A central business district is characterized by a concentration of _____.
a. convenience stores
b. parking facilities
c. suburban housing
d. cultural and entertainment facilities
A deduction from a bill made by a retailer due to such infractions as late shipping or
improper labeling is called a _____.
a. penalty
b. liquidated damage
c. chargeback
d. holdback
A retailer shifting from a retailer-based credit card system to a bank-based credit card
system illustrates _____.
a. resizing
b. self-service operations
c. downsizing
d. outsourcing
A major difference between unplanned business districts and planned shopping centers
is based upon _____.
a. size
b. store composition
c. trading area
d. ownership of real-estate
Rationalized retailing is often used in conjunction with _____.
a. micromerchandising
b. prototype stores
c. a top-down space management approach
d. a bottom-up space management approach
When a movie theater increases its price from $6 to $7, its quantity demanded decreases
from 600 to 400 seats. Its price elasticity of demand (expressed as a positive number)
equals _____.
a. 0.2
b. 0.9
c. 1.8
d. 2.6
Goods priced at $.87, $1.95, and $99,990 illustrate _____.
a. leader pricing
b. odd pricing
c. flexible pricing
d. multiple-unit pricing
Which pricing strategy is proper when customers are highly sensitive to price, low
prices discourage actual and potential competition, and total retail costs do not increase
as much as sales volume increases?
a. early recovery of cash
b. market skimming
c. selling against the brand
d. market penetration
A small appliance retailer has in-store cooking demonstrations, offers free samples, and
lets consumers try out selected new appliances in an environment that resembles a small
kitchen. This retailer _____.
a. employs functional product groupings
b. has a theme-setting display
c. practices experiential merchandising
d. utilizes the model stock approach
Which organizational arrangement is most commonly used by both department stores
and chain retailers?
a. separate store organization
b. equal store organization
c. main store control organization
d. decentralized organization
The major proportion of a retailer’s promotional effort should be directed at its primary
trading area.
What type of products generate high sales levels for a short time period?
a. fashion merchandise
b. assortment merchandise
c. seasonal merchandise
d. fad merchandise
The study of problem awareness is difficult since consumers may buy the same product
for different reasons, may have subconscious motivations, and may not tell the retailer
their real reasons for product/service purchases.
U.S. vending machine sales are largely confined to cigarettes and candies.
Maximum floor space is utilized in a curving traffic flow.
It is important for “parasite” retailers to delineate their trading area to properly direct
their promotional efforts.
Which retail institutions do not require advertising support from suppliers?
a. off-price chains and membership clubs
b. department stores and variety stores
c. superstores and traditional department stores
d. variety stores and membership clubs
If total revenue decreases when prices decrease, the price elasticity of demand is elastic.
A department store has the greatest assortment of any general merchandise retailer.
Since all crises cannot be anticipated, it is not important that a retailer establish
contingency plans for major potential crises.