Quiz 2 mgmt 324

________ pricing uses buyers' perceptions of value as the key to pricing. A) Customer value-based B) Cost-based C) Time-based D) Markup E) Target return

A) Customer value-based

________ pricing involves charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items. A) High-low B) Everyday low C) Cost-plus D) Break-even E) Penetration

A) High-low

Which of the following is true with regard to personal selling? A) Personal selling entails personal presentations by a firm's sales force for the purpose of making sales and building customer relationships. B) Personal selling involves making personal requests to potential buyers to enter intoshort-term business relationships with firms. C) Personal selling distances the buyer from the seller and does not focus on building enduring relationships. D) An outside sales force is not involved in personal selling. E) Personal selling is a relatively new profession.

A) Personal selling entails personal presentations by a firm's sales force for the purpose of making sales and building customer relationships.

With which of the following strategies would a company give only a limited numberof dealers the right to distribute its products in their territories? A) exclusive distribution B) extensive distribution C) moderate distribution D) primary distribution E) intensive distribution

A) exclusive distribution

The ________ organization is the most common type of contractual relationship. A) franchise B) horizontal C) conventional D) multi-national E) entrepreneurial

A) franchise

The total production costs at Kellner Machine Works are $87,000 out of which$45,000 represent fixed costs. Which of the following is representative of the variable costs incurred by the company? A) $35,000 B) $42,000 C) $45,000 D) $87,000 E) $132,000

B) $42,000

________ play an important role in matching supply and demand by providing consumers with a broad assortment of products in small quantities. A) Virtual banks B) Intermediaries C) Price consultants D) Uniform-delivery networks E) Upstream partners

B) Intermediaries

In a(n) ________, leadership is assumed not through common ownership or contractual ties but through the size and power of one or a few dominant channel members. A) horizontal marketing system B) administered VMS C) corporate VMS D) contractual VMS E) conventional VMS

B) administered VMS

Any paid form of nonpersonal presentation and promotion of ideas, goods, or servicesby an identified sponsor is called ________ and includes broadcast, mobile, print, andonline forms. A) sales promotion B) advertising C) direct and digital marketing D) personal selling E) public relations

B) advertising

Which of these steps is NOT one of the five As of the customer journey? A) awareness B) authority C) appeal D) act E) advocacy

B) authority

Multiprint, a printer manufacturing firm, sells ink cartridges for each of its specificmodels. Only Multiprint cartridges are compatible with Multiprint printers, and no twomodels share the same specifications. What type of pricing does Multiprint use? A) product line pricing B) captive product pricing C) optional product pricing D) by-product pricing E) product bundle pricing

B) captive product pricing

Which of the following terms refers to the wholesalers and retailers that form a vital link between the firm and its customers? A) factory-supply networks B) downstream partners C) resource banks D) upstream partners E) supply channels

B) downstream partners

Retailers such as Costco and Walmart charge a constant, daily low price with few orno temporary price discounts. This is an example of ________ pricing. A) competition-based B) everyday low C) cost-plus D) break-even E) penetration

B) everyday low

Which of the following is the first step in developing an effective integratedcommunications and promotion program? A) designing a message B) identifying the target audience C) determining the communication objectives D) collecting feedback E) choosing the media through which to send a message

B) identifying the target audience

Robin works in a manufacturing company in Ohio. She sells products and handles customer requests via the company's online live chat feature. In her company, Robin is most likely a part of the ________. A) outside sales force B) inside sales force C) product designing team D) operations management team E) executive managemen

B) inside sales force

Midnight Magic, a perfume manufacturing company, plans to release a new fragranceduring the holiday season at $99 per bottle. The company intends to bring the price downto $49 within six months of its release to attract buyers who couldn't afford the initialprice. Which of the following pricing strategies is Midnight Magic using? A) market-penetration pricing B) market-skimming pricing C) competitive pricing D) cost-plus pricing E) product-line pricing

