Exam 2 Example Questions

12) ________ play an important role in efficiently making products available to target markets in the needed varieties and quantities. A) Virtual banks B) Intermediaries C) Price consultants D) Uniform-delivery networks E) Upstream partners

B) Intermediaries

7) 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

1) Which of the following is an example of a convenience product? A) fast food B) diamond ring C) furniture D) life insurance E) refrigerator

A) fast food

8) 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? A) $15 B) $25 C) $30 D) $50 E) $75

B) $25

18) Which of the following statements is true regarding the affordable method for setting a promotion budget? A) It is mostly used by large businesses. B) It completely ignores the effects of promotion on sales. C) It tends to place promotion first among spending priorities. D) It leads to a certain annual promotion budget. E) It almost always results in overspending.

B) It completely ignores the effects of promotion on sales.

4) Symmonds Inc., a company manufacturing breakfast cereals, has extended its special Crispo cereal brand into a full line of breakfast cereals plus protein shakes, fruit and sandwich spreads, butter, and doughnuts. This is an example of ________. A) line extension B) brand extension C) licensing D) co-branding E) cannibalization

B) brand extension

11) Dips in the economy and the instant price comparisons made possible by the Internet have contributed to ________. A) decreased consumer price sensitivity B) increased consumer price sensitivity C) a less direct relationship between supply and demand D) low brand equity for luxury goods E) decreased brand loyalty

B) increased consumer price sensitivity

13) Which of the following is true of the exclusive distribution strategy? A) It makes products available to everybody, everywhere. B) It is used primarily for convenience items. C) It helps promote a brand's luxury image. D) It gives producers no control over their products. E) It enlists all of the intermediaries willing to carry a company's products.

C) It helps promote a brand's luxury image

19) Which of the following is most likely a shortcoming of advertising? A) It is the most expensive promotion tool. B) It cannot reach masses of geographically dispersed buyers. C) It is impersonal and lacks the direct persuasiveness of company salespeople. D) It cannot trigger quick sales. E) It cannot be used to build up a long-term image for a product.

C) It is impersonal and lacks the direct persuasiveness of company salespeople

20) The manufacturer of Crest toothpaste provides free samples of its toothpaste to dentists and encourages them to distribute these samples to their patients and to inform the patients about advantages of using Crest. The manufacturer of Crest toothpaste is using ________. A) sales promotion B) direct marketing C) a push strategy D) a pull strategy E) a vertical diversification strategy

C) a push strategy

14) 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 ________. A) buzz marketing B) experiential marketing C) integrated marketing communication D) word-of-mouth marketing E) database marketing

C) integrated marketing communication

17) Communication through a telephone call is considered a part of a(n) ________ communication channel. A) online B) nonverbal C) personal D) nonpersonal E) unidirectional

C) personal

2) Proton Corp. is an automobile manufacturer known for producing efficient, durable, and low-priced cars. Recently, the company launched a new range of luxury cars to broaden its market appeal and to add prestige to its existing line of cars. This is an example of ________. A) social marketing B) product line filling C) product line stretching D) internal marketing E) cannibalization

C) product line stretching

16) An ad for Maybelline age-minimizing makeup in Ladies' Home Journal magazine featured actress Gigi Hadid and offered readers a $2-off coupon when they tried the new makeup. In the context of the communication model, measuring which of the following would be the best way for the source to measure feedback? A) the number of subscribers to Ladies' Home Journal B) the number of people who make up the target market C) the number of people who redeem the coupon D) the number of people who have purchased Maybelline products in the past E) the number of people to whom Gigi Hadid is an appealing spokesperson

C) the number of people who redeem the coupon

6) Department stores such as Kohl's and JCPenney's practice high-low pricing by ________. A) charging a constant, everyday low price B) providing few or no temporary price discounts C) increasing prices temporarily on select products D) having frequent sale days for store credit-card holders E) underpricing most consumer items

D) having frequent sale days for store credit-card holders

3) The customers of Parry's Hair Salon have noticed that the quality of a haircut depends on who provides it as well as when, where, and how the service is provided. Which of the following characteristics of service is evident in this instance? A) service intangibility B) service inseparability C) service perishability D) service variability E) service distinction

D) service variability

15) In the communication process, an actual HP printer/fax machine advertisement would be considered ________. A) encoding B) decoding C) the product D) the message E) the medium

D) the message

5) Factors a company considers in setting its price include all of the following EXCEPT ________. A) competitors' strategies and prices B) product costs C) overall marketing strategy and mix D) value of the product on the pre-owned market E) nature of the market and demand

D) value of the product on the pre-owned market

9) Mansfield Pharmaceuticals markets Zipro, an antibiotic. The firm has fixed costs of $1,000,000 and variable costs of $2 per bottle of 50 tablets priced at $10 per bottle. What is the break-even volume? A) 25,000 B) 55,000 C) 100,000 D) 115,000 E) 125,000

E) 125,000

10) Which of the following exemplifies a pure competitive market? A) a market where many buyers and sellers trade over a range of prices rather than a single market price B) a market where a single firm controls the larger fraction of the market share C) a market where a few powerful firms control the larger fraction of the market share D) a market characterized by only a few large sellers E) a market 1here many buyers and sellers trade in a uniform commodity

E) a market 1here many buyers and sellers trade in a uniform commodity