BDS ANSWERS AND QUESTIONS SET A+
✔✔What limitations/issues should you remember for market research? - ✔✔Cost;
historic data may not predict future behaviour; reliability of responses; existing data may
not be adaptable/relevant. Also ask whether a sample/test is representative.
✔✔What are the 4Ps of the marketing mix? - ✔✔Product; Price; Place; Promotion.
Trigger: develop/evaluate a marketing strategy for a product.
✔✔What additional Ps make the 7Ps for services? - ✔✔People; Process; Physical
evidence. Services are intangible and often produced/consumed at the same time, so
staff, systems and visible evidence matter.
✔✔What are the 4Cs to consider when setting price? - ✔✔Costs; Customers;
Competition; Corporate objectives.
Do not choose price in isolation.
✔✔What is price elasticity of demand (PED)? - ✔✔Measures price sensitivity. PED = %
change in quantity demanded / % change in price. Using absolute magnitude: <1 =
inelastic; >1 = elastic.
✔✔What does inelastic demand imply after a price rise? - ✔✔Quantity falls by a smaller
proportion than price rises, so revenue tends to rise. But contribution/profit may not
necessarily rise. Also consider long-term response and competitor price changes
✔✔Key advantages/risks of acquisition growth? - ✔✔Advantages: speed, existing
capabilities/customers, possible synergies, overcome barriers.
Risks: high entry price, culture clash, integration problems, inherited reputation/risks
and extra fixed/financing costs.
✔✔Franchising vs licensing? - ✔✔Franchising = right to exploit a business brand/model,
normally with central support, for fees/share of revenue. Licensing = right to exploit an
asset/IP, normally with less central support.
✔✔What limitations/issues should you remember for market research? - ✔✔Cost;
historic data may not predict future behaviour; reliability of responses; existing data may
not be adaptable/relevant. Also ask whether a sample/test is representative.
✔✔What are the 4Ps of the marketing mix? - ✔✔Product; Price; Place; Promotion.
Trigger: develop/evaluate a marketing strategy for a product.
✔✔What additional Ps make the 7Ps for services? - ✔✔People; Process; Physical
evidence. Services are intangible and often produced/consumed at the same time, so
staff, systems and visible evidence matter.
✔✔What are the 4Cs to consider when setting price? - ✔✔Costs; Customers;
Competition; Corporate objectives.
Do not choose price in isolation.
✔✔What is price elasticity of demand (PED)? - ✔✔Measures price sensitivity. PED = %
change in quantity demanded / % change in price. Using absolute magnitude: <1 =
inelastic; >1 = elastic.
✔✔What does inelastic demand imply after a price rise? - ✔✔Quantity falls by a smaller
proportion than price rises, so revenue tends to rise. But contribution/profit may not
necessarily rise. Also consider long-term response and competitor price changes
✔✔Key advantages/risks of acquisition growth? - ✔✔Advantages: speed, existing
capabilities/customers, possible synergies, overcome barriers.
Risks: high entry price, culture clash, integration problems, inherited reputation/risks
and extra fixed/financing costs.
✔✔Franchising vs licensing? - ✔✔Franchising = right to exploit a business brand/model,
normally with central support, for fees/share of revenue. Licensing = right to exploit an
asset/IP, normally with less central support.
