Marketing Exam 4
•If a retailer buys a pair of jeans for $10 and sells the jeans for $14, what is the markup as a percentage of cost? -A 40% -B 28.6% -C 14% -D 4%
•Answer: A, 40% (markup/cost) = $4/$10 = 40%
•If a retailer buys a pair of boots for $40 and sells the boots for $60, what is the markup as a percentage of cost? -A 50% -B 5% -C 15% D33%
•Answer: A, 50% (markup/cost) = $20/$40 = 50%
•Which of the following conditions would NOT be favorable to differential pricing? -A Customers are a single homogenous market. -B Reselling of the product between market segments is not possible. -C Market segments possess different sensitivities towards price. -D Prices charged do not antagonize individual market segments.
•Answer: A, Customers are a single homogenous market.
•You have a product that you need to ship to the buyer, but you want the buyer to pay all shipping costs. The most appropriate pricing policy would be -A F.O.B factory -B F.O.B destination -C base point pricing -D freight absorption pricing
•Answer: A, F.O.B. factory
•Which of the following statements about marketing channels is incorrect? -A They minimize utility. -B They facilitate exchange efficiencies. -C They form a supply chain. -D They maximize utility.
•Answer: A, They minimize utility.
•Which of the following is an example of a nonstore retailer? -A a vending machine -B a beautician -C a self-serve gas station -D a portable snow-cone stand
•Answer: A, a vending machine Non store retailer: -The selling of products outside the confines of a retail facility
•An electronics company manufactures an inexpensive MP3 player that is sold below its competitors. However, the company charges high prices for special memory cards and software needed to use the player to its full capabilities. This is an example of -A captive pricing -B bait pricing -C price lining -D price discrimination
•Answer: A, captive pricing
•Higher levels of brand loyalty frequently allow producers to -A charge higher prices -B charge lower prices -C increase the breakeven point (in units) -D reduce product quality
•Answer: A, charge higher prices
•A graph of the quantity of products expected to be sold at various prices if other factors remain constant is called a -A demand curve -B supply curve -C revenue curve Dmarginal cost curve
•Answer: A, demand curve
•Holiday Inn prices its rooms so that it is less expensive to stay on weekends than during the week when there is heavy business travel. This illustrates which type of pricing basis? -A demand-based -B seasonal -C cost-based -D competition-based
•Answer: A, demand-based
•You would find the GREATEST variety of services at a -A department store -B supermarket -C warehouse club -D factory outlet store
•Answer: A, department store
•Charging more for a Snickers candy bar in a vending machine than in a supermarket is an example of -A differential pricing -B price lining -C competition-based pricing -D cost-based pricing
•Answer: A, differential pricing
•The use of the telephone and non-personal media to introduce products to consumers, who then can purchase them via mail, telephone, or the Internet is called -A direct marketing -B direct advertising -C marketing strategy -D catalog marketing
•Answer: A, direct marketing
•A large centralized warehouse that focuses on moving goods rather than storing them is called a -A distribution center -B private warehouse -C public warehouse -D bonded storage warehouse
•Answer: A, distribution center
•A _________ is a limited function wholesaler that provides information about market conditions and grants credit to customers, but doesn't physically possess the merchandise or deliver the merchandise to customers. -A drop shipper -B truck wholesaler -C mail order wholesaler -D cash and carry wholesaler
•Answer: A, drop shipper
•Sam's Grocery was selling orange juice for $3/gallon. At this price, Sam's sold 40 gallons/week. When the price was decreased to $2.70/gallon, Sam's sold 58 gallons/week. The demand for Sam's orange juice is -A elastic -B fixed -C inelastic -D marginal
•Answer: A, elastic: •If a demand is elastic, a change in price will cause an opposite change in total revenue
•In the equation for calculating the breakeven point in units, the numerator is -A fixed costs -B total costs -C variable costs -D price minus variable costs
•Answer: A, fixed costs
•Which of the following is NOT one of the types of utilities typically created through marketing channels? -A form utility -B time utility -C place utility -D possession utility
•Answer: A, form utility The three are Time, place, possession (PTP)
•Some beer and soft drink producers market their products in 24-packs, 30-packs, and larger sizes. This practice of selling larger quantities for a single price is called -A multiple-unit pricing -B bundle pricing -C odd-even pricing -D everyday low prices
•Answer: A, multiple-unit pricing
•Intensive distribution is MOST LIKELY to be used for which of the following products? -A newspapers -B tennis rackets -C clothing -D automobiles
