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A flexible-price policy is illegal in the U.S.
Answer:
A market is a group of competitors selling similar products.
Answer:
The Statistical Abstract of the United States is one of the most useful summaries of
secondary data published by the federal government.
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The Magnuson-Moss Act regulates product warranties.
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Institutional advertising may try to inform, persuade, or remind, but it usually focuses
on the name and prestige of an organization or industry.
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A selling agent takes over the whole marketing job of producers, not just the selling
function.
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If an individual is injured by a defective or unsafely designed product, the seller's legal
obligation to pay damages is called product liability.
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Every firm should try to use the just-in-time approach to physical distribution.
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Manufacturers' agents don't cost the producer anything until something sells.
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Reminder advertising is most likely to be useful in the market maturity or sales decline
stages of the product life cycle-especially when the product has achieved brand
insistence or brand preference.
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In its raw form, marketing managers find data useful.
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Retailing includes all of the activities involved in reselling goods to final consumers,
but it does not include the sale of services to final consumers since services must be
produced in the presence of the consumer.
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A sales manager who wishes to supervise and control his salespeople's activities closely
should pay them a straight salary instead of a straight commission.
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Economic needs are concerned only with getting the best quality at the lowest price.
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Online focus groups can offset some of the limitations of traditional focus groups
because one aggressive member is less likely to dominate the group.
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Gross domestic product includes foreign income earned in a country.
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Assorting activities involve putting together a variety of products to give a target
market what it wants.
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Manufacturers' sales branches are warehouses that producers set up at separate locations
away from their factories.
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Home shopping methods-like cable TV shopping channels and catalogs-now use a
multichannel approach by adding a website.
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Technology is the application of science to convert an economy's resources to output.
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Most firms in the U.S. avoid using a one-price policy because it is so inconvenient to
administer and leads to more negotiation and higher selling costs.
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International opportunities should be considered in the strategy planning process, but
they don't always survive as the most attractive ones that are turned into strategies.
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Fashion-related products tend to have short life cycles.
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A company that provides its sales reps with information technology tools should expect
that reps will do a better job with administrative tasks but that they will be less effective
in their actual sales calls.
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Because they don't try to earn a profit, the marketing concept is not very useful for
nonprofit organizations.
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Meeting competition and nonprice competition are both status quo objectives.
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Stocking allowances are given to an intermediary to get shelf space for a product.
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Marketing activities should be of no interest to a nonprofit organization.
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A firm's average variable cost (per unit) is obtained by dividing the total fixed cost by
the total variable cost.
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The elimination of separate barriers to inter-European trade is making Europe a large
unified market.
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Production, not marketing, should determine what products are to be made.
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According to the text, consumer buying decisions are influenced by economic needs,
psychological variables, social influences, culture, and the purchase situation.
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Distribution costs can be very low for digital products because there is often no
physical good to distribute.
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A new channel is more likely to prompt conflict if it focuses on segments not already
served by current channels.
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Many people think that it is unethical to spy on competitors to obtain their trade secrets,
but it is perfectly legal.
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According to the text, marketing means:
A. making a good product that sells itself.
B. much more than selling and advertising.
C. selling and advertising.
D. producing goods and/or services.
E. doing whatever it takes to be able to offer consumers a "better mousetrap."
Answer:
The steps individuals go through in accepting or rejecting a new idea are known as
A. the adoption process.
B. the dissonance process.
C. belief formation.
D. information search.
E. extensive problem solving.
Answer:
_____ is a time-related factor.
A. Demographic intensity
B. Urgency of a need
C. Environmental viability
D. Economy of purchase
E. Sociological interest
Answer:
Beth Sahadi usually buys Sassoon shampoo because she likes its smell. But this
morning her local drugstore was out of Sassoon, so she decided to buy another highly
advertised brand that was on sale because she really needed to wash her hair that night.
For Beth, Sassoon has probably achieved brand:
A. preference.
B. insistence.
C. nonrecognition.
D. rejection.
E. extinction.
Answer:
Sales promotion:
A. is not likely to be used in the market maturity stage of the product life cycle.
B. objectives and situation should determine what specific type of sales promotion is
best.
C. should not be needed if a firm has a good mass selling program.
D. objectives should be developed after the other promotion decisions have been
made-so the manager knows how much is left in the budget.