B) market-skimming pricing

From the economic system's point of view, the role of ________ is to transform the assortments of products made by producers into the assortments wanted by consumers. A) upstream partners B) marketing intermediaries C) third-party logistics D) price consultants E) factory supervisors

B) marketing intermediaries

8) Extel Inc., a home appliance manufacturer, uses sales representatives to sell itsproducts to wholesalers and individual customers. This is an example of ________. A) sales promotion B) personal selling C) public relations D) direct and digital marketing E) advertising

B) personal selling

Which of the following is a conventional consumer marketing channel? A) producer to business distributor to end consumer B) producer to wholesaler to retailer to end consumer C) producer to end consumer to business customer D) producer to retailer E) producer to business distributor to business customer

B) producer to wholesaler to retailer to end consumer

What sets the floor for product prices? A) consumer perceptions of the product's value B) product costs C) competitors' strategies D) advertising budgets E) market competition

B) product costs

The experience curve reveals that ________. A) repetition in production has no visible impact on production costs B) repetition in production enhances efficiency C) the average cost of production remains the same with accumulated production experience D) repetition in production adds to the costs and thereby increases the prices of outputs E) the average cost of production increases with accumulated production experience

B) repetition in production enhances efficiency

The use of short-term incentives to encourage the purchase or sale of a product orservice is called ________. A) direct and digital marketing B) sales promotion C) personal selling D) public relations E) publicity

B) sales promotion

Which of the following best explains the growth of telephone and online selling? A) the use of the Do Not Call Registry B) the ability to make up to 8 times as many more customer contacts per day than anoutside salesperson C) the similarity in cost between the inside and outside sales forces D) the difficulty and expense of reaching some customers E) the preference of customers for face-to-face contact

B) the ability to make up to 8 times as many more customer contacts per day than an outside salesperson

The sets of firms that supply companies with the raw materials, components, parts, information, finances, and expertise needed to create products or services are known as________. A) retailers B) upstream partners C) distributors D) downstream partners E) distribution channels

B) upstream partners

Costs that change with the level of production are referred to as ________. A) fixed costs B) variable costs C) target costs D) total costs E) overhead costs

B) variable costs

In what situation is a complex sales force structure used? A) when a company sells a narrow variety of products to few types of customers over abroad geographic area B) when a company sells a wide variety of products to many types of customers over abroad geographic area C) when a company sells a wide variety of products to many types of customers over as mall geographic area D) when a company sells a wide variety of products to few types of customers over as mall geographic area E) when a company sells a narrow variety of products to many types of customers over asmall geographic area

B) when a company sells a wide variety of products to many types of customers over abroad geographic area

In 2011, the fixed costs of a company were $500,000, and its variable costs equaled$150,000. In 2010, the company made an annual profit of $200,000. It has been predicted that, despite a steady growth, the company's variable costs will likely equal $300,000 by2013. The total costs of the company in 2011 were ________. A) $350,000 B) $450,000 C) $650,000 D) $800,000 E) $950,000

C) $650,000

________ involves cultivating opinion leaders and getting them to spread informationabout a product or a service to others in their communities. A) Sales promotion B) Indirect marketing C) Buzz marketing D) Stealth marketing E) Public relations

C) Buzz marketing

________ involves setting prices based on the costs for producing, distributing, andselling the product plus a fair rate of return for effort and risk. A) Value-based pricing B) Competition-based pricing C) Cost-based pricing D) Penetration pricing E) Break-even pricing

C) Cost-based pricing

A cell phone manufacturing firm produced 1,000 cell phones a day but believed that it could reasonably step up production to 2,000 cell phones a day. Consequently, it built a larger plant and installed efficient machinery and work arrangements to realize the projected output. Which of the following can most likely be inferred from this information? A) The unit cost of producing 2,000 cell phones per day would be twice that of the unit cost of producing 1,000 units per day. B) A production plant with the capacity of producing 5,000 cell phones a day would be most efficient. C) The unit cost of producing 2,000 cell phones per day would be lower than the unit cost of producing 1,000 units per day. D) A 2,000-capacity production plant would be less efficient because of increasing diseconomies of scale. E) The fixed costs of the firm are more likely to increase with the increase in output.

