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Operational linkages are
A. direct ties between the internal operations of buyer and seller firms.
B. changes in a firm's product or procedures that are unique to its relationship partner.
C. connections that outline contractual obligations.
D. services that link a buyer's production and purchasing departments.
A producer is likely to focus its promotion effort on stimulating selective demand at
what stage in the product life cycle?
A. Market introduction.
B. Market growth.
C. Market maturity.
D. Sales decline.
E. When primary demand is exhausted.
Which of the following geographic pricing policies would probably handicap a
producer wanting to compete with other producers who are closer to a potential buyer?
A. F.O.B. mill
B. F.O.B. delivered
C. Zone pricing
D. Freight absorption
E. All of these would probably handicap a producer.
The various economic systems around the world are:
A. equally effective at providing for the needs of citizens.
B. always shaped by the free decisions of producers and consumers.
C. known collectively as the "command economy."
D. heavily influenced by a society's political institutions.
E. based on the ideal of a pure subsistence economy.
About what percentage of GDP do the developed economies in the U.S. and Europe
spend on logistics-related costs?
A. 1-2 percent
B. 5-7 percent
C. 9-15 percent
D. 20-25 percent
E. 30-35 percent
The following activities are rightly considered marketing except:
A. advertising the grand opening of a new furniture store.
B. researching which furniture designs are popular with consumers.
C. determining how many pieces of furniture can be sold at different price points.
D. building a facility to make furniture.
E. selling furniture to customers in a furniture showroom.
According to the text, product life cycles are:
A. getting longer.
B. speeding up in the later stages.
C. now about the same length as 100 years ago.
D. getting shorter.
E. slowing down in the early stages.
The Roulette Corporation, a video game manufacturer, sets a single price for a set of 5
video games, a video game console, and a pair of speakers. This pricing strategy is
called _____.
A. full-line pricing
B. complementary product pricing
C. product-bundle pricing
D. bid pricing
E. psychological pricing
When a salesperson calls on a new business prospect,
A. he may have trouble identifying all of the buying center members.
B. he usually must see the purchasing manager first.
C. the probability of encountering a gatekeeper is high.
D. All of these alternatives are correct.
The clustering techniques that can be used in segmenting:
A. eliminate the need for management intuition and judgment.
B. group people together into heterogeneous product-market segments.
C. try to find similar patterns within sets of data.
D. allow managers to ignore segmenting dimensions.
E. None of these is true.
If you are seeking new product ideas for your business, a good source is:
A. Intermediaries
B. Customers
C. Your production people
D. Your salespeople
E. All of these would be good sources for new product ideas.
Regarding airfreight, which of the following statements is NOT true?
A. Airfreight may reduce the total cost of distribution.
B. Inventory costs usually increase, since only small quantities can be shipped at a time.
C. Very bulky items cannot be shipped economically.
D. Airfreight is opening up new markets for many perishable items.
E. There are usually fewer problems from theft and damage with airfreight.
When a marketing manager notices that customer reaction to a new product does not
meet expectations, they need to be prepared to _____ or move to a new marketing mix.
A. pivot
B. discontinue
C. prototype
D. revitalize
E. roast
Operating supplies typically:
A. need technical and experienced personal contacts, probably at top-management
level.
B. need widespread distribution or prompt delivery.
C. need technical contacts to determine specifications required, but widespread contacts
usually are not necessary.
D. need skillful personal selling by producer.
E. None of these alternatives is correct.
Each month the billing department of Phoenix Enterprises processes an average of 51
orders from customers at a cost of about $612 (in salaries and supplies). What is the
average cost per order for this department (to the nearest dollar amount)?
A. $4
B. $6
C. $8
D. $10
E. $12
When business buyers purchase items such as grease, electricity, typing paper, and
paper clips, they are buying:
A. accessory equipment.
B. operating supplies.
C. components.
D. repair supplies.
E. maintenance supplies.
A firm's decisions regarding channel type, market exposure and kinds of intermediaries
would fall under the marketing mix variable of
A. Product.
B. Place.
C. Promotion.
D. Price.
E. People.
When planning strategies for international markets, keep in mind that:
A. a marketing manager must rely primarily on intuition because there is usually little
available information about the social and cultural influences on buying behavior.
B. the effects of cultural influences on consumers are usually obvious, if you just take
the time to think about the buying situation.
C. cultural changes may make outdated stereotypes even more misleading.
D. local cultural differences are seldom of any real value.
E. All of these should be kept in mind when planning strategies for international
markets.
In international markets, a firm can sell its management and marketing know-how while
letting locals own the production and distribution facilities by using
A. licensing.
B. exporting.
C. joint venturing.
D. management contracting.
E. direct investment.
The most important variable in a firm's marketing mix is:
A. Product.
B. Price.
C. Promotion.
D. Place.
E. None of these since all contribute to one whole.
A penetration pricing policy
A. tries to sell the top of the demand curve initially.
B. tries to sell the whole market at one low price.
C. tries to sell the top of a market.
D. tries to target the elite market first.
E. involves price movement down the demand curve over time.
Services
A. are intangible.
B. often have to be produced in the presence of the customer.
C. are not easy to store.
D. are perishable.
E. All of these choices are correct.
Regarding organizational buying,
A. a "national accounts" sales force often makes sense when firms with many facilities
buy from a central location.
