Which of the following statements does not describe gross margin?
A. It can be expressed as a percentage of net sales.
B. It is the profit on the goods sold excluding the operating expenses.
C. It is also referred to as gross profit.
D. It is a performance measurement.
E. It is a measure of return on assets.
Answer:
(p.374-376) What is the best reason for retailers to develop and maintain relationships
with multiple and sometimes competing suppliers?
A. A more efficient supply chain occurs when multiple vendors are involved.
B. A function of retailers is to provide assortments, so they must deal with a variety of
suppliers.
C. By working with multiple suppliers, retailers tend to make better negotiators.
D. A variety of vendors assures more profit.
E. It would be unethical for a buyer to solely work with one supplier.
Answer:
Demarkus finally received financial backing from his wealthy aunt in order to open a
pawn shop. He contacted the landlord of a nearby shopping center since he had his eye
on a vacant storefront. To his surprise, his request for a lease was denied. What most
likely prevented the landlord from leasing to Demarkus?
A. A fixed-rate clause
B. An escape clause
C. A licensing clause
D. A prohibited-use clause
E. An exit clause
Answer:
Tide detergent, Ralph Lauren polo shirts, and Hewlett-Packard printers are all examples
of _____.
A. private-label brands
B. national brands
C. general brands
D. generic brands
E. licensed brands
Answer:
In order to develop a multiattribute attitude model of its customers, a retailer should
gather information about all of the following EXCEPT:
A. the alternative retailers that customers consider.
B. the benefits that customers consider when making their retailer choices.
C. the importance weights that customers attach to the features they consider when
choosing a retailer.
D. customers’ belief ratings of each retailer’s performance on the characteristics when
selecting a store.
E. the customer’s age, education, and income levels.
Answer:
Which of the following is set by vendors by withholding benefits such as cooperative
advertising or even refusing to deliver merchandise to noncomplying retailers?
A. Predatory pricing
B. Horizontal pricing
C. Bait and switch
D. Vertical pricing
E. MSRP pricing
Answer:
Which of the following principles forming the basis of a new legislation on consumer
privacy encourages retailers to treat consumer privacy as their default setting?
A. Simplified consumer choice
B. Data mining
C. Privacy by design
D. Greater transparency
E. Opt-in agreements
Answer:
Which of the following would be the best example of an output measure?
A. Square feet of shelf space allocated to a particular item
B. The expense of running a magazine advertisement
C. The purchase of new inventory
D. The cost of paying overtime to a clerk who worked late
E. Monthly net profits for the entire store
Answer:
When the law office of Dewey, Cheatham, and Howe received the case of legal paper it
had ordered from an internet office supply retailer, the office manager was dismayed to
find the paper was pink even though it was marked white. The office manager packed
the paper and sent it back to the retailer who in turn sent it back to the vendor. This is an
example of:
A. resourcing.
B. backwards distribution.
C. reverse logistics.
D. backwards handling.
E. demarketing.
Answer:
Amanda considers shopping to be a game. She goes shopping because she enjoys
finding bargains and discounts. Amanda is always on the lookout for special offers and
discounts. Hence, Amanda’s hedonic needs are satisfied by a sense of:
A. adventure.
B. stimulation.
C. status and power.
D. deliberation.
E. functionality.
Answer:
Gains.com is a website which features a wide range of products from different retailers
put up for auction. The retailers charge customers based on their willingness to pay to
maximize profits. Which pricing technique is being used by the retailers who put their
products for auction on Gains.com?
A. First-degree price discrimination
B. Second-degree price discrimination
C. Third-degree price discrimination
D. Odd pricing
E. Leader pricing
Answer:
Merrill Lynch, Marriott, and Century 21 are examples of:
A. dollar stores.
B. off-price retailers.
C. service retailers.
D. specialty stores.
E. full-line discount stores.
Answer:
Which of the following would not affect the operating costs of a store?
A. Having a large MSA
B. Having a small MSA
C. Proximity of the store to the distribution center
D. State regulatory environment
E. Congestion of people and cars
Answer:
Retailers use _____ to get quality private-label merchandise at low prices.
A. chargebacks
B. buybacks
C. reverse auctions
D. commercial bribery
E. markdown money
Answer:
Direct selling is characterized by all of these EXCEPT that it is not _____.
A. a highly interactive form of retailing
B. taking place in the home
C. mainly performed by independent agents
D. a low cost method of retailing
E. used for selling personal care products
Answer:
The difference between the service promised by a retailer and the service actually
delivered is known as the _____.
A. communications gap
B. delivery gap
C. research gap
D. market gap
E. knowledge gap
Answer:
Which of the following persons is a vendor who forms an alliance with a retailer to help
gain consumer insight, satisfy customer needs, and improve performance and profit
across a category?
