Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
1. What are the four major types of business markets, and what are the characteristics of each?
2. Discuss the differences between business and consumer transactions.
3. What are some of the major concerns of business customers in making purchase decisions?
4. What factors affect the purchase method that business customers choose?
5. Compare and contrast the three major types of purchases made by business customers.
6. Demand for business products can be characterized in four ways; describe these four characteristics and compare and
contrast their attributes.
7. Explain how purchase decisions for business products may be influenced by persons in a buying center.
8. Describe the various stages of the business buying decision process.
9. In what ways do environmental factors affect the business buying decision process?
10. Discuss how interpersonal factors influence the business buying decision process.
11. How do individual factors affect the business buying decision process?
12. Compare and contrast the consumer buying decision process and the business buying decision process.
13. In what ways can an industrial classification system be used by business marketers to analyze target markets?
14. What are the major advantages of the North American Industry Classification System (NAICS) compared to the
Standard Industrial Classification (SIC) system?
15. The three purposes for which individuals or groups can use products in order for it to be considered a business market
are
a.
use in daily operations, end consumption, and resale.
b.
direct use in producing other products, company travel, and end consumption.
c.
resale, use in daily operations, and direct use in producing other products.
d.
governmental, institutional, and reseller purposes.
e.
making other products, selling to other businesses, making component parts.
16. In business markets, individuals or groups purchase products for one of three purposes. These purposes are
a.
resale, wholesale, and direct use.
b.
wholesale, direct use, and use in producing other products.
c.
resale, wholesale, and use in producing other products.
d.
resale, direct use in producing other products, and use in general daily operations.
e.
use in general daily operations, wholesale, and resale.
17. When Hunter Ceiling Fans buys electrical wire for use in producing its ceiling fans, Hunter is part of what type of
market for electrical wire?
a.
Resale
b.
Wholesale
c.
Customer
d.
Consumer
e.
Business
18. Business markets are typically divided into four categories. These categories are
a.
retailers, wholesalers, services, and nonprofit firms.
b.
producer, manufacturer, reseller, and government.
c.
producer, reseller, government, and institutional.
d.
manufacturer, wholesaler, retailer, and services.
e.
reseller, retailer, government, and institutional.
19. Individuals and business organizations that purchase products for the purpose of making a profit either by using the
products to produce other products or by using them in their operations are classified as ____ markets.
a.
consumer
b.
institutional
c.
producer
d.
government
e.
reseller
20. An accountant who purchases software for maintaining clients' books is an example of a buyer in a(n) ____ market.
a.
consumer
b.
producer
c.
reseller
d.
government
e.
institutional
21. Individuals and business organizations that buy finished goods and resell them to make a profit without changing the
physical characteristics of the product are classified as ____ markets.
a.
consumer
b.
institutional
c.
producer
d.
government
e.
reseller
22. ____ buy products from manufacturers and then resell the products to other firms in the distribution system.
a.
Retailers
b.
Producers
c.
Distributors
d.
Warehouses
e.
Wholesalers
23. Mike's Roadside Market buys produce from area farmers, marks the merchandise at a price that includes some profit,
and then sells the fruit and vegetables to the people in and around Centerville. Mike's would be classified as part of a ____
market.
a.
consumer
b.
producer
c.
government
d.
reseller
e.
wholesaler
24. Snappy Tools, Inc., purchases hammers, bolts, and other hardware items from a variety of manufacturers and sells
them to hardware stores at a price that includes a profit for Snappy Tools, Inc. The company would be part of what type of
business market?
a.
Reseller
b.
Producer
c.
Consumer
d.
Government
e.
Supply
25. Motorola buys silicone which is used in its chip-making process. Motorola produces microchips for use within a wide
variety of products for other firms, such as Ford, GM and Samsung. Motorola is a buyer in a(n) ____ market.
a.
producer
b.
government
c.
reseller
d.
construction
e.
institutional
26. Retailers like Target and Kmart are considered to be members of which business market?
a.
Reseller
b.
Customer
c.
Producer
d.
Institutional
e.
Services
27. Which of the following statements about reseller markets is false?
a.
Resellers are concerned with the level of demand for the product.
b.
Resellers are not concerned with how much space the product takes up as long as it has a high price.
c.
