_____ centers are primarily general merchandise and convenience that range from
100,000- 350,000 square feet. They may include discount department stores,
supermarkets, and home improvement stores.
a. Neighborhood
b. Regional
c. Fashion/Specialty
d. Outlet
e. Community
A retailer of luxury products offers personal shopping, free gift wrapping, and free
delivery. The retailer is most likely considering which factor when determining the
customer services offered?
a. Competition
b. Price image
c. Cost of service
d. Type of merchandise
e. Retailer characteristics
The mass merchandising formula is very much driven by low gross margins which
means the retailer must keep its cost low resulting in:
a. higher customer service.
b. higher customer satisfaction.
c. lower customer service.
d. lower customer satisfaction.
e. higher customer traffic.
The cost of a direct mail advertisement for Rolling Hills Restaurant was $5,000 and was
sent to 15,000 households. Reach for the direct mail advertisement was determined to
be 10,000. Which of the following is the correct cost per thousand-target market
(CPM-TM)?
a. $0.33
b. $.50
c. $1.00
d. $333.33
e. $500
If a retailer can sell an item for $6 and needs a 40 percent markup on retail to meet
profit objectives, that retailer should pay no more than _____ for the item.
a. $2.40
b. $3.60
c. $6.40
d. $8.40
e. $9.60
Which of the following refers to merchandise that cannot be sold because of theft, loss,
and damage?
a. Miscellaneous
b. Unaccounted for
c. Shrinkage
d. Grossed
e. Lost
The three most common defenses available to suppliers charged with price
discrimination are:
a. changing market conditions, meeting competition, and good faith actions.
b. ignorance of law, unprofitability of the supplier, and cost justification.
c. cost justification, changing market conditions, and meeting competition.
d. unprofitability of supplier, cost justification, and meeting competition.
e. changing market conditions, meeting competition, and ignorance of law.
_____ is the overall feeling or mood projected by a store through its aesthetic appeal to
the human senses.
a. Feel
b. Ambience
c. Flavor
d. Sense
e. Decor
Inventory planning based on the weeks’ supply method would be most appropriate for a
_____, where inventories are planned on a weekly basis and where sales do not
fluctuate substantially.
a. supermarket
b. furniture store
c. department store
d. sporting goods store
e. campus bookstore
A buyer’s planned sales are $80,000, planned initial markup is $60,000 and planned
reductions are $7,500. What is the buyer’s planned gross margin on the merchandise
budget?
a. $52,500
b. $72,500
c. $60,000
d. $67,500
e. $87,500
Reilly’s law of retail gravitation explains how:
a. shopping centers attract business.
b. large urbanized areas attract customers from smaller rural communities.
c. retail stores attract business from mail-order customers.
d. small stores can survive in a highly competitive environments.
e. a retailer can determine when outshopping can be profitable.
Secondary markets can be described as:
a. metropolitan areas with a population of 50,000 or more.
b. concentrated ethnic population spots in urban areas.
c. communities with populations of less than 50,000.
d. bedroom communities outside of major cities.
e. inner-city areas with populations between 30,000 and 70,000.
The first stage of the retail life cycle is:
a. entry.
b. realignment.
c. introduction.
d. growth.
e. decline.
_____ are those expenses that a retailer incurs in running the business other than the
cost of the merchandise.
a. Total assets
b. Return expenses
c. Current assets
d. Operating expenses
e. Prepaid expenses
Retail experts are finding that it is difficult to sell to older Americans because this
segment:
a. is shrinking as a percentage of the total population.
b. is skeptical and uninterested in shopping.
c. barely has enough money to support its current standard of living.
d. is too busy paying off mortgages and car loans.
e. is behaving just like its parents did 20 years before.
The logistics network consists of all firms that are involved in moving physical
inventory from initial source to the retail store.
Retailers can only obtain a low degree of differentiation through their customer-service
programs.
A community shopping center generally has a 30-50 percent anchor ratio.
As the distance between competing stores increases, the stores trading areas will
decrease.
Storing involves breaking down heterogeneous products into more homogenous groups.
Anchor stores are the stores in a shopping center that are most dominant and are
expected to draw customers to the shopping center.
Intratype competition is the most common type of retail competition.