AGBU 4340 EXAM 2

A company faces fixed costs of $100,000 and variable costs of $8 per unit. It plans to directly sell its product in the market for $12. How many units must it produce and sell to break even?

25,000

Whitelight sells its toothpastes in many convenience stores across the country. This is an example of ________ distribution.

intensive

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.

vertical

Herbie Inc., a firm manufacturing sandwich makers, has fixed costs of $250,000, variable costs of $20 per unit of output, and expected unit sales of 50,000 units. What is the unit cost of a sandwich maker manufactured by Herbie?

$25

A farm supply company plans to launch a new premium type of Vetgun with a unit cost of $270 and wants to earn a 10 percent markup on its sales. The selling price of the Vetgun is ________.

$300

The lighting in Jake's Steak Restaurant is dim. The chairs are covered in leather and each table is covered with a white linen cloth. The colors are limited to earth tones with an occasional splash of red. Patrons cannot hear any kitchen noises, only a pleasant melody that seems familiar but unrecognizable. The smells are extraordinarily varied. This is a description of the restaurant's ________.

Atmosphere

________ and ________ do not take title to goods, and they perform only a few channel functions.

Brokers; Agents

Using ________ pricing, companies are able to turn their trash into cash, allowing them to make the price of their main product more competitive.

By-product

Sears, Target, and Kroger are examples of ________.

Corporate chains

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 is called ________ pricing.

Customer- segment

________ are large and highly automated warehouses designed to receive goods from various plants and suppliers, take orders, fill them efficiently, and deliver goods to customers as quickly as possible.

Distribution center

Bon Vivant offers an assortment of exclusive French wines at incredibly low prices. These prices are neither limited-time offers nor special discounts, but represent the daily prices of products sold by Bon Vivant. This reflects Bon Vivant's ________ pricing strategy.

Everyday Low

________ are manufacturer-owned and operated stores that offer prices as low as 50 percent below retail on a wide range of mostly surplus, discounted, or irregular items.

Factory outlets

At Neiman Marcus, a first-class department store, customers shop for high-end products and they are assisted in every phase of the shopping process. Neiman Marcus is a ________.

Full-service retailer

________ pricing refers to offering just the right combination of quality and gratifying service at a fair price.

Good- Value

________ pricing involves charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items.

High- Low

In a(n) ________, two or more companies at one level join together to follow a new marketing opportunity.

Horizontal marketing system

Delia's is a clothing retailer that targets teenage girls. The company runs coordinated promotions for its catalogs, Web site, and retail outlets. It uses the same models in its catalog, print ads, and Web site. Delia's works to make sure its public relations activities as well as its sales promotions harmonize with its advertising in all aspects. From this information, we can infer that Delia's is using ________.

Integrated marketing communication

When a company sets a high price for a new product with the intention of reducing the price in the future, it is using the ________ pricing strategy.

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.

Marketing channel

________ involves planning, implementing, and controlling the physical flow of goods, services, and related information from points of origin to points of consumption to meet customer requirements at a profit.

Marketing logistics

Specialty stores carry ________ with ________ within them.

Narrow product lines; deep assortments

Which of the following is NOT one of a wholesaler's channel functions?

Off- Price Retailing

Which of the following product mix pricing strategies involves pricing additional or accessory products sold along with the main product?

Optional-product pricing

The ________ organization is a common type of contractual relationship.

franchise

A company's total marketing communications mix consists of a special 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?

The promotion mix

Which of the following is an example of a Third-party Logistics (3PL) provider?

UPS Business Solutions

Costs that change with the level of production are referred to as ________.

Variable Costs

A manufacturer of a variety of technological devices asked its marketing department to develop inexpensive methods of building and maintaining brand awareness and excitement. The marketing department then recruited consumers who were early adopters of technological devices to spread the word about the company's new products. This is an example of ________.

buzz marketing

Which of the following product mix pricing strategies involves pricing products that can only be used with the main product?

captive product pricing

Which of the following methods is used by companies to set their advertising budgets based on the industry average?

competitive- parity method

What sets the ceiling for product prices?

customer perceptions of the product's value

Lifebelt Insurance sells insurance only through its door-to-door salespeople. What type of marketing channel does Lifebelt use?

direct

Ocean Spray sells its air fresheners only through Ray's Drugs. This is an example of ________ distribution

exclusive

In a bid to attract more customers in a market that has several competitors, Barrymore's Bakery slashed the prices of all its products by 50 percent. Managers at the firm reasoned that lower prices would draw in even more customers, making up for the reduction in price several times over. Which of the following pricing strategies are they using?

market-penetration pricing

The AIDA model identifies the characteristics of an effective ________.

marketing message

Communication through a telephone call is considered a part of a(n) ________ communication channel.

personal

Springfield, a convenience store, has recently begun to redesign and restock its stores to offer a more upscale environment with products such as house wines and fresh foods. This information indicates that Springfield has most likely changed its ________.

positioning

Using a(n) ________ strategy, the producer directs its marketing activities toward final consumers to induce them to buy the product.

pull

John Deere does very little promoting of its lawn mowers and garden tractors to final consumers. Instead, John Deere's sales force works with Lowe's, Home Depot, independent dealers, and other channel members, who in turn sell John Deere products to final consumers. According to this information, which of the following promotion mix strategies is being used by John Deere?

push strategy

Which of the following promotion categories is most likely to include the use of displays, discounts, coupons, and demonstrations?

sales promotion

Price discrimination is legal when a ________.

seller can prove its costs are different when selling to different retailers

A ________ is a group of retail businesses built on a site that is planned, developed, owned, and managed as a unit.

shopping center

Companies using target costing ________.

start with an ideal selling price and then target costs that will ensure that the price is met

Which of the following companies uses product bundle pricing?

Panizza, whose combo meals are priced lower than its individual components sold together

Savings for You, a discount retail chain, is highly competitive. When entering a new market, Savings for You often cuts prices so deeply that it sells below costs, effectively pushing smaller companies with less purchasing power out of the market. Savings for You is most likely guilty of ________.

Predatory pricing

When sellers set prices after talking to competitors and engaging in collusion, they are involved in ________.

Price fixing

Which of the following promotion tools involves building up a good corporate image and handling unfavorable stories and events?

Public relations

________ includes all activities involved in selling goods and services to those buying for resale or business use.

wholesaling

In Viña del Mar, Chile, a large number of shops specialize in selling the same quality of seafood products along the beach frequented by tourists. No individual shop dares charge more than the going price without fearing loss of business to other shops. This exemplifies ________.

Pure competition