intro to business final practice test 1

How has the Sarbanes-Oxley Act affected accountants?

It has eliminated many nonauditing tasks they use to provide for their customers.

_____ involves creating a unique marketing mix for every consumer.

One-to-one marketing

Which of the following statements describes an advantage that personal selling has over other forms of promotion?

Personal selling costs can be adjusted by controlling the size of the sales force.

_____ is the act of informing, persuading, and reminding the target market about a product.

Promotion

Which of the following is an example of an industrial service?

a management consulting company

CPM in advertising terms means:

cost per thousand

Which of the following is NOT one of the stages in the product life cycle?

development

Public relations departments:

do all of the above

When Canada Dry first introduced Wink soda in the 1960s, it used the slogan, "Join the cola dropouts." The purpose of this advertising campaign was most likely to:

get customers to try the new product

In the newspaper comics, Cathy is often seen talking to a department store clerk who is trying to persuade her that she needs to buy a new wardrobe. The clerk is engaged in:

personal selling

Which of the following is an example of an individual factor that influences the consumer decision-making process?

personality

_____ is the set of values, ideas, attitudes, and symbols created to shape human behavior.

Culture

_____ is the ratio of benefits to the sacrifice necessary to obtain those benefits.

Customer value

To ensure accuracy and consistency in the way financial information is reported, accountants follow rules known as:

generally accepted accounting principles

A(n) _____ is a summary of what a company has earned and spent over a given period.

income statement

The categories of heavy, moderate, and light users have to do with which type of segmentation?

volume

Which of the following is a type of sales promotion that can be used if the organization's goal is to increase brand loyalty?

frequent-buyer programs

Which of the following is NOT a type of retailer?

manufacturers' representative

The _____ is the belief that the firm should dedicate all of its planning, policies, operations, and efforts to the satisfaction of the customer.

marketing concept

Gross sales for Nevada Silver, a retailer of silver jewelry was $120,000 for the month of May. Sales discounts amounted to $18,000. There were no returns. The difference, $102,000, is Nevada Silver's:

net sales

Customer satisfaction:

refers to the customer's feeling that a product has met or exceeded expectations

Which of the following terms equals the total profits of a company minus all dividends (distributions of profits) to stockholders?

retained earnings

The difference between net sales and cost of goods sold is:

gross profit

In general, when a business is engaged in environmental scanning, it looks at all of the following external forces that might affect it EXCEPT:

suppliers

A(n) _____ is a retail store that sells at prices 25 percent or more below traditional department store prices in spartan environments.

off-price retailer

A face-to-face sales presentation of a good or service to a prospective customer is called:

personal selling

Assume a company has inventory valued at $50,000, its total current assets, including this inventory, total $90,000. Its total current liabilities total $20,000. Its quick ratio is:

2

Assume the net profit for manufacturer of mountain bikes was $1,000,000 last year. The firm paid out $40,000 in dividends and has 200,000 shares of common stock outstanding. Its earnings per share (EPS) was:

$5

_____ is any paid form of nonpersonal presentation by an identified sponsor.

Advertising

The _____ ratio is a measure of the firm's ability to pay its current liabilities once inventory is subtracted from current assets.

acid-testRATIONALE: The quick ratio is a measure of the firm's ability to pay its current liabilities once inventory is subtracted from current assets.

Which of the following is an example of an advertising medium?

all of the above

Which one of the following is a commonly used method for market segmentation?

all of the above

Leon Georges works in the warehouse for a manufacturer of air-purification systems. He is responsible for the transportation of metal components, preformed plastic, etc. used to manufacture the systems as well as the efficient movement of the finished systems from the manufacturing facility to the warehouse to distribution trucks. Georges is involved in:

distribution

The chain of manufacturer, agent, wholesaler, and retailer through which items like x-ray machines, dental equipment, and safety goggles flow is called a(n) ______ channel.

distribution

Victorinox is the name of the company that manufacturers Swiss army knives. The _____ channel the company utilizes to get its knives to market is to wholesalers, than to retailers, and finally to consumers.

distribution

When the producers of Ocean Spray cranberry products decided to make Craisins (a dried cranberry snack food) available in convenience stores, supermarkets, and vending machines, it was involved with determining _____ strategy

distribution

Which of the following is NOT an element of the promotional mix?

