Core: Marketing, 8e (Kerin)
Chapter 5 Understanding Organizations as Customers
1) According to the textbook, JCPenney buys paper for which of the following media?
A) in-store signage
B) special advertising inserts in magazines such as Vogue
C) newspaper inserts and direct mail pieces
D) annual and 10-K reports
E) point-of-purchase displays
2) Purchasing paper for JCPMedia is one example of
A) organizational buying.
B) online buying.
C) on-time delivery.
D) derived demand.
E) cooperative selling.
3) When JCPMedia buys paper for JCPenney newspaper inserts, it considers suppliers’ forest
management and other sustainability practices. JCPMedia buyers consider these as part of the
process to
A) fulfill profit responsibilities.
B) formally evaluate paper supplier capabilities.
C) eliminate the need for online purchasing.
D) shorten the value chain.
E) fulfill the auditing role.
4) JCPenney looks at several capabilities when selecting a paper supplier. These organizational
buying criteria include on-time delivery, the availability, quality and quantity of selected grades
of paper, forestry management and sustainable practices, and price. This examination would be
done during the ________ stage of the organizational buying decision process.
A) procurement analysis
B) break-even analysis
C) purchase decision
D) information search
E) alternative evaluation
5) The marketing of goods and services to companies, governments, or not-for-profit
organizations for use in the creation of goods and services that they can produce and market to
others is referred to as
A) integrated marketing.
B) institutional marketing.
C) business-to-business marketing.
D) reseller marketing.
E) organizational marketing.
6) Business-to-business marketing refers to
A) the marketing of goods to companies, governments, or ultimate consumers for use in the
creation of goods and services.
B) the marketing of products to not-for-profit organizations at a reduced fee or nominal cost for
use in the creation of goods and services that they can produce and market to others.
C) the marketing of products and services to companies, governments, or not-for-profit
organizations for use in the creation of products that they can produce and market to others.
D) the marketing of services in the area of intellectual property such as legal, financial, or
creative consulting.
E) the marketing of an idea to create interest or generate goodwill, not just for an individual
brand but also for an entire industry or product class.
7) Manufacturers, wholesalers, retailers, service companies, not-for-profit organizations, and
government agencies that buy goods and services for their own use or for resale are referred to as
A) multinational buyers.
B) resellers.
C) organizational buyers.
D) ultimate consumers.
E) institutional buyers.
8) Organizational buyers are
A) wholesalers, retailers, and service companies that buy goods and services exclusively for
resale.
B) any organization that buys products and services for their own use or for resale.
C) not-for-profit organizations that buy goods and services for their own use.
D) firms that typically buy physical goods and resell them again without any reprocessing.
E) all buyers in a nation including ultimate consumers.
9) Organizational buyers include manufacturers, wholesalers, retailers, service companies, not-
for-profit organizations, and government agencies that
A) purchase exclusively from one supplier.
B) are exempt from state and local taxes.
C) sell directly to ultimate consumers.
D) sell goods and services for their own use.
E) buy products and services for their own use or for resale.
10) Which of the following organizational buyers purchases raw materials and parts to reprocess
into the finished goods they sell?
A) retailers
B) wholesalers
C) agents
D) manufacturers
E) ultimate consumers
11) Which of these statements regarding organizational buyers is most accurate?
A) Wholesalers and retailers resell the goods they buy without reprocessing them.
B) Wholesalers and retailers alter the goods they sell to meet the specific needs of their
customers prior to resale.
C) Manufacturers purchase processed goods and resell them to suppliers who in turn resell them
to ultimate consumers.
D) Ultimate consumers can be considered organizational buyers when they purchase in large
quantities.
E) Government agency purchases are more similar to ultimate consumer purchases than they are
to wholesalers and retailers.
12) All of the following are organizational buyers except which?
A) industrial firms
B) government units
C) ultimate consumers
D) resellers
E) wholesalers
13) Organizational buyers are divided into three markets, which are
A) industrial, wholesaler, and retailer.
B) industrial, retailer, and government.
C) retailer, manufacturer, and government.
D) industrial, government, and ultimate consumer.
E) industrial, reseller, and government.
14) Which of the following exemplifies an organizational buyer?
A) A local baker buys sugar at the grocery store to make cookies with his children at home.
B) A dentist buys a new couch for her den.
C) An architect hires an Uber to take him to the airport for a vacation.
D) The owner of an office building contracts with a service to provide overnight janitorial
services for it.
E) The mayor rents a tuxedo to wear to his daughter’s wedding.
15) An industrial firm
A) is one that is independently owned and takes title to the merchandise it sells.
B) buys physical goods and resells them again without any reprocessing.
C) deals exclusively with federal, state, and local governments.
D) in some way reprocesses a product or service it buys before selling it again to the next buyer.
E) only produces a product, not a service.
16) A firm that reprocesses a product or service it buys before selling the product again to the
next buyer is referred to as
A) an industrial firm.
B) a reseller firm.
C) a government agency.
D) a wholesaler.
E) a retailer.
17) Mining companies, farms, transportation, and legal services are all examples of companies in
the
A) consumer market.
B) cooperative market.
C) reseller market.
D) industrial market.
E) government market.
18) Which of the following types of firms are in the industrial market?
A) retailing
B) fisheries
C) wholesaling
D) state governments
E) federal regulatory agencies
19) Which of the following is a service business within the industrial market?
A) construction
B) mining
C) insurance
D) government
E) farming
20) ________ comprise the highest percentage of firms in industrial markets.
A) Manufacturing firms
B) Construction firms
C) Agricultural firms
D) Mining companies
E) Service companies
21) The services market sells diverse services such as legal advice, auto repair, and dry cleaning,
and this market represents 75 percent of all industrial firms. Which of the following is another
such service firm?
