Marketing Exam 2 (Chapters 4-6)

In the context of the economic environment in the United States, which of the following statements is true of consumer's incomes? a. Average U.S. incomes have fallen in the recent years. b. Ethnicity is the primary determinant of a person's earning potential. c. The median household income is the same across all the states. d. A single marketing mix is adopted toward people with different incomes.

a. Average U.S. incomes have fallen in the recent years.

A difference between Generation X and Baby Boomers is that ___________________. a. Baby Boomers outspend in categories such as personal care products and medical care. b. Baby Boomers are currently in two different stages of the life cycle. c. Baby Boomers give more priority to saving money than any other age group. d. Baby Boomers are the most tech-savvy generation.

a. Baby Boomers outspend in categories such as personal care products and medical care.

Matthew purchased a new cell phone. As per the manual, the battery should be charged for at least 3 hours before its first use. After just 1 hour of charging, the phone exploded. The explosion was due to a problem with the battery. In this case, Matthew can lodge a complaint with the ______________________ against the cell phone company. a. Consumer Product Safety Commission b. Consumer Protection Commission c. Federal Trade Commission d. Department of Trade

a. Consumer Product Safety Commission

Which of the following statements is true of having a global vision? a. It involves being aware of threats from foreign competitors in all markets. b. It enables firms to operate within clear and distinct geographic and political barriers. c. It reduces profits and increases costs for a company. d. It means overlooking the importance of being competitive in the home country.

a. It involves being aware of threats from foreign competitors in all markets.

Which of the following is true of the World Bank? a. It offers low-interest loans to developing nations. b. It lacks power to provide advice and information for developing nations. c. To receive loans, countries must restrict private enterprises. d. To receive loans, countries must pledge to increase trade barriers.

a. It offers low-interest loans to developing nations.

In the context of economic factors, which of the following statements is true of disposable income? a. It refers to the income available after paying taxes. b. It increases when inflation rates increase. c. It rarely affects the quality of an individual's lifestyle. d. It refers to the income that is spent on living expenses.

a. It refers to the income available after paying taxes.

Which of the following scenarios represents the role of social media in consumer information search? a. Jennifer actively participates in an online forum that discusses about new electronic products. b. Xavier buys a new set of furniture after watching an advertisement about it on the television. c. Clara seeks the opinions of her colleagues to help her decide whether to buy a car or a bike. d. Bennett uses a discount coupon that he received in his email to buy a product of his choice.

a. Jennifer actively participates in an online forum that discusses about new electronic products.

Which of the following statements is true of franchising? a. The majority of international franchises are for fast-food restaurants and business services. b. Firms that do not want to become heavily involved in licensing or global marketing engage in franchising. c. It involves the employment of an export broker and an export agent. d. It is a form of licensing that has declined rapidly in recent years.

a. The majority of international franchises are for fast-food restaurants and business services.

In the context of the relationship between businesses and governments, which of the following statements is true? a. The marketing mix is dependent on government regulation. b. Businesses do not require government regulation to operate efficiently. c. Private businesses are not required to comply with government rules. d. Governments do not benefit from private business firms.

a. The marketing mix is dependent on government regulation.

Slightly altering a basic product to meet the local conditions in a foreign market is called product ____________________________. a. adaptation b. standardization c. invention d. diversification

a. adaptation

Maria sees a leather coat in a department store and purchase it immediately even though it is expensive. Before purchasing, she experiences inner tension that she may be able to purchase the same coat for a lesser price in another store. This inner tension is an example of ____________________________. a. cognitive dissonance b. subliminal perception c. need recognition d. selective exposure

a. cognitive dissonance

Pilcher Corp. manufactures tents in its two factories located at two states in Arkadas. It exports its goods to several of its neighboring countries while production remains in the two locations. In this case, Pilcher Corp. is in the ____________________ of global business. a. first stage b. second stage c. third stage d. fourth stage

a. first stage

Gnosis Inc., a company that has its headquarters in Lumberne, sets up manufacturing units in different countries to increase cost savings. However, it incurs heavy losses due to the increase in fuel and transportation costs. The company's board of directors decides that it is in the best interest of the company to shift its units back to Lumberne and use local labor. The strategy adopted by Gnosis Inc. is an example of __________________. a. inshoring b. countertrading c. global marketing standardization d. international franchising

a. inshoring

Unlike Hispanic Gen Xers, Hispanic Millennials tend to be ____________________. a. more open-minded about relationships than their parents. b. lax about pursuing rewarding careers and business ventures. c. uninfluenced by their cultural heritage and familial roots. d. more concerned about themselves than their families.

