mark exam 3

Which two modes of transportation are used when containers are shipped by fishyback?

Water carriers and trucks

To compete effectively on a price basis, which of the following must be true?

A firm should be the low-cost seller of the product.

While grocery shopping, Kris saw an endcap display for Betty Crocker's new Mug Treats product. Kris is in the _______ stage of the product adoption process.

.awareness

What is the reorder point if the usage rate is 20 units per day, the order lead time is 8 days, and the safety stock is 60?

220. The reorder point = (Order lead time × Usage rate) + Safety stock. In this example, (8 × 20) + 60 = 220.

Tuscany Pizza sells its frozen pizzas to grocery stores in the Midwest for $4.50 each. Its annual fixed costs to produce the pizzas are $80,000 annually and its variable costs are $2 per pizza. Calculate the breakeven point for Tuscany Pizza.

32,000. The breakeven point is calculated by dividing fixed costs ($80,000) by the per-unit contribution to fixed costs (price minus variable costs; $4.50 minus $2; $80,000 divided by $2.50 equals 32,000).

In order for a label to say, "Made in USA," the Federal Trade Commission says that which of the following must be true?

All or virtually all of a product's components are made in the United States.

Which of the following statements is true regarding consumers' reliance on the price-quality relationship?

Consumers are more likely to rely on the price-quality relationship when they cannot judge the quality of the product themselves.

Which of the following does NOT apply to shopping products?

Consumers are typically unaware of the product until they see it online or in a store.

Which of the following is NOT one of the main uses of labeling?

Encourage multiple purchases

For which of the following products is exclusive distribution most appropriate?

Exclusive distribution is using only a single outlet in a fairly large geographic area to distribute a product. Of the options given, it is most appropriate for luxury cars.

If a firm is using nonprice competition to distinguish its products from other brands, it does not need to worry about competitors' prices.

F

The end result of eliminating marketing intermediaries is a cost benefit.

F

The reorder point is computed by multiplying the service standard by the order lead time.

F

Unfinished furniture is considered to be a convenience product because it is relatively inexpensive.

F

When a consumer moves into the adoption stage of the product adoption process, they will adopt the new product.

F

A shopping product has one or more unique characteristics and buyers are willing to expend considerable effort to obtain it.

F.A specialty product has one or more unique characteristics and buyers are willing to expend considerable effort to obtain it.

While the specific communication vehicles employed in promotion have not changed, the fundamental role of promotion is changing.

False

The Comfort Station Restaurant features daily lunch specials just like grandma used to make and enjoys serving "comfort-style" food—food that nurtures and comforts the soul. The restaurant is near a large office complex and competes against many national chains such as Chipotle, McDonald's, and Subway. It typically offers its lunch specials at $8.99 per person, but recently lowered its prices to $6 per person hoping that consumers would relate this price to Subway's $6 sandwich deal, which was so popular. Which of the following objectives is The Comfort Station Restaurant most likely seeking to achieve?

Increasing market share

Which of the following best describes the shape of the demand curve for a prestige product?

It has a curved shape showing that consumers are willing to purchase greater quantities at higher prices than lower prices. However, beyond a certain high price point, demand declines.

Linda felt she had to buy an iPhone. Her old "flip phone" had finally died and her children have been asking her for months to get an iPhone. They thought it would be great if Linda could FaceTime with her young

Late majority

Pierre runs a grocery store and is working with his suppliers in the planning and implementation of the flow of products from the manufacturer to his store. The goal is to make the transportation and storage of products more efficient and effective. He is engaging in _______.

Logistics management involves planning, implementing, and controlling the efficient and effective flow and storage of products and information from the point of origin to consumption to meet customers' needs and wants. Pierre is engaging in logistics management.

In which stage of the product life cycle do sales reach their peak?

Maturity

You are meeting with the head of a consumer advocacy group that claims your firm's promotion activities are causing food prices to rise. Naturally, you disagree with this claim, and you are meeting with this individual to make your case. Which of the following statements would be a strong defense against this advocacy group's claim?