distribution

A(n) _____ is an independent wholesaler who buys related product lines from many manufacturers and sells them to industrial users.

industrial distributor

When Nike donated $25,000 to a low-income area to provide job training, it received free and positive _____ in the news media

publicity

Liquidity ratios measure:

short-term financial stability

The maker of Centrum multivitamins introduced Centrum Silver, a vitamin designed specifically for older people. Centrum Silver is an example of a _____, a product that uses an existing brand name in an existing category but with a new formula.

line extension

The ratios that are of special interest to the firm's creditors and measure the firm's ability to pay short-term debts as they come due are called _____ ratios.

liquidity

The craft store marked skeins of embroidery thread down to a quarter apiece to attract more customers into the store. This was below the store's cost. The skeins of thread was intended to be a _____ to increase store traffic:

loss leader

Which of the following products would be correctly described as being in the decline stage of their product life cycle?

manual typewriters

The brand name Cover Girl appeared in a young adult novel called Cathy's Book: If Found Call (650) 266-8233. One sentence in the book reads: "a killer coat of Lipslicks, a line of Cover Girl lip glosses. Procter &Gamble promoted the novel at beinggirl.com Web site in exchange for the mention. This is an example of"

product placement

Channels of distribution make distribution easier by performing all of the following functions EXCEPT:

production

_____ are distribution channel members that buy finished products from manufacturers and sell them to retailers.

Wholesalers

Ennis Worth has a six-month loan for $7,500 that he used to refurbish the fishing boat he uses to earn his living. This loan is an example of:

a long-term liability

The channels through which advertising is carried to prospective customers are advertising:

media

_____ segmentation is based on what the product will do rather than on consumer characteristics.

Benefit

_____ is the collection, recording, and analysis of data important in marketing and communicating that information to management.

Marketing research

Radial tires installed on four-wheel drive vehicles are examples of:

component parts

On an income statement, operating expenses that cannot be linked to cost of goods sold or to sales are called _____ expenses.

general and administrative

A marketer that took the city and the climate into consideration as marketing variables would be concerned about _____ segmentation.

geographic

Products that are bought after comparing price, suitability, quality, and style are called _____ products.

shopping

A strategy of charging a high introductory price for a new product that invites eventual competition is called price:

skimming

What is the primary difference between a merchant wholesaler and an agent?

whether it takes title to the product

A kennel designed for boarding small dogs has current assets of $8,000, current liabilities of $2,000, and fixed assets of $25,000. The small company has a current ratio of:

4

_____ is the action that people take in buying and using goods and services.

Buyer behavior

_____ is the efficient management of the acquisition of raw materials to the factory and the movement of products from the producer to industrial users and consumers.

Distribution

How do distribution channels improve product distribution?

Distribution channels reduce the number of transactions needed to get the product from the manufacturer to the consumer

Wultec International Inc., a Canada-based manufacturer, produces end-of-line packaging equipment, such as wrapping machinery, which is used in warehouses to cover pallets and protect their contents. Wultec end-of-line packaging equipment, when purchased for warehouse use, is an example of which type of business product?

accessory

Diapers is a product category in the maturity stage of its product life cycle. This means that the manufacturers of diapers:

are creating product line extensions

Which of the following is a consumer durable?

bedroom dresser

Which of the following is a consumer nondurable?

breakfast cereal

A manufacturers' representative is sometimes called a(n):

manufacturer' agent

In selling telephone service, AT&T tries to gather as much information as possible about the consumer's income, buying habits, service preferences, and occupation. AT&T is utilizing:

marketing research

American Pet Pro purchases pet grooming supplies from various manufacturers, sorts them, and resells them to retailers. American Pet Pro is a(n) _____ wholesaler.

merchant

Independent wholesalers that buy goods from manufacturers on their own account and then resell them to other businesses are:

merchant wholesalers

After all expenses have been subtracted from revenues on an income statement, the final figure or bottom line is called the _____ when it is a positive number.

net profit

Which of the following is NOT one of the six steps in the accounting cycle?

