufficient marketing effort

Management

1)Even if a product's potential is extremely high, its sales may not materialize due to insufficient marketing effort.                True    False

 

  1. In a new product development process, the financial analysis generally begins with the calculation of the net present value, NPV.     True    False

 

  1. In the product development process, sales forecasting is typically the responsibility of the process manager on the new product team.      True    False

 

  1. In addition to the considerations of time and cost, one should also consider product and market newness when selecting the most appropriate forecasting model.      True    False

 

  1. The A-T-A-R model is the basis of many simulated test markets.      True    False

 

  1. Laggards refer to those users who will be among the first to try the product.            True    False

 

  1. Adoption of innovation refers to the process by which an innovation is spread within a market, over time and over categories of adopters.              True    False

 

  1. Product innovators, including consumer packaged goods innovators, still most often use a simple version of the A-T-A-R model.           True    False

 

  1. Most common forecasting methods are extrapolations and work well on established products.        

True    False

 

  1. An early field use test with a prototype will not assure success, but it can say intended users like what they see.           True    False

 

  1. Factor analysis can be used to estimate the net present value of a new product when it is still in the concept stage.              True    False

 

  1. Many of the mathematical sales forecasting models were initially developed for use on durable goods.               

True    False

 

  1. New product projects need to be considered on how well they fit the firm's strategy for innovation.               

True    False

 

  1. In a bottom-up strategic approach, the firm lays out its strategy first, and then allocates funds across different kinds of projects.      True    False

 

  1. With reference to new product development, the top performing firms tend to rely only on financial criteria.             True    False

 

  1. In order to calculate the net present value, that might be associated with a proposed product, it is necessary to:     
    1. create a sales forecast.
    2. calculate the internal rate of return, IRR.
    3. define the payback period.
    4. assess costs.

 

  1. Which of the following is true of sales forecasting for new products?           
    1. If a product's potential is high, sales will materialize in spite of insufficient marketing efforts.
    2. Sales forecasting is the final step in a financial analysis.

C.Sales forecasting is conducted only after calculating key financial benchmarks such as net present  value or internal rate of return.

D. Sales forecasting is typically the responsibility of the marketing personnel on the new products team.

 

  1. Sales forecasting is typically the responsibility of a _____ on the new product team.    A. project manager
    1. technical advisor
    2. marketing person
    3. process manager

 

  1. In a new product development process, which of the following is most likely to be determined first while analyzing the financial aspects of a product?     
    1. Net present value
    2. Sales forecast
    3. Internal rate of return
    4. Payback period

 

  1. It is difficult to forecast success for _____.                
    1. product improvements
    2. line extensions
    3. new-to-the-world products
    4. flanker brands

 

  1. Ancon Inc., typically forecasts potential product sales based on the number of customers who say they would either definitely or probably buy the product, on a five-point scale. The firm's sales forecast is based upon _____.    A. regression analysis
    1. the A-T-A-R model
    2. purchase intentions
    3. test market results

 

  1. _____ is one of the pseudo sale market testing methods used later in the new product process, typically when the physical product is available for the consumer to take home and try.      
    1. The Delphi probe model
    2. The A-T-A-R model
    3. Scenario writing
    4. Regression analysis

 

  1. As per the A-T-A-R model, long-run market share can be expressed as MS = T × R × AW × AV. What does "T" stand for in the equation?        
    1. Ultimate long-run trial rate
    2. Ultimate long-run repeat purchase rate
    3. Percent awareness
    4. Percent availability

 

  1. According to the A-T-A-R model, long-run market share can be expressed as MS= T × R × AW × AV. In this equation, "R" is the:          
    1. ultimate long-run trial rate.
    2. ultimate long-run repeat purchase rate.
    3. percent availability.
    4. percent awareness.

 

  1. In the context of forecasting sales using an A-T-A-R model, which of the following methods can be used if the data availability is inaccurate?       
    1. A what-if analysis
    2. A diffusion analysis
    3. A regression analysis
    4. A correlation analysis

 

  1. Which of the following serves as the basis of many simulated test markets?             
    1. The cumulative expenditures curve
    2. The risk or payoff matrix
    3. The A-T-A-R model
    4. The decay curve

 

  1. _____ refers to the process by which an innovation is spread within a market, over time and over categories of adopters.             A. Diffusion of innovation
    1. Adoption of innovation
    2. Adaptation of innovation
    3. Simulation of innovation

 

  1. Those users who will be among the first to try a product are called:    A. early adopters.
    1. the early majority.
    2. the late majority.
    3. laggards.

 

  1. Which of the following forecasting tools is commonly used for durable goods and is based on the diffusion curve of new products through a population?         
    1. The A-T-A-R model
    2. Econometric analysis
    3. Multiple regression analysis
    4. The Bass model

 

  1. With reference to the Bass diffusion model, which of the following best represents the growth in the total number of purchases that is typically based on adoption by innovators?           
    1. The cumulative expenditures curve
    2. Skimming
    3. Initial diffusion rate
    4. Itemized response

 

  1. Which of the following is the most commonly used approach to sales forecasting outside of the consumer packaged goods industry?               
    1. The A-T-A-R model
    2. Progressive regression
    3. Conjoint analysis
    4. Perceptual gap mapping

 

  1. The management's primary task in sales forecasting is to:       A. purchase state-of-the-art forecasting models.
    1. make necessary estimates as solid as possible.
    2. ensure that all past sales records are accurately archived.
    3. conduct training on sales forecasting.