Promotion can help keep prices lower by facilitating price competition.

Kohler, a manufacturer of bathroom fixtures such as sinks and toilets, has uploaded several videos to YouTube that help demonstrate how to install its fixtures. These videos are best categorized under which of the following types of promotion?

Public relations

When sales representatives for Owens Corning meet potential customers, it offers stuffed pink panthers to promote its insulation. This example illustrates Owens Corning's use of which of the following elements of the promotion mix?

Sales promotions

The _______ has had a strong impact on pricing decisions since it prohibits conspiracies to control prices and has led courts to rule that price-fixing among firms in an industry is illegal.

Sherman Antitrust Act

Area Which of the following describes a disadvantage of using an industrial distributor?

Since they are independent firms, they may be difficult to control

Of the following choices, which would be the most difficult brand name to legally protect?

Southwest Bakery

After appearing on a national talk show to discuss her line of bracelets and rings, Natalie expected sales volume to increase. Unfortunately, the sales volume was higher than expected and her company had $250,000 in lost sales because it did not have enough inventory. The $250,000 represents which of the following inventory management costs?

Stockout

Which of the following actions should a firm follow when marginal costs are equal to marginal revenue?

Stop producing additional units in order to maximize profitability

A manufacturer may try to prohibit intermediaries from selling its products outside designated sales territories to tighten control over distribution of its products.

T

Which of the following best defines the evaluation stage of the product adoption process?

The buyer considers the product's value versus the competition.

Which of the following factors or situations would affect the success of a company's use of nonprice competition?

The existence of unique product features that consumers value

The Fisher-Price company produces toys and baby-related products. For the introduction of its line of nursery furniture for infants and small children, the Fisher Company will most likely use _______ distribution for the products.

The nursery furniture would be a shopping product. Selective distribution is appropriate for shopping products

Which of the following aspects of a product's packaging is most likely to lead to a reseller refusing to carry a product?

The product is cumbersome or requires too much shelf space.

A landscaper buys a trailer so that he can transport tools and a lawnmower to different properties. This trailer is an example of which type of business product?

The trailer is an example of accessory equipment, which is equipment that is used in production of a product. Installations are facilities and nonportable major equipment.

Which of the following is a major goal of integrated marketing communications?

To send a consistent message to consumers

Which of the following is the best example of noise that originates with the receiver in the communication process?

Tony checks his e-mail when the television commercial break begins.

Redlands Distributing wants to carry Tide detergent products, made by Procter & Gamble (P&G). P&G agrees, but only if the supplier also purchases P&G's entire line of detergents such as Gain and Cheer. If this were to occur, Procter & Gamble would be engaging in which of the following channel management practices?

Tying agreement

Brandon is an avid golfer and often entertains customers on the golf course. He's considering purchasing a new set of clubs and is concerned both about the price and quality of the clubs. What type of consumer best describes Brandon and his golf club purchase?

Value-conscious

When Microsoft, the company that produces the Windows operating system, introduced its Windows Phone smartphones, this was called

a brand extension

Ralph Lauren is planning a promotion in which it will showcase all of its clothing lines to buyers at retail stores. It also plans to develop a direct marketing campaign that will use social media to introduce its new seasonal styles. Ralph Lauren is using _______ with the retail showcase and _______ with the social media campaign.

a push policy; a pull policy

Customers receive the benefits of form utility from an intermediary when _______.

a retailer offers to add a monogram to a product

Paula is working on a promotional program for her company's line of designer dog collars. Her company needs to promote the dog collars to pet owners, so she is likely to use _______ because it reaches a vast number of people at a low cost per person.

advertising

FedEx provides overnight shipping of packages across the United States. If a customer in San Francisco wants a package to be delivered to Atlanta the following morning, speed is very important, and the customer is willing to pay a higher price for the speed. FedEx would most likely use _______ for transporting the overnight package from San Francisco to Atlanta.

airplanes. Airplanes offer very fast speed, allowing the shipment to arrive by the following morning. The cost associated with this mode of transportation is also very high.

