Product Development & Pricing Strategy Flashcards
6 cards from real CMA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Product Development & Pricing Strategy flashcards as text
What does the 'product life cycle' (PLC) describe?
Answer: The stages a product goes through from launch to decline in the market
The product life cycle describes the stages — introduction, growth, maturity, and decline — that a product passes through in the market.
What is a 'minimum viable product' (MVP) in product development?
Answer: A version of a product with just enough features to satisfy early customers and gather feedback for future development
An MVP is a product version with just enough features to attract early adopters, allowing the company to validate assumptions before full development.
Which pricing strategy sets a high initial price for a new product and lowers it over time?
Answer: Price skimming
Price skimming sets a high launch price to capture maximum revenue from early adopters before gradually reducing the price.
What is 'penetration pricing'?
Answer: Setting a low initial price to quickly gain market share, then raising the price
Penetration pricing launches a product at a low price to attract customers quickly and build market share before gradually increasing prices.
What is 'value-based pricing'?
Answer: Setting prices based on the perceived value of the product to the customer
Value-based pricing sets prices according to the perceived value of the product to the customer, not just the cost to produce it.
Which of the following best describes 'product differentiation'?
Answer: Distinguishing a product from competitors' offerings through unique features, quality, or branding
Product differentiation highlights unique features, quality, or branding that make a product distinctly better or different from competing products.