marketing test one Chapter Three
If Toby Roberts has an income of $30,000, pays $6,000 in rent, $1,200 in utilities, and $5,000 in taxes per year, his disposable income is
$25,000
The Coca-Cola Company has recognized the significant increase in population diversity within the U.S. soft-drink market. Which one of the following best illustrates the company's integration of this knowledge into its marketing strategy?
Ads featuring Hispanic actors and Tejano music
Which of the following companies would probably be most interested in tracking discretionary income levels?
BMW automobiles
Meyers' Sporting Goods, a national chain, has been doing business with Soljur Sports, a manufacturer of skateboards, for several years. Recently, it came to the attention of Meyers' financial director that the average cost per Soljur Sports skateboard had substantially increased over that of the previous year. A corporate attorney was notified and began to look into the situation. The attorney found that Soljur Sports was selling a similar number of skateboards to a competitive chain for $10 less per skateboard. The attorney for Meyers' Sporting Goods immediately filed a complaint with the Federal Trade Commission. A regular customer of Meyers Sporting Goods feels that some of its advertisements are deceptive. He responded to an ad for sale skateboards one hour after the store opened and found that none were left. Where should he file a complaint?
Better Business Bureau
Jared Bledsoe hires a local landscape firm to plant trees and shrubs in his yard. The firm plants mostly dead plants but refuses to return Jared's money or replace the dead items. Jared's best course of action would be to contact the
Better Business Bureau.
Which of the following agencies would most likely have jurisdiction over the problem with lead in the paint of children's toys?
Consumer Product Safety Commission
A new U.S. automobile company, Specialty Motors, was established in 2004. In 2008, a recession caused disposable income to decline, and the annual amount of dollars spent by consumers for automobiles dropped drastically. Specialty Motors faced the problem of trying to determine whether the economy would turn toward prosperity or toward depression. No matter what happened, Specialty Motors was also worried about an impending global steel shortage, which would make a big difference in its future marketing plans. The economy might recover from the recession, but the automobile makers might be forced to ask consumers to curtail consumption just when the hope of a better year was finally in sight. All in all, the future looked dismal for Specialty Motors. Total disposable income is at its lowest during which of the following?
Depression
Heidi decided to spend some of her saved money on tickets to a Cold Play concert coming to town, and now she is planning on buying a new outfit for the concert. What type of resources is Heidi making decisions about?
Discretionary income
Which of the following attributes of a Toyota Scion would be most appropriate to emphasize in television commercials during an economic recession?
Durability
Which of the following is an advantage that self-regulatory agencies such as the BBB and the NARB have over governmental laws and regulatory agencies?
Establishment and implementation are usually less expensive.
Which of the following agencies regulates marketing activities the most?
Federal Trade Commission
Of all the federal regulatory units, the ____________ most heavily influences marketing activities.
Federal Trade Commission (FTC)
In its advertisements, Johnson's Hair Care Products claims that its KLTR-14 gel will restore the hair of bald men. Members of the NARB believe the claim is unsupportable. What action can the NARB take?
File a complaint with the Federal Trade Commission.
In a period of economic recovery, the best marketing strategy for FedEx would be characterized by which of the following features?
Flexibility
Which of the following are the most frequently sentenced organizational crimes?
Fraud and antitrust violations
__________ competitors provide very different products that satisfy the same basic customer need.
Generic
In the near future, what subculture will become the second largest group in the United States?
Hispanics
Meyers' Sporting Goods, a national chain, has been doing business with Soljur Sports, a manufacturer of skateboards, for several years. Recently, it came to the attention of Meyers' financial director that the average cost per Soljur Sports skateboard had substantially increased over that of the previous year. A corporate attorney was notified and began to look into the situation. The attorney found that Soljur Sports was selling a similar number of skateboards to a competitive chain for $10 less per skateboard. The attorney for Meyers' Sporting Goods immediately filed a complaint with the Federal Trade Commission. Suppose that a customer has a complaint against Meyers Sporting Goods Stores. He files a complaint with the Better Business Bureau. What action could the BBB take against Meyers if the complaint was substantiated and Meyers did not change the offending practice?