Isaiah has been subscribing to ESPN The Magazine for several years. He loves reading the articles every month and thinks that $29.95 for a one-year subscription is a great deal. He recently received a subscription renewal notice from ESPN. The new yearly rate for the magazine is $39.95. Isaiah isn't sure that he is willing to pay more for the subscription. Isaiah is likely using _______ to make this determination.

an internal reference price

Roberts Tool & Die Co. creates metal parts for manufacturers, including the aluminum posts for head rests in many automobiles manufactured in the United States. If the company observes that marginal costs and average total costs are both $39, then _______.

average total costs are at its lowest level

Tide Free and Gentle is a _______ of laundry detergent made by Procter & Gamble.

brand name

The oldest form of exchange is known as

bartering

In its commercials, the mattress company Sealy focuses on the comfort and quality of its brand of mattress. This advertisement is best described as being designed to _______.

build selective demand.This advertisement is designed to increase demand for the Sealy brand of mattress. This is an example of building selective demand, which is defined as demand for a specific brand.

A grocery store that sells both Annie's Homegrown Organic Macaroni & Cheese and Horizon Organic Macaroni & Cheese has been giving Annie's products better locations on the shelves and promoting them more in stores than Horizon's products. If this continues, _______ is likely to result.

channel conflict

Mary is currently working on updating her company's website, incorporating signs and symbols that will help represent the ideas that the company is trying to express. Mary is most likely working on the _______ for the website.

coding process

ClearView Windows sends out postcards containing an advertisement and a coupon to potential residential customers. This is part of the _______ component of the communication process.

communication channel

A minor league baseball team communicates to its target market by advertising on local television and radio stations, in local newspapers, on its own website, through postings on social media, and on banner ads. These vehicles through which the baseball team transmits its coded messages to potential customers are called _______.

communication channels

The internet, mobile apps, and billboards are all considered

communication channels

Packaging is most important, as a strategic tool, for

consumer convenience products

Subway, a fast-food sandwich restaurant, has channel members that are connected using legal agreements that spell out the rights and responsibilities of each member. This is an example of a(n) _______ vertical marketing system (VMS).

contractual

Lindsay stops by the Safeway grocery, her preferred store, on the way home from work. She picks up her usual brand of laundry detergent and orange juice, but she sees that there are no more free-range eggs available. Lindsay is very concerned about the ethical treatment of animals and so she leaves Safeway and goes to another grocery to purchase the free-range eggs. Lindsay's purchase of the laundry detergent and orange juice would most likely be classified as _______ products. Her purchase of the eggs would most likely be classified as _______ products.

convenience; shopping.Convenience products are relatively inexpensive, frequently purchased items for which buyers exert only minimal purchasing effort. Lindsay purchases detergent and orange juice frequently and does not need to exert much purchasing effort. Shopping products are items for which buyers are willing to expend considerable effort in planning and making the purchase. While for most people eggs would be a convenience product, Lindsay is concerned about free-range eggs. For her she is willing to expend the extra energy to get what she wants.

The _______ is/are considered the lowest level at which a company would price its product or service.

costs

If the demand for coffee beverages is similar to most products, if Starbucks were to increase the price of its coffee beverages, demand or sales of these beverages to consumers would most likely _______.

decrease

Sometimes a marketer may successfully create awareness and interest, but customers may stall during the evaluation stage. In this case, promotions such as free samples are employed to encourage product trial.

encourage product trial

If children and teenagers are insisting on wearing expensive name-brand apparel, a criticism of promotion can be made that promotion

encourages materialism

Abdul has started a lawn mowing business in his neighborhood. He spends $4 every month for a small advertisement in the community newsletter. He also pays for gasoline to use in the lawn mower. The money Abdul spends on the advertisement is a _______ cost and the money he spends on gasoline is a _______ cost.