a. more open-minded about relationships than their parents.

Martin and Marla are working parents. They intend to buy a new car for their family. In this case, their choice of car will be influenced by the _________________________. a. number of children in their family. b. distance between their house and their offices. c. size of their house. d. look of the car.

a. number of children in their family.

Selma wants to buy a budget smartphone with good features. However, she cannot decide which one to buy. She asks her coworkers for advice. In this scenario, Selma's buying decision is likely to be influenced by a(n) __________________________. a. primary membership group b. secondary membership group c. nonaspirational reference group d. aspirational reference group

a. primary membership group

Hera's Kitchen, a fast-food chain, frequently updates photos of its signature dishes on its blog and moderates a page where its customers can share opinions and give feedback. In this case, Hera's Kitchen is using ____________________. a. social media marketing b. decentralized marketing c. product adaptation d. countertrade

a. social media marketing

Maria is very empathetic toward animals. So, she only buys cosmetic products that explicitly claim that they have not been tested on animals. In this case, Maria's buying decision is based on ___________________________. a. values b. ethical fallacies c. aesthetics d. confirmation biases

a. values

Which of the following statements is true of the consumer decision journey? a. A consumer is unlikely to drop a number of items from the potential purchase set. b. An advertisement causes a consumer to research a number of products or services. c. Addition of new products takes place in the beginning of the consumer decision journey. d. Reviews from peers, retailers, and competitors are considered only after purchasing a product.

b. An advertisement causes a consumer to research a number of products or services.

A difference between African American populations and Asian American populations is that ___________________________. a. Asian Americans seldom retain their core Asian values. b. Asian Americans' population growth has been fueled primarily by immigration. c. Asian Americans' spending power is less than African Americans. d. Asian Americans refrain from buying from Asian American stores.

b. Asian Americans' population growth has been fueled primarily by immigration.

In the context of populations, which of the following is a similarity between tweens and teens? a. Both populations believe that price and quality are very important when making purchase decisions. b. Both populations have high spending power. c. Both populations are massive in size compared to other populations. d. Both populations give priority to saving money.

b. Both populations have high spending power.

In the context of ethnic markets in the United States, which of the following statements is true? a. The American demographic profile is witnessing minimal change. b. By 2050, around one in three U.S. residents will be of Hispanic descent. c. One marketing mix can be adopted to cater to the needs of ethnic markets. d. Ten percent of the Hispanic population in the United States is of Mexican descent.

b. By 2050, around one in three U.S. residents will be of Hispanic descent.

In order to stimulate innovation, Harlose Inc. allows its researchers to devote 2-3 hours of their normal work schedule to pursue their own ideas and projects. Which of the following approaches is the company using in this case to stimulate innovation? a. Using Web enlisting b. Catering to entrepreneurs c. Allowing self-dealing d. Using basic research

b. Catering to entrepreneurs.

____________________ is the inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions. a. Stimulus generalization b. Cognitive dissonance c. Subliminal perception d. Self-actualization

b. Cognitive dissonance

Which of the following is an example of outsourcing? a. Laelle Corp., a technological company, customizes its products to meet the needs of diverse customer groups. b. Harlose Inc., a firm based in Acquardica, shifts its manufacturing units to a country where cheap labor is available. c. Rues and West Bros., an automobile manufacturer, has offices in different countries, but it decides to close its international operations and return to its home country. d. Fesnas Inc., a multinational firm, produces standardized products that can be sold all over the world.

b. Harlose Inc., a firm based in Acquardica, shifts its manufacturing unites where cheap labor is available.