B. purchasing managers are more likely to be found in large organizations.
C. a geographically bound salesperson can be at a real disadvantage.
D. All of these alternatives regarding organizational buying are true.
The cash discount terms "2/10, net 30" mean that:
A. the invoice is dated February 10 and must be paid by February 30.
B. the buyer will, in effect, be borrowing at a 36 percent annual interest rate if he takes
30 days to pay the invoice.
C. the buyer must make a 2 percent down paymentwith the balance due in 10 to 30
days.
D. a 2 percent discount off the face value of the invoice is permitted if the bill is paid
within 30 days.
E. None of these alternatives is correct.
Randy Todd, marketing manager for Sporting Products, Inc. (SPI), is thinking about
how changes taking place among retailers in his channel might impact his strategy.
SPI sells the products it produces through wholesalers and retailers. For example, SPI
sells basketballs to Wholesale Supply for $8.00. Wholesale Supply uses a 20 percent
markup and most of its 'sport shop" retailer customers, like Robinson's Sporting Goods,
use a 33 percent markup to arrive at the price they charge final consumers. However,
one fast growing retail chain, Sports Depot, only uses a 20 percent markup for
basketballs, even though it pays Wholesale Supply the same price as other retailers.
Furthermore, Sports Depot occasionally lowers the price of basketballs and sells them
at costto draw customers into its stores and stimulate sales of its pricey basketball
shoes.
Sports Depot is also using other pricing approaches that are different from the sports
shops that usually handle SPI products. For example, Sports Depot prices all of its
baseball gloves at $20, $40, or $60with no prices in between. There are three big bins -
one for each price point.
Todd is also curious about how Sports Depot's new strategy to increase sales of tennis
balls will work out. The basic idea is to sell tennis balls in large quantities to nonprofit
groups who resell the balls to raise money. For example, a service organization at a
local college bought 2,000 tennis balls printed with the college logo. Sports Depot
charged $.50 each for the tennis balls-plus a $500 one-time charge for the stamp to print
the logo. The service group plans to resell the tennis balls for $2.50 each and contribute
the profits to a shelter for the homeless.
Todd is not certain if Sports Depot ideas will affect SPI's plans. For example, SPI is
considering adding tennis racquets to the lines it produces. This would require a
$500,000 addition to its factory as well as the purchase of new equipment that costs
$1,000,000. The variable cost to produce a tennis racquet would be $20, but Todd
thinks that SPI could sell the racquet at a wholesale price of $40 each. That would allow
most retailers to add their normal markup and make a profit. However, if Sports Depot
sells the racquet at a lower than normal price other retailers might decide to carry it.
When Sports Depot temporarily lowers the price of basketballs, it is using:
A. bait pricing.
B. leader pricing.
C. value in use pricing.
D. psychological pricing.
E. prestige pricing.
Advertising allowances offered by producers can be ILLEGAL unless they are made
available:
A. for products of "like grade and quality."
B. to all customers on proportionately equal terms.
C. to all buyers in equal dollar amounts.
D. on all products sold by the producer.
E. within an FTC approved agreement.
Literacy studies show that ______________ percent of adults (age 15 or older) cannot
read and write.
A. 10
B. 18
C. 38
D. 50
E. 60
Kayla Jurgenson, marketing manager for Super Gaming Computers and Accessories
(SGCA), is reviewing her company's plans for the coming year.
SGCA sells its products through retail computer dealers and some specialty gaming
stores. Currently, SGCA is carried in 25 percent of all retail computer stores nationwide,
but in California is carried in only 10 percent of stores. So, Kayla has set an objective of
being in 25% of all retail computer stores in California within one year.
SGCA plans to introduce a new SuperDuperGamer model with special features that fits
its target market of teen and young adult gamers. The SuperDuperGamer uses a new
technology and is expected to be a breakthrough product, but it will be important to
build awareness for it to succeed. So, the advertising objective is for 40% of SGCA's
target market to be aware of the new SuperDuperGamer model within 3 months. SGCA
also wants to help its retailers reduce their current stock of SuperGamer computers
before the new model comes out in a month. The SuperGamer has been on the market
for two years and has been a top seller in the category. SGCA's advertising objective for
the SuperGamer computer is to reduce current dealer stock by 80% within the next
month.
SGCA is also introducing a SuperEnhancer sound card, which is designed to
significantly enhance the game-playing experience with older computers. Research with
gamers show that it is very well received, so the advertising objective for the
SuperEnhancer sound card is to gain 40% market share among all gaming-specific
sound cards in the next year. To help achieve that objective, Jurgenson is planning to
use an ad that shows the sound card and a game player being knocked off his chair by
the sound. The headline on the ad reads, "9 Out of 10 Gamers Say that the
SuperEnhancer Sound Beats All Others!"
SGCA is having a sales contest to encourage retailers to quickly reduce the inventory of
SuperGamer computers. Retailers with the highest sales during the next month win an
expense paid trip to a special dealer meeting at a resort in Hawaii. This is
A. probably illegal, since it might encourage price competition among retailers.
B. an example of cooperative advertising.
C. promotion aimed at employees.
D. the type of promotion that continues to impact sales even after the promotion is over.
E. an example of a producer using sales promotion in the channel.
A firm's "marketing mix" decision areas would NOT include:
A. Promotion.
B. People.
C. Price.
D. Product.
E. Place.
Short-lived goods and services which are charged off as they are usedrather than
depreciated over several yearsare called:
A. nontaxable items.
B. expense items.
C. derived items.
D. durables.
E. capital items.