fixed; variable

A contractor who specializes in upgrading kitchens has a table set up at the county fair where he offers people a free estimate in exchange for their contact information. This promotional effort is directed at _______.

identifying prospects

SC Johnson is a consumer goods manufacturer. The company's product mix includes home cleaning products, air care, pest control, home storage, and auto care. The president of marketing at SC Johnson would like to add laundry products to its product mix. SC Johnson would be _______.

increasing the width of its product mix. The depth of product mix is the average number of different product items offered in each product line. The width of the product mix is measured by the number of product lines a company offers, so SC Johnson would be increasing the width of its product mix by adding a product line.

When a toothpaste manufacturer has a policy of naming each of its toothpaste products differently, such as Shine, Pearl, and UltraWhite, this strategy is called _______ branding.

individual

When Coke Zero was added to the line of Coca-Cola products, it most likely was introduced using _______ distribution.

intensive

Courtney is a transportation coordinator for Nike. She has a large shipment of shoes arriving from plants in Asia and plans on using waterways, railroads, and trucks to transport the containers. Using these different transportation methods will allow Nike to take advantage of the benefits offered by each type of carrier. Using different types of carrier is referred to as _______.

intermodal transportation

The distinguishing feature between a brand mark and a trademark is that a trademark _______.

is registered with the U.S. Patent and Trademark office

The breakeven point is important for firms to know and understand because if a company is unable to sell products at this point or higher, it is _______.

losing money

Place utility is best described as

making the product available in locations where customers wish to purchase it

Freight transportation companies that have the ability to transport products in many different ways including ships, rails, trucks, and air service are known as

megacarriers

Carlos is listening to the radio while driving with his kids in the back seat. During the commercial break, one of the children repeatedly asks Carlos if they have arrived at their destination. The child's questions would be considered _______ in the communication process.

noise

Gap, an American clothing retailer, has come under fire recently for its use of manufacturing facilities in Myanmar. The UN has investigated the Myanmar government's crimes against Rohingya Muslims in Myanmar's Rakhine state saying it is a human rights catastrophe. Gap's continuation of clothing production in a country accused of crimes against humanity concerns _______.

operations management.Operations management is concerned with managing activities from production to final delivery through system-wide coordination. As the most public and visible aspect of the supply chain, operations management decisions can involve fair trade, working conditions, and child labor concerns.

David is reviewing proposals from different shipping companies to see whether he can improve _______ of his company's products.

order delivery

Word-of-mouth communications are most effective for _______ products.

personal services.Word-of-mouth communication is very important when people are selecting restaurants and entertainment along with automotive, medical, legal, banking, and personal services like hair care.

Zach enjoys dressing well and believes it's important to his image that he looks polished and professional. He makes his purchase decisions based on the reputation of a brand and appreciates the additional status that brands such as Burberry and Rolex provide to him. He is characterized as a _______ consumer.

prestige-sensitive

In the mid-1990s, Archer Daniels Midland Company was accused of _______. The company, along with its Japanese and Korean competitors, agreed to a set price for lysine, an additive found in animal feed, for their mutual benefit.

price fixing

The EU recently fined major truck makers for pricing that they viewed as anticompetitive. Many years ago, the managers at five of the companies got together and decided to set certain prices. By setting agreed-upon prices, customers would have to purchase at those prices and could not go to a competitor that sold comparable products at lower prices. They also agreed to pass the costs of environmental regulations onto consumers. These truck makers were fined for _______.

price fixing

Busch Stadium in St. Louis, Missouri, where the St. Louis Cardinals baseball team is based, is surrounded by a large number of restaurants and bars who are interested in attracting fans before and after games to dine or drink at their locations. Recently, one bar offered $1 drafts and another decided to offer $1 pitchers. The manager of a third bar decided to offer a buy-one-get-one half-price special on entrees as she knew that lowering prices on beer could result in a(n) _______ that could erode profits and be harmful to all competitors.