Issue a warning to consumers through the local newspaper.
Why are marketers interested in consumers' levels of disposable income?
It is a ready source of buying power.
Which of the following provides protection for and regulates brand names, brand marks, trade names, and trademarks?
Lanham Act
A new U.S. automobile company, Specialty Motors, was established in 2004. In 2008, a recession caused disposable income to decline, and the annual amount of dollars spent by consumers for automobiles dropped drastically. Specialty Motors faced the problem of trying to determine whether the economy would turn toward prosperity or toward depression. No matter what happened, Specialty Motors was also worried about an impending global steel shortage, which would make a big difference in its future marketing plans. The economy might recover from the recession, but the automobile makers might be forced to ask consumers to curtail consumption just when the hope of a better year was finally in sight. All in all, the future looked dismal for Specialty Motors. In what type of competitive structure is Specialty Motors operating?
Monopolistic competition
What national self-regulatory organization screens ads?
National Advertising Review Board
What type of competitive structure exists when just a few sellers control a large portion of the supply of a product?
Oligopoly
Texas rice farmers wish to get their product into the Japanese market but are hindered by a complex maze of regulations imposed by the Japanese government. The farmers are most likely to attempt to influence which aspect of the marketing environment?
Political
Which of the following is not a reason that marketers try to maintain good relations with elected political officials?
Political officials can accept direct corporate campaign contributions.
During which stage of the business cycle is unemployment low and total income relatively high?
Prosperity
In general, which of the following competitive structures is an organization least likely to operate?
Pure competition
Meyers' Sporting Goods, a national chain, has been doing business with Soljur Sports, a manufacturer of skateboards, for several years. Recently, it came to the attention of Meyers' financial director that the average cost per Soljur Sports skateboard had substantially increased over that of the previous year. A corporate attorney was notified and began to look into the situation. The attorney found that Soljur Sports was selling a similar number of skateboards to a competitive chain for $10 less per skateboard. The attorney for Meyers' Sporting Goods immediately filed a complaint with the Federal Trade Commission. Suppose that the Soljur Sports company was actually discriminating against Meyer Sporting Goods with its price increase. Which of the following acts prohibits this type of business behavior?
Robinson-Patman
Price discrimination is prohibited by the ___________ Act
Robinson-Patman
International Office Supplies Wholesaler charges different prices to its various customers without any legal justification. This company is in violation of the
Robinson-Patman Act.
Which of the following is not at the generic competitor level for Ford's Expedition sport utility vehicle?
Saturn SKY
In its advertisements for Bud Light beer, Anheuser-Busch has decided to include a statement saying "Know when to say when." This is an example of which one of the following types of regulatory forces affecting marketing efforts?
Self-regulation
Which of the following statements about self-regulatory programs is false?
Self-regulatory guidelines generally are stricter than governmental regulatory programs.
Which of the following acts was enacted to prevent businesses from restraining trade and monopolizing markets?
Sherman Antitrust Act
If all the gas stations in a city collaborated to determine what gas prices should be charged, they would be violating the
Sherman Antitrust Act.
Which of the following regulatory groups is a system of nongovernmental, independent, local regulatory agencies supported by local businesses?
The Better Business Bureau
Which of the following firms would be most likely to have a monopoly for its competitive environment?
TimeWarner Cable TV
Which of the following would represent a brand competitor for Ford's Escape Hybrid sport utility vehicle?
Toyota's Highlander Hybrid
Which of the following industries is most commonly regulated by state regulatory agencies?
Utility companies
Which of the following is the best example of utilizing technology to improve consumer relationships?
Waiters recording orders on handheld computers
When a firm continues to violate what the Better Business Bureau believes to be good business practices, what is one of the main actions the bureau will take?
Warn consumers of the unfair practices.
