41) Under the ________ method of establishing an advertising budget, the owner sees
advertising as a luxury.
A) what-is-affordable
B) matching competitors
C) percentage of sales
D) objective-and-task
Topic: How to Prepare an Advertising Budget
AACSB: Analytic Skills
42) The most commonly used method of establishing an advertising budget for a small business
is:
A) a percentage of sales.
B) spending what competitors spend.
C) objective-and-task method.
D) what is affordable.
Topic: How to Prepare an Advertising Budget
AACSB: Analytic Skills
43) The ________ method is the most difficult and least used technique of establishing an
advertising budget.
A) percentage of sales
B) spending what competitors spend
C) objective-and-task
D) what-is-affordable
Topic: How to Prepare an Advertising Budget
AACSB: Analytic Skills
44) Under ________, a manufacturer splits the cost of advertising with a small retailer if the
retailer features its product.
A) cooperative advertising
B) shared advertising
C) direct advertising
D) integrated marketing
Topic: How to Advertise Big on a Small Budget
AACSB: Analytic Skills
11
45) Timex designs a set of newspaper ads promoting its watches, making them available at no
cost to jewelers selling its watches so they can add their names, addresses, and phone numbers. It
is using ________ advertising.
A) institutional
B) generic
C) cooperative
D) shared
Topic: How to Advertise Big on a Small Budget
AACSB: Reflective Thinking
46) In a(n) ________ advertising program, a group of similar businesses forms a “syndicate” to
produce “generic” ads that allow the individual businesses to dub in local information.
A) cooperative
B) shared
C) direct
D) integrated
Topic: How to Advertise Big on a Small Budget
AACSB: Analytic Skills
47) A successful public relations technique used by local businesses to sponsor and promote
fundraising activities of nonprofit groups is called:
A) cooperative advertising.
B) shared advertising.
C) cause marketing.
D) integrated marketing.
Topic: Creating a Promotional Strategy
AACSB: Analytic Skills
48) Other cost saving suggestions for advertising expenditures include:
A) repeat ads that have been successful.
B) hire independent copywriters, graphic designers, photographers, and other media specialists.
C) use of identical ads in different media.
D) All of the above
Topic: How to Advertise Big on a Small Budget
AACSB: Analytic Skills
12
49) For advertising to work it should:
A) fit into your company’s overall market strategy.
B) use as much financial resources as possible.
C) be part of the firm’s operating strategy.
D) None of the above
Topic: Introduction
AACSB: Analytic Skills
50) A tip for effective advertising is:
A) set long-term advertising objectives.
B) advertise in all media.
C) include many texts in your ads.
D) All of the above
Topic: Creating a Promotional Strategy, Table 10.1
AACSB: Analytic Skills
51) Before making a sales call, the salesperson sets three objectives. Which one is not an
objective?
A) The primary objective
B) The visionary objective
C) The maximum objective
D) The minimum objective
Topic: Personal Selling
AACSB: Analytic Skills
52) Floating spots are common in what type of advertising media?
A) Radio
B) Newspaper
C) Magazine
D) Television
Topic: Media Options
AACSB: Analytic Skills
13
53) Tactics that can help an entrepreneur stimulate positive publicity for the firm are:
A) writing news releases and faxing them to the media.
B) sponsoring a community project.
C) promoting a cause.
D) All of the above
Topic: Creating a Promotional Strategy
AACSB: Analytic Skills
54) ________ forces the salesperson to be open-minded and to shoot for the top.
A) The primary objective
B) The minimum objective
C) The visionary objective
D) The ultimate objective
Topic: Personal Selling
AACSB: Analytic Skills
55) What advertising media attract a large percentage of the advertising dollars nationwide?
A) Newspaper
B) Radio
C) Internet
D) Television
Topic: Media Options
AACSB: Analytic Skills
56) To a business owner, the success of a trade show depends on:
A) understanding how a specific trade show might contribute to sales.
B) evaluating the alternative shows based on both cost and size.
C) Both A and B
D) selling a lot of products or services in a trade show.
Topic: Trade Shows
AACSB: Analytic Skills
14
57) ________ refers to a key customer benefits or a product or service that sets it apart from its
competition.
A) Unique product selling
B) Unique selling proposition
C) Competitive advantage
D) Differentiation
Topic: Define Your Company’s Unique Selling Proposition
AACSB: Analytic Skills
58) The ________ becomes the heart of a company’s advertising message.
A) USP
B) brand equity
C) price
D) product
Topic: Introduction
AACSB: Analytic Skills
59) Which of the following statements is correct?
A) Advertising, promotion, and public relations can be effective means of increasing sales by
informing customers of the business and its goods and services.
B) Advertising, promotion, and public relations can be effective by improving the image of the
firm and its products.
C) Advertising, promotion, and public relations can be effective by persuading customers to
purchase the firm’s goods or services.
D) All of the above
Topic: Introduction
AACSB: Analytic Skills
60) ________ is any sales presentation that is nonpersonal in nature and is paid for by an
identified sponsor.
A) Personal selling
B) Press release
C) Advertising
D) Marketing
Topic: Advertising
AACSB: Analytic Skills
15
61) Which of the following statements is correct?