price war

Jack was born in Australia and moved to the United States when he was a teenager. He is an actor and gets paid to give presentations to elementary school students on Australia's culture and traditions as "Outback Jack." When speaking to school children, Jack is _______.

providing a service

A bed and breakfast inn holds crafting getaways where all of the people staying at the property are interested in the same activity. These getaways are typically done during the fall when fewer people typically visit. These getaways are designed to _______.

reduce sales fluctuations

A customer's _______ refers to whether the price will move customers closer to purchase of the product and the degree to which the price enhances their satisfaction with the purchase experience and with the product after purchase.

response to the price.Customer response refers to whether the price will move customers closer to purchase of the product and the degree to which the price enhances their satisfaction with the purchase experience and with the product after purchase.

Laurie bought herself a new jacket using a marketing channel that has only one intermediary. That intermediary is classified as a

retailer

ValueCut has a Haircut Club that gives customers their eighth haircut for free after they have bought seven at regular price. The primary objective of this type of program is _______.

retaining loyal customers

Each year, Doritos holds a contest for customers to create a commercial. The winning commercial, as decided by internet voters, airs during the Super Bowl. This contest is an example of Doritos using _______ for its promotion strategy.

sales promotions

In the weeks leading up to Thanksgiving, Butterball turkey may allocate more of its promotion budget to _______ in order to account for the coupons it will be issuing to consumers.

sales promotions

Valpak is a company that mails out packets of coupons to consumers. These coupons mostly include discounts for local and regional businesses. Valpak is helping these companies with their _______.

sales promotions

When Lean Cuisine promotes the quality, taste, and calorie contents of its line of frozen meals, it is attempting to develop _______.

selective demand

Perishable products such as dairy or produce are more likely to be distributed through

shorter channels. Shorter channels mean that there will be less handling of the products and therefore the products will reach shelves quickly.

In the growth stage of the product life cycle, a typical marketing strategy seeks to _______.

strengthen market share and position the product favorably against aggressive competitors by emphasizing its benefits

Jars of Peter Pan, Skippy, and Jif peanut butter could be considered category-consistent packages because _______.

the jars of all brands are similar and follow a traditional shape for peanut butter jars

Brand equity is best defined as _______.

the marketing and financial value associated with a brand's strength in a market

Ryder describes itself as a firm "that delivers outstanding execution from deep expertise in your industry. Our proven supply chain management and transportation solutions, LEAN guiding principles and an established network across NAFTA and Asia help us customize the right solution to meet your business' needs." Due to its specialized expertise, many firms outsource its logistics activities to Ryder. Ryder is most likely a(n) _______.

third-party logistics (3PL) firm

Sutter Homes Winery offers special discounts to retailers to compensate them for providing transportation or warehousing services, which are known as _______ discounts.

trade

When the Quaker Oats Company manufactures its Quaker Chewy Bars, it places several boxes of the bars into larger shipping boxes that are then stacked onto pallets. These pallets can then be easily moved around using forklifts in a process called _______.

unit loading

Amazon's "Alexa Lost Her Voice" commercial was shared by thousands of people through social media and watched millions of times on YouTube. This is an example of _______.

viral marketing

Marginal revenue (MR) minus marginal costs (MC) tells a company

whether a unit makes a profit

The various products carried by a retailer can also have dimensions of width and depth. For example, Dick's Sporting Goods carries sports clothes, shoes, exercise equipment, hunting and fishing equipment, camping supplies, and other products. Bass Pro Shops carries fishing equipment but has a larger selection of different models and brands. In this case, the product mix of Dick's Sporting Goods is _______, and the product mix of Bass Pro Shops is _______.

wide; deep

If the percent change of quantity demanded for razors is .5 and the percent change in price is −.18, what is the price elasticity of demand?

−2.78.\ Price elasticity of demanded is calculated by dividing the percent change in quantity demanded by the percent change in price. .5 / −.18 = −2.78.