A Producer of Alcoholic Beverages Produces Four Different Brands of Beer

question 54

Multiple Choice

A producer of alcoholic beverages produces four different brands of beer: BlackStar, BlueStar, Grandeur, and Holmes. BlackStar is a standard brew, while BlueStar has low alcohol content. Grandeur is low in calories, and Holmes has high alcohol content. In this case, the manufacturer uses different brand names for each of its products to:

• A) associate the image of one product with that of another.
• B) increase consumer brand awareness.
• C) enter a new product class.
• D) target specific market segments more efficiently.

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Definitions:

Economies of Scale

A situation where the cost of producing one unit of a good decreases as the volume of production increases.

Diseconomies of Scale

The phenomenon where, beyond a certain point, the cost per unit increases as a company continues to grow in size and output.

Per-Unit Cost

The average cost for each product produced, calculated by dividing the total production costs by the total units produced.

Output

The total quantity of goods or services produced by a firm, sector, or economy within a certain period of time.