Channel conflict often results when a manufacturer opens a new distribution channel,
especially if it directly competes with its existing intermediaries.
The break-even point is the intersection of the total cost curve and the total profit curve.
Use of the scientific method in marketing research helps managers make the best
decisions possible.
Today, about half of all computer hardware and software and a quarter of all books are
sold online.
The three basic sales tasks are order-getting, order-taking, and supporting.
The buying power of Hispanics and African Americans exceeds $1 trillion a year.
A marketing plan for a new strategy needs to take into consideration the timeand
effortthat will be required to get people up to speed on the new jobs they will be
expected to do.
A cooperative advertising program can help a producer achieve coordination and
integration of ad messages in the channel of distribution.
Strategic planning is the managerial process of developing and maintaining a match
between an organization’s resources and its market opportunities.
The growth of mega-agencies has been prompted by large corporations who need to
advertise worldwide.
“Pushing” a product through a channel relies on very aggressive promotion to final
consumers to try to get them to ask intermediaries for the product.
Advertising costs can often be allocated to specific products, just as the cost of labor in
the factory can be allocated to specific products.
When a marketing strategy increases profit contribution without increasing capital
invested, the firm’s return on investment also increases.
Emergency products are purchased only when the need is great and urgent, and
therefore price is usually not very important.
Family, social class, reference groups, and culture are the psychological variables that
affect a consumer’s buying decisions.
The text credits L.L. Bean’s marketing success to its great location.
During the “marketing company era,” the total company effort is guided by the idea that
customers exist to buy the firm’s output.
Marketing does not occur unless two or more parties are willing to exchange something
for something else.
Component parts usually require much processing to get them ready for assembly.
According to the text, it’s best for the “channel captain” to be a producer rather than a
wholesaler or retailer.
Department stores are larger stores that are organized into many separate departments
and offer many product lines.
Discrepancies of quantity occur because individual producers want to produce large
quantities of products while individual consumers prefer to buy products in small
quantities.
Walmart, one of the largest mass-merchandisers in the U.S., handles 30 percent or more
of the total national sales for whole categories of products.
Procter and Gamble is an example of a consumer packaged goods firm that has
dramatically increased its use of trade promotion in the promotion blend.
Dealer brands are brands created by producers.
Salespeople may represent their company to customers and, in turn, represent their
customers within the company.
Open-ended questions are less likely to be asked in quantitative research than in
qualitative research.
Business and individual managers are subject to both criminal and civil laws.
It makes sense for a manager to use leader pricing on a product only if consumers are
unlikely to be aware of the normal price.
The “economic buyer” view of consumers says that individuals will only buy the
cheapest goods and services availableregardless of quality.
When the competitive environment moves toward pure competition, producers offer
very different products that consumers do not perceive as substitutes for each other.
The best way to increase customer equity is to find cost-effective ways to increase
earnings from current customers while bringing profitable new customers into the fold.
Secondary data involves information that has been collected or published already.
The cost of handling a purchase order for operating supplies may be more than the cost
of the purchase.
During the traditional communication process, a source does decoding and a receiver
does encoding.
Reverse channels may provide a way to retrieve unwanted products from
intermediaries, business customers, or final consumers.
A firm that has a lot of “management know-how,” but expects production problems in a
foreign market, might be wise to use management contracting.
Attitudes, Income and Opinions are the “AIO” variables used in lifestyle analysis.
A marketing manager can choose from only two promotion methodspersonal selling
and mass selling.
Customer equity
A. focuses on the costs of acquiring new customers rather than on increasing revenues
from current customers.
B. is basically a historical measure of how profitable a firm has been in the past.
C. is a concept that applies to firms that target final consumers but not to firms that
target business customers.
D. will increase if a firm increases its market share with a particular strategy.
E. is the expected earnings stream of a firm’s current and prospective customers over
some time period.
