Final answer:
The statement that concept testing presents a small sample of potential buyers with a trial version of the new product to determine their initial reactions is true. This is a key step in product development, which helps refine the design based on consumer feedback.
Step-by-step explanation:
True/False: Concept testing presents a small sample of potential buyers with a trial version of the new product to determine their initial reactions. This statement is true. Concept testing is an important part of the development process for new products. It involves presenting a prototype or early version of a product to a small group of potential consumers to gauge their reactions and gather feedback. For example, if a new laundry detergent is being developed, concept testing might involve a study to determine the proportion of consumers who prefer the new brand over the leading competitor.
Such evaluations are critical in refining the product design to better meet consumer needs and preferences. Testing and evaluation of the prototype are necessary to uncover any weaknesses or opportunities to improve the product. This step is essential in a typical spiral design process, where designs are repeatedly brainstormed, developed, tested, and refined until they meet the required criteria and constraints.
In the broader context of product development and advertising, the role of regulatory agencies like the Federal Trade Commission (FTC) is to ensure that factual claims about a product's performance are checked to prevent false advertising, thus protecting consumer interests based on the principle of caveat emptor or 'let the buyer beware.'