49) Home-country middlemen are also known as ________ middlemen, and are located in the
producing firm’s country.
A) area
B) local
C) merchant
D) domestic
E) regional
50) What company offers a manufacturer’s retail store?
A) Toys “R” Us
B) Walmart
C) Costco
D) Benetton
E) IKEA
51) A marketing manager of a firm with small international sales volume is looking for a
middleman who can take responsibility for promotion of the company’s products, credit
arrangements, physical handling, and market research. Also, the middleman must be able to
provide information on financial, patent, and licensing matters. What type of middleman would
be the best choice for this marketing manager if he wants to meet his objectives?
A) a manufacturer’s export agent
B) an export merchant
C) a trade representative
D) an export management company
E) a complementary marketer
52) Which statement is true regarding an export management company (EMC)?
A) It acts as a middleman for firms with relatively large international sales volume.
B) It operates under its own name while providing services to another firm.
C) It does not have direct responsibility to the parent firm.
D) It acts as a middleman for firms willing to involve their own personnel in international
functions.
E) It calls for smaller investment from the parent firm to get into international markets.
53) A major disadvantage of ________ is that they can seldom afford to make the kind of market
investment needed to establish deep distribution for products.
A) export management companies
B) trading companies
C) import associations
D) global retailers
E) complementary marketers
54) ________ offer one of the easiest routes to gain entrance into the complicated Japanese
distribution system because they virtually control distribution through all levels of channels in
Japan.
A) Trade representatives
B) Trading companies
C) Brokers
D) Export management companies
E) Complementary marketers
55) A major goal of the Export Trading Company (ETC) Act was to
A) allow U.S. companies to bypass tax laws with respect to international trading.
B) remove antitrust disincentives to export activities in the U.S..
C) bypass trade barriers in foreign countries.
D) earn the highest possible profits in foreign countries.
E) combine export shipments within single containers.
56) Which arrangement is best undertaken when a firm wants to keep its seasonal distribution
channels functioning throughout the year?
A) price skimming
B) using the services of a trading company
C) establishing a retail store
D) using the services of an export management company
E) complementary marketing
57) IGP owned a large warehouse in England where it stored and distributed books. It was
approached by a greeting card company in the U.S. to distribute those as well. Since the products
would go into similar markets and IGP could make a profit on the distribution of the greeting
card line, it decided to participate in
A) backhauling.
B) demand shifting.
C) piggybacking.
D) shape shifting.
E) skimming.
58) Companies with marketing facilities or contacts in different countries with excess
distribution capacity or a desire for a broader product line sometimes take on additional lines for
international distribution. The formal name for such activities is
A) skimming.
B) backhauling.
C) complementary marketing.
D) export marketing.
E) demand shifting.
59) A(n) ________ is an individual agent middleman or an agent middleman firm providing a
selling service for manufacturers that cover only one or two markets.
A) manufacturer’s retail store
B) export management company
C) Webb-Pomerene export association
D) global retailer
E) manufacturer’s export agent
60) A ________ provides a selling service for a manufacturer, has a short-term relationship with
the manufacturer, and operates on a straight commission basis.
A) manufacturers’ retail store
B) trading company
C) global retailer
D) manufacturer’s export agent
E) complementary marketer
61) The Webb-Pomerene Act of 1918 made it possible for American business firms to join
forces in export activities without being subject to the
A) Sherman Antitrust Act.
B) Federal Communications Act.
C) Trade Commission Act.
D) Food, Drug, and Cosmetics Act.
E) Robinson-Patman Act.
62) A(n) ________ is a middleman in a foreign country or U.S. possession that can obtain a
corporate tax exemption on a portion of the earnings generated by the sale or lease of export
property.
A) Webb-Pomerene export association
B) manufacturer’s export agent
C) export management company
D) complementary marketer
E) foreign sales corporation
63) ________ are a type of domestic middleman.
A) Sole proprietors
B) Export management companies
C) Foreign distributors
D) Lessors
E) Joint ventures
64) In the context of the types of domestic middlemen, the WTO in 2003 ruled ________ to be
in violation of international trade rules, thus starting a major trade dispute with the European
Union.
A) foreign sales corporations
B) direct marketing partnerships
C) trading companies
D) export promotion companies
E) Webb-Pomerene export associations
65) What is true of foreign sales corporations?
A) They are commonly called piggybackers.
B) They can only be related to a manufacturing parent and not an independent broker.
C) They virtually control distribution through all levels of channels in Japan.
D) They accumulate, transport, and distribute goods from many countries.
E) They can function as a principal or a commissioned agent.
66) What is one of the six Cs of distribution channel strategy?
A) communication
B) continuity
C) capacity
D) commission
E) contribution
67) What is one of the key elements in distribution decisions when it comes to choosing
channels?
A) selection of optimum container sizes
B) volume discounts and rebates
C) functions performed by middlemen
D) local advertising modes
E) target market culture
68) What is a critical element associated with using a particular type of middleman?
A) knowledge of the culture of the target market
B) number of employees
C) mode of transportation for moving goods
D) influence over the target market
E) cash-flow patterns
69) Which mode of distribution in the foreign market will require a company to make the
maximum financial investment?
A) export management companies
B) trading companies
C) export associations
D) direct sales force
E) complementary marketers
70) What is one of the highest costs of doing business in China?
A) money required for the transportation of goods
B) money required for obtaining appropriate permits
C) cost of local advertising
D) capital required to maintain effective distribution
E) cost of customizing products for the Chinese market
71) Which mode of distribution affords the most control over the distribution channels but often
at a cost that is not practical?
A) complementary marketers
B) direct sales force
C) export associations
D) trading companies
E) export management companies
72) Transporting and storing goods, breaking bulk, providing credit, local advertising, sales
representation, and negotiations with middlemen most directly relate to which of the six Cs of
the channel distribution strategy?
A) cost
B) control
C) coverage
D) character
E) continuity
73) One way to get around the difficulty of full-market coverage in a country is to
A) seek significant penetration in major population areas.
B) avoid countries with multiple languages.
C) assess countries in terms of market segments, not geographic segments.
D) keep marketing efforts to highly developed areas.
E) focus on the use of one channel.
74) Most middlemen handle brands in good times when the line is making money but quickly
reject such products within a season or a year if they fail to produce during that period. This is a
problem associated with which of the six Cs of distribution channel strategy?
A) character
B) continuity
C) control
D) cost
E) capital requirement
75) One reason channels of distribution often pose longevity problems is that most middlemen
A) do not maintain sufficient inventory to serve customers.
B) lack product knowledge resulting in low sales volume.
C) have little loyalty to their vendors.
D) tend to slow down distribution to extract higher commissions.
E) do not have sufficient knowledge of the target market.
76) What subject area should be on the checklist of criteria for evaluating middlemen servicing a
market?
A) flexibility
B) sensitivity
C) cultural empathy
D) productivity
E) breadth of knowledge