In Which of the Following Ways Is Product Development Different

question 63

Multiple Choice

In which of the following ways is product development different for services than for physical goods?

• A) Instead of gathering product ideas, the company goes immediately to the testing phase.
• B) Instead of screening ideas, the company tests all of them, since no prototype is needed.
• C) Instead of creating a prototype, the company develops a service process design.
• D) The business analysis step is not needed, since there are no production costs with services.
• E) The commercialization step is gradual for services, but rapid for physical goods.

---

Definitions:

Marginal Product

The additional output that results from using one more unit of a factor, keeping other factors constant.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a factor, such as labor or capital, in the production process, critical for decision-making in resource allocation.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a factor input, considering other factors constant.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a resource or factor of production.