Which of the following terms refers to consumers' propensity to buy?
Willingness to spend
The D-Lite Corporation produces a unique type of light bulb that is used in refrigerator manufacturing. D-Lite is the only maker of this light bulb, and there are no close substitutes for it. In this case, the D-Lite Corporation would be
a monopoly
The tobacco industry in the United States is dominated by three large companies. When any one of these companies changes its price on tobacco products, the other two companies quickly adjust their prices to match it. From these characteristics, the tobacco industry could best be described as
an oligopoly.
When PepsiCo takes the information collected through research and attempts to assess and interpret what it means for its soft-drink marketing efforts, PepsiCo is engaged in environmental
analysis
By the turn of the twentieth century, the population of the United States had shifted to three large racial and ethnic groups. These groups are
blacks, Hispanics, and whites.
A new U.S. automobile company, Specialty Motors, was established in 2004. In 2008, a recession caused disposable income to decline, and the annual amount of dollars spent by consumers for automobiles dropped drastically. Specialty Motors faced the problem of trying to determine whether the economy would turn toward prosperity or toward depression. No matter what happened, Specialty Motors was also worried about an impending global steel shortage, which would make a big difference in its future marketing plans. The economy might recover from the recession, but the automobile makers might be forced to ask consumers to curtail consumption just when the hope of a better year was finally in sight. All in all, the future looked dismal for Specialty Motors. Although all types of competition will affect Specialty Motors' marketing performance, it will be most concerned about _________ competitors.
brand
Companies that market products with similar features, benefits, and prices to the same customer group are known as _________ competitors.
brand
Marketers primarily focus their environmental analysis on ____ competitors.
brand
___________ competitors are the most significant to marketers because buyers see the different products of these firms as direct substitutes for each other.
brand
Environmental scanning means ___________ information about the marketing environment, whereas environmental analysis is concerned with ___________ this information.
collecting; assessing
When marketers define their target market, they establish a set of
competitors
What is the most important factor in distinguishing disposable income from income?
consumer spending
A group of protesters carries signs encouraging people to boycott Joe's Market, a small grocery store in an urban area. The protesters claim that Joe's takes unfair advantage of elderly and minority consumers. This protest is part of what we see today as the
consumerism movement.
Many well-known restaurants and corporations are changing to a completely smoke-free environment, and fewer restaurants offer smoking and nonsmoking sections. These firms are responding to changes in
cultural values.
Organizations that provide smoke-free environments or low-fat products are responding to changes in
cultural values.
Many health care companies are making adaptations to meet the needs of an aging population as the demand for medical services and products such as diabetes supplies increases. This change in marketing strategy is best explained by a change in
demographics
Consumer confidence is at a low during periods of
depression
The best approach for a company to take when monitoring its competitors is
developing a system for gathering ongoing information about competitors.
A new U.S. automobile company, Specialty Motors, was established in 2004. In 2008, a recession caused disposable income to decline, and the annual amount of dollars spent by consumers for automobiles dropped drastically. Specialty Motors faced the problem of trying to determine whether the economy would turn toward prosperity or toward depression. No matter what happened, Specialty Motors was also worried about an impending global steel shortage, which would make a big difference in its future marketing plans. The economy might recover from the recession, but the automobile makers might be forced to ask consumers to curtail consumption just when the hope of a better year was finally in sight. All in all, the future looked dismal for Specialty Motors. The income a consumer would use to purchase a Specialty Motors automobile is considered ___________ income.
discretionary
Which category of income are marketers most interested in?
disposable income
Consumerism is a
diverse group of individuals and organizations attempting to protect the rights of consumers.
