DECA Marketing Cluster Sample Exam #1 of 5

One business promising to do something for another business in return for receiving compensation is an example of a:

Contract. (Contracts are agreements among two or more parties stating that one party is to do something in return for something provided by another party. If one business promises to do something for another business in return for receiving compensation, the two businesses have a contract. Then, the businesses are obligated to fulfill their part of the contract. In most cases, contracts benefit both parties, although promising to do something in return for receiving compensation is not necessarily a benefit. Treaties are trade agreements among two or more countries. An enterprise is another term for a business.)

Thomas does not know the answer to Mr. O'Malley's question about a complex product. Which of the following is the best way for Thomas to respond to Mr. O'Malley's inquiry:

"I'm not sure, Mr. O'Malley. My coworker, Reggie, knows a lot about this model. If you can wait a moment, I will have him speak with you." (If employees do not know the answers to customers' questions, they should try to find another employee who does. This person may be a coworker, supervisor, or an individual who works in another department. To provide good customer service, Thomas should do his best to answer Mr. O'Malley's question as soon as possible. Providing the manufacturer's website address and reading the product manual at a later time are not options that provide prompt customer service. It is inappropriate to give out customers' telephone numbers to others without their permission.)

Your supervisor has asked you to prepare a marketing status report for each of the company's six regional offices. The most appropriate way to organize the information is:

By site location. (When preparing reports, you should organize the content in the way that will make the most sense to the reader. In the example, the supervisor is asking for a status report for different offices, which indicates that the supervisor will likely want to scan the information by location to quickly review the status of each office or site. Another way to organize the information might be by listing each activity (e.g., advertising, sales) with each site's status included in each activity; however, this format may be cumbersome and difficult to determine each site's status at a glance. Presenting facts in chronological order involves describing steps or historical events in the sequence in which they occur. Reverse sequence involves describing steps or historical events in the opposite order.)

Asking questions is important because it:

Can clear up misunderstandings. (Asking questions can help you clarify, understand, and clear up misunderstandings. When you're attempting to listen, it's not the time to voice your opinion. By asking questions, you become an active, not passive, participant in the conversation. While asking questions is beneficial, it doesn't help your brain process speech more quickly. Your brain is actually very efficient already; it can process speech four times as fast as people can talk.)

Marcy is ready to buy a new computer, and she has saved up enough money to buy the model she wants. Which of the following describes the quantity that Marcy is prepared to buy:

Demand. (In order for demand to exist, consumers must have both the desire and the ability to purchase the product. Supply is the amount of the product that sellers are willing and able to offer for sale at a specified price in a given time period. Market price is the actual price that prevails in a market at any particular moment. Elasticity is an indication of how changes in price will affect changes in the amounts demanded and supplied.)

Cindy's lemonade stand sells lemonade to customers. The route that the lemonade is taking from the producer to the final consumer is:

Direct. (Direct is a channel of distribution in which goods and services move directly from the producer to the consumer. Indirect is a channel of distribution in which goods and services move from the producer to the channel members and then to consumers or industrial users. Roundabout is not a method of distribution. Intermediaries are channel members who perform the activities needed in getting a good or service from those who produce it to those who consume it.)

A memo on the bulletin board from a supervisor to staff members is an example of __________ communication.

Downward. (Downward communication passes information down the chain of command to employees. This is a frequently used form of communication because supervisors must often provide general information to all workers. Horizontal communication is between persons or departments on an equal level. Upward communication moves from employees up to management. Formal communication may move in any direction, but it would be in the form of a letter, report, etc., rather than a bulletin board memo.)

When an agent legally acts in the best interests of his/her client, the agent is establishing a(n) __________ relationship.

Fiduciary. (An agent is someone who acts on the behalf of another party. The agent often negotiates contracts and handles legal issues for another person with that person's consent. The agent who shows that s/he is loyal, trustworthy, and acting in the best interest of his/her client (principal) is fostering a fiduciary relationship. Authoritative relationships are based on a particular level of control. Principal is a legal term that describes the client. Legislative processes involve the procedures in which people or governments establish laws.)

When businesses want to make their products available to customers but do not want to over-distribute their goods and services, they are seeking:

Ideal market exposure. (When a business takes steps to ensure that a product is available to the target market without over-distributing the product, it is seeking ideal market exposure. If product supply is higher than demand, the business loses money on the unsold products. Therefore, businesses strive to obtain ideal market exposure to satisfy demand but not have a surplus of goods. Exclusive and intensive are distribution patterns. The type of distribution pattern that a business uses depends on its ideal market exposure. Direct distribution is a type of distribution channel in which goods and services move directly from the producer to the consumer or industrial user.)

An example of a natural resource is:

Iron ore. (Natural resources include those things that are provided to us by nature. Office equipment is a capital good. Capital goods are materials used in the production of other goods and services. Physical ability is an example of a labor resource. An electrician is a human resource.)