Resellers want producers to be able to supply adequate quantities of the product.
d.
Resellers are concerned with the availability of technical and promotional assistance from the producer.
e.
Resellers are concerned with the markup percentage they can get on the product.
28. Because retailers have to be concerned with product selection, price, and space, they often evaluate products on the
basis of
a.
their markup.
b.
sales per square foot of selling area.
c.
how many of the product they can fit in a certain amount of space.
d.
profit per dollar of selling price.
e.
the reliability of the supplier.
29. Which type of business market tends to have the most complex buying procedures?
a.
Reseller
b.
Institutional
c.
Retailer
d.
Government
e.
Producer
30. When the city of Chicago buys iPads for its restaurant inspectors to use during their visits, the purchase from Apple
would be considered
a.
a regulatory sale.
b.
a reseller purchase.
c.
a government purchase.
d.
a producer purchase.
e.
an institutional sale.
31. The state of Montana is preparing to buy a large quantity of frozen orange juice for use in a large school district.
Citrus Sweet, Inc. is in the citrus juice business but has never sold to the government market. To have a chance at getting
this order, Citrus Sweet's first step must be to get her firm to
a.
make a presentation appointment with the state.
b.
quote prices to the purchasing department.
c.
advertise in the capital city.
d.
negotiate with the state.
e.
secure a slot on the list of qualified bidders.
32. About what percentage of the annual U.S. gross domestic product is government spending?
a.
2 percent
b.
10 percent
c.
20 percent
d.
40 percent
e.
50 percent
33. A friend of yours starts his own business. He would like to expand his client base to include the government, but he
believes his small business would be ignored. Based on your knowledge from the text, you tell him
a.
that he's absolutely right, the government doesn't deal with small businesses.
b.
although the government will deal with small businesses, he will never make a profit off a government
contract.
c.
that any government, federal, state, or local would laugh at the size of his business.
d.
the government rarely considers new suppliers when making purchasing decisions.
e.
the government buys products from all sizes of business, but there is some red tape.
34. The government decides to purchase a new fleet of fighter jets for the U.S. Air Force. What type of buying procedure
is the government most likely to use?
a.
The government will request bids from all companies on its qualified bidder list.
b.
It will contact whatever company made the last jets and have them develop the new ones.
c.
Ads will be placed in the top five circulated U.S. newspapers for a company to produce the jets.
d.
The government will select a few firms and enter into negotiations with them until the contract is awarded.
e.
The contract will go to the first company that submits a reasonable bid for the desired jets.
35. Pi Delta Mu sorority purchases food in bulk to feed its members living in the house. This means it is part of a(n) ____
market.
a.
producer
b.
consumer
c.
reseller
d.
institutional
e.
government
36. When charitable organizations such as the American Cancer Society, Second Harvest Foodbank, and the Red Cross
make purchases for goods and services to use in their daily operations, they would be considered to be _______ buyers.
a.
corporate
b.
government
c.
institutional
d.
producer
e.
nonprofit
37. Institutional markets are
a.
intermediaries who resell goods to make a profit.
b.
federal and state government units.
c.
state or local government units.
d.
consumers who buy products for their own use.
e.
organizations that seek nonbusiness goals.
38. Which of the following would be considered an institutional buyer?
a.
The University of Illinois
b.
The Environmental Protection Agency
c.
Apple Computers
d.
The United Way
e.
City of Greenville
39. What are the two ways governments make purchases?
a.
Cash or credit
b.
Contracting previous suppliers and bids
c.
Bids and negotiated contracts
d.
Lottery system and contract negotiations
e.
Request for new purchases and recurring orders
40. What is a primary difference between business and consumer buyers?
a.
Consumer buyers require more product information than business buyers.
b.
Business purchases are made by one individual whereas families make consumer purchases together.
c.
Repeat sales are more common with consumer buyers than business buyers.
d.
Consumers primarily buy inexpensive items; businesses only buy expensive items.
e.
Business buyers generally make larger orders than consumer buyers.
41. Bob Denton of Denton Pest Control buys equipment from Allied Tools because Allied hires him to spray its
warehouse for insects periodically. This practice is an example of
a.
cost-benefit trading.
b.
cooperative selling.
c.
reciprocity.
d.
supplier agreements.
e.
modified rebuy purchase.