paying accounts payable

There are a lot of talented people. Many singers who have not been discovered are as talented or more so than some of the best-known musical artists. For instance, pricing a musical act at $20,000 when a small community arts center can get just as great an entertainment experience for its audience for $5,000 is an example of:

prestige pricing

When Top-Flite introduced its Strata golf balls with a new design for better flight with hit by metal clubs, it charged three times the price of golf balls currently on the market. This high introductory pricing is an example of:

price skimming

Maria Manow is planning to sell handmade quilts over the Internet. As she decides what to charge for a full-sized quilt, Manow will calculate her fixed and variable costs. At this point, Manow will be developing her _____ strategy.

pricing

Compassion International is a nonprofit organization dedicated to releasing poor children from spiritual, economic, social and physical poverty. What would be the most likely goal for an advertising campaign for this international organization?

provide information

Which of the following is an example of a capital product that would be found in a brewery?

bottling machine

When Gene O'Hare went online to plan his vacation to Australia, he learned that he could buy plane tickets, rent a car, and pay for a hotel in a reduced-price tourist package, which made it very convenient for him to book his trip. The Web site O'Hare visited used _____ to make trip planning easier and more economical.

bundling

A product that is bought by a company for use in making another product is called a(n) _____ product.

business

Business products are classified into two categories. Large, expensive items with long life spans are called _____ products, and; smaller, less expensive items with short life spans are called _____ products

capital; expense

What is the salesperson doing when, after his presentation is over, he asks, "May I call the company and place your order for 20 cases of Ecco brand golfing shoes?"

closing the sale rational

What are the two distinct markets toward which sales promotions can be targeted?

consumers and members of the marketing channel

As a promotional tool, podcasting offers the advantage to listeners of:

convenience

Which of the following is NOT an example of a promotional goal?

delivering the product

The manufacturer Mike and Ike, the fruit-flavored chewy candies, has changed its packaging and developed contests all geared to 12- to 17-year-olds. What type of market segmentation identifies its market?

demographic

Sullins Cleaning Service has purchased a new pressure washer for $18,000. Sullins Cleaning is allowed to charge a portion of the company's cost during its useful life against the profits it generates. This practice is called:

depreciation

The _____ is a series of marketing entities through which goods and services pass on their way from producers to end-users

distribution channel

The ratio of net profit to the number of shares of common stock outstanding is called the:

earnings per share

What is the final step in the selling process?

following up on sales

U.S. Carburetion Inc. makes natural gas and gasoline powered generators. Assume the company had $100,000 in net sales for the week of September 11th. Cost of goods sold was $42,000. On an income statement, the remaining $58,000 would be classified as:

gross profit

Which of the following is an example of nonstore retailing?

home shopping network

The two types of distribution channels are

industrial and consumer

Shenshen Zhongxing Telecom (ZTE) is a Chinese company that is the only telecommunications company in China that produces and markets an inexpensive camera phone to sell to middle class Chinese living in urban areas. Because ZTE targets a single segment within a limited geographical area, it can be said to have a(n):

niche competitive advantage

Vegetarians have the upper hand in Mumbai, India, where not eating meat is a centuries-old tradition. In a booming Indian economy, the vegetarians are outnumbering the meat-eaters in many metropolitan areas. In response to this growing vegetarianism (especially among the middle class), franchises like Pizza Hut have created 100 percent vegetarian menus. By eliminating all meat from pizzas, the Indian Pizza Huts have engaged in a _____ strategy.

product

In August 2006, the manufacturer of Cross pens introduced the golden toned Verve pen as featured in the Stormbreaker film. In James Bond fashion, the Cross pen serves as one of the key gadgets in the film. The use of the Cross pen is an example of:

product placement RATIONALE: Product placement is paid inclusion of brands in mass media programming.

Any communication or activity designed to win goodwill or prestige for a company or person is called:

public relations

Drew Pastrin bought an AZPX brand skateboard because all of the "other guys" were buying them. Pastrin was influenced by a(n) _____ factor.

social

Roger Wu has decided to buy a new Porsche. Since there are no Porsche dealers in his community, he must travel almost 200 miles to a find a Porsche dealer to purchase the car of his dreams. For Wu, a Porsche is a _____ product

specialty

Abercrombie & Fitch stores are aimed at college-aged consumers. The parent company also operates retail clothing stores under the name Hollister, which are targeted to 14- to 18-year-olds and under the name Abercrombie, which sell children's wear. Abercrombie & Fitch operate:

specialty stores

A(n) _____ is a summary of the money flowing into and out of a firm.

statement of cash flows