An effective executive summary

Is written for people who won't read the whole document. (The executive summary is often read by people who simply don't have time to read the entire report. That's why it's so important to make sure your executive summary is as accurate and error-free as possible. You don't need to include every point from the business report—an executive summary should only be about 1/10th the length of the original document. Focus on including only the main points. Avoid using too much technical terminology. The executive summary is often read by people who aren't experts in the field, and it needs to be easily understood by everyone. For the same reason, it's also important to avoid using complex sentences. Remember that the executive summary will often be skimmed by busy people. Help them understand your executive summary by making it as easy-to-read as possible.)

When the meeting leader asked the group participants if they had any suggestions for the new product catalog, Lily pulled out a list of notes that she had compiled and talked for the remaining 20 minutes of an hour-long meeting. In this situation, Lily:

Monopolized the discussion. (When participating in a staff meeting, it is important to provide information or make suggestions when appropriate. When one person dominates the discussion, others do not have an opportunity to provide their input. Because Lily spoke for a long time during the meeting, she monopolized the discussion. There isn't enough information provided to determine if Lily provided positive feedback, followed parliamentary procedure, or expressed her opinions clearly.)

What do business owners consider when they select a business ownership structure?

Personal circumstances, financial needs, and the type of business. (Because each business owner's situation is unique, the owner must consider the type of business being operated, the amount of capital that is needed to start the business, and the owner's personal circumstances. For example, an independently wealthy, single person who starts a consulting business has different needs than a chef who has little capital and wants to open a full-service restaurant. Product versatility, advertising strategies, and product mix are not generally considered when determining the appropriate business ownership structure.)

How can a business build its customers' trust and communicate its commitment to ethical practices?

Publish its confidentiality statement. (A business can build its customers' trust by communicating that it will not share its customers' confidential information with third parties and that it will take measures to secure online transactions. One way to communicate this commitment is by publishing its confidentiality statement in company brochures, in email messages, and on its website. Developing liberal business policies, hiring employees who have a positive attitude and posting its earnings on its website may help build trust with customers; however, these actions do not communicate the business's commitment to adhering to its ethics.)

The office photocopier is jammed again! Fortunately, there is an instruction manual to guide you through the process of removing the jammed paper. What is the best way to use the manual to clear the photocopier?

Read step one and then perform step one. Repeat this process in sequential order until all of the steps are completed, and you have removed the paper. (When assembling or fixing equipment, it is usually easier to understand directions by reading the step, performing the step, and then moving on to the next step in the sequence. By doing so, you are less likely to hurt yourself or the machine. You are more likely to make mistakes (and more likely to hurt yourself or the machine) if you briefly skim the manual, read the manual before performing the steps, perform the steps in reverse order, or perform the step before reading the instructions.)

Negative word-of-mouth advertising due to unresolved customer complaints can cost a business its:

Reputation. (Negative word-of-mouth advertising due to unresolved customer complaints can cost a business its reputation. Once a reputation has been damaged, it is very difficult to rebuild. Customer complaints should not necessarily cost a business its employees, its facilities, or its licenses.)

Which of the following often makes it difficult for small manufacturers that have limited budgets to receive an equal opportunity to distribute their new products:

Slotting allowances. (A slotting allowance is a cash premium that manufacturers pay to businesses to cover the costs involved in carrying a new product. In many cases, the cash premium is substantial because there is a lot of competition among manufacturers to encourage businesses to carry their products. Often, the manufacturer that offers the largest allowance is the one that gets shelf space for its new product. This may be unethical because small manufacturers that cannot afford to pay large slotting allowances do not have an equal opportunity to distribute their products. The gray market involves buying from unauthorized distributors. Channel strategies are distribution plans. Targeted advertising involves focusing on a specific group.)

What does an enclosure notation at the bottom of a business letter signify?

Something is being sent with the letter. (The word "Enclosure" at the bottom of the page indicates that other material accompanies the letter. This lets the recipient know s/he should look for additional material and lets the sender know if the material was not enclosed. Reference initials indicate who prepared a letter. The copy notation (cc) preceding a name (or names) signifies that copies of the letter were sent to persons other than the addressee. A request for a reply is usually included within the body of the letter.)

Businesses are being socially responsible to their customers when they:

Test the safety of their products. (Every business has the responsibility of producing and/or offering safe, quality products. If businesses fail to be sensitive to the well-being of their product users, the businesses will probably fail. Providing safe working environments and offering job training are ways businesses can be socially responsible to their employees. Contributing to community causes demonstrates social responsibility toward the community.)

A manufacturer that decides to sell directly to large retailers rather than through wholesalers might create __________ conflict within its distribution channel.

Vertical. (Conflict in a distribution channel occurs when there is disagreement among the various channel members. Vertical conflict occurs when there is disagreement between different levels of the same channel. An example of a vertical channel is a manufacturer selling to wholesalers who then sell to retailers. If the manufacturer decides to bypass the wholesalers and sell directly to retailers or stores, conflict may develop within that vertical channel of distribution because the wholesalers are being eliminated. Horizontal conflict occurs among businesses at the same channel level, such as between different franchisees for the same business competing in the same city. Formal and conventional are not types of channel conflict.)