The task method for budgeting marketing expenses:
A. means that a company budgets roughly what competitors budget for each item.
B. budgets last year’s marketing expense ratio times FORECASTED sales.
C. might result in very different marketing expenses from year to year.
D. is the most commonly used method of setting budgets.
E. None of these alternatives is correct.
A cash-and-carry wholesaler does NOT:
A. store inventory.
B. anticipate his customers’ needs.
C. take title to the products he sells.
D. grant credit.
E. stock the products he sells.
Many countries forbid this form of advertising.
A. Comparative advertising
B. Pioneering advertising
C. Competitive advertising
D. Reminder advertising
E. Institutional advertising
In a pure subsistence economy,
A. each family unit is self-sufficient.
B. exchanges are very important.
C. the standard of living must be relatively high.
D. there is a great need for intermediaries.
A buyer who has not purchased from a vendor in the past is MOST LIKELY to buy
from that vendor when there is:
A. straight rebuy buying.
B. selective buying.
C. new-task buying.
D. selective task buying.
E. modified rebuy buying.
If a large furniture retailer were to purchase Drexel (a manufacturer of sofas and
chairs), this would be an example of:
A. a tying contract.
B. an administered channel system.
C. internal expansion.
D. vertical integration.
E. horizontal integration.
A Hewlett-Packard “all-in-one” printer that serves as a computer printer, fax machine,
copier, and scanner would fall into which of the following business product classes?
A. Accessories.
B. Components.
C. Installations.
D. Raw materials.
E. Supplies.
Which of the following statements accurately compares marketing to final consumers
with marketing to organizational customers?
A. Marketing to organizations is just like marketing to final consumers.
B. Business-to-business marketing includes marketing to final consumers.
C. Purchasing decisions by organizational buyers are usually more economic and less
emotional as compared to consumers.
D. Firms may choose to serve either organizational buyers or final consumers, but not
both.
E. Consumers are more likely to utilize purchasing specifications as compared to B2B
buyers.
Blue Ridge Weavers wants to set its selling price on an item so that the retail list price
will be $50taking into account the usual markups of 10 percent at wholesale and 30
percent at retail. At what price should Blue Ridge Weavers sell the item?
A. $32.50
B. $31.50
C. $35.00
D. $34.00
E. $38.00
Regarding automatic vending, which of the following statements is TRUE?
A. It is important for soft drinks, candy bars, and snack foods.
B. Costs are relatively high because the machines are expensive to stock and repair.
C. Although its growth has been spectacular, automatic vending still accounts for less
than 2 percent of total U.S. retail sales.
D. A major advantage is customer convenience.
E. All of these statements about automatic vending are TRUE.
Sometimes suppliers take straight rebuy relationships for granted, which can:
A. lead to poor customer service.
B. create opportunities for competitors.
C. are reserved for short-term marketing relationships.
D. lead to new-task buying.
E. cause buyers to request routine information updates from suppliers.
In the customer-initiated communication process:
A. the marketer targets more of its promotion effort at specific individuals who respond
directly.
B. a firm relies on a CRM database to target specific prospects.
C. a customer initiates the communication process with a decision to search for
information in a particular message channel.
D. a seller initiates the communication process with a decision to search for information
in a particular message channel.
E. there is a transfer of information from higher-level management to production
workers.
Retailer-sponsored groups formed by independent retailers that run their own buying
organizations and conduct joint promotion efforts are called:
A. Corporate chains.
B. Voluntary chains.
C. Cooperative chains.
D. Franchise operations.
E. Private chains.
Customer service reps:
A. are order getters who sell service products.
B. usually work with missionary salespeople.
C. resolve problems after a purchase has been made.
D. usually install technical products for customers.
E. hire professional services personnel.
When seeking problem-specific data through qualitative research, the researcher:
A. attempts to get yes or no answers from subjects.
B. creates strict guidelines to direct responses to questions.
C. tries to prevent the subject from giving open-ended responses.
D. seeks for subjects to share their honest thoughts on a topic without interference.
E. desires to obtain broad generalities from subjects.
A salesperson who seeks possible buyers with a well-organized sales presentation
designed to sell a good, service, or idea is called a(n) ____________.