C) The unit cost of producing 2,000 cell phones per day would be lower than the unit cost of producing 1,000 units per day.

Which of the following abilities would LEAST likely be measured when recruiting and testing applicants for a sales position? A) sales aptitude B) work style C) accounting skills D) motivation E) relationship skills

C) accounting skills

Companies that adopt value-added pricing ________. A) consider value-added features as a fitting substitute for aggressive cost cutting B) set incredibly low prices to meet competition C) attach value-added features and services to differentiate their offers and support their higher prices D) overprice their products without any apparent justification E) underprice their products and lower quality to boost demand in the short-run

C) attach value-added features and services to differentiate their offers and support their higher prices

A ________ VMS integrates successive stages of production and distribution under single ownership. A) contractual B) contingency C) corporate D) conventional E) communal

C) corporate

10) What sets the ceiling for product prices? A) product manufacturing costs B) sellers' perceptions of the product's value C) customer perceptions of the product's value D) variable costs E) break-even volume

C) customer perceptions of the product's value

The New Age Gallery has three admission prices for students, adults, and seniors,even though all three groups are entitled to the same services. This form of pricing iscalled ________ pricing. A) psychological B) product form C) customer-segment D) captive product E) by-product

C) customer-segment

A(n) ________ is a straight reduction in price on purchases during a stated period oftime or of larger quantities. A) allowance B) free sample C) discount D) tax credit E) quota

C) discount

An appeal that attempts to stir up either negative or positive sentiments that can motivate purchase is called a(n) ________ appeal. A) rational B) structural C) emotional D) moral E) standard

C) emotional

As production moves up, the average cost per unit decreases because ________. A) variable costs decrease B) of increasing diseconomies of scale C) fixed costs are spread over more units D) overhead costs decrease E) revenue increases

C) fixed costs are spread over more units

Consumers are less likely to use price to judge the quality of a product when they________. A) have never tried the product before B) have little knowledge of the brand C) have experience with the product D) are shopping for luxury items E) cannot physically examine the product

C) have experience with the product

Companies facing the challenge of setting prices for the first time can choose between two broad strategies: market-penetration pricing and ________ pricing. A) comparative B) competitive C) market-skimming D) market-segmentation E) cost-plus

C) market-skimming

A ________ is a set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user. A) product line B) product delivery network C) marketing channel D) consumer base E) resource bank

C) marketing channel

Sales force management includes all of the following EXCEPT ________salespeople. A) recruiting B) evaluating C) paying D) supervising E) training

C) paying

A(n) ________ is an individual who represents a company to customers by prospecting, communicating, selling, servicing, information gathering, and/or relationship building. A) auditor B) trainer C) salesperson D) manager E) human resource personnel

C) salesperson

Today's consumers do not need to rely on marketer-supplied information about products and services because they can use ________ to seek out a wealth of information. A) push strategies B) direct and digital marketing C) the Internet D) personal selling E) public relations

C) the Internet

The company's channel objectives are influenced by all of the following EXCEPT________. A) the company's marketing intermediaries B) the company's competitors C) the age of the company D) the nature of the company E) the company's products

C) the age of the company

A market-penetration pricing policy should LEAST likely be used for a new product when ________. A) the market is highly price sensitive B) production and distribution costs fall as sales volume increases C) the product's quality and image support a high price D) a high price helps keep out the competition E) there are few or no competitors in the market

C) the product's quality and image support a high price

A company's total marketing communications mix consists of a specific blend of advertising, sales promotion, public relations, personal selling, and direct-marketing tools that the company uses to communicate customer value and build customer relationships.Which of the following terms best describes this set of communications tools? A) the product mix B) product line filling C) the promotion mix D) the price mix E) horizontal diversification

C) the promotion mix

Samsung Mobile plans to launch a new phone with a unit cost of $270 and wants to earn a 10 percent markup on its sales. Samsung's markup price is ________. A) $275 B) $280 C) $295 D) $300 E) $335