E. None of these alternatives is correct.
Answer:
Warehouse clubs such as Sam's Club and Costco
A. usually operate in large, no-frills facilities.
B. have been successful targeting small-business customers.
C. emphasize homogeneous shopping products.
D. usually charge consumers an annual membership fee.
E. All of these alternatives are true for warehouse clubs.
Answer:
"Positioning" is a marketing management aid that refers to:
A. a product's ability to provide both immediate satisfaction and social responsibility.
B. how customers think about proposed and/or present brands in a market.
C. a firm's ability to distribute products through intermediaries who are in the right
position to reach target customers.
D. how a firm approaches customer relationship management.
E. all of these alternatives are true.
Answer:
Coca-Cola is taking advantage of the new willingness of Chinese leaders to engage in
international trade by marketing its soft drinks in China. What type of opportunity is
Coke pursuing?
A. Market development
B. Diversification
C. Product development
D. Market penetration
Answer:
Which of the following is NOT one of the organizational buying processes discussed in
the text?
A. Multiple task buying.
B. Modified rebuy buying.
C. New-task buying.
D. Straight rebuy buying.
E. None of these, i.e., all are buying processes.
Answer:
Which of the following statements best describes the modern view of marketing?
A. The job of marketing is to get rid of whatever the company is producing.
B. Marketing should take over production, accounting, and financial services within a
firm.
C. Marketing is concerned with generating a single exchange between a firm and a
customer.
D. Marketing begins with anticipating potential customer needs.
E. Production, not marketing, should determine what goods and services are to be
developed.
Answer:
Physical distribution customer service level means all of the following EXCEPT:
A. Honda wants enough bumpers to build cars that day.
B. A vacationer wants Avis to have his rental car clean and ready when he arrives at the
rental car counter.
C. Sears' shirts are priced at a fair value.
D. McDonald's has enough large cups so that customers can buy the larger size drinks
which are on sale.
E. Safeway's loaves of bread are in stock-and not crushed-when customers want them.
Answer:
The vertical marketing system that typically has the greatest amount of cooperation
among channel members is a(n):
A. Traditional channel system.
B. Administered channel system.
C. Contractual channel system.
D. Franchise channel system.
E. Corporate channel system.
Answer:
A good order getter:
A. is likely to use a high level of personal persuasion.
B. is especially important for selling installations and accessory equipment.
C. needs "know how" to help solve customers' problems.
D. uses a well-organized sales presentation designed to get new business.
E. All of these alternatives are correct.
Answer:
Use this information to answer the following question that refer to the CPI case.
Conservo Products, Inc. (CPI), with annual sales of $200 million, is a well-known
producer of a variety of paper products, almost all of which are made from recycled
materials. Picnic plates account for about 70 percent of CPI's sales. The rest of the
firm's sales come from custom-designed materials-such as box liners and spacers, small
boxes, and disposable products-like trays, towels and napkins.
CPI's picnic plates are sold through 'sales reps" to grocery wholesalers and retail
grocery chains. The sales reps are paid a 5 percent commission on all sales in their
assigned territories. They usually handle related-but noncompeting-lines for several
other manufacturers. Along with their selling duties, the sales reps help CPI with local
advertising and sales promotion efforts. Orders for the custom products are obtained by
area managers who are paid a straight salary to call on business and institutional
customers. The area managers are trained paper specialists and often help their
customers design the products they order.
The picnic plates are priced to give CPI a 90 percent markup on the cost of producing
the product-with the cost figured by taking the total factory cost for the previous year
and dividing that total cost by the number of units produced and sold during that period.
The firm's invoices read "F.O.B.-Delivered" and "1/10, net 30." Customers are allowed
to deduct 3 percent from the face value of the invoice for buying plates in carload
quantities, and another 2 percent for advertising them locally.
The custom products are sold "F.O.B. mill"-with CPI offering a price for each job.
Competition is strong from many other manufacturers who are able to offer very similar
products which meet the customers' specifications.
CPI forecasts that sales will increase to $250 million by 2012. However, much of this
growth is tied to picnic plates-a market in which the firm has about a 7 percent market
share and faces aggressive price competition from many smaller firms with greater
brand familiarity. Further, CPI has been late with more than 50 percent of its plate
orders due to scheduling conflicts with orders for custom products.
