Scenario 12.1 Use the Following to Answer the Questions

question 109

Multiple Choice

Scenario 12.1
Use the following to answer the questions.
Cheetos Fat-free Crunchies is a product developed through advanced technology.Cheetos engineered a technique for making reduced-fat snacks that taste cheesier and stay fresh longer.Cheetos introduced Fat-free Crunchies in limited markets in 2012 and began national distribution in 2013.
About 18 months later,a series of competitors' ads was run to counter claims that Cheetos Crunchies actually contained 1.5 grams of fat,and that they contained preservatives and additives.Research showed that the taste of Cheetos Crunchies was also perceived negatively by some people.To save the product,Cheetos reduced the remaining fat to 0 grams,took out the preservatives,and improved the taste.
-Refer to Scenario 12.1.In 2012,Cheetos was in which phase of new-product development?

• A)Idea screening
• B)Product development
• C)Test marketing
• D)Business analysis
• E)Idea generation

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Definitions:

Natural Resource Cost

The initial cost of acquiring and preparing natural resources for extraction, not including exploration or development.

Intangible

Assets that lack physical substance but possess value, such as patents, trademarks, and goodwill.

Fair Value

An estimate of the market value of an asset or liability, based on the current price at which an asset could be sold or a liability settled in a fair transaction between willing parties.

Double Declining-Balance

An accelerated depreciation method that doubles the normal depreciation rate, reducing the book value of assets more quickly in the initial years.