•Answer: A, newspapers Intensive distribution- -Using all available outlets to distribute a product. •Convenience products with high replacement rates -Provides availability and reduces search time -Availability is more important than outlet type
•Which of the following is NOT one of the keys to retailing specified in the text? -A providing the lowest price to final consumers -B providing a level of service sought by a targeted audience -C providing a level of product quality sought by a targeted audience -D providing a level of innovation sought by a targeted audience
•Answer: A, providing the lowest price to final consumers
•A restaurant with a full menu also offers a limited number of selections on its "early bird" menu (before 6 pm,) with a lower prices. This is an example of -A secondary-market pricing -B a ROI pricing strategy -C bait pricing -D periodic discounting
•Answer: A, secondary-market pricing
•Merchant wholesalers -A take title to goods and assume risk -B are facilitating agents -C receive goods on consignment and negotiate sales -D bring buyers and sellers together
•Answer: A, take title to goods and assume risk
•Bishop Plains Crafts purchases wicker baskets for $20 and sells them for $30. What is markup as a percentage of cost for Bishop Plains Craft's wicker baskets? -A 75% -B 50% -C 66.7% -D 10%
•Answer: B, 50% (Markup / Cost = 10 / 20 = 50%)
•Which of the following is a problem with everyday low prices (EDLP)? -A EDLP lowers promotional costs. -B EDLP can teach consumers to demand deeply discounted prices. -C EDLP increases losses from frequent markdowns. -D An EDLP policy can destabilize sales volume.
•Answer: B, EDLP can teach consumers to demand deeply discounted prices.
•_________ is the contracting of physical distribution tasks to third parties who do not have managerial authority within the marketing channel. -A Warehousing -B Outsourcing -C Materials handling -D Wholesaling
•Answer: B, Outsourcing
•Bill Smith purchased 1,000,000 tons of coal from a mine in central Illinois. He then found two power plants to buy the coal - each buyer will arrange for the coal to be transported to their power plant. Bill Smith is -A a broker -B a drop shipper -C a selling agent -D a truck wholesaler
•Answer: B, a drop shipper: directly from seller to buyer without going through normal distribution
•An ad states "You might expect to pay $10 for a zip disk of this quality, but our zip disks are available for $6.95." In this example, $10 is -A an internal reference price -B an external reference price -C the average total cost -D the marginal cost
•Answer: B, an external reference price: A comparison price provided by others
•Which of the following is the best example of "risk taking" as it applies to wholesaling? -A assuming responsibility for product liability -B assuming responsibility for excess inventory -C assuming risk for price increases in raw materials -D providing information about markets to customers
•Answer: B, assuming responsibility for excess inventory
•Seldoor Corp. has manufacturing plants in three cities. Seldoor determines freight costs from the closest plant to the customer, regardless of which plant the goods were actually shipped from. Seldoor is apparently using -A zone pricing -B base point pricing -C F.O.B factory -D F.O.B. destination
•Answer: B, base point pricing
•When a consumer buys a new computer, he/she also receives an operating system and software pre-installed - all for a single price. This is called -A multi-unit pricing -B bundle pricing -C reference pricing -D prestige pricing
•Answer: B, bundle pricing
•Home Depot, Best Buy, and Toys "R" Us are all examples of -A superstores -B category killers -C discount stores -D department stores
•Answer: B, category killers: •Concentrate on a major product category and compete on the basis of low prices and product availability
•The basic assumption in price lining is -A the presence of the isolation effect -B demand for the product groups is inelastic -C it creates the perception of increased customer value -D that the price information increases the customer's perceptions of product quality
•Answer: B, demand for the product groups is inelastic
•Macy's, JC Penney, and Sears are all examples of a -A discount store -B department store -C superstore -D catalog showroom
•Answer: B, department store:• Large retail organizations characterized by wide product mixes and organized into separate departments to facilitate marketing efforts and internal management
•Interlaud Computer Co. sells its computers directly to consumers through its on-line web site, directly to large retailers, and to wholesalers who in turn sell to independent retailers. This type of distribution is called -A tri distribution -B dual distribution -C selective distribution -D intensive distribution
•Answer: B, dual distribution
•The use of two or more channels to distribute the same product to the same target market is called -A multi-distribution -B dual distribution -C contractual distribution D. indirect distribution