For the custom products, CPI uses ______________ pricing.
A. demand-backward
B. penetration
C. average-cost
D. target-return
E. bid
Answer:
Research to evaluate advertising effectiveness:
A. should focus primarily on the judgment of advertising experts.
B. should focus primarily on measuring increases in sales.
C. includes experiments conducted using split runs on cable TV systems.
D. is a problem because nothing can be done until after the ad has actually run.
E. None of these alternatives is correct.
Answer:
Which of the following possible segmenting dimensions is a "demographic" dimension?
A. Benefits sought
B. Social class
C. Purchase relationship
D. Brand familiarity
E. Rate of use
Answer:
Which of the following is NOT true about multichannel shopping?
A. The growth of online retailing makes it easier for consumers to use multichannel
shopping.
B. Consumers that inspect products in a brick-and-mortar store and buy at a lower from
a different retailer online multi-shopping.
C. Smartphone apps make it easier to multichannel shop.
D. All retailers like multichannel shopping.
E. Multichannel shoppers move through different retailers as they move through the
purchase process.
Answer:
Total industry profits reach their maximum during the __________ stage of the product
life cycle.
A. market maturity
B. sales decline
C. market development
D. market introduction
E. market growth
Answer:
Which of the universal functions of marketing deals most directly with advertising a
product in magazines?
A. Transporting
B. Selling
C. Financing
D. Risk-taking
E. Market information
Answer:
Of the following headlines from the WALL STREET JOURNAL, which is most likely
to be about a MACRO-marketing topic?
A. "Tupperware Has a New Strategy."
B. "Thailand Has Unusually Large Number of Wholesalers."
C. "Military Supplier Shifts to Selling Gas Masks to Private Citizens."
D. "Coke Plans Beverage Line to Compete with Lipton's."
E. "Dow Chemical Adds Shipping Safeguards."
Answer:
Some salespeople are expected to act as "marketing managers" in their own geographic
territories and decide:
A. how they will allocate their promotion money and their own time.
B. which customers they will target.
C. which intermediaries they will rely on or help.
D. which products in the company's line they will push aggressively.
E. All of these decisions are correct.
Answer:
Which of the following is not within the power of the Consumer Product Safety
Commission?
A. It can set safety standards for products.
B. It can order repairs of unsafe products.
C. It can order returns of unsafe products.
D. It can back up its orders with fines and jail sentences.
E. It can conduct random searches for unsafe products in consumers' homes.
Answer:
Use this information for question that refer to the Yummy Ice Cream case.
Kelly Stich, marketing manager for Yummy Ice Cream Products, is thinking about some
of her products and her promotion plans for the coming year.
Yummy Ice Cream Products is introducing a new ice cream treat called PlanetSavers.
This treat uses ice cream produced with environmentally friendly processes that save
energy and protect the ozone. Yummy plans to send articles to magazines, local
newspapers, and environmental groups that explain the environmentally safer treat. The
product also has a unique texture and different flavor.
Stich wants to use counter cards and in-store signs to let people know about Cherry
Walrus, the company's new flavor. She is also developing sales training materials that
will teach ice cream scoopers in Yummy's ice cream stores to promote the product.
Right after Cherry Walrus is introduced each store will also hand out coupons that are
good for one day only.
Yummy Mondaes is a product that has been around for 25 years. It is Yummy's take on
the classic ice cream sundae, but white-brownie and coffee-flavored crumbles are added
to make it extra special. The company sells this product in one and two quart containers
through major grocery store chains. It relies on personal selling and price discounts to
retailers to move more of the product. The company does very little consumer
promotion for this product.
Yummy Fudge on a Stick is a new product of fudge-flavored ice cream on a stick.
Yummy plans to sell it through retail grocery stores and is launching an aggressive
advertising program that will use television, radio, newspaper, magazines, and the
Internet. Most of its promotion will be directed at consumers.
Two years ago, the company introduced Yummy Fruit on a Stick, an all-natural frozen
fruit product on a stick. The product category has been popular, continues to grow, and
is in the market growth stage of the product life cycle.
If Yummy wanted to target opinion leaders, which of the following groups is most
likely to include them?
