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the purchasing decision. Samsung has already contacted several producers of the quasi-assembly pods, and has begun
negotiations with their sales representatives.
132. Refer to Scenario 7.1. Which of the following groups should Samsung not include in its buying center for the new
equipment?
a. Purchasing agents at Samsung
b. Eventual users within Samsung
c. Potential future Samsung customers
d. Gatekeepers within Samsung
e. Senior managers at Samsung
133. Demand for a business product is ____ when two or more items are used in combination to produce a product.
a. inelastic
b. joint
c. fluctuating
d. derived
e. partnered
134. All of the following are important concerns of business customers except
a. achieving a specific level of quality in the products offered to target markets.
b. obtaining a level of quality that meets specifications.
c. obtaining products that exceed specifications to ensure the best possible product performance.
d. obtaining products for which the quality level is consistent.
e. supporting customers with services they expect.
135. John owns an ice cream and frozen treat restaurant and is considering adding new menu items. He recently met with
the representative of a yogurt company who is trying to convince John to add the frozen yogurt to his menu. John has
never offered a yogurt product in the restaurant and has concentrated on ice cream items. The yogurt product would not
need a different freezer or dispensing unit, so the investment would be similar to changing flavors of ice cream. However,
since he’s never offered yogurt, he’s unsure what the market response will be and how much profit he can achieve with
the frozen yogurt. What type of purchasing decision does this represent for John?
a. modified rebuy
b. straight rebuy
c. new-task purchase
d. contracted purchase
136. A marketer who starts selling to the business market, after having spent most of his career selling directly to
consumers, will quickly come to realize that business customers are very demanding. Business customers place a high
value on which of the following aspects of a buying relationship?
a. The geographical location of the selling firm
b. The long-term business strategy of the selling firm
c. The size of the selling firm
d. The mix of services offered by the selling firm
e. The packaging of the product
137. The state of Montana is preparing to buy a large quantity of frozen orange juice for use in a large school district.
Citrus Sweet, Inc. is in the citrus juice business but has never sold to the government market. To have a chance at getting
this order, Citrus Sweet’s first step must be to get her firm to
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a. make a presentation appointment with the state.
b. quote prices to the purchasing department.
c. advertise in the capital city.
d. negotiate with the state.
e. secure a slot on the list of qualified bidders.
138. When buying materials, the purchasing agent for Alco Pillow Manufacturing Company considers a variety of factors.
Which one of the following is least likely to concern this buyer?
a. Does the quality of the goods meet company specifications?
b. Does the supplier consistently deliver on time?
c. Does the supplier also sell to my competitors?
d. Does the supplier offer the services required?
e. Does the price meet company budget requirements?
139. The stages of the business buying decision process, in order, are
a. recognizing the problem, establishing product specifications, searching for products and evaluating possible
suppliers, selecting suppliers and products, and evaluating performance.
b. recognizing the problem, searching for products and evaluating possible suppliers, selecting suppliers and
products, establishing product specifications, and evaluating performance.
c. recognizing the problem, selecting suppliers and products, evaluating performance, establishing product
specifications, and searching for substitute products.
d. establishing product specifications, recognizing the problem, searching for products, evaluating possible products
and suppliers, selecting suppliers and products, and evaluating performance.
e. establishing product specifications, searching for products, selecting suppliers and products, evaluating
performance, recognizing the problem, and evaluating possible products and suppliers.
140. Marketers can take advantage of a wealth of public and private data about business customers using various
industrial classification systems. However, as with any data, there are limitations associated with industrial classification
systems’ data. Which of the following is a limitation of industrial classification systems’ data?
a. Some industries are included in multiple classifications in the systems.
b. Double counting of sales data may occur when products are shipped between two divisions within the same
organization.
c. Only businesses with more than 1000 employees are included.
d. Only service businesses are included in the classifications.
e. The data is only available on a quarterly basis.