 

  1. Which of the following is a problem associated with sales forecasting?        
    1. Sales managers tend to make promises a year ahead about sales time and support.
    2. New product managers spend a lot of time in conducting field tests on their new products.
    3. Most common forecasting methods work well only on new products, and not on established products.
    4. Target users don't always know what the new product will actually be or what it will do for them.

 

  1. Leah Hubert senses that her "favorite" product concept might be dismissed due to "inappropriate and unreasonable" financial analysis tools that cannot accurately reflect its potential. Leah has attempted to use her influence to push the concept past such obstacles. In this scenario, Leah is functioning as a _____.              
    1. product architect
    2. financial forecaster
    3. product champion
    4. financial analyst

 

  1. Firms that develop a stream of new items that differ very little from those now on the market, insert them into the market without great fanfare, watch which ones end users rebuy, and drop those that do not find favor are using the policy of _____.              A. low-cost development and marketing
    1. forecasting and risk management
    2. approving situations, not numbers
    3. forecasting what is known

 

  1. When faced with weak financial estimates, NewPro Inc. sometimes implements its new product ideas on a small scale to see where the solution might lie. Based on this information, we can say that NewPro Inc. is employing _____.       A. market testing rollouts
    1. econometric modeling
    2. life cycle analysis
    3. diffusion modeling

 

  1. Which of the following is a way of putting risk back into product innovation while managing it well?    
    1. Isolating or neutralizing the in-house critics
    2. Demanding precise financial analysis at the time of screening
    3. Implementing a product idea on a large scale when the financial analysis is weak D. Avoiding the use of market testing rollouts

 

  1. Managers who feel business is suffering from "paralysis by analysis" are most likely to:       A. commit to a strategy of low-cost development and marketing.
    1. approve situations, not numbers.
    2. forecast what is known.
    3. go ahead with sound forecasts but prepare to handle the risks.

 

  1. _____ analysis may be used to estimate the net present value of a new product when it is still in the concept stage.              
    1. Real-options
    2. Progressive regression
    3. Factor
    4. Conjoint

 

  1. The _____ tool includes several ways to assess strategic fit and market attractiveness, and also considers financial performance.         
    1. opportunity identification and selection
    2. concept generation
    3. concept evaluation
    4. development

 

  1. In the new product development process, the product use test is conducted during the _____ phase of the process.    
    1. opportunity identification and selection
    2. concept generation
    3. project evaluation
    4. development

 

  1. Strategic criteria for new product development are best analyzed through the use of _____.    A. financial modeling
    1. sales forecasting
    2. PIC evaluation
    3. NPV calculation

 

  1. If a firm is already involved in plenty of quick-hit projects, strategic portfolio considerations would indicate that new funding would be better routed to a long-term, major technology development. The firm, as per the example, follows a(n) _____.              
    1. top-down strategic approach
    2. bottom-up strategic approach
    3. portfolio approach
    4. inductive approach

 

  1. A firm may approve many new product projects if:                A. simple financial hurdles are not the only criterion.
    1. resource constraints are included in the NPV calculations.
    2. the management ignores small, quick-hit projects to focus on developing new product technologies.
    3. low-quality work reduces the quality of information used for decision making.

 

  1. Which of the following is true of top-performing firms?        
    1. They only use the bottom-up approach for strategy development.
    2. They only use the top-down approach for strategy development.
    3. They use a combination of both top-down and bottom-up approaches for strategy development.
    4. They tend to rely only on financial criteria when selecting projects.

 

  1. Under the _____, the firm or SBU lays out a strategy, and then allocates funds across different kinds of projects.    
    1. top-down strategic approach
    2. top-two-boxes approach
    3. market testing approach
    4. bottom-up strategic approach

 

  1. Firms that build strategic criteria into their project selection tools are using a _____ strategic approach.    A. top-down
    1. top-two-boxes
    2. market testing
    3. bottom-up

 

  1. According to the Hoechst-U.S. scoring model, which of the following is a factor related to the firm's product innovation charter (PIC)?       A. Probability of technical success
    1. Probability of commercial success
    2. Reward
    3. Strategic leverage

 

  1. According to the Hoechst-U.S. scoring model, which of the following is a full-screen feasibility factor?

       

    1. Probability of technical success
    2. Business-strategy fit
    3. Strategic leverage
    4. Reward

 

  1. According to the Hoechst-U.S. scoring model, which of the following factors is based on financial criterion?    
    1. Probability of technical success
    2. Business-strategy fit
    3. Strategic leverage
    4. Reward

 

  1. What are some of the considerations to keep in mind when developing sales-forecast?        

        

        

        

 

  1. Discuss the Bass diffusion model.       

        

        

        

 

  1. Summarize the problems associated with forecasting.            

        

        

        

 

  1. Discuss any four ways in which dependence on poor forecasts can be reduced.       

        

        

        

 

  1. Explain the top-down and bottom-up approaches to strategy development.              

        

        

        

 

 

 

 

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