After Mattel Evaluated Many New Products to Add to Its

question 62

Multiple Choice

After Mattel evaluated many new products to add to its Barbie product line and before any prototype was created,the toy manufacturer instructed a committee to select three of the ideas to present to a group of consumers.The consumer group was asked to evaluate the three product ideas in terms of their marketability.This stage of new-product development is called:

• A) prototype screening
• B) concept testing
• C) market testing
• D) idea manipulation
• E) idea diffusing

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Definitions:

Fixed Costs

Regular expenses that an entity incurs, which are not affected by changes in business activity levels, such as lease payments and insurance premiums, essential for financial planning.

Machine Setup Costs

Expenses incurred to prepare machinery for production, including calibration, cleaning, and testing.

Batch Level

Refers to the classification in cost accounting that associates costs with specific batches of goods or services rather than with individual units or processes.

Unit-level Costs

Costs that are incurred for every unit produced, directly proportional to the production volume.