141. Individuals and business organizations that purchase products for the purpose of making a profit either by using the
products to produce other products or by using them in their operations are classified as ____ markets.
a. consumer
b. institutional
c. producer
d. government
e. reseller
142. Individual influencing factors refer to
a. relationships among those in the firm’s buying center.
b. uncontrollable environmental forces.
c. the power an individual controls in the buying center.
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d. personal characteristics of individuals in the buying center.
e. activities of suppliers.
143. In placing a tire order with Michelin, South Side Industrial Supply finds that the truck tires it is ordering have
increased $37.50 in price since the last order. South Side proceeds with the order, confident that it can pass on the price
increase to future customers. This is an example of business products having ____ demand.
a. derived
b. inelastic
c. joint
d. fluctuating
e. higher
144. Goodyear is a manufacturer and marketer of tires for new passenger cars. In recent years, the company’s business has
declined because of the overall decrease in consumer demand for new cars. In this case, the demand for Goodyear’s tire
products is said to be ____ since it depends on the demand for new cars.
a. inelastic
b. fluctuating
c. derived
d. elastic
e. nonderived
145. Snappy Tools, Inc., purchases hammers, bolts, and other hardware items from a variety of manufacturers and sells
them to hardware stores at a price that includes a profit for Snappy Tools, Inc. The company would be part of what type of
business market?
a. Reseller
b. Producer
c. Consumer
d. Government
e. Supply
146. During the search for products and evaluating possible suppliers stage of the business buying decision process,
marketers sometimes use ____ analysis to examine the quality, design, materials, and possibly item reduction in order to
acquire the product in the most cost-effective way.
a. cost
b. value
c. profit
d. strategic
e. SWOT
147. In business markets, individuals or groups purchase products for one of three purposes. These purposes are
a. resale, wholesale, and direct use.
b. wholesale, direct use, and use in producing other products.
c. resale, wholesale, and use in producing other products.
d. resale, direct use in producing other products, and use in general daily operations.
e. use in general daily operations, wholesale, and resale.
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148. Brittni is an account executive for a financial services firm that specializes in employee benefits services. She is
meeting with the owner of a small business who has grown to the level where he needs to provide extended employee
benefits to be in compliance with the Affordable Care Act. In the past, the small business provided a small stipend to
employees to cover some of their insurance costs, but they now must offer comprehensive health-care insurance coverage
or face a fine. Brittni is happy to help the small business owner and is excited about the opportunity to gain another
customer. The company owner has purchased other insurance services such as property and casualty for the business, but
has never purchased a group insurance plan and anticipates that it will take a considerable amount of time in the purchase
process since this represents a significant decision for the company and its employees. What type of business purchase
does this represent?
a. new-task
b. straight rebuy
c. modified rebuy
d. contracted purchase
149. Which one of the following countries will not be included in the data presented in the new industry classification
system that is replacing the SIC?
a. Mexico
b. Canada
c. United States
d. Japan
e. All but one NAFTA country
150. About what percentage of the annual U.S. gross domestic product is government spending?
a. 2 percent
b. 10 percent
c. 20 percent
d. 40 percent
e. 50 percent
151. Sylvia works for Dell Computers in the purchasing department and has been receiving more orders related to tablet
and portable computers compared to desktop computers. She’s noticed a significant reduction in the number of monitors
the company is manufacturing as well as traditional desktop systems. It seems that fewer individuals are purchasing
desktop computers for their home offices and many businesses have switched to portable computers since the workforce
prefers the capability to work “on the go” rather than be required to complete work at the office. Therefore, it’s likely the
demand for desktop computers and monitors is:
a. derived
b. fluctuating
c. joint
d. inelastic
152. Safeway Supermarkets recently placed an order with the Kahn Corporation for hotdogs. The typical weekly order is
for 10 cases; however, since the upcoming weekend includes a holiday, this time Safeway is ordering 100 cases of
hotdogs. Safeway orders this product on a regular basis. What type of purchase does this week’s purchase represent?