Brian is a blue-collar worker who works in a shipping industry. He receives a daily wage as per his working hours. Given this information, which of the following is likely to be true. a. He rates job satisfaction as the most important reason for taking a job. b. He depends on others for economic and emotional support. c. He does not belong to the middle-class lifestyle. d. He does not utilize the Internet to make his buying decisions.

b. He depends on others for economic and emotional support.

Which of the following strategies can help businesses foster innovation? a. Using micromanagement techniques b. Hiring employees with high risk tolerance c. Telling employees that they must fear innovation failure d. Curbing research activities

b. Hiring employees with high risk tolerance.

Which of the following statements is true of social change? a. It is independent of customers' attitudes, values, and lifestyles. b. It is difficult to integrate into marketing plans. c. It is an internal marketing variable. d. It is easily forecasted by marketing managers

b. It is difficult to integrate into marketing plans.

Which of the following is true of a company that is in the fourth stage of global business development? a. It manufactures goods in its home country and sells them in another country. b. It is present in countries where it can gain a competitive edge through talent or capital. c. It has its core corporate functions in its home country. d. It is set up in countries where it has no potential customers.

b. It is present in countries where it can gain a competitive edge through talent or capital.

Which of the following statements is true of the impact of the Internet on global marketing? a. The global "Internet economy" is no longer restrained by the old brick-and-mortar rules, regulations, and habits. b. Opening an e-commerce site on the Internet immediately puts a company in the international marketplace. c. In all respects, going global on the Internet is harder than it has ever been before. d. An e-commerce site of a firm in one country cannot be accessed by people in another country.

b. Opening an e-commerce site on the Internet immediately puts a company in the international marketplace.

__________________ is perhaps the most difficult external variable for marketing managers to forecast, influence, or integrate into marketing plans. a. Machinery b. Social change c. Human resource d. Demography

b. Social change

Which of the following statements is true of demographic characteristics? a. They can be easily controlled by marketers. b. They are strongly related to consumer buying behavior in the marketplace. c. They seldom influence promotional strategies of marketers. d. They are static and do not experience change.

b. They are strongly related to consumer buying behavior in the marketplace.

Which of the following statements is an indication of the impact of vast differences in natural resources? a. They stifle international dependencies. b. They create export opportunities for countries with abundant resources. c. They inhibit inflation and recession. d. They result in minor shifts of wealth among countries.

b. They create export opportunities for countries with abundant resources.

Which of the following statements is true of social influences on consumer behavior? a. They exert the broadest and deepest influence when compared to other external factors. b. They help consumers obtain product information and decision approval. c. They include factors such as age, gender, and lifestyle. d. They rarely influence consumer buying decisions.

b. They help consumers obtain product information and decision approval.

Which of the following can help businesses maintain their market share and profit margins? a. Focusing on increasing overhead costs b. Working hard despite growing challenges c. Focusing on pricing and not product quality d. Refraining from adopting new technologies

b. Working hard despite growing challenges

Tangron Farms provides milk to Yinkers, a cheese manufacturing company. In return, Yinkers supplies Tangron Farms with cheddar and cheese, which Tangron Farms markets in its home country. This is an example of _____________________. a. product adaptation b. countertrade c. price fixing d. dumping

b. countertrade

The study of people's vital statistics, such as age, race, ethnicity, and location is known as ________________. a. polygraphy b. demography c. deontology d. graphology

b. demography

A(n) _______________ is a law that compels a company earning foreign currency from its exports to sell it to a central bank. a. tariff b. exchange control c. quota d. excise duty

b. exchange control

Jacob visits an auto repair shop. Due to the decrease in the value of money, he learns that a spark plug would cost him 15 percent more than what he had paid for last year. In this case, Jacob has to pay more as a result of ____________________. a. recession b. inflation c. technological advancement d. technological lockout

b. inflation

Marketers affect consumers' motivation to learn about, shop for, and buy a certain brand by _______________________. a. reducing consumer involvement while shopping for products. b. influencing the degree to which consumers perceive a good or service to be self-relevant. c. using standardized marketing techniques across different segments of consumers. d. encouraging the practice of show-rooming.

b. influencing the degree to which consumers perceive a good or service to be self-relevant.