•Answer: B, dual distribution
•Premier Timepiece Corporation has decided to produce a luxury wristwatch that will cost $7,000-$10,000 each. Premier is most likely to choose ___________ distribution for this product. -A intensive -B exclusive -C extensive -D selective
•Answer: B, exclusive Exclusive distribution: -Using a single outlet in a fairly large geographic area to distribute a product •Expensive, high-quality products purchased infrequently
•Tovey Transport Co. contacts several companies with small loads to ship and arranges transportation of their goods with carriers, combining several small loads to create a full load. Apparently, Tovey is a(n) -A intermodal transporter -B freight forwarder -C megacarrier -D drop shipper
•Answer: B, freight forwarder: Huge loads
•An independent marketing intermediary that takes title to business products and carries inventories is called a(n): -A manufacturer's agent -B industrial distributor -C vertical marketing system -D contractual marketing system
•Answer: B, industrial distributor
•A _________ shopping center typically contains several specialty and convenience stores and targets customers who live within two to three miles of the shopping center. -A regional -B neighborhood -C community -D free standing
•Answer: B, neighborhood
•Which of the following is NOT a general merchandise retailer? -A department store -B off-priced retailer -C supermarket -D warehouse club
•Answer: B, off-price retailer
•The three main tasks of order processing are -A warehousing, JIT, and inventory mgmt. -B order entry, order handling, and order delivery -C order lead time, usage rate, and safety stock -D materials handling, warehousing, and inventory management
•Answer: B, order entry, order handling, and order delivery
•When barriers to entry are low and demand is elastic, the most appropriate new product pricing strategy would be -A price skimming -B penetration pricing -C price lining -D prestige pricing
•Answer: B, penetration pricing
•Kandu Company manufacturers power tools (saws, drills,and sanders) It has introduced a new product line ("Contractor") of superior quality tools to go along with a budget line ("Handyman") and the original line ("Kandu"). Kandu should consider pricing the new line of tools using -A captive pricing -B premium pricing -C penetration pricing -D secondary-market pricing
•Answer: B, premium pricing
•Value exchanged for products in a marketing exchange is called -A revenue -B price -C expenses -D barter
•Answer: B, price
•Gas station A reduced its price from $1.40/gallon to $1.35/gallon. Gas station B lowered its price, dropping to $1.33/gallon. Gas station A responded by lowering prices again to $1.33/gallon. This is an example of -A differential pricing -B price competition -C penetration pricing -D nonprice competition
•Answer: B, price competition
•When a new product is being introduced to market, and demand for the product is expected to be inelastic, the most appropriate pricing strategy would be -A bait pricing -B price skimming -C secondary-market pricing -D penetration pricing
•Answer: B, price skimming
•Which of the following is a pricing strategy commonly associated with new product pricing? -A prestige pricing -B price skimming -C negotiated pricing -D price lining
•Answer: B, price skimming
•Goals that describe what a firm wants to achieve through pricing are called -A pricing targets -B pricing objectives -C pricing missions -D pricing tactics
•Answer: B, pricing objectives
•Which pricing policy is employed by most physicians and attorneys? -A price skimming -B professional pricing -C negotiated pricing -D premium pricing
•Answer: B, professional pricing
•Identifying an unserved or underserved market segment and serving it through a strategy that distinguishes the retailer from others in the minds of the members of the target market is called -A target marketing -B retail positioning -C retailing -D franchising
•Answer: B, retail positioning
•Shopping products, such as televisions and personal computers, require that consumers have the opportunity to comparison shop and ask questions. For these products, _____ distribution is most appropriate. -A intensive -B selective -C exclusive -D vertical
•Answer: B, selective
•The steps involved in establishing a price strategy include all of the following EXCEPT -A understanding costs -B setting the demand -C determining competitors' prices -D developing a basis for pricing
•Answer: B, setting the demand
•Matching the prices of competitors is known as a -A cash flow pricing strategy -B status-quo pricing strategy -C survival pricing strategy -D return-on-investment pricing strategy
•Answer: B, status-quo pricing strategy
•Bait pricing is considered acceptable when -A consumers are informed in writing that bait pricing is being used -B sufficient quantities of the "bait" item are available -C sufficient quantities of substitutes for the bait product are available -D This is a trick question, since bait pricing is illegal in most states.