The rapid adoption of the use of the Internet has resulted in rapid changes such as the increase of distance learning, changing social networks, and concerns such as copyright and privacy issues that the government is focusing on. These effects of technology are collectively known as
dynamics
Nabisco learned that health-conscious consumers preferred lower fat snack and lowercarbohydrate foods. At the same time, the firm saw sales of such products slumping and was careful not to launch any new varieties of these products for a while. Which of the following best describes Nabisco's action?
environmental analysis
Collecting information from secondary sources such as business, government, trade, and general-interest publications plays an important role in
environmental scanning
Dell Computer collects information about a wide variety of competitive, economic, political, legal and regulatory, technological, and sociocultural forces that affect its marketing activities. This process is called
environmental scanning
XM Radio is concerned about how the increasing use of MP3 players will affect the future sales of its satellite radio service. The company decides to gather information about the changing trends in music access to prepare for this trend. XM Radio's process is called
environmental scanning
To monitor changes in the marketing environment effectively, marketers must engage in
environmental scanning and analysis.
The 1990 Nutritional Labeling and Education Act directly prohibits
exaggerated health claims on food packages.
By offering credit and financing through its GMAC division, General Motors is trying to help consumers
expand current buying power at the expense of future buying power.
Discretionary income is associated with all of the following except
food
Due to limited resources, a consumer decided to serve Hawaiian Punch to a New Year's Eve party crowd instead of Korbel champagne. As a result of this action, Korbel and Hawaiian Punch can be viewed as ___________ competitors.
generic
The amount of money received through wages, rents, investments, pensions, and subsidies is called
income
A person's buying power is a function of
income, wealth and credit
When using credit to make purchases, consumers are
increasing current buying power at the expense of future buying power.
Meyers' Sporting Goods, a national chain, has been doing business with Soljur Sports, a manufacturer of skateboards, for several years. Recently, it came to the attention of Meyers' financial director that the average cost per Soljur Sports skateboard had substantially increased over that of the previous year. A corporate attorney was notified and began to look into the situation. The attorney found that Soljur Sports was selling a similar number of skateboards to a competitive chain for $10 less per skateboard. The attorney for Meyers' Sporting Goods immediately filed a complaint with the Federal Trade Commission. If the Federal Trade Commission believes that Soljur Sporting Goods is acting in violation of the law, the first move for the FTC is to
issue a complaint stating that the business is in violation of the law.
When a firm has many potential competitors and tries to develop a marketing strategy to differentiate its products from the competitors' products, a(n) _______ structure exists in the competitive environment.
monopolistic competition
J. Pitner Clothing is a medium-size specialty men's and women's clothing store in a market with many other specialty stores, department stores, and discounters. It has established a reputation for offering high-quality, fashionable merchandise with quality service. J. Pitner's competitive environment would best be characterized as
monopolistic competition.
Consumer protection legislation deals with all of the following legal concerns except
monopolistic practices.
Mixed Concrete cannot be shipped farther than twenty-five miles because the concrete might harden in the truck. Citrus County Concrete Company is the only supplier of mixed concrete to customers within a thirty-mile radius. Citrus County Concrete is an example of which one of the following competitive structures?
monopoly
The type of competitive structure that exists in the case where there are almost no substitutes for a product is a(n)
monopoly
What type of competitive structure exists when a firm produces a product that has no close substitutes?
monopoly
The Better Business Bureau is probably the best-known
nongovernmental regulatory group.
Three primary methods of collecting information for environmental scanning are
observation, secondary sources, and marketing research.
The four major competitive structures are
oligopolies, monopolies, monopolistic competition, and pure competition
The American automobile industry used to be dominated by "The Big Three," including General Motors, Ford, and Chrysler. However, as many more foreign competitors began influencing this market, the American companies had to modify and differentiate their products. The automobile industry moved from a(n) ______ structure to a(n) _______ structure.
oligopolistic; monopolistic competition
Most marketers operate in a competitive environment of either
oligopoly or monopolistic competition.
One way for corporations to attempt to influence the political environment is through
organizing political action committees.
Textile companies historically face issues concerning the use of child labor in foreign countries and the various regulations created concerning this labor. The type of marketing environment forces executives for these companies are most likely to try to influence are ______ forces.
political
Procompetitive laws are those designed to
preserve competition.
