Market Segmentation Refers to

question 5

Multiple Choice

Market segmentation refers to

• A)the philosophy that to do a truly excellent job of marketing,a company should concentrate on only one customer segment at a time.
• B)sorting prospective buyers into groups that are willing to pay more than the cost of production for a good or service.
• C)disaggregating prospective buyers from groups into segments of one (individuals)and then creating specific products that will satisfy this person's unique needs.
• D)aggregating prospective buyers into groups that have common needs and will respond similarly to a marketing action.
• E)the belief that it is possible to satisfy every customer's needs if you can identify the correct segment within which they belong.

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Definitions:

Marginal Propensity

The ratio of change in an economic variable (e.g., consumption, saving) to a change in another economic variable (e.g., income).

Disposable Income

Post-tax income that households can allocate towards savings and expenses.

Consumption Spending

The total amount of money that households spend on goods and services within a certain period.

Disposable Income

Income available to households for saving and expenditure post-income tax deductions.