•Answer: B, sufficient quantities of the "bait" item are available
•A large self-service store that carries a complete line of food products along with some non-food products is called a -A discount store -B supermarket -C superstore -D off-price retailer
•Answer: B, supermarket
•A reduction off the list price given by a producer to an intermediary for performing certain functions is called a -A promotional allowance -B trade discount -C quantity discount -D cash discount
•Answer: B, trade discount
•Which of the following limited-service wholesalers would be most likely to make personal sales calls on customers? -A cash-and-carry wholesaler -B truck wholesaler -C drop shipper -D mail order wholesaler
•Answer: B, truck wholesaler
•Which of the following types of limited-service wholesalers is most likely to provide delivery of merchandise to customers? -A cash-and-carry wholesalers -B truck wholesalers -C drop shippers Dmail order wholesalers
•Answer: B, truck wholesalers
•The most flexible schedules and routes of all major transportation modes are associated with -A railroads -B trucks -C pipelines -D airways
•Answer: B, trucks
•A company ships its products by rail to a distribution center, where its containerized products are then loaded onto trucks for delivery to its customers. This company is -A a freight forwarder -B using intermodal transportation -C a drop shipper -D a general merchandise wholesaler
•Answer: B, using intermodal transportation Intermodal transportation: -An integrated transportation approach in which two or more transportation modes are used in combination
•A soft drink manufacturer offers a 12-pack of soft drinks for the sale price of $2.99. The sign above it says "normally $3.99 - now $2.99." Consumers, however, have come to expect a price of $3.29 for a 12-pack. The internal reference price is -A $1.00 ($3.99 - $2.99) -B $2.99 -C $3.29 -D $3.99
•Answer: C, $3.29 Internal reference price: •A price developed in the buyer's mind through experience with the product
•If an invoice dated June 1, 2002 for $1,000 offers a cash discount of 2/10, net 30, how much should be paid if the invoice is paid on June 5? -A $1,000 -B $1,020 -C $980 -D $800
•Answer: C, $980
•Thames Compressor Company's policy is have at least 100 compressors in inventory at all time. If Thames' order lead time is 10 days and the usage rate is 7 compressors per day, what is Thames' reorder point for compressors? -A 117 compressors -B 70 compressors -C 170 compressors -D 83 compressors
•Answer: C, 170 compressors
•Which of the following sequences is the most likely? -A A producer starts with a penetration pricing strategy, then switches to bait pricing. -B A producer starts with a penetration pricing strategy, then switches to price skimming. -C A producer starts with price skimming, then switches to a penetration pricing strategy. -D A producer starts with price skimming, then switches to bait pricing.
•Answer: C, A producer starts with price skimming, then switches to a penetration pricing strategy.
•_____________ is an arrangement in which a supplier grants a dealer the right to sell products in exchange for some type of consideration. -A Direct marketing -B Direct advertising -C Franchising -D Automatic vending
•Answer: C, Franchising
•Which of the following is an ADVANTAGE of franchising for the franchisee? -A The franchisee does not have to work very hard because success is almost guaranteed. -B The franchisee pays to use the franchiser's name, products, and assistance. -C The franchisee can capitalize on the business experience of others. -D The franchisee gives up a certain amount of control.
•Answer: C, The franchisee can capitalize on the business experience of others.