A. Influencer
B. Order-getter
C. Order taker
D. Order-generator
E. Gatekeeper
Gross national income (GNI):
A. is the total market value of goods, but not services, produced in a year.
B. is an excellent basis for comparing consumer well-being across different cultures and
economies.
C. is a measure similar to GDP but does not include income earned by foreigners who
own resources in that nation.
D. is the total market value of services, but not goods, produced in a year.
E. All of these are true.
Because more intermediaries are using computer systems to control inventory levels,
A. they can assess the profitability of each product.
B. new-task buying is increasing.
C. they are carrying larger inventories.
D. negotiated contract buying is increasing.
E. All of these alternatives are occurring.
A college “marketing club” printed 1,000 “We’re Number 1” bumper stickers for sale at
$3.00 each as a fund-raiser. Its fixed costs were $500, and the variable cost for each
sticker was $.50. The club’s average cost per unit was:
A. $2.00.
B. $2.50.
C. $0.50.
D. $1.00.
E. There is not enough information to tell.
A transistor radio, an MP3 player, and a portable CD player might compete in the same
A. single target market.
B. multiple target market.
C. product-market.
D. combined target market.
E. generic market.
Regarding marketing managers and the development of market research:
A. Marketing managers may only be consumers of research.
B. Marketing managers do not need to be able to explain what they want from
research-specialists know.
C. Marketing managers do not have to use the language of marketing research
specialists.
D. Marketing managers do not need to know the basic research process.
E. All of these are true.
A local TV retailer hires knowledgeable salespeople to explain the differences among
its models to customers, but a nearby discount store with very few sales staff sells the
same TVs at a lower price. This is an example of __________ conflict.
A. horizontal
B. traditional
C. vertical
D. contractual
E. corporate
Which of the following is NOT an example of an organizational buyer?
A. A government buyer purchasing a new desk for the mayor’s office.
B. A woman buying cookware to sell to her friends and neighbors.
C. A sales rep buying a new necktie to make a good impression.
D. A wholesaler buying a delivery truck.
E. None of these is a good example of an organizational buyer.
The future poses many challenges for marketing managers because:
A. international competition makes it even harder to gain a competitive advantage.
B. consumers’ rights of privacy are harder to protect.
C. long-run consumer welfare is becoming more important.
D. environmental damage is no longer a hidden cost.
E. All of these are good reasons why the future poses many challenges.
____ refers to a firm’s obligation to improve its positive effects on society and reduce
its negative effects.
A. The nonprofit orientation
B. The micro-macro dilemma
C. Marketing ethics
D. Legal obligations
E. Social responsibility
For Tesla, a new firm that makes an electric sports car, estimating how many
competitors will make electric vehicles and what kinds they will make, is:
A. one of the universal functions of innovation.
B. a production activity.
C. an example of the micro-macro dilemma.
D. best left to intermediaries.
E. a part of marketing.
In the 30-minute TV infomercial for a new type of “home gym equipment,” a toll-free
800 number is prominently displayed across the bottom of the screen. This is an
example of ______________ promotion.
A. latent-response
B. delayed-response
C. indirect-response
D. laggard-response
E. direct-response
To help producers manage discrepancies between what gets produced and what
customers need, channel specialists perform _____ activities, such as accumulating,
bulk-breaking, sorting, and assorting.
A. channel
B. regrouping
C. direct marketing
D. promotion
E. selective distribution
A manufacturer spends a large amount of money on research and development leading
to the introduction of a product that is likely to present the firm with a breakthrough
opportunity. The manufacturer prices the product with the goal of achieving a 20
percent return on its investment. Which of the following types of pricing objectives is
the company using?
A. Target return.
B. Profit maximization.
C. Nonprice competition.
D. Meeting competition.
E. Dollar or unit sales growth.