The product of market demand, market share, average selling price, and channel
discounts is the ________.
A) marketing and sales expenses
B) net marketing contribution
C) net sales
D) operating income
E) marketing return on investment
Which of the following statements is true regarding choosing offensive strategic market
plans?
A) A business with a good cash position that is facing stagnant growth in maturing
markets might pursue the market penetration strategy.
B) A market-based business will often find that it has more resources to fund market
opportunities than there are market opportunities.
C) A business with a long-run need for better profit performance would be inclined to
select the share penetration strategy.
D) The selection of one offensive strategic market plan over another depends on the
business’s long-run profit needs.
E) A business has to prioritize strategic market opportunities on the basis of its
performance objectives.
Global Wood Ventures Inc. is an American firm that manufactures, distributes, and
exports structural plywood. The firm finds that multiple inventory management errors
were causing customer dissatisfaction and reducing the firm’s profits. It identified
several companies, in completely different industries, that were considered to be the
best in inventory management. After obtaining permission, professionals from Global
Wood Ventures Inc. studied the inventory management system of One Stop Mart, a firm
well known for its inventory management techniques. This knowledge helped Global
Wood Ventures Inc. to develop a more error-free inventory management system. In this
example, Global Wood Ventures Inc. uses which of the following strategies?
A) competitive benchmarking
B) perceptual mapping
C) disintermediation
D) competitor analysis
E) vertical integration
As an operational component of channel performance, customer reach refers to
________.
A) cost to serve
B) volume
C) operating efficiency
D) service quality
E) retention
Calculate the average relative product quality of the product, if the business has a
customer value of 25, and above-average relative price of 125.
A) -25
B) 5
C) -100
D) 100
E) 150
Functional names differ from evocative names in that functional names ________.
A) are derived from the basic benefit provided by the product
B) do not have any association with a core customer benefit
C) are built from root words and morphemes
D) are poetic constructions based on the rhythm of saying them
E) are associated with positive attributes or feelings
Which of the following is true of businesses with a narrow market vision?
A) Their view of market demand enables them to recognize emerging market
opportunities.
B) Their view of market demand enables them to achieve maximum market potential.
C) They have the ability to see unserved needs that no one is addressing.
D) They do not see beyond the articulated needs of served customers.
E) They include all potential substitute products.
Calculate the advertising expense for period 16 if the sales effect for that period is $240
million.
A) $256 million
B) $224 million
C) $160 million
D) $24 million
E) $15 million
Crowdsourcing differs from mass collaboration in that crowdsourcing initiatives
________.
A) use collaborative web sites and wikis
B) yield results very slowly
C) facilitate an information-sharing environment
D) have a specific purpose or problem to solve
E) are open-source projects
Which of the following statements is true about a monetize-cash-flow defensive
strategy?
A) It operates with minimal marketing resources.
B) It is used when an optimize position strategy is viable.
C) It allows a business to exit a market quickly.
D) It is used by a business to exit the market slowly.
E) It aims to extract the maximum long-run cash flow from the market.
Which of the following statements is true of a pull communication strategy?
A) It aims to create interest among customers and motivate them to acquire more
information.
B) It is directed at channel intermediaries and channel influencers.
C) It is of limited use when the company seeks to enhance consumer retention among
current consumers.
D) It focuses on focused on trade associations and industry influencers.
E) It does not include digital communication methods.
Calculate the number of transactions made per year if a total of 20 million transactions
are made in a year by 40 manufacturers and 4,000 retailers.
A) 250
B) 125
C) 75
D) 50
E) 175
Each unit of a product is sold at $5. The cost per unit is $2. What is the percent margin
for the product?
A) 60%
B) 40%
C) 66.6%
D) 16.3%
E) 33.3%
Which of the following is true regarding competitive rivalry?
A) The more competitors an industry has, the higher will be the differentiation among
them.
B) High differentiation among competitors increases competitive rivalry.
C) Excess capacity within an industry can cause competitors to intensify their moves
against one another.
D) Intense competitive rivalry leads to higher prices and margins.
E) Intense competitive rivalry leads to lower marketing and sales expenses for retaining
customers.
Which of the following is a performance metric used to measure brand-image
communications?
A) high recall of key content
B) high rate of purchase
C) high ad and brand recall
D) response to requested action
E) low ownership costs
Calculate the average relative price of the product of a business that has a customer
value of 36, and a below-average relative product quality of 114.
A) -78
B) -36
C) 150
D) 78
E) 36
________ buy components from manufacturers and assemble them to make their own
products.
A) Wholesalers
B) Value-added resellers
C) Original equipment manufacturers
D) Sales agents
E) Distributors
The first step in building a marketing plan is the step of ________.
A) revenue planning
B) performance plan
C) situation analysis
D) marketing strategy
E) performance review
Which of the following statements is true about a monetize-cash-flow defensive
strategy?
A) It operates with minimal marketing resources.
B) It is used when an optimize position strategy is viable.
C) It allows a business to exit a market quickly.
D) It is used by a business to exit the market slowly.
E) It aims to extract the maximum long-run cash flow from the market.
Which of the following refers to change along the technology innovation curve that
allows for the development of products that are less expensive, smaller, and often easier
to use?
A) discontinuous innovation
B) disruptive innovation
C) continuous innovation
D) end-user innovation
E) radical innovation
Organic Harvest Inc. is an American manufacturing firm based in California. The firm
manufactures and sells a line of organic fruit juices under the brand name
OrganicDrinks. The firm also markets a line of medicinal health drinks, under the brand
name HerbalDrinks.
