A business product with large unit sales, for which transportation accounts for only a
small percentage of the total cost, is usually distributed using the
producer-agent-business user channel.
a. True
b. False
Which of the following will improve the quality of the presentation used for
approaching a prospective customer?
a. Using complex graphics to explain product features
b. Making the presentation precise without going into product price details
c. Focusing on educating the prospective customer about the firm’s goodwill rather than
on product features
d. Using precollected information for tailoring the presentation to match the customer’s
needs
Price is generally the deciding factor in purchasing raw materials since the costs vary
widely across markets.
a. True
b. False
Based on your understanding of Porter’s Five Forces, you have identified potential new
entrants as the key threat to your florist business. Choose the most accurate reason(s)
for this situation.
a. The Internet has reduced barriers to entry.
b. The Internet has increased barriers to entry.
c. The number of flower suppliers has increased.
d. The quality of silk flowers has improved.
e. All of the above are accurate reasons.
Institutional markets are characterized by widely diverse buying practices.
a. True
b. False
_____ are trade restrictions that limit the number of units of products in certain
categories that can cross a country’s boundary for resale.
a. Protective tariffs
b. Embargoes
c. Import quotas
d. Subsidies
The WTO makes binding decisions in mediating disputes and reduces trade barriers.
a. True
b. False
Marketers are increasingly emphasizing to consumers that their products are not only
highquality, but they also have no health risks and they do not damage the environment.
This emphasis is consistent with which of the following concepts?
a. Socially conscious promotion
b. Ethical marketing
c. Green marketing
d. Environmental management
e. Customer relationship management
In recent years, large equipment manufacturers such as Caterpillar and Komatsu have
focused on the mining industry as a major growth area. However, in recent months the
mining industry is showing signs of a recession and mines around the world are
reducing their output and laying off workers. Due to the decline in sales of raw
materials coming from the mine, Caterpillar has experienced a decline in sales of
mining equipment. Which of the following best describes the demand for Caterpillar
equipment in the mining industry?
a. derived
b. volatile
c. joint
d. inelastic
The products whose lifecycles can be extended or stretched indefinitely are referred to
as orphan brands.
a. True
b. False
A product that contributes directly or indirectly to the output of other products for resale
is also known as a(n) _____ product.
a. marketing mix
b. specialty products
c. product
d. services
e. convenience products
f. impulse goods
g. installations
h. wholesalers
i. business-to-business (B2B)
j. supplies
k. emergency goods
l. shopping products
m. component parts and materials
n. staples
o. product mix
p. product line
q. line extension
r. total quality management
s. product lifecycle
t. benchmarking
Sam watches an ad on TV for a new laptop from Sony. This ad is an example of product
advertising.
a. True
b. False
The basic objectives or goals of an organization are derived from its:
a. standard operating procedures.
b. operational plans.
c. supervisory management strategy.
d. mission statement.
An organization that regularly provides a standardized set of data on a periodic basis to
its subscribers is called a ______.
a. full-service research supplier
b. syndicated service
c. supplier relationship management company
d. market simulation firm
Vending machines are classified as a form of automatic merchandising.
a. True
b. False
One of the problems associated with brand licensing is that brand names do not transfer
well to all products.
a. True
b. False
Manufacturing the products in-house is always the best way for companies to acquire
needed products.
a. True
b. False
If the demand for a product stays almost constant throughout an industry regardless of
the change in the price of the product, it can be said that the product is experiencing
a(n) _____ demand.
a. derived
b. joint
c. volatile
d. inelastic
_____ is a technology that secures a website by encrypting information and providing
authentication.
a. SMTP
b. HTTP
c. SSL
d. TCP/IP
For those companies that do not intend to generate revenue from their website, online
success is measured in terms of:
a. the numbers of visitors who make repeat purchases.
b. increased brand awareness and brand loyalty.
c. the amount of time a customer spends on a website before making a purchase.
d. the number of people who search information by visiting a store and then make
online purchase.
Alva, a fashion house specializing in designer bags, sells its products only through a
limited number of boutiques worldwide. This is an example of:
a. intensive distribution.
b. associative distribution.
c. selective distribution.
d. discriminative distribution.
The change in total cost that results from producing an additional unit of output is
called _____ cost.
a. breakeven analysis
b. tariffs
c. unfair-trade laws
d. incremental-cost pricing
e. profit maximization
f. demand
g. value pricing
h. monopoly
i. elasticity
j. marginal
k. fair-trade laws
l. yield management
m. oligopoly
n. cost-plus pricing
o. full-cost pricing
p. supply
q. marginal analysis
r. target-return objectives
s. market-share objectives
t. pure competition
Ford Motor Company surveyed 10,000 customers to analyze their needs and
preferences in automobiles. At the end of the survey, respondents were asked to provide
demographic information, including age. Responses concerning preferences were
strikingly similar for each group within a specific five-year age range. This result is an
example of the _____ effect.
a. income
b. life cycle
c. cohort
d. Hafner’s
Pricing objectives tied directly to meeting prices charged by major competitors
emphasize the price element of the marketing mix and focus less strongly on nonprice
variables.
a. True
b. False
During the recession stage of the business cycle, consumers have enough money to
spend, but caution often restraints their willingness to buy.
a. True
b. False
The limitations of which of the following were overcome with the introduction of Web
services?
a. Marketing websites
b. Intranets
c. Extranets
d. EDI
e. Virtual private networks
Segmentation by benefits sought is a product-related segmentation approach that:
a. determines the marketer’s effectiveness in satisfying the consumer.
b. measures brand loyalty and consumer perception.
c. re-evaluates customer reactions post-consumption.
d. focuses on the attributes that people seek in a product.
Organizations within the same industry usually have the same mission.
a. True
b. False
Primary metropolitan statistical areas (PMSAs) are identified within areas of
1-million-plus populations.
a. True
b. False
Organizational purchasing decisions tend to be standardized, resulting in the same
procedures being used for both capital and expense items.
a. True
b. False
Extensive planning time is required for the purchase of supplies.
a. True
b. False
Social media helps marketers to connect with influencers.
a. True
b. False
A(n) _____ is a group of retail stores designed, coordinated, and marketed to shoppers
in a geographic trade area.
a. stock-keeping unit (SKU)
b. markup
c. markdown
d. retail convergence
e. scrambled merchandising
f. atmospherics
g. broker
h. general merchandise retailer
i. category killer
j. rack jobber
k. supercenter
l. auction house
m. specialty store
n. retailers
o. mass merchandiser
p. truck jobber
q. direct marketing
r. drop shipper
s. planned shopping center
t. wheel of retailing
In selecting the target market for your gourmet tea store, you were influenced by
multiple factors. These included:
a. The number of people who appreciate and will go out of their way to buy gourmet
tea.
b. How much profit you can make by selling to gourmet tea enthusiasts.
c. How stiff the competition will be from other tea merchants or sellers of substitute
products.
d. FDA standards for tea safety.
e. All of the above