D) $300

Sigma Inc. has 2,000 Type-A accounts, each requiring 35 calls per year, and 1,000 Type-B accounts, each requiring 15 calls per year. What is the sales force's workload? A) 15,000 calls B) 35,000 calls C) 70,000 calls D) 85,000 calls E) 95,000 calls

D) 85,000 calls

Which of the following is true with regard to price? A) Historically, price has had the least perceptible impact on buyer choice. B) Price is the least flexible element in the marketing mix. C) Unlike product features and channel commitments, prices cannot be changed quickly. D) Price is the sum of all the values that customers give up to gain the benefits of having a product. E) Prices only have an indirect impact on a firm's bottom line

D) Price is the sum of all the values that customers give up to gain the benefits of having a product.

Which of the following statements is true about personal communication channels? A) A magazine advertisement exemplifies the use of a personal communication channel. B) All personal communication channels are directly controlled by a company. C) Personal communication channels do not allow sending and receiving of feedback. D) Word-of-mouth influence uses a personal communication channel. E) A billboard message exemplifies the use of a personal communication channel.

D) Word-of-mouth influence uses a personal communication channel.

Using ________ pricing, companies are able to turn their trash into cash, allowing them to make the price of their main product more competitive. A) product bundle B) optional product C) captive product D) by-product E) product line

D) by-product

Which of the following is NOT a step in designing an effective marketing channel? A) evaluating the channel alternatives B) identifying major channel alternatives C) analyzing consumer needs D) determining pricing policy for channel members E) setting channel objectives

D) determining pricing policy for channel members

All of the following are problems associated with the poor selection of salespeopleEXCEPT ________. A) lower sales B) costly turnover C) less productivity D) fewer training expenses E) disruptive customer relationships

D) fewer training expenses

If a company ________, it should adopt a product sales force structure, in which the sales force specializes along product lines. A) specializes in a single product B) manufactures a small number of simple products C) maintains that product specialization is counterproductive D) has numerous and complex products E) lacks salespeople with superior technical know-how

D) has numerous and complex products

The Great Recession of 2008 to 2009 triggered a shift in consumer attitudes toward ________. A) variety and price B) perceptions of value C) locations of stores D) price and quality E) economic data

D) price and quality

Which of the following promotion tools involves building up a good corporate image and handling unfavorable stories and events? A) sales promotion B) personal selling C) direct and digital marketing D) public relations E) advertising

D) public relations

Which of the following involves computerized, digitized sales force operations that let salespeople work more effectively anytime, anywhere? A) SWOT analysis B) BCG matrix C) digital marketing system D) sales force automation system E) field service management system

D) sales force automation system

Shoe Trends, a company that manufactures formal shoes for men and women, offers to give its customers $10 for an old pair of shoes when they buy a new pair. In essence, they're reducing the price of the new shoes by $10. What is this type of price adjustment called? A) functional discount B) captive product pricing C) seasonal discount D) trade-in allowance E) by-product pricing

D) trade-in allowance

Ultra Tech Inc., a company manufacturing gardening tools, has decided to switch to a territorial sales force structure. Which of the following benefits is the company most likely to gain as a result of this decision? A) The cost of training new recruits would be eliminated.B) An increased focus on short-term customer relationships would boost local sales of specialized products. C) Each salesperson would be assigned to sell a single product in which he/shespecializes. D) The capacity for mass production of a wide range of products would significantly increase. E) As each salesperson travels within a limited geographic area, travel expenses would decline.

E) As each salesperson travels within a limited geographic area, travel expenses would decline.

Champion, Inc. is a manufacturer of lunch boxes, school bags, and school stationery.Charles Payton, the CEO of Champion, hopes to sell the products at a low price to penetrate the market quickly. Which of the following best supports a market-penetration strategy for Champion? A) Production costs increase as sales volume increases. B) It is very difficult for competitors to enter the market. C) The cost of producing a smaller volume is negligible. D) The quality of the products supports high initial prices. E) The market for the products is highly price sensitive.

