Section 2: Indicate True (T) or False (F) for the following: (40 marks) True 1. Price elasticity measures how sensitive a product is to changes in price. 2. You shouldn't test customers before giving a service a brand name 3 "No brand" is not a real strategy 4. Gross margin can be represented as a 5. 6. 7. 8. 9. percentage or a $ value Positioning statements indicate what is different about a product or service Buy 10 and get the 11th cup free is an example of a loyalty program When competitors are offering better prices, companies can reposition their services Branded house and house of brands are the same thing Deleting a product is a portfolio management strategy 10 Funding is variable during the Fuzzy Front End 11 12. Eroding Brands have high brand stature and low brand strength. Cannibalization occurs when a product steals market share from another product 13. Breakeven price is based only on variable costs 14. Products that are price ending in the number 9 usually sell more than others 15. When companies use a segmented 16. 17. 18. 19. 20. approach toward price that considers how each group of customers assesses value, they are using competitive pricing strategies Companies can offer incentives to channel partners when launching a product Brand strategies change on a yearly basis A Cash Cow are strong revenue earners for companies The Business Model Canvas is used when introducing a new product Cost plus pricing considers a products or services costs plus a markup False