Concept Testing Presents a Small Sample of Potential Buyers with a Trial

question 80

True/False

Concept testing presents a small sample of potential buyers with a trial version of the new product to determine their initial reactions.

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Definitions:

Price Elasticity

The measure of how much the quantity demanded of a good responds to a change in the price of that good, often used to understand the sensitivity of consumers to price changes.

Income Elasticity

Income elasticity measures how the demand for a good or service changes in response to changes in consumer income.

Marginal Utility

The extra pleasure or benefit gained by a consumer from consuming an additional unit of a product or service.

Utility Function

A mathematical representation of how consumers rank different bundles or combinations of goods according to their level of satisfaction.