Mini-Case Question. Organic Harvest Inc. offers five flavors under the OrganicDrinks
brand. Based on the success of these flavors, the firm introduces three new flavors of
OrganicDrinks: Pink Pomegranate, Cool Coconut Water, and Spicy Apple Cider. In this
example, Organic Harvest Inc. uses which of the following product-line extension
strategies?
A) vertical brand-line extension
B) horizontal brand-line extension
C) new product-market brand extension
D) cobranding
E) product bundling
Which of the following is a defensive strategy that often occurs in the late and mature
stages of the product life cycle when growth potential is limited and competitive
position is set?
A) an optimize position strategy
B) a vertical integration strategy
C) an invest to improve position strategy
D) an invest to grow strategy
E) a new market entry strategy
VitaMind manufactures a line of vitamins and supplements, and distributes them
through retail health food and organic grocery stores. While this young company is
currently realizing profits, the owners want to plan for future growth and are beginning
the formal market planning process.
Mini-Case Question. Based on information from their analysis, VitaMind determined
that there is an opportunity to expand distribution of its line of products into mass
merchandisers. In which of the following steps of the market planning process will
specific details regarding VitaMind’s proposed channel strategy be specified?
A) situation analysis
B) SWOT analysis
C) revenue plan
D) marketing strategy
E) performance review
What type of customers are most likely known as “customer terrorists”?
A) customers who use their bargaining powers to purchase products at a cheaper price
B) customers who engage in shoplifting
C) customers who verbally communicate their bad experiences to others
D) customers who show a false sense of loyalty to a particular brand
E) customers who only buy the product if it is offered at an attractive price or with a
promotional incentive
In the context of SWOT analysis, strength refers to the ________.
A) unique sources of advantage that the marketing plan should leverage
B) circumstances that limit the company’s performance and should be addressed
C) potentialities that would improve profitability and should be addressed
D) current and possible factors that could impede performance
E) aspects of the geo-political environment that strengthen the stand of the business at
present
If a business is a large purchaser of a commodity product (less important to the buyer)
and is in an industry in which switching costs are low, generally the supplier power
________.
A) is low
B) is high
C) is greater than customer buying power
D) is equal to customer buying power
E) is likely to increase with a decrease in switching costs
The main purpose of a reduced-market-focus strategy is to ________.
A) enter new market-segments
B) become more efficient
C) increase market share
D) develop new markets
E) increase customer loyalty
Smith Automotive is a company that produces component parts for automobile engines.
A margin of $4 per unit produces fixed expenses of $80 million. The market demand for
the component parts is 400 million units per year.
Mini-Case Question. Determine the margin per unit if the company needs to sell 40
million units in order to break even.
A) $10 per unit
B) $8 per unit
C) $4 per unit
D) $2 per unit
E) $1 per unit
Simmons Inc. is an American firm that manufactures and distributes a line luxury
furniture under the brand name Elegant Living. The firm measures the loyalty levels of
its customers and classifies them into the different groups based on their loyalty index.
Which of the following customers are most likely to be classified as spinners by
Simmons Inc.?
A) Customers who have a loyalty score between 50 to 69.
B) Customers who purchase an Elegant Living furniture one time because of an
attractive discount.
C) Customers who are first-time buyers.
D) Customers who are likely to recommend Elegant Living furniture to potential
buyers.
E) Customers who buy a lot of Elegant Living products as well as products from other
furniture brands.
Which of the following types of costs is an allocated cost based on the use of the plant,
equipment, and other fixed expenses needed to run the production operation?
A) variable costs
B) manufacturing overhead costs
C) corporate overhead costs
D) research and development expenses
E) marketing sales and expenses
Without defining the desired product positioning and value proposition for a specific
target market, the ________ process would quickly deteriorate into an internal process
that was built around product features rather than customer benefits.
A) brand naming
B) brand identification
C) brand encoding
D) brand equity
E) brand extension
The fair price for the Merrill Microwaves, manufactured by Merrill Inc., is considerably
higher than its actual price of $140. Merrill Microwaves have a relative performance
rating of 125. According to this data, Merrill Microwaves provides ________.
A) lower-quality products at higher prices
B) superior-quality products at higher prices
C) products with very high life-cycle cost
D) relatively lower value to the customers when compared to an average relative
performance rating
E) a very good value for customers, but it may be underpricing the product
Which of the following are the components of a revenue plan?
A) return on sales, asset turnover, and return on assets
B) percent margins and profitability metrics
C) personnel and expenditures
D) market share, pricing, and revenues
E) break-even sales and shares
A monetize strategy differs from a harvest strategy in that a monetize strategy
________.
A) is a defensive strategy
B) manages prices and marketing resources in a way that maximizes cash flow without
exiting the market
C) is used for maximizing profits and cash flow as a business slowly exits a
product-market
D) protects an attractive market position in which the business dominates with respect
to competitive position
E) is a strategy for exiting a market by selling or closing down the business or
eliminating the product
Which of the following is true about licensing?
A) It is a bad option for products that are difficult to produce.
B) It refers to the transfer of trademark rights held by one party to another party.
C) It allows owners of intellectual property to obtain payment for their creations in a
lump sum.
D) It involves the legal assignment of the rights to a product from one party to another.
E) It is a method of protecting the brand name and logo of a company.