A. Assortment supervisor
B. Category captain
C. Category manager
D. Category specialist
E. Consumer advocate
Answer:
A(n) _____ exists when a vendor and a retailer enter into an agreement that requires the
retailer to take a product it doesn’t necessarily desire to ensure that it can buy a product
that it does desire.
A. exclusive dealing agreement
B. functional discount
C. competition
D. buyback
E. tying contract
Answer:
Sara, a traveler, visits a climate-controlled, lighted shopping center with retail stores on
both sides of an enclosed walkway. What type of shopping center is this most likely to
be?
A. Outlet center
B. Neighborhood shopping center
C. Power center
D. Enclosed shopping mall
E. Lifestyle center
Answer:
A(n) _____ is a promotional program undertaken by a vendor and a retailer working
together.
A. cooperative program
B. customer relationship management program
C. employee feedback management program
D. employee assistance program
E. work-life balance program
Answer:
Which of the following retailers are likely to use a grid store layout?
A. Essentials Supermarket
B. Janet’s Boutique
C. Radiant Shoe Store
D. Linda’s Beauty Salon
E. Zen’s Coffee Shop
Answer:
Training employees to effectively deal with customers, providing better assistance to
customers, and explaining the use of complex products to potential customers reduces
the _____.
A. production gap
B. research gap
C. communication gap
D. delivery gap
E. knowledge gap
Answer:
Retailers reduce their _____ by utilizing mystery shoppers to assess service quality.
A. standards gap
B. knowledge gap
C. responsiveness
D. reliability
E. tangibility
Answer:
_____ uses the data on recent purchases made by customers to evaluate the potential
contribution of each customer segment.
A. Market basket analysis
B. RFM analysis
C. 1-to-1 retailing
D. Add-on selling
E. Share of wallet analysis
Answer:
A(n) _____ is a small group of respondents interviewed by a moderator using a loosely
structured format in which participants are encouraged to express their views and
comment on the views of others in the group.
A. focus group
B. ethnic group
C. demogroup
D. customer advisory council
E. online research community
Answer:
The Hometown Dog Groomer offered a free flea dip to its regular customers. The
owner had extra employees to deal with the crowd but provided only one dip tank,
which slowed down the process. What could the owner do to deliver the desired service
level?
A. Plan for a better resource-to-yield output.
B. Provide instrumental support.
C. Offer incentives to customers.
D. Assure the customers of better service in future.
E. Adopt an antagonistic attitude toward customers.
Answer:
Which of the following statements about the U.S. distribution system is TRUE?
A. The U.S. retail industry is mostly composed of many small and medium-sized firms.
B. Many U.S. retailers are large enough to have their own warehouses.
C. The retail density in the U.S. is lower than that found in Europe.
D. A large independent wholesale industry supplies goods to all retailers.
E. The U.S. retail industry has a fragmented distribution system.
Answer:
(p.497-498) Apparel retailers that display most of their merchandise on freestanding
fixtures typically measure space productivity in terms of _____.
A. sales per linear foot
B. sales per square foot
C. inventory turnover
D. retained earnings
E. asset turnover
Answer:
A retailer that is vertically integrated:
A. concentrates on selling only to businesses.
B. outsources all supply chain activities to independent firms.
C. has limited control on the activities of the supply chain.
D. performs more than one activity in the distribution channel.
E. concentrates only on operating its own retail stores.
Answer:
What can department stores do to differentiate their merchandise offering and
strengthen their image?
A. Increase their pricing
B. Decrease the variety and assortment of merchandise within the store
C. Seek exclusive arrangements with nationally recognized brands
D. Merge with faltering retailers to gain their market share
E. Start selling both soft goods and hard goods
Answer:
Of the following, which can be converted into cash within one year?
A. Current assets
B. Fixed assets
C. Accrued assets
D. Accountable assets
E. Substantial assets
Answer:
An electronic retailer surveys its customers to understand the factors that they consider
before making a purchase decision. The retailer is trying to bridge the _____ by using
customer research.
A. delivery gap
B. standards gap
C. performance gap
D. knowledge gap
E. communication gap
Answer:
Which of the following is typically the last step in site selection?
A. Define present trade area.
B. Analyze trade area characteristics.
C. Conduct a situational analysis.
D. Match characteristics of present trade area with potential sites.
Answer:
Which of the following terms describe the process of moving returned goods to the
retailer from the consumer to the DC and then to the vendor for the purpose of
capturing value or proper disposal?
A. Ticketing
B. Reverse logistics
C. Marking
D. Cross-docking
E. Exception management logistics
Answer:
My Favorite Quilt Shop LLC offers members of their Fabric Lovers Club merchandise
worth $20 for every $200 they purchase plus additional discounts on classes and new
fabric lines. The Fabric Lovers Club LLC. is a good way to develop:
A. internal excellence.
B. store awareness.
C. good customer service.
D. customer loyalty.
E. ethical business practices.
Answer: