An example of odd pricing would be:
a. a low introductory price followed by a sharp price increase.
b. ‘buy one, get one free’.
c. having the selling price end in any odd number.
d. subtracting a trade-in from the selling price.
e. selling a product for $39.98 instead of $40.00.
The four basic types of objectives that a retailer can formulate are:
a. financial, gross margin return on sales, return on assets, and return on net worth.
b. equity, benefactor, consumer choice, and employment.
c. sales volume, market share, productivity, and profitability.
d. societal, market performance, personal, and financial performance.
e. marketing performance, profitability, productivity, and societal.
When all airlines agree to set fares at the same price, they are:
a. engaging in vertical price fixing.
b. violating fair trade laws.
c. engaging in horizontal price fixing.
d. violating the Federal Trade Commission Act.
e. engaging in price discrimination.
_____ occurs when achieving the goals of either the supplier or the retailer would
hamper the performance of the other.
a. Perceptual incongruity
b. Domain disagreements
c. Goal incompatibility
d. Gray marketing
e. Dual Distribution
A(n) _____ is a type of contractual vertical marketing channel that is actually a form of
licensing.
a. retailer-owned cooperative
b. conventional marketing channel
c. franchise
d. wholesaler-sponsored voluntary group
e. independent retailer
The Sports Barn sells football helmets for PeeWee football, and a customer buys one
for his son. The helmet cracks in several places as the son makes a tackle during a game
later that fall, leaving the boy seriously injured. The _____ makes the retailer
potentially liable.
a. implied warranty of correctness
b. Clayton Act
c. expressed warranty of merchantability
d. Robinson-Patman Act
e. implied warranty of merchantability
Identify the incorrect statement about the conventional marketing channel.
a. It is historically predominant in the United States.
b. It is a sloppy and inefficient method of conducting business.
c. It fosters intense negotiations within each pair of institutions in the supply chain.
d. Its members are able to divide the marketing functions among all the participants.
e. It has been on the decline in the United States since the early 1950s.
Which of the following activities is NOT a transaction service?
a. Gift wrapping and packaging
b. Credit
c. Convenient hours
d. Personal shopping
e. Layaway
Customer satisfaction is important to retailers for the following reason:
a. Customer satisfaction is an integral part of the retailers mission statement and must
be constantly assessed.
b. It costs the average retailer five times as much money to get a new customer into the
store as it does to make a sale to current customers.
c. Customer satisfaction has a direct impact on customer segments.
d. Population, social and economic trends are crucial to a customers overall shopping
experience.
e. Satisfied customers will positively affect market segmentation.
The goal of space allocation is to:
a. maximize customer access to high-profit items
b. evenly divide floor space between the five functional areas
c. make the largest possible amount of space available to hold merchandise and be
shopable
d. allow for the rapid restocking of valuable shelf space in high-turnover merchandise
categories
e. design a store which maximizes back room stock capacity
If the planned sales for the month are $70,000, the merchandise budget calls for a
planned stock-to-sales ratio of 2.3, and the financial leverage is 1.1, then the planned
BOM inventory should be:
a. $77,000
b. $84,000
c. $161,000
d. $177,100
e. $194,100
Which of the following is an example of a posttransaction service offered by retailers?
a. Information aids
b. Counseling lessons
c. Credit availability
d. Delivery
e. Layaway
Exclusive distribution:
a. means only one retailer is used in the trading area.
b. means that a smaller number of retailers are used to reach the target market.
c. means that all possible retailers are used to reach the target market.
d. is associated with the distribution of convenience goods.
e. is associated with shopping goods.
_____ occurs when both retailer and supplier openly communicate their ideas,
concerns, and plans.
a. Mutual trust
b. Two-way communication
c. Solidarity
d. Category management
e. Gray marketing
Shoppers who like low prices and cannot afford much more belong to which general
market segment as classified by Walmart?
a. Conscientious objectors
b. Price-sensitive affluents
c. Brand aspirationals
d. Value-price shoppers
e. One-stop shoppers
The following planned figures have been developed by a buyer for next month: sales =
$100,000; reductions = $7,000; EOM stock = $250,000; BOM stock = $300,000;
commitments for delivery during next month = $15,000. What are planned purchases
and OTB for the buyer?
a. $57,000; $42,000
b. $157,000; $142,000
c. $57,000; $72,000
d. $39,000; $54,000
e. $175,000; $412,000
When a retailer uses promotion to attract new customers, these new customers can
come from:
a. the retailer’s existing primary trade area, an expanded trade area, and new residents to
the community.
b. nearby cities and towns.
c. new residents to the community and tourists.
d. mail order sales and outshopping customers.
e. penetrating the existing trade area by stimulating more frequent shopping from
current customers.
Retailing is often characterized as:
a. monopolistic competition.
b. vertical competition.
c. pure monopoly.
d. pure competition.
e. perfect competition.
Since the U.S. population growth has slowed in recent years, successful retailers will be
those that take away market share from competitors.
Explain how variety, breadth, and depth influence a retailer’s merchandise mix. What
factors constrain a retailer’s optimal merchandise mix, and how can a retailer overcome
these constraints?
A customer that visits a retailer and finds the service level to be below their
expectations is likely to become a repeat customer.
The wheel of retailing theory is an attempt to explain how retailers have reacted to the
demands of consumers in this “wheeling and dealing” competitive economic system.