A) Do not count on sponsorships for your entire advertising campaign.
B) It is not necessary to be a dominant sponsor of the event.
C) Most sponsorships are free and do not cost the company anything.
D) All of the above
Topic: Media Options
AACSB: Analytic Skills
62) David started his business a couple of years ago. After several marketing promotions, he
decided to establish direct contact between his sales people and the customers. His marketing
communication is:
A) advertising.
B) public relations.
C) sales person sponsorship.
D) personal selling.
Topic: Personal Selling
AACSB: Reflective Thinking
63) One advantage of personal selling is:
A) success is not measured just by sales volume but also by customer satisfaction.
B) top sales people use an indirect approach to close the deal.
C) the sales person knows what the company wants and works for company’s perspective.
D) All of the above
Topic: Personal Selling
AACSB: Analytic Skills
64) ________ is unsolicited commercial e-mail.
A) E-mail advertising
B) Banner advertising
C) Spam advertising
D) Cookie advertising
Topic: Media Options
AACSB: Analytic Skills
16
65) When using advertising, the small business owner should ask him/herself certain questions
such as “What business are we in?”, “What image do we want to project?”, etc.
Topic: Define Your Company’s Unique Selling Proposition
AACSB: Analytic Skills
66) The most powerful unique selling proposition is tied to the tangible practical features of the
product.
Topic: Define Your Company’s Unique Selling Proposition
AACSB: Analytic Skills
67) One way ad effectiveness can be measured is to simply measure the increased volume of
traffic into the store as a result of the ad.
Topic: Advertising
AACSB: Analytic Skills
68) Contacting local business and civic groups, sponsoring a seminar, offering to be interviewed
on a radio show are types of publicity a small business owner could use.
Topic: Publicity
AACSB: Analytic Skills
69) One of the most important advertising decisions the small business manager must make is
selecting the specific media to employ in disseminating the manager’s personal message.
Topic: Selecting Advertising Media
AACSB: Analytic Skills
70) The small business manager should employ the same advertising media as competitors to
increase the likelihood of advertising success.
Topic: Selecting Advertising Media
AACSB: Analytic Skills
17
71) When choosing a medium for an advertising message, a small business owner needs to
consider the absolute costs of the ad, the ad’s cost per potential customer reached.
Topic: Selecting Advertising Media
AACSB: Analytic Skills
72) Newspaper circulation as a percentage of total households reached has climbed over the past
two decades, making it an excellent value for the advertising dollar.
Topic: Media Options
AACSB: Analytic Skills
73) Newspapers are flexible and provide selected coverage in the firm’s trading area.
Topic: Media Options
AACSB: Analytic Skills
74) One disadvantage of newspaper ads is their long closing time.
Topic: Media Options
AACSB: Analytic Skills
75) Newspaper ad space is typically sold by lines and columns or inches and columns.
Topic: Media Options
AACSB: Analytic Skills
76) Because of radio’s nearly universal presence, advertising messages receive a tremendous
amount of exposure in the target market.
Topic: Media Options
AACSB: Analytic Skills
77) By choosing a radio station with the appropriate listener profile, a small business owner can
reach almost any target market desired.
Topic: Media Options
AACSB: Analytic Skills
18
78) Radio ads require repeated broadcasting in order to be effective; one-time exposures don’t
work.
Topic: Media Options
AACSB: Analytic Skills
79) In radio advertising, 30-second ads are the most common.
Topic: Media Options
AACSB: Analytic Skills
80) The primary benefit of television ads is their ability to demonstrate a good or service in a
graphic, vivid manner.
Topic: Media Options
AACSB: Analytic Skills
81) A significant disadvantage of television advertising is the difficulty in changing an ad to
match the rapidly changing marketplace.
Topic: Media Options
AACSB: Analytic Skills
82) The effectiveness of banner ads is judged through the pop-up rate.
Topic: Media Options
AACSB: Analytic Skills
83) Magazines have a wide audience reach in that nearly 9 out of 10 adults read an average of
seven different magazines a month.
Topic: Media Options
AACSB: Analytic Skills
84) The total circulation of magazines in the U.S. is 33 million.
Topic: Media Options
AACSB: Analytic Skills
19
85) Most magazines printed today are broad, general interest publications, printed as national
editions.
Topic: Media Options
AACSB: Analytic Skills
86) Magazines have a shorter closing time than newspapers, making them timely and highly
flexible.
Topic: Media Options
AACSB: Analytic Skills
87) Direct mail has been a popular method of small business advertising for a long time.
Catalogs were printed as early as the 15th century.
Topic: Media Options
AACSB: Analytic Skills
88) The greatest strength of direct mail is its ability to allow the owner to select the specific
audience to receive the message.
Topic: Media Options
AACSB: Analytic Skills
89) Direct mail ads typically produce quick results; in most cases, the ad will generate sales
within three or four days after it is received.
Topic: Media Options
AACSB: Analytic Skills
90) The cost of designing direct mail is less than in other media and is considered quite low.
Topic: Media Options
AACSB: Analytic Skills
91) Direct mail advertisers have found that recipients of direct mail computer disks throw them
away at a higher rate than they do magazines or newspapers.
Topic: Media Options
AACSB: Analytic Skills
20