a. New-task
b. Repetitive
c. Institutional
d. Straight rebuy
e. Modified rebuy
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153. Mike’s Roadside Market buys produce from area farmers, marks the merchandise at a price that includes some profit,
and then sells the fruit and vegetables to the people in and around Centerville. Mike’s would be classified as part of a ____
market.
a. consumer
b. producer
c. government
d. reseller
e. wholesaler
154. Christoff’s Lawn & Lot is a small business that provides landscaping and grass cutting services in the spring and
summer. Christoff’s usually contracts with customers on an annual basis, with the terms set out at the beginning of the
season. This year, the area experienced a significant amount of rain, causing the grass to grow more quickly. Christoff’s
was required to cut the grass every time it grew 2 inches, and no matter how many times it needed cutting, the customer
paid the same monthly amount based on the original contract. The price of gas has now grown by 35% causing Christoff’s
to pay more for their supplies. The demand for gas despite its price represents ________ demand for Christoff’s Lawn &
Lot.
a. elastic
b. inelastic
c. derived
d. joint
e. separate
Scenario 7.1
Use the following to answer the questions.
Samsung is entering the home appliance market with its new French Door Refrigerator. In designing the production
facility, it has a need for various pieces of equipment, including the perpetual assembly belt-drive, quasi-assembly pods,
and finishing stations. The purchasing agent for the appliance division is inquiring about who will be needed for input on
the purchasing decision. Samsung has already contacted several producers of the quasi-assembly pods, and has begun
negotiations with their sales representatives.
155. Refer to Scenario 7.1. There are many factors that would influence Samsung’s business buying decisions. Which one
of the following would not?
a. Environmental
b. Organizational
c. Interpersonal
d. Demographic
e. Individual
156. Despite its usefulness, industrial classification data pose some disadvantages. Which of the following is an example
of a limitation of the North American Industry Classification System (NAICS)?
a. Frito Lay maintains its own network of logistics and supply chain services and often shifts products to other Frito
Lay manufacturing facilities. The NAICS could overstate the shipments since it has no way to account for products that
are shipped between two establishments within the same firm.
b. The NAICS categories the industry into 20 sectors which is fewer than provided by the SIC system.
c. The NAICS data is provided every 10 years, so the results are not very current.
d. The NAICS data is less current than the SIC system.
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157. Perry Supply’s sales and sales force have continued to expand. Now, the firm plans to add a fleet of company cars as
part of its sales compensation package. For Perry Supply, these vehicles would represent a ____ purchase.
a. modified rebuy
b. straight rebuy
c. new-task
d. reevaluated
e. repetitive
158. As the new sales representative for H & L Electronics, Sophie is responsible for calling on hospital management and
selling electronic hospital equipment such as blood pressure cuffs, scales, and heart monitors. Sophie knows that she
needs to be friendly with the administrative assistants in the management offices in order to make sure that H & L’s
information brochures and new product diagrams actually get to the management staff. In this situation, Sophie is
exhibiting her knowledge that administrative assistants are often ________ in the buying decision process.
a. gatekeepers
b. users
c. influencers
d. buyers
e. controllers
159. The Alzheimer Association is a national nonprofit organization serving individuals who suffer from Alzheimer’s or
dementia and their families as well as providing funding to support research. The Alzheimer’s Association has chapters or
affiliate organizations across the country to better serve each local market area. Each Alzheimer Association chapter is
responsible for making purchases for their offices furniture, computers, printers, and other business services the
organization needs, such as telephone or Internet. The Alzheimer Association is a _______ type of business market.
a. institutional
b. government
c. reseller
d. producer
160. A representative product taken from a lot or batch, evaluated, and purchased refers to
a. homogeneous selection.
b. description.
c. trust.
d. negotiated inspection.
e. sampling.