E) The market for the products is highly price sensitive.

Which of the following statements is true regarding today's marketingcommunications? A) More marketers are shifting away from narrowly defined micromarkets and moving toward mass marketing. B) More customers have started relying on marketer-supplied information rather than finding out information on their own. C) Network television, magazines, newspapers, and other traditional mass media continue to increase their dominance. D) Focused marketing programs, which are designed to build closer relationships with customers in more narrowly defined micromarkets, are no longer used by marketers. E) Today's consumers are better informed about products and services.

E) Today's consumers are better informed about products and services.

At Price & Wallace Inc., a pharmaceuticals company, members of the sales force andmarketing department tend to have disagreements when things go wrong with a customer.The marketers blame the salespeople for poorly executing their strategies, while thesalespeople blame the marketers for being out of touch with customers. Which of thefollowing steps should upper management at Price & Wallace take to help bring the salesand marketing functions closer together? A) establish a customer sales force structure and make sure that sales quotas are easily achievable B) establish a complex sales force structure C) emphasize traditional methods of selling D) adopt a sales force automation system and implement team selling E) appoint a high-level marketing executive to oversee both marketing and sales

E) appoint a high-level marketing executive to oversee both marketing and sales

Which of the following is one of the five major promotion tools? A) market penetration B) strategic positioning C) product line filling D) market diversification E) direct and digital marketing

E) direct and digital marketing

Which of the following is most likely a fixed cost? A) sales representative commissions B) product distribution costs C) manufacturing input costs D) temporary worker salaries E) facility rental payments

E) facility rental payments

Managers at the Imperial Hotel-Chicago complained that the chain's overall image was hurt because Imperial Hotel-Dallas was overcharging guests and providing poor service. The Imperial Hotel was experiencing ________ conflict. A) equilateral B) vertical C) multitiered D) communal E) horizontal

E) horizontal

When McDonald's offers its products inside of a Walmart store, it is using a(n)________. A) conventional marketing system B) corporate VMS C) contractual VMS D) administered VMS E) horizontal marketing system

E) horizontal marketing system

A marketing channel that consists of one or more intermediaries is known as a(n)________ marketing channel. A) cyclic B) upstream C) looped D) direct E) indirect

E) indirect

Go Zone plans to introduce four tablet models over the next year. These models range from basic readers at $99 per unit, to more sophisticated tablets at $399 per unit. The more features a model has, the more expensive it is. What pricing strategy is Tone Zone using for its range of tablets? A) product line pricing B) product bundle pricing C) captive product pricing D) by-product pricing E) optional product pricing

E) optional product pricing

Which of the following product mix pricing strategies involves pricing additional oraccessory products sold along with the main product? A) inclusive product pricing B) exclusive product pricing C) by-product pricing D) product bundle pricing E) optional-product pricing

E) optional-product pricing

Kevin is a salesperson working for a company that manufactures gardening tools. He is involved in door-to-door sales and travels every day to call on customers. In his company, Kevin is most likely a part of the ________. A) top management B) inside sales force C) product designing team D) customer support team E) outside sales force

E) outside sales force

A movie theater offers a reduced price for an afternoon showing of a film. This typeof pricing is ________ pricing. A) location-based B) customer-segmented C) cost-based D) product form E) time-based

E) time-based

When KFC came into conflict with its franchisees over the brand's Unthink KFC repositioning, which emphasized grilled chicken over its traditional Kentucky fried chicken, KFC experienced ________ conflict. A) equilateral B) horizontal C) multitiered D) communal E) vertical

E) vertical

Under which type of geographic pricing strategy does each customer take responsibility for the freight charges for the product from the factory to its destination? A) zone pricing B) basing-point pricing C) uniform-delivered pricing D) dynamic pricing E) FOB-origin pricing

FOB-origin pricing

True/False: Direct and digital marketing includes catalogs, e-mail, direct mail, social media, andmobile marketing.

True

True/False: Direct and digital marketing involves engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships.

True

Calculate total costs

fixed costs + variable costs