Marketers who attempt to influence and change the various environmental forces have a(n) _____ response to these forces.
proactive
Toyota has developed aluminum car bodies that are 100 percent recyclable and light enough to help conserve fuel. What kind of response is this to environmental forces?
proactive
___________ competitors are those that compete in the same product class, but their products have different features, benefits, and prices
product
Assuming that inflation is low, high buying power characterizes the _____ stage of the business cycle
prosperity
If in an industry, none of the many sellers could influence the price of supply of its products, this industry would be characterized as
pure competition
The two least common competitive structures at the opposite ends of the continuum are
pure competition and monopolies.
Although Matt's company engages in environmental scanning and analysis, he feels more comfortable changing his policies and strategies to adapt to environmental forces rather than trying to influence these forces. Matt has a(n) _____ approach to marketing environmental forces.
reactive
Marketers who view political forces as being beyond their control are taking a ___________ response toward these forces.
reactive
Although marketing theory supports the contrary, it is more probable that marketing budgets will be cut during periods of economic
recession
Total buying power declines during periods of economic
recession
Consumers begin to become more price and value conscious during periods of
recessions
Consumer confidence and willingness to spend begins to increase during periods of _____, and marketers must remain very flexible to make the necessary adjustments.
recovery
If M&M Mars Candies found a magazine article that provided key information on the television viewing habits of major candy consumer groups, this would be an example of information obtained through environmental
scanning
The Children's Online Privacy Protection Act prohibits websites and Internet providers from
seeking personal information from children under the age of 13
The Pharmaceutical Research and Manufacturers of America sets guidelines for its member firms to follow regarding the use of unethical practices. Thus, it is engaging in
self-regulation.
The strength of a person's "buying power" depends on economic conditions and
size of resources that can be traded in an exchange.
People for the Ethical Treatment of Animals (PETA) have demonstrated against the sale of coats made of animal furs. PETA's efforts to change shoppers' attitudes represent a __________ force for fur retailers.
sociocultural
The FTC can issue a cease-and-desist order, which is an injunction to
stop doing whatever caused the complaint
Newsweek enhances its visibility to readers by making its magazine available on the Internet. Newsweek is capitalizing on which environmental force?
technological
When Cisco Systems attempts to anticipate the effect of new products and processes on its own innovations, other business organizations, and society in general, the firm is engaging in
technology assessment.
Technology is
the application of knowledge and tools to solve problems and perform tasks more efficiently.
More than half of the research of technology created is paid for by
the federal government
Companies that compete for the same limited financial resources of the same customers are known as _________ competitors.
total budget
In today's marketing environment, competitors can take on many forms. For example, Diet Coke can be seen as a competitor to Wrigley's Double Mint chewing gum. In this circumstance, these two products are described as ___________ competitors.
total budget
Technology assessment is
trying to foresee the effects of new products and processes on the firm's operation and on society in general.
A new U.S. automobile company, Specialty Motors, was established in 2004. In 2008, a recession caused disposable income to decline, and the annual amount of dollars spent by consumers for automobiles dropped drastically. Specialty Motors faced the problem of trying to determine whether the economy would turn toward prosperity or toward depression. No matter what happened, Specialty Motors was also worried about an impending global steel shortage, which would make a big difference in its future marketing plans. The economy might recover from the recession, but the automobile makers might be forced to ask consumers to curtail consumption just when the hope of a better year was finally in sight. All in all, the future looked dismal for Specialty Motors. When Specialty Motors is operating during a recessionary period, its promotion efforts should stress
value and utility.
The textbook suggests that the best approach a firm can take in responding to marketing environmental forces is
variable
The accumulation of past income, natural resources, and financial resources is known as
wealth
Although Shelby's income is comfortable, she hesitates to purchase a new car because she is concerned about how poor economic conditions may affect her company and in turn her future employment. Shelby lacks
willingness to spend