TrinkCan, a health drink manufacturing company in Belwick , entered into an agreement with Kidflavor, a fruit juice company in Acquardica, to form a new company called ChildPower that produces health drinks for kids. In this scenario, ChildPower is an example of an international _______________________. a. licensor b. joint venture c. franchisor d. wholly owned affiliate

b. joint venture

A _______________ is the unique combination of product, place (distribution), promotion, and price strategies. a. target market b. marketing mix c. management mix d. target economy

b. marketing mix

Allied Cosmos, a cosmetics company, decides to expand its operations to lower-income areas in developing countries. It starts to sell shampoos in smaller packages and caters to the needs of people in lower-income areas. In this scenario, Allied Cosmos is involved in ____________________________. a. contract manufacturing b. product adaptation c. promotion adaptation d. marketing standardization

b. product adaptation

Richard wanted to buy a new video game. He visited three different video game stores and found one video game that he liked a lot. However, he did not buy it. Instead, he bought a digital copy of the same game at a discounted price from the game's website. Richard's shopping involvement is an example of _____________________. a. web-rooming b. show-rooming c. window shopping d. store checking

b. show-rooming

Unlike routine response behavior, in extensive decision making, a consumer ______________________________. a. is not familiar with the available brands in the market. b. uses several criteria for evaluating his or her options and spends much time seeking information. c. practices this type of decision making while buying frequently purchased, low-cost goods and services. d. is familiar with several different brands in the product category but sticks with one brand.

b. uses several criteria for evaluating his or her options and spends much time seeking information.

Which of the following statements is true of the external marketing environment? a. A target market is determined from a pre-established marketing mix. b. A marketing mix should not involve any further changes once it has been prepared. c. A marketing mix is designed to appeal to a specific group of potential buyers. d. A target market is shaped without considering consumer preferences.

c. A marketing mix is designed to appeal to a specific group of potential buyers.

Bub Fizz Inc. manufactures chewing gum. Through marketing research, it was learned that most of its customers use the chewing gum as mouth freshener. Hence, it modified its formula to manufacture gums that have a long-lasting flavor. In this scenario, which of the following was responsible for the change in the product? a. Promotion strategy b. Green marketing c. Consumer behavior d. Cause-related marketing

c. Consumer behavior

Laelle Corp. is a fashion apparel store. The manager of the store encourages his employees to come up with new dress designs every month. The employees are told that they have to present the designs without the hesitation of the failure. The creator of the best dress is rewarded. Which of the following approaches is used by Laelle Corp.? a. Catering to entrepreneurs b. Enlisting the Web c. Creating an innovative environment d. Talking to early adopters

c. Creating an innovative environment

Which of the following statements is a difference between first-stage multinational companies and second-stage multinational companies? a. First-stage multinational companies operate an entire line of business in another country, whereas second-stage multinationals have their core corporate functions in different countries. b. First-stage multinational companies sell products only in one country, whereas second-stage multinational companies sell products in two countries. c. First-stage multinational companies operate in one country and sell into others, whereas second-stage multinationals set up foreign subsidiaries to handle sales in one country. d. First-stage multinational companies include mostly high-tech companies, whereas second-stage multinational companies include firms that gain a competitive edge through the availability of talent.

c. First-stage multinational companies operate in one country and sell into others, whereas second-stage multinationals set up foreign subsidiaries to handle sales in one country.