A) communication
B) wholesalers
C) retailers
D) government units
E) educational institutions
22) Corning, Inc., which transforms an exotic blend of materials to create optical fiber capable of
carrying much of the telephone traffic in the United States on a single strand, is operating in
________ market.
A) a consumer
B) a government
C) a service
D) a reseller
E) an industrial
23) Archer Daniels Midland Co. (ADM) is the world’s largest cocoa-bean processor. It buys
cocoa beans and converts them into cocoa powder and cocoa butter, which it then sells to
companies like Hershey’s that manufacture consumer products containing chocolate. ADM is
operating in ________ market.
A) a consumer
B) a government
C) an industrial
D) a manufacturing
E) a reseller
24) Keystone Foods, which invented the individual quick freeze process for beef, provides
McDonald’s with millions of pounds of chicken, beef, and fish annually for use in its restaurants.
The firm sources the animal proteins from farms and processes them in a variety of ways, such as
breading or freezing, before selling them to McDonald’s. Keystone is operating in ________
market.
A) a heavy goods
B) a government
C) a service
D) an industrial
E) a reseller
25) Graham-Field Health Products makes hospital beds and wheelchairs from the component
parts and materials it buys. It sells these manufactured products to hospitals, nursing homes, and
retailers of health care products. Graham-Field Health Products operates in ________ market.
A) a consumer
B) a government
C) a service
D) an industrial
E) a reseller
26) Wholesalers and retailers that buy physical products and resell them without any
reprocessing are referred to as
A) industrial firms.
B) reseller firms.
C) government agencies.
D) consumer product firms.
E) nonprofit firms.
27) Among organizational markets, the reseller market includes
A) manufacturers.
B) logistics and supply chain providers.
C) government agencies.
D) end-user service providers.
E) retailers and wholesalers.
28) European Style Furniture (ESF), headquartered in New York, acquires fine furniture from
several high quality manufacturers in Europe and enjoys exclusive distribution rights from them
to sell to furniture stores throughout the United States. In this context, ESF is most likely
classified as
A) a producer.
B) a reseller.
C) a service provider.
D) a government agency.
E) an industrial firm.
29) 1-800 Contacts is based in Draper, Utah, and sells contact lenses manufactured by other
well-known companies, including Johnson & Johnson Vision Care, Ciba Vision, Bausch &
Lomb, and CooperVision. It would most likely be classified as
A) an industrial service provider.
B) a health care provider.
C) a reseller.
D) an industrial firm.
E) a government agency.
30) Liberty Medical Supply is a home delivery service that sells diabetes testing supplies,
prescription drugs, and other supplies directly to consumers to assist them in the management of
their health-related conditions. Since Liberty Medical does not make any changes to the supplies
that it obtains from manufacturers, it would most likely be classified as
A) an industrial service provider.
B) a health care manufacturer.
C) an industrial firm.
D) a reseller.
E) a government agency.
31) In terms of organizational markets, Amazon.com, Lands’ End, and JCPenney would most
likely be classified as
A) government units.
B) resellers.
C) manufacturers.
D) wholesalers.
E) industrial firms.
32) Federal, state, and local agencies that buy products and services for the constituents they
serve are referred to as
A) industrial markets.
B) reseller markets.
C) consumer markets.
D) government units.
E) global markets.
33) When Louisiana State University buys new laptops for its faculty, it is operating as
A) an industrial market.
B) a business market.
C) a government unit.
D) a consumer market.
E) a service provider.
34) When the General Services Administration (GSA), an agency of the federal government,
purchased 116 Chevy Volts from General Motors for its vehicle fleet, it was operating as
A) an industrial market.
B) a business market.
C) a consumer market.
D) a government unit.
E) a service provider.
35) The City of Denver contracts with Solid Waste Management to provide trash collection
services for its citizens. The city is operating as
A) a government unit.
B) an industrial market.
C) a business market.
D) a consumer market.
E) a service provider.
36) The system that provides common industry definitions for Canada, Mexico, and the United
States, which makes it easier to measure economic activity in the three member countries of the
North American Free Trade Agreement (NAFTA), is referred to as the
A) Standard Industrial Code System (SICS).
B) United Nations Central Product Classification System (UNCPCS).
C) National Codes of Industry System (NCIS).
D) North American Industry Classification System (NAICS).
E) Federal System of International Organizations (FSIO).
37) The North American Industry Classification System (NAICS)
A) provides common industry definitions for North America, Central America, and South
America to measure economic activity in the Western Hemisphere.
B) provides common industry definitions between Canada and the United States to measure
economic activity and reduce barriers of trade for cross-border firms.
C) provides a classification system for products that is consistent worldwide.
D) provides a classification system for products that is consistent across North America, Central
America, and South America to measure economic activity in the Western Hemisphere.
E) provides common industry definitions for Canada, Mexico, and the United States to measure
economic activity in the three member countries.
38) NAICS provides common industry definitions to facilitate the measurement of economic
activity for the member countries of the
A) European Union (EU).
B) United Nations (UN).
C) North American Free Trade Agreement (NAFTA).
D) North Atlantic Treaty Organization (NATO).
E) World Trade Organization (WTO).
39) The acronym NAICS stands for
A) National Association of Industrial Compliance Standards.
B) National Association of Industrial Communication Systems.
C) North American Industrial Communication Standards.
D) North American Industry Classification System.
E) North Atlantic Industrial Classification System.
40) The NAICS provides common industry definitions for
A) Canada, the United Kingdom, and the United States.
B) North America, Asia, and Europe.
C) North America, Central America, and South America.
D) Canada, England, and Australia.
E) Canada, Mexico, and the United States.