•______ is the placement of one or more boxes on a pallet or skid so that they can be efficiently loaded by mechanical means, such as a forklift. -A Containerization -B Modalization -C Unit loading -D Unitization
•Answer: C, Unit loading
•____________ are the cheapest method of shipping heavy, low-value, non-perishable goods such as ore, coal, and grain. -A Pipelines -B Airways -C Waterways -D Railroads
•Answer: C, Waterways
•Nonprice competition is effective when -A the prices for competing products are low, relative to the buyer's income -B major competitors share a set of key product features -C a company extensively promotes its distinguishing product characteristics -D customers do not view the distinguishing characteristics for a product to be important
•Answer: C, a company extensively promotes its distinguishing product characteristics
•A middleman linking producers to other middlemen or ultimate consumers through contractual relationships or through the purchase and resale of products is called: -A a marketing channel -B a distribution system -C a marketing intermediary -D a retailer
•Answer: C, a marketing intermediary
•Traditional specialty retailers have -A a narrow product mix and narrow product lines -B a broad product mix and narrow product lines -C a narrow product mix and a deep product lines -D a broad product mix and a deep product lines
•Answer: C, a narrow product mix and a deep product lines
•ABC Supermarket is offering a gallon of milk for $1.75 (slightly below their actual cost) in order to increase store traffic and sales of other store items. This is an example of -A bait pricing -B captive pricing -C a price leader -D bundle pricing
•Answer: C, a price leader
•The fastest of all transportation modes are -A railroads -B pipelines -C airways -D trucks
•Answer: C, airways
•In odd-even pricing, even prices are intended to communicate -A everyday low prices (EDLP) -B limited-time lower prices -C an upscale product image -D lower levels of product value
•Answer: C, an upscale product image
•An example of a product frequently marketed to consumers using negotiated pricing is -A milk -B magazine subscriptions -C automobiles DCD players
•Answer: C, automobiles
•Which of the following is a benefit created by distribution? -A production -B increased price -C availability -D the determination of ultimate product value
•Answer: C, availability
•When the price for a hotel room increases during peak travel seasons or when a special event is nearby (such as a convention), _____________ pricing is being used. -A markup -B cost-plus -C demand -D skimming
•Answer: C, demand
•The TV ad that states "Use your credit card and call Miss Clio at our toll-free number for your personal tarot reading" is an example of -A catalog marketing -B direct selling -C direct response marketing -D telemarketing
•Answer: C, direct response marketing:-A type of marketing that occurs when a retailer advertises a product and makes it available through mail or telephone orders
•The activities that make products available to customers when and where they want to purchase them are called -A transporting -B retailing -C distribution -D wholesaling
•Answer: C, distribution
•Critics who suggest that eliminating wholesalers would lower consumer prices -A do not care about efficient service -B believe that wholesalers are inefficient -C do not recognize that services wholesalers provide would continue to be necessary even if wholesalers were eliminated -D are trying to acquire power in the marketing channel
•Answer: C, do not recognize that services wholesalers provide would continue to be necessary even if wholesalers were eliminated Wholesalers: Sale goods at high quantity w low prices
•Which of the following limited-service wholesalers does NOT take physical possession of the merchandise they sell? -A cash-and-carry wholesaler -B truck wholesaler -C drop shipper -D mail order wholesaler
•Answer: C, drop shipper
•The Dray Company wants to sell compressors to Oil Drilling Co. in order to achieve economies of scale in Dray's compressor product line. To get Oil Drilling Co.'s business, Dray has offered to pay a large portion of the freight costs. This is an example of -A zone pricing -B uniform geographic pricing -C freight absorption -D F.O.B factory
•Answer: C, freight absorption
•The merchant wholesaler that performs the widest range of wholesaling functions is called a -A total wholesaler -B general merchandise wholesaler -C full-service wholesaler -D specialty line wholesaler
•Answer: C, full-service wholesaler
•The perceived advantage of "odd" pricing is -A increased consumer perceptions of product quality -B increased consumer perceptions of product prestige -C increased consumer perceptions that the purchase has been discounted -D decreased consumer perceptions of cognitive dissonance
•Answer: C, increased consumer perceptions that the purchase has been discounted