42. A disadvantage of reciprocity is that it can lead to
a.
a price war.
b.
higher promotional costs.
c.
more competitive firms entering the industry.
d.
less-than-optimal purchases for the buyer.
e.
longer periods of negotiation.
43. Jason owns a small landscaping business called GreenScapes. When buying a new pickup truck for his landscaping
business, Jason negotiated with Palmetto Dodge, a dealer, with the agreement that GreenScapes would be the service
company Palmetto Dodge used for all of its landscaping needs. This is an example of
a.
a new task purchase.
b.
a straight rebuy.
c.
a modified rebuy.
d.
reciprocity.
e.
a straight purchase.
44. Which of the following statements about business buying is false?
a.
Business marketers prefer not to sell to customers who place small orders.
b.
Business marketers must often sell their products in large quantities to make profits.
c.
Most business purchases are made by committee.
d.
Business purchases are usually made on the basis of contracts.
e.
Orders in business markets tend to be smaller than those placed in consumer markets.
45. Many suppliers and their customers invest time and resources to build and maintain mutually beneficial relationships
which are often called
a.
partnerships.
b.
co-ops.
c.
monopolies.
d.
reciprocity.
e.
alliances.
46. Raython Hardware and Thames Industrial Supplier have worked closely for many years and have a mutually
beneficial relationship in which Raython provides all of Thames's hardware needs in a timely manner. Raython and
Thames's relationship could be best characterized as a(n)
a.
reciprocity agreement.
b.
partnership.
c.
intra-organizational group.
d.
alliance.
e.
tying arrangement.
47. Which of the following is true with respect to buyers in business markets?
a.
Business buyers always act rationally when making purchases for their company.
b.
Business customers tend to be less informed about the products they purchase than consumer buyers.
c.
Business customers demand detailed information about a product's functional features and technical
specifications.
d.
Business customers are no different than buyers in consumer markets.
e.
Business customers tend to buy products from their friends and contacts with business suppliers.
48. When buying materials, the purchasing agent for Alco Pillow Manufacturing Company considers a variety of factors.
Which one of the following is least likely to concern this buyer?
a.
Does the quality of the goods meet company specifications?
b.
Does the supplier consistently deliver on time?
c.
Does the supplier also sell to my competitors?
d.
Does the supplier offer the services required?
e.
Does the price meet company budget requirements?
49. Product specifications are best described as
a.
physical characteristics and level of quality.
b.
descriptions of a product.
c.
numbers of quality inspections required.
d.
comparisons to similar products.
e.
defective product return policies.
50. Most businesses try to control the level of quality in the parts they buy from suppliers. Most firms develop standards
for ____ in order to achieve their quality goals.
a.
how many different suppliers they use
b.
how many parts can fail
c.
controlling when shipments will arrive
d.
the percentage of defects allowed
e.
how long the parts should last
51. All of the following are important concerns of business customers except
a.
achieving a specific level of quality in the products offered to target markets.
b.
obtaining a level of quality that meets specifications.
c.
obtaining products that exceed specifications to ensure the best possible product performance.
d.
obtaining products for which the quality level is consistent.
e.
supporting customers with services they expect.
52. Volkswagen purchases upholstery for the interiors of its vehicles from various suppliers. This upholstery must have a
set of characteristics that is expressed by Volkswagen. This set is called
a.
descriptions.
b.
product features.
c.
criterion.
d.
purchase requests.
e.
specifications.
53. Management at Readyfresh Dry Cleaners is concerned that it maintains a high level of service for its business
accounts. How should the firm monitor the level of service these customers receive?
a.
Develop a code of service.
b.
Set service objectives.
c.
Formally survey customers.
d.
Specify service uniformity.
e.
Stress truthfulness with employees.
54. A Pillsbury mill in Utah buys grain from growers in the western region. The purchasing agent for Pillsbury will most
likely use which buying method?
a.
Description
b.
Inspection
c.
Sampling
d.
Negotiation
e.
Selection
55. Collin Roberts of Roberts Construction is planning to buy a piece of used earth-moving equipment. He would most
likely base his purchase decision on ____ of the alternative machines.
a.
descriptions
b.
inspections
