Entrepreneurship I Unit 4 Test

Which of the following is an example of an industrial user:

A hairstylist buying new scissors to perform haircuts

Which of the following intermediaries never actually owns the products they promote and sell:

Agents

What are three types of purchasing?

Buying for resale, buying for transformation, and buying for business use

If a purchasing specialist discusses potential issues and ways to resolve them with a supplier prior to making a purchase, what are the two parties doing?

Negotiating

Which indirect channel of distribution is used to reach large retailers when the producer does not want responsibility for the selling activities?

Producer to agent to retailer to consumer

Which of the following companies is most likely to purchase raw materials and components to convert into finished products:

Ford

Suzette purchases sporting goods from several different manufacturers and sells the items in her shop, Suzy's Sports. What kind of buyer is Suzette?

Retail

What is an acceptable reason to select a supplier offering the best value but not the lowest price?

The lowest priced product is of inferior quality.

Annika, the purchasing specialist for Dottie's Donut Shop, just located a new, less expensive sugar supplier. Dottie does not plan to lower donut prices. If Annika buys the shop's sugar from this cheaper supplier, what is likely to happen?

The profit margin for donuts will increase.

Why should a purchasing specialist evaluate supplier performance?

To determine whether they should use the supplier again

Why should purchasing specialists develop positive relationships with their suppliers?

To help ensure that the suppliers will follow through on their promises

What type of intermediary would purchase baseball bats from one producer, mitts from another, and balls from still another and then sell an assortment to sporting goods stores?

Wholesaler

Doormats, carpeting, phones, and cleaning chemicals are all items that an office might buy for

business use.

Jaron, the district technology coordinator for Abington City Schools, is responsible for purchasing new computers for the district. He recently sent out a request for price quotes to five different computer companies, and he is waiting to hear what the various suppliers' proposed prices will be. Jaron is conducting

competitive bidding.

Producers are able to match their production to the needs and wants of consumers or industrial users because intermediaries

develop assortments of goods.

Quality Distributors buys electrical equipment and supplies from ABC Electric and sells them to local electrical contractors. Quality Distributors is an example of a(n)

intermediary.

The use of intermediaries enables producers to make larger profits because intermediaries

may sell more than the producer could sell on its own.

Intermediaries buy large quantities of goods from producers and sell smaller quantities to other intermediaries or to consumers. The result is that intermediaries __________ their per-unit cost for goods.

reduce

Walmart, Domino's, and Avis Rent-a-Car are examples of

retailers

In addition to purchasing, Sherita's job responsibilities include developing partnerships and alliances with suppliers, watching for business threats and opportunities, and looking for ways to improve processes. Sherita is involved in

strategic planning.

Molly purchases raw materials for a factory that changes the shape or appearance of those materials through a process known as

transformation

An intermediary function that makes goods available to consumers where they are wanted and needed is

transporting and storing.

Top-Notch Wheels buys mountain bikes from The Great Colorado Mountain Bike Company and sells them to bike shops. Top-Notch Wheels is an example of a(n)

wholesaler

An advantage for producers in using the producer-to-wholesaler-to-retailer-to-consumer distribution channel is that

wholesalers usually buy in large quantities.

Which of the following is an example of an ultimate consumer:

A teenager buying their first car

Which of the following is a step in the purchasing process:

Identifying needs

Which of the following retailers would be most likely to be part of the producer-to-retailer-to-consumer channel:

Large retail chain

What distribution channel is used for high-priced industrial goods when the producer does not have its own sales force?

Producer to agent to user

What is the most common channel of distribution for large industrial goods?

Producer to industrial user

Which of the following is a direct channel of distribution for consumer goods and services:

Producer to ultimate consumer

What is one way in which purchasing specialists play an important role in the success of a business?

Providing a flow of goods

After a purchasing specialist has determined that they have selected the right supplier for a job, what do the purchasing specialist and the supplier develop?

Purchase agreement

Nina oversees the buying of goods and services for her company. Which business department does she likely work in?

Purchasing

Which of the following is a way to evaluate supplier performance after the purchased goods or services have been delivered:

Review the invoice

What are two things that a purchasing specialist should consider when making a make-or-buy decision?

The company's production capabilities and the cost of making the needed parts

Which of the following services would be distributed by a producer-to-agent-to-consumer channel:

Travel planning

Which of the following is a benefit of channels of distribution:

We can more easily obtain products from all over the world.

Which of the following is a detail that a buyer should know prior to placing an order for raw materials:

Whether the company has room to store the raw materials

Jeremiah purchases sterling silver necklaces and bracelets from Native American artisans and sells the items to jewelry stores and gift shops. What kind of buyer is Jeremiah?

Wholesale

Where does a channel of distribution begin?

With the producer