Magnira Chocolates, a company in Sparanthea, signed an agreement with Chocolate Town that enables Magnira Chocolates to sell Champ Candy in Sparanthea by giving royalty payments to Chocolate town. Which of the following marketing strategies is illustrated in this scenario. a. Exporting b. Franchising c. Licensing d. Joint venture

c. Licensing

In the context of distribution, which of the following statements is true of American companies importing goods from overseas facilities to the United States? a. Due to increased means of transport, manufacturers are maintaining inexpensive buffer stocks. b. In many developing nations, channels of distribution and the physical infrastructure are inadequate. c. Logistics has been a growing challenge for U.S. companies seeking to cut costs by shifting more production to countries where manufacturing is cheaper. d. Shipping costs are reducing, which makes operations cost effective for the American companies importing goods from overseas facilities.

c. Logistics has been a growing challenge for U.S. companies seeking to cut costs by shifting more production to countries where manufacturing is cheaper.

In the context of factors that affect consumer decision making, which of the following statements is true of cultural values? a. They are inherent rather than learned or acquired. b. They are exerted only as conscious decisions. c. They correspond to consumption patterns. d. They are static and do not experience change.

c. They correspond to consumption patterns.

___________________ is a form of licensing that has grown rapidly in recent years. a. Importing b. Exporting c. Franchising d. Contract manufacturing

c. franchising

Unlike utilitarian value, hedonic value ______________________. a. cannot be the sole value that a consumer receives from a service. b. can be viewed as a means to an end. c. gives the consumers good feelings, happiness, and satisfaction. d. is obtained from products rather than services

c. gives the consumers good feelings, happiness, and satisfaction.

In the context of consumer involvement, limited decision making typically occurs when a consumer ____________________. a. buys an unfamiliar, expensive product or an infrequently bought item. b. expends high effort in searching for information or in considering various alternatives. c. has previous product experience but is unfamiliar with the current brands available. d. buys a brand first and evaluates its quality later.

c. has previous product experience but is unfamiliar with the current brands available.

Stanley likes using fountain pens. When he came across a new series of fountain pens manufactured from Dilloit Pens, he eagerly bought one. The pen's appealing exterior combined with the long-established reputation of Dilloit Pens made Stanley assume that the fountain pen would be of high quality. To his disappointment, the pen smudged and bled despite using high-quality ink. In this case, Stanley purchased the pen based on ____________________________. a. actual value b. consumer set c. perceived value d. evoked set

c. perceived value

Brandon is planning to buy a new house. He visits Reardon & Matthews, a professional real estate agency, to find a house within his budget. In this case, Brandon is relying on a(n) _____. a. non-aspirational reference group b. primary membership group c. secondary membership group d. aspirational reference group

c. secondary membership group

Fresnas Corp. was held guilty for bribing foreign government officials to procure business deals. Which of the following government agencies is responsible for banning Fresnas Corp. from engaging in international business? a. Restoring American Financial Stability Act b. Consumer Financial Protection Bureau c. Consumer Product Safety Commission d. Federal Trade Commission

d. Federal Trade Commission

Which of the following is true in the context of foreign competition in the U.S. market? a. Many foreign competitors do not consider the United States an attractive target market. b. Competition from foreign firms is very weak in the television industry. c. Competition from foreign firms in the United States is limited to the textile industry. d. Foreign firms in U.S. markets now focus on product quality rather than price.

d. Foreign firms in U.S. markets now focus on product quality rather than price.

Aaron and Jane, a married couple, plan to buy a car. Aaron chooses a car that has a sporty look. Jane, on the other hand, chooses a car that is beautiful and elegant. In this scenario, which of the following plays a role in influencing Aaron and Jane's purchase decisions? a. Age b. Economic influences c. Family life cycle d. Gender

d. Gender

A retail store in Lumberne launches an e-commerce site to promote its business all over the world. The site is accessible in different languages. In this case, which of the following is true? a. People who visit the site have to visit the physical store to purchase the goods. b. The retail store will spend more on distribution and buffer stocks than before. c. In order to enter the international marketplace, the retail store must earn double profits in the first year of launching the site. d. It may be restrained by the old brick-and-mortar rules, regulations, and habits.

d. It may be restrained by the old brick-and-mortar rules, regulations, and habits.

