______ are the cognitive and affective responses that result from interfacing.
a. Consequences
b. Experiences
c. Results
d. Effects
e. Connections
Which of the following is an important factor to consider when determining the service
level to be offered by a retailer?
a. Target market income
b. Selling policies of your channel partners
c. Price image
d. Minimum wage rate
e. level of inflation
If a retailer has a net profit margin of 3 percent, asset turnover of 4.0x, and financial
leverage of 2.0x, then its return on net worth is:
a. 6 percent.
b. 8 percent.
c. 12 percent.
d. 24 percent.
e. 48 percent.
The aim of operations management is to:
a. heighten customer service.
b. advance the merchandise mix.
c. maximize the performance of current operations.
d. develop more effective long-term plans.
e. increase a product’s perceived value to the customer.
The Celler-Kefauver Antimerger Act:
a. prohibits unfair and deceptive acts and practices regardless of whether competition is
injured.
b. establishes protection for trademarks.
c. defines price discrimination as unlawful (subject to certain defenses) and provides the
FTC with the right to establish limits on quantity discounts.
d. amends Section 7 of the Clayton Act by broadening the power to prevent corporate
acquisitions where the acquisition may have a substantially adverse effect on
competition.
e. requires large companies to notify the government of their intent to merge.
Identify the correct statement about quick response (QR) systems.
a. They are developed by conventional channel members.
b. They are also known as SKU systems.
c. These systems are different despite the similar names adopted by various retail
industries.
d. They are designed to obtain real-time information on consumers’ actions by capturing
ECR data at point-of-purchase terminals.
e. The information obtained is used to develop new or modified products, manage
channel-wide inventory levels, and lower total channel costs.
A salesperson’s conversion rate is defined as:
a. the total number of customers who walk out of the store with a purchase divided by
the total number of customers who entered the store.
b. the number of customers who make a purchase on the first visit to a store divided by
the total number of customers.
c. total number of transactions per hour.
d. total items purchased divided by number of customers entering the store.
e. the number of customers who make a purchase divided by the number of customers
who do not make a purchase.
Concerning the ‘supply chain,’ which of the following statements is true?
a. Supply chains are so closely associated with high prices that many retailers are
dropping out of supply chains and performing the functions themselves.
b. Most supply chains will disappear within the next decade, as all merchandise will
soon be purchased directly from manufacturers.
c. Supply chains do not aid the retailer in providing possession, form, or place utility,
for the final consumer.
d. Profits sufficient for survival and growth will be difficult for a retailer to achieve
without being part of an efficient, effective supply chain.
e. Supply chains seldom change over time.
Which of the following is an advantage of using the retail method of inventory
valuation versus the cost method?
a. Physical inventories using retail prices are subject to more error
b. Inventories need to be taken in order to prepare the accounting statements
c. Physical inventories take long periods of time to complete
d. It provides an automatic, conservative valuation of ending inventory
e. Heavy reliance on bookkeeping activities
According to the text, which of the following is NOT one of the general ways a retail
salesperson can spend his/her time?
a. Idle time
b. Nonselling time
c. Merchandising time
d. Selling time
e. Absent time
Which of the following external forces does NOT have a major influence on the supply
chain?
a. Technological environment
b. Employee morale
c. Legal environment
d. Consumers
e. Behavior of competitors
Which of the following is a modern day example of ‘relieving’ individuals of physical
activity?
a. Automatic clothes dryer
b. Internet
c. Treadmill
d. Cell phones
e. Health clubs
When a consumer has a strong preference for either the brand or the store but not both
he/she will engage in:
a. decelerated problem solving.
b. habitual problem solving.
c. limited problem solving.
d. extended problem solving.
e. tertiary problem solving.
Which of the following laws prohibit retailers from operating in certain locations and
require building and sign specifications to be met?
a. Zoning laws
b. Franchise laws
c. Blue laws
d. Taxing laws
e. Canon laws
All of following are reasons why the promotion activities of the retailer’s supply chain
may conflict with the retailer’s objectives EXCEPT:
a. manufacturers want to create a positive image for their products.
b. retailers want consumers to know they have the products.
c. retailers usually attempt to explain how the product works.
d. manufacturers care only that consumers buy their products, not which store they
make their purchases in.
e. retailers tend to be more short-term oriented.
Once planned sales have been determined, the next step when developing a
merchandise budget is to determine:
a. planned monthly BOM/EOM inventories.
b. the buyer’s planned monthly gross margin.
c. planned monthly retail reductions.
d. total planned sales for the season.
e. planned purchases at retail and cost.
Many retailers develop checklists for site evaluation. Which general category would
NOT be found on such a list?
a. Local demographics
b. Traffic flow and accessibility
c. Retail competition
d. Site characteristics
e. Identification of target markets
If a retailer has an ROA of 10 percent and a financial leverage of 4.0, then its RONW
would be:
a. 0.4 percent.
b. 6 percent.
c. 14 percent.
d. 26 percent.
e. 40 percent.
The best example of the spine layout is found in:
a. automobile showrooms.
b. discount department stores.
c. drugstores.
d. medium-sized specialty stores.
e. discount furniture stores.
The elements that make up a retailer’s promotion, including advertising, publicity,
personal selling, and sales promotions, should be managed:
a. sequentially.
b. separately.
c. simultaneously.
d. from a total systems perspective.
e. using a cost-minimization approach.
The _____ is a group of products that are closely related because they are intended for
the same end use, are sold to the same customer group, or fall within a given price
range.
a. merchandise line
b. merchandise product mix
c. brand management
d. product assortment
e. unit management
Gray marketing is when counterfeit merchandise flows through unauthorized channels.
One disadvantage that a franchisor provides a franchisee is that by borrowing from the
franchisor, the franchisee has access to a lower cost of capital.
Why is price lining used by some retailers?
Sabriya’s Hats has a gross margin of $100,000 and operating expenses of $75,000.
Operating profit equals $25,000.
The strategic profit model (SPM) assesses a retailer’s performance and is based on the
retailer’s net profit margin, rate of asset turnover, financial leverage, and return on net
worth.
While only written warranties are covered by state laws, many types of warranties are
subject to federal laws.
Manufacturers and retailers, but not wholesalers, are primary marketing institutions.
What factors (other than price) do customers place a value on? How can a retailer use
these factors to create a differential advantage?
The design of a sales job has a major impact on a salesperson’s performance.