161. Bob Denton of Denton Pest Control buys equipment from Allied Tools because Allied hires him to spray its
warehouse for insects periodically. This practice is an example of
a. cost-benefit trading.
b. cooperative selling.
c. reciprocity.
d. supplier agreements.
e. modified rebuy purchase.
162. In its purchase of desktop business computers, Albertson’s asked that potential suppliers provide information only on
units with 8GB of memory. As Albertson’s management evaluates this purchase, it finds that 8GB is inadequate for many
of the software programs used at Albertson’s. In this instance, the firm would need to modify which aspect of the purchase
process?
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a. Searching
b. Specification development
c. Alternative evaluation
d. Selection
e. Performance evaluation
163. Business markets are typically divided into four categories. These categories are
a. retailers, wholesalers, services, and nonprofit firms.
b. producer, manufacturer, reseller, and government.
c. producer, reseller, government, and institutional.
d. manufacturer, wholesaler, retailer, and services.
e. reseller, retailer, government, and institutional.
164. Your firm manufactures motorcycles for the consumer market. You purchase raw materials to build the motorcycles
from a variety of suppliers in the U.S. and abroad. The volume of your raw materials purchases is a function of the
customer demand for your firm’s motorcycles. Which of the following best describes the type of demand your firm has
for these raw materials?
a. Forecasted demand
b. Elastic demand
c. Customer-driven demand
d. Joint demand
e. Derived demand
165. Product specifications are best described as
a. physical characteristics and level of quality.
b. descriptions of a product.
c. numbers of quality inspections required.
d. comparisons to similar products.
e. defective product return policies.
166. Pi Delta Mu sorority purchases food in bulk to feed its members living in the house. This means it is part of a(n)
____ market.
a. producer
b. consumer
c. reseller
d. institutional
e. government
167. A Pillsbury mill in Utah buys grain from growers in the western region. The purchasing agent for Pillsbury will most
likely use which buying method?
a. Description
b. Inspection
c. Sampling
d. Negotiation
e. Selection
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168. ____ analysis is a systematic evaluation of current and potential suppliers that focuses on many dimensions including
price, product quality, delivery service, product dependability, and overall company reliability.
a. Value
b. Vendor
c. Buying center
d. Strategic
e. Cost
169. Demand for business products is also known as ____ demand.
a. derived
b. corporate
c. business buying
d. manufacturing
e. industrial
170. Your university has decided to purchase new computers for all of the computer labs on campus. Typically, the
purchasing agent negotiates with manufacturers and makes the decision on what to buy. However, for this purchase he has
asked members of the computer science department to give input on the purchase decision. In this instance, the student
senate would be acting as a(n) ____, while the purchasing agent is a(an) ______.
a. user; buyer.
b. user; gatekeeper.
c. user; decider.
d. influencer; decider.
e. influencer; gatekeeper.
171. The third stage in the business buying decision process is to
a. evaluate product specifications to solve the problem.
b. evaluate products relative to specifications.
c. select and order the most appropriate product.
d. evaluate product and supplier performance.
e. search for products and suppliers.
172. How do individual factors affect the business buying decision process?
173. Discuss how interpersonal factors influence the business buying decision process.
174. What are some of the major concerns of business customers in making purchase decisions?
175. What are the major advantages of the North American Industry Classification System (NAICS) compared to the
Standard Industrial Classification (SIC) system?
176. Discuss the differences between business and consumer transactions.
177. Demand for business products can be characterized in four ways; describe these four characteristics and compare and
contrast their attributes.
178. Explain how purchase decisions for business products may be influenced by persons in a buying center.
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179. What factors affect the purchase method that business customers choose?
180. What are the four major types of business markets, and what are the characteristics of each?
181. Compare and contrast the three major types of purchases made by business customers.
182. Describe the various stages of the business buying decision process.
183. Compare and contrast the consumer buying decision process and the business buying decision process.
184. In what ways can an industrial classification system be used by business marketers to analyze target markets?
185. In what ways do environmental factors affect the business buying decision process?
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Answer Key
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