•Which of the following is NOT one of the reasons a retailer might want to adopt scrambled merchandising? -A generating more traffic -B increasing impulse purchases -C increasing the depth of the product mix -D creating higher profit margins
•Answer: C, increasing the depth of the product mix
•Marshall's and Burlington Coat Factory are all examples of -A discount stores -B superstores -C off-price retailers -D specialty retailers
•Answer: C, off-price retailers: •Buy manufacturers' seconds, overruns, returns, and off-season merchandise for resale to consumers at deep discounts
•The series of activities used to move products from producers to consumers and other end users is called -A outsourcing -B a channel of distribution -C physical distribution -D materials handling
•Answer: C, physical distribution
•Which transportation mode has the lowest cost per pound for the products it typically carries? -A railroads -B waterways -C pipelines -D trucks
•Answer: C, pipelines
•Interlaud Corp. sells 5000 units of its product to ABC for $25/unit, while selling 5000 units of the same product to XYZ for $40/unit. Interlaud's goal is to drive XYZ out of business so higher prices can be charged to all buyers. This is an example of -A price fixing -B bait pricing -C price discrimination -D captive pricing
•Answer: C, price discrimination
•Limited-service wholesalers are characterized by -A providing as much service as customers desire -B being specialists in most of the wholesaling functions -C providing only some marketing services and specializing in a few functions -D carrying the narrowest range of products
•Answer: C, providing only some marketing services and specializing in a few functions
•Value-conscious consumers are primarily concerned about the _________ of a product. -A quality -B price -C quality and price Dquality, price, and prestige
•Answer: C, quality and price
•Reducing the time it takes to complete a process is the physical distribution objective of -A meeting the customer service standards -B reducing total distribution costs -C reducing cycle time -D meeting the needs of supply chain members
•Answer: C, reducing cycle time
•A __________ is an organization that purchases products for the purpose of reselling them to ultimate consumers. -A wholesaler -B distributor -C retailer Dconsumer products manufacturer
•Answer: C, retailer
•Four Star Clothing Fashions is a retail store that has recently started adding some new product lines, including home furnishings, gift items, and floral items. Four Star is apparently practicing -A direct marketing -B non-store retailing -C scrambled merchandising -D direct selling
•Answer: C, scrambled merchandising: -The addition of unrelated products and product lines to an existing product mix, particularly fast-moving items that can be sold in volume
•Using only some available outlets to distribute a product is called -A intensive distribution -B dual distribution -C selective distribution -D exclusive distribution
•Answer: C, selective distribution
•What type of retailing was pioneered by the Home Shopping Network? -A telemarketing -B automatic vending -C television home shopping -D online retailing
•Answer: C, television home shopping: -A form of selling in which products are presented to television viewers, who can buy them by calling a toll-free number and paying with a credit card
•"Disco Classics" is a music CD sold on late night TV for $14.95 + $2.95 for shipping. The same shipping charge applies, regardless if the buyer is across the street or across the country. "Disco Classics" uses __________ pricing. -A F.O.B. factory -B F.O.B destination -C uniform geographic -D base-point
•Answer: C, uniform geographic
•Transactions in which products are bought for resale, for making other products or for general business operations are called -A retailing -B manufacturing -C wholesaling Ddistributing
•Answer: C, wholesaling
•Profit = Total Revenue - ____________ -A Unit Costs -B Marginal Costs -C Marginal Revenue -D Total Costs
•Answer: D, Total Costs
•Which of the following products would be LEAST likely to conform to a classic demand curve? -A a Ford Taurus -B a Toyota Echo -C a box of Captain Crunch cereal -D a Rolex watch
•Answer: D, a Rolex watch
•Customers who cut and buy their own Christmas trees from a tree farm are employing -A a business marketing channel -B the most commonly used marketing channel -C an indirect-marketing channel Da direct-marketing channel
•Answer: D, a direct-marketing channel
•When the products of one organization are distributed through the marketing channels of another organization, there exists -A a direct-marketing channel -B multiple distribution -C dual distribution -D a strategic channel alliance
•Answer: D, a strategic channel alliance
•The physical elements in a store's design that appeal to consumers' emotions and encourage buying is called -A retail positioning -B direct marketing -C franchising -D atmospherics
•Answer: D, atmospherics