Who among the following has the highest purchasing power? a. Martha, whose monthly income and cost of living are $4000 and $2700, respectively. b. Peter, whose monthly income and cost of living are $5000 and $3800, respectively. c. Stacy, whose monthly income and cost of living are $5500 and $4200, respectively. d. James, whose monthly income and cost of living are $3000 and $1500, respectively

d. James, whose monthly income and cost of living are $3000 and $1500, respectively

Which of the following is an example of a marketing-controlled information source? a. Personal memories b. Personal experiences c. Friends d. Salespeople

d. Salespeople

Ira believes that Damien soap moisturizes effectively. When she sees Damien shampoo at the store, she purchases it as she assumes that it will have the same effect. In this case, which of the following forms of learning influences Ira to buy Damien shampoo? a. Selective distortion b. Product differentiation c. Self-actualization d. Stimulus generalization

d. Stimulus generalization

Which of the following statements is true of the Hispanic Millennials in the United States? a. They are unwilling to accept future family obligations and the difficulties of supporting parents. b. They adopt a monolingual approach to media consumption. c. They use English as a common language instead of Spanish for their everyday activities. d. They embrace parts of their culture, yet they also look forward to being successful in business

d. They embrace parts of their culture, yet they also look forward to being successful in business.

According to critics, which of the following statements is true of multinational corporations? a. They have failed to tap financial resources from all over the world. b. They require greater expenditure for labor than for equipment. c. They are drifting away from their primary agenda of international trade. d. They often transfer capital-intensive technologies to developing nations.

d. They often transfer capital-intensive technologies to developing nations.

According to Maslow's hierarchy of needs theory, physiological needs should be satisfied first because they ____________________________________________. a. are the highest human needs. b. tend to attract marketers more than any other needs. c. include a sense of love and belonging. d. are essential to a person's survival.

d. are essential to a person's survival.

Angelo is an intermediary who buys goods from local manufacturers and sells those goods to buyers in other countries. While doing so, he assumes all risks involved and keeps the revenues he earns from the transactions. In this case, Angelo is most likely a(n) _______________________. a. buyer for import b. export broker c. importer d. buyer for export

d. buyer for export

The Internet has made going global easier than it has ever been, but the promise of "borderless commerce" remains restrained because of the ___________________________. a. demographic makeup of various people accessing a website. b. cultural variations of the people visiting a website. c. system of floating exchange rates. d. old brick-and-mortar rules, regulations, and habits.

d. old brick-and-mortar rules, regulations, and habits.

The practice of sending U.S. jobs abroad is known as _______________________. a. countertrade b. licensing c. dumping d. outsourcing

d. outsourcing

Business needs government regulation to ________________________. a. promote competition between firms. b. cater to the needs of society. c. foster anti-competitive practices. d. protect innovators of new technology.

d. protect innovators of new technology.

Unlike internal information search, external information search _________________________. a. is done during the need recognition stage. b. involves recalling information stored in a person's memory. c. stems largely from a person's previous experience with a product. d. seeks information from non-marketing and marketing-controlled sources.

d. seeks information from non-marketing and marketing-controlled sources.

Jeremy was watching the news. The news featured the suspected malicious practices that were occurring in Jeremy's favorite shopping mall. When he wanted to share the news with his friends, he could not remember some of the activities featured on the news. This is an example of ___________________________. a. subliminal perception b. selective distortion c. stimulus generalization d. selective retention

d. selective retention

Franz Tress, a cosmetics manufacturing company, offers an annual subscript plan to its customers where the customers have the option to automatically renew the subscription plan once it completes its term. In this scenario, Franz Tress is trying to influence its customers' decision journey through ________________________. a. motivation b. brand renewal c. the need recognition cycle d. the loyalty loop

d. the loyalty loop

Harlose Inc. operates in a country that has rich deposits of diamonds. It exports the produce from a few of its underground pipe mines and an open cast mine. Given this information, Harlose Inc. is _________________________. a. being sensitive to the culture of various countries. b. assessing the financial security of people in its country. c. evaluating the demographic makeup of the country. d. utilizing the natural resources of its country.

d. utilizing the natural resources of its country.