Final answer:
Test marketing is indeed an extension of the product screening process, allowing businesses to introduce a product to a realistic market setting and determine whether it should move to full commercialization.
Step-by-step explanation:
The statement that test marketing is an extension of the product screening process is True. Test marketing operates as a phase within the larger new product development process. After initial product ideas have been screened to eliminate those that do not meet market potential or company objectives, firms often employ test marketing. This stage involves introducing the prospective product into a realistic market setting to gauge its performance and collect consumer feedback. The insights gained from test marketing can inform decisions on whether to launch the product widely, make further modifications, or abandon the project altogether, thus reducing the risk of a costly failure. Typically, test marketing is used after the product development and before commercialization, assisting in refining marketing strategies, distribution channels, and other elements of the marketing mix.