•A __________ would be particularly attractive to a small retailer with a questionable credit history. -A drop shipper -B general-merchandise wholesaler -C specialty line wholesaler -D cash-and-carry wholesaler
•Answer: D, cash-and-carry wholesaler
•Which of the following pricing approaches would MOST likely be used for custom-made equipment and commercial construction projects? -A prestige pricing -B return-on-investment pricing -C markdown pricing -D cost-plus pricing
•Answer: D, cost-plus pricing
•Given that demand is elastic, if the price increases, total revenue will then -A increase -B stabilize -C fluctuate -D decrease
•Answer: D, decrease
•Amway, Mary Kay, and Avon are all examples of -A discount stores -B category killers -C telemarketers -D direct selling
•Answer: D, direct selling: sold directly to someone face to face at home or in an office
•Which of the following is NOT a possible pricing objective? (as presented in the text) -A market share -B survival -C status quo -D marketing mix
•Answer: D, marketing mix
•Each year, ABC Retailers holds major sales at Christmas, Memorial Day, and Back-to-School (August). This is an example of -A random discounting -B secondary-market pricing -C price lining Dperiodic discounting
•Answer: D, periodic discounting
•Setting a limited number of prices for selected groups or lines of merchandise (such as a store that sells men's suits at three price levels - $150, $200, and $250) is called -A comparison pricing -B reference pricing -C product-line pricing -D price lining
•Answer: D, price lining
•Which of the following is NOT one of the major wholesaling functions? -A inventory control and data processing -B financing and budgeting -C risk taking -D product quality
•Answer: D, product quality
•In general, which of the following is considered to be an advantage of catalog marketing? -A flexibility -B extensive customer service -C broad product assortments -D reduced operational expenses
•Answer: D, reduced operational expenses
•Which of the following is NOT an example of product-line pricing? -A bait pricing -B price lining -C premium pricing -D reference pricing
•Answer: D, reference pricing
•Which of the following types of pricing is based on the "isolation effect"? -A premium pricing -B bundle pricing -C prestige pricing -D reference pricing
•Answer: D, reference pricing
•Which of the following would be expected to offer the widest product mix to shoppers? -A traditional business districts -B traditional shopping centers -C community shopping centers -D regional shopping centers
•Answer: D, regional shopping centers
•Selective distribution is typically appropriate for -A specialty products -B unsought products -C staple products -D shopping products
•Answer: D, shopping products
•The sum of average fixed and average variable costs, multiplied by the quantity produced, is called -A marginal cost -B marginal revenue -C average total cost -D total cost
•Answer: D, total cost
•Run-Tex is an independently owned store that focuses on serving runners, joggers, and walkers with a large assortment of shoes and related accessories and strong service, including advice on proper shoe fit. Run-Tex is BEST described as a -A department store -B discount store -C category killer -D traditional specialty retailer
•Answer: D, traditional specialty retailer
•Sam's Club and Costco are examples of -A discount stores -B department stores -C superstores -D warehouse clubs
•Answer: D, warehouse clubs: •Large-scale, members-onlyestablishments that combine
•Calculate the breakeven point in units for the following table. -A 2,000 -B 5,000 -C 3,333 -D 1,000 Price: 10 Total fixed Costs: 10,000 Average Variable Costs: 5
Answer: A, 2,000
•Calculate the breakeven point in units for the following table. -A 2,000 -B 5,000 -C 3,333 D1,250 Price: 50 Total Fixed Costs:100,000 Average Variable Costs: 30
Answer: B, 5,000
•Which of the following statements about cost-plus pricing is NOT true? -A Producers often prefer cost-plus pricing during periods of rapid inflation in raw material prices. -B Cost-plus pricing strategies are often used to build market share. -C Government contracts frequently use cost-plus pricing. -D Sellers sometimes increase costs to establish a larger profit base.
Answer: B, Cost-plus pricing strategies are often used to build market share
•From a marketer's standpoint, what is the major drawback to periodic discounting? -A Fluctuations in inventory level strain the supply chain. -B Customers often can predict discounts and delay purchases to receive discounts. -C Periodic discounting creates seasonal sales fluctuations. -D Consumers often perceive that products using periodic discounting have lower levels of product quality.
Answer: B, Customers often can predict discounts and delay purchases to receive discounts
•An individual or organization that facilitates transactions in which products are bought for resale, for making other products, or for general business operations is called a -A retailer -B wholesaler -C supplier -D selling agent
Answer:B, wholesaler
