Jeddah Knowledge International School

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1 Jeddah Knowledge International School Business Studies Revision Pack Quarter 4 Grade 9 Name: Section:

2 SECTION A Multiple Choice Questions 1. Which of the following options places the stages of a typical product life cycle in the correct order? a) Growth, maturity, decline, introduction b) Introduction, maturity, growth, decline c) Introduction, decline, growth, maturity d) Introduction, growth, maturity, decline 2. Choose the best feature of packaging for a new soft drink aimed at young children: a) Made of glass with a label containing details of contents b) Made of plastic that can be recycled with information on the label about contents and a competition that children can enter. c) Made of strong water resistant cardboard, with a label containing content details and a money off voucher. d) Made of tin with a ring pull,large label GOOD FOR YOU,and the contents. 3. All of the following are examples of extension strategies that could be used to lengthen a product s life cycle except: a) Launching a new product to replace a declining one b) Introducing new designs to an existing product c) Sell the product into new markets d) Re launch the product with a new advertising campaign 4. Which of the following is NOT an advantage of a product life cycle diagram? a) It helps the firm with important marketing decisions b) It shows firms the advantages of having more than one product on the market at any one time c) It shows the sales of competitors products too. d) It shows the extension strategies that might be needed. 5. Which of the products below is likely to have the longest product life cycle? a) A new design of washing machine b) A fashionable jeans

3 c) A new hit pop music CD d) A branded ice cream 6. A chocolate manufacturer uses a cost plus pricing for its product.the cost of making 1000 bars of a brand is $500.The firm wants to add a profit mark up of 50% per bar. The final selling price will be: a) $1 b) 50 cents c) $3 d) 75 cents 7. An oil company is keen to maintain market share. It is most likely to use: a) Price skimming b) Competitive pricing c) Cost plus pricing with a high mark up d) Penetration pricing to start with and then price skimming 8. A supermarket buys tins of soup for $2 each. It sells them for $3 each. The profit mark up is: a) 100% b) 50% c) 25% d) $3 9. If a soup powder company wants to sell its brand at a similar price to all other brands available in the market,it should use: a) Competitive pricing b) Price skimming c) Cost plus pricing d) Price penetration 10. The pricing strategy aims to encourage customers to switch to the new product because of the lower price. Which strategy are we talking about? a) Competitive pricing b) Price skimming c) Cost plus pricing d) Price penetration

4 11. The aim of this pricing strategy is to make the customer believe the product is cheaper than it really is. Pricing in this way is intended to attract customers who are looking for "value". What strategy are we talking about? a) Competitive pricing b) Price skimming c) Cost plus pricing d) psychological pricing SECTION B Read the following passage about KL Juice Bar and answer the following questions. KL Juice Bars: The marketing options After much thought Salman and Karen decided not to expand their business by franchising. Instead, they would continue to open new juice bars at the rate of one or two a month. However, the last bar that was opened was not doing as well as expected. Karen believed that this was for two reasons: some customers had been overheard saying that they were becoming rather bored with the juice only policy of the company last month a Euro Juice Bar opened its first branch in the country and it had been heavily advertised. This bar sold not only juice drinks but also a range of teas, coffees and food. A change to the marketing mix? The threat of new competition was forcing Salman and Karen to think about the marketing mix of their product KL Juices. Since the start of their business they had always used the same mix: Place: juice bars in main cities in primary locations Product: high quality fruit juices freshly prepared nothing else! Each drink was served in special KL Juice glasses that had to be washed carefully Price: $2 per glass of juice this was high by the standards of other cafés Promotion: a grand opening of each café using public relations but little advertising. The business depended a great deal on word of mouth recommendations and did not use any sales promotions, such as special offers or free gifts. Both Salman and Karen thought that these seemed rather cheap and unsuitable for their high class product. Things were now changing. Not only had Euro Juice Bars started to open franchised outlets, but the country s economy was in poor shape. The earlier tax and interest rate reductions had caused inflation and the economy was now in danger of going into a recession. Now seemed to be a good time to think about a complete change of marketing mix, but Karen also knew that she could not afford to lose existing customers.

5 Questions 1. Define the following terms: a) Marketing mix : b) Packaging : c) Cost plus pricing : 2. Currently, KL Juice Bars price their juices by adding a 400% mark up to cost. Each juice costs 40 cents but is sold for $2. What would the new price be if the firm used a 500% mark up. 3. Discuss TWO factors, other than the costs of the fruit, that KL Juice Bars should consider before pricing their juices. 4. Salman is considering a new form of packaging for each drink rather than using the glasses as at present. List four factors he should take into account before deciding on an alternative.

6 5. Assume that your new marketing mix is accepted by Karen. Prepare a sample advertisement that could be used for the opening of the next juice bar. Justify the style of advert that you choose. 6. Design suitable packaging for the KL Juice. Draw how you think it should look. Explain your design and what needs to be included on the outside of the container.

7 7. Draw, label and explain the different stages of the product life cycle.