A. innovators
B. early adopters
C. laggards
D. late majority
E. early majority
Answer:
Behavioral targeting
A. tries to place ads on websites that are designed to appeal to the firm's target market.
B. decides how the messages will reach the target audience.
C. allows advertisers to pay only when a customer clicks on the ad and links to the
advertiser's website.
D. tries to reach target customers who are actually interested in what the firm has to
communicate.
E. delivers ads to consumers based on previous websites the customer has visited.
Answer:
Trying to get the "cream" of a market (i.e., the top of a demand curve) at a high price
before aiming at the more price-sensitive customers is consistent with a(an):
A. flexible-price policy.
B. sales-oriented pricing policy.
C. skimming pricing policy.
D. introductory price dealing policy.
E. penetration pricing policy.
Answer:
The _____ step in the new-product development process could involve research and
development as well as engineering to design and build the physical part of the product.
A. screening
B. idea evaluation
C. roll out
D. commercialization
E. development
Answer:
In which quadrant of the S.W.O.T. analysis tool does the following fit? A firm is
vulnerable to recession.
A. Strengths
B. Weaknesses
C. Opportunities
D. Threats
Answer:
Which of the following is NOT true about intermediaries?
A. They save time for other participants in a transaction.
B. They always increase total expenses for a product.
C. They play an important role in the exchange process.
D. They specialize in trade rather than production.
Answer:
Use this information for question that refer to the Pricing 1 case. (WPI) case.
As a project for her marketing class, Emily Washington is researching how five local
businesses price their products. The following are brief sketches of what she has learned
about each company.
At Bella Computers, Emily has discovered that the company earned a 6 percent return
on investment this year and wants to increase it to 9 percent next year. To its retailer
customers, Bella Computers gives cash discount terms of 2/10, net 30. It also gives
retailers a 3% reduction on the invoice amount for advertising Bella products locally.
Bella gives retailers' salespeople 2% of the sale price for each Bella Computer they sell.
At Ross Pharmaceuticals, she learned that the company has invested heavily in
developing a new product that recently received a patent. Because cash is tight, the
company wants to achieve a rapid return on its investment. The new patented product is
badly needed in the market, so a very inelastic demand curve is expected.
Digital Imaging makes photographic prints for wedding photographers. It is very
concerned about competitor reactions to its pricing, so it has selected prices that will not
draw the attention of the competition and not start a price war. Digital Imaging offers
customers an 8% discount if their purchases exceed $20,000 a year.
Jack's One Hour Cleaners recently opened for business. The company invested a lot of
money in new equipment, and feels that it has to quickly get "at least 10% market share
to stay in the game." This need obviously influences the company's pricing decisions.
Jack's also plans to offer customers 20% discounts on any order over $20.
National Printing Equipment (NPE) produces equipment that helps to print newspapers
and magazines. The company sells directly to printers and through wholesalers. Its
salespeople negotiate prices with individual customers and often have to match
competitors' prices. NPE has a new product, the Gutenberg NP201, with some
competitive advantages now, but competitors are expected to follow quickly with
similar products. The new product is being introduced into a market with elastic
demand. Regarding freight charges for its equipment, NPE's invoice reads, "Seller pays
the cost of loading equipment onto a common carrier. At the point of loading, title to
such products passes to the buyer, who assumes responsibility for damage in transit,
except as covered by the transportation agency."
National Printing Equipment ships its products:
A. based on freight-absorption pricing.
B. using uniform delivered pricing.
C. F.O.B. shipping point.
D. F.O.B. buyer's factory.
E. at no cost to the customer.
Answer:
Storing of goods is necessary when
A. there is more demand and no supply.
B. quality doesn't match demand.
C. production doesn't match consumption.
D. production doesn't match quality demanded.
E. products are produced in small batches.
Answer:
The desirability of a common "product-market commitment" is based on the idea that:
A. each member of the channel should focus on a different target market.
B. the whole channel is competing with other channel systems.
C. the producer should always be the "channel captain."
D. a channel can eliminate the marketing functions.
E. All of these ideas are relevant.
Answer:
What is the first job of an advertisement?
A. Getting action
B. Holding interest
C. Getting attention
D. Arousing desire
E. Creating awareness
Answer:
With the ___________ approach, the customer and the salesperson work together to
satisfy the customer's needs and solve the problem.
A. Prepared sales
B. Fixed sales
C. Selling formula
D. Consultative selling
E. Differentiated value
Answer:
