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A stationery retailer generally prices portable copiers using a 30 percent markup. The
retailer expects to sell 125 portable copiers at the 30 percent markup. How many units
would it have to sell at a 40 percent markup to maintain the same gross profit?
a. 80
b. 94
c. 100
d. 105
Effective employee theft deterrents include _____.
a. alternating the direction of hangers on merchandise near exits
b. using iron gates and/or shatterproof glass on display windows
c. inspecting all packages brought into the store
d. locking up trash containers kept outside
A problem common to franchisors and department or discount stores that utilize leased
departments is the _____.
a. short duration of most leases
b. potential negative effect on the firm's overall image
c. inflexibility with regard to store hours and operating style
d. legality of contract provisions relating to use of approved vendors
A retailer has to carefully determine the direct retailing costs associated with stocking a
given item in computing _____.
a. direct product profitability
b. inventory turnover
c. return of inventory investment
d. gross profit per linear foot of shelf space
In developing performance measures for a retail operation, it is important to _____.
a. change the measures on an annual basis
b. use measures comparable to secondary source data
c. develop measures unique to the firm
d. focus on inventory management measures
Private labels are an integral part of the channel control strategy of _____.
a. variety stores
b. off-price chains
c. independents
d. box (limited-line) stores
Intensive owner participation in a business is most likely to occur when _____.
a. a retailer is well-capitalized
b. delegation of work to others will diminish consumer loyalty
c. a firm has strong financial controls
d. store hours are long
A summary of a retailer's revenues and expenses over a particular time period is
referred to as a _____.
a. cash flow projection
b. balance sheet
c. profit-and-loss statement
d. accounts receivable aging analysis
A manufacturer or wholesaler, in attempting to illegally enforce vertical price fixing,
may _____.
a. conspire with other manufacturers to set retail prices
b. utilize fair trade protection
c. own its retail facilities
d. refuse to sell goods to price-cutting retailers
Poor morale and boredom caused by extreme specialization can be overcome through
_____.
a. a Theory X orientation
b. job specialization
c. the use of prototype stores
d. cross-training
Channel relations tend to be most volatile in exclusive distribution.
For many advertisers, particularly those with small trading areas, newspapers and
television advertising contain much wasted circulation.
Institutional advertising does not emphasize product sales.
A retailer needs to be careful that short-run tactical decisions are not made at the
expense of long-run strategy.
A major advantage to a retailer's having a large inventory is the minimization of
expenses associated with obsolescence and deterioration.
The information search process can involve the use of commercial, noncommercial, and
social sources.
A significant disadvantage to the retail method of accounting is the required detailed
bookkeeping system.
