exam 3 practice questions
A psychological price is designed to encourage purchases based on emotional rather than rational responses. One approach to psychological pricing is a. customary pricing b. loss-leader pricing c. competition-oriented pricing d. unit pricing e. cash discounting.
A
After seeing a gorgeous diamond cocktail ring on TV, Cyndee calls a toll-free number and orders the ring. This illustrates A) television home shopping. B) telemarketing. C) online retailing. D) catalog marketing. E) automatic vending.
A
Based on the wheel-of-retailing concept, changes in the ________ require retailers to adjust in order to survive. A) environment B) store image C) merchandise D) location E) services
A
Carlotta was recently promoted to manager of the Banana Factory, a local candy store. As a new store manager, she is very concerned about the functional and psychological picture that consumers have of her store. From a retail perspective, Carlotta seems to be concerned about the Banana Factory's a. image b. product assortment c. location d. positioning e. atmospherics.
A
Channel power is a. The ability of one channel member to facilitate or hinder the goal attainment of other channel members. b. The functions and services that channel member has to offer compared with others in the channel c. The structure that facilitates the movement of a product through the channel d. Something that does not exist among channel members e. Usually turbulent in marketing channels
A
Compute the reorder point if the usage rate is 300 units per day, the lead time is 2 weeks, the safety stock is 900 units, and the company works a 5-day week. a. 3,900 units b. 1,500 units c. 3,000 units d. 3,600 units e. 1,200 units
A
Customers of McDonald's, Wal-Mart, and Neiman Marcus, respectively, can be characterized as ________________,__________________, and____________. a. value-conscious, price-conscious, and prestige-conscious. b. price-conscious, value-conscious, and prestige-conscious c. price-conscious, variety-conscious, and prestige-conscious d. value-conscious, variety-conscious, and prestige-conscious e. product-conscious, price-conscious, and prestige-conscious
A
Elasticity of demand describes a. changes in demand that result from changes in price b. changes in total revenues that result from changes in demand. c. changes in price that result from changes in demand. d. an inverse change in total revenues that results from changes in price. e. a parallel change in total revenues that results from changes in price
A
For carrying a producer's product, a distribution channel member expects to a. receive a profit that is comparable to what it could make from handling competing products. b. receive discounts for small orders.c. receive a low per unit profit if carrying the product requires considerable time and resources. d. pay the entire cost of sales training and other support activities. e. receive a profit that is greater than or equal to 40 percent of the product's purchase and carrying costs.
A
For which of the following products would intensive distribution be most appropriate? a. Gasoline b. Automobiles c. Moderately priced luggage d. A hot-air balloon e. Washing machine
A
Horizontal channel integration can reduce costs because a. The combined units operate more efficiently than independent institutions. b. The market is made more heterogeneous c. A number of institutions are combined under a common management d. The functions of an intermediary are performed at some other channel level. e. Government regulations protect independent institutions
A
Horizontal channel integration involves a. Bringing under one management organizations that function at the same basic level b. Bringing several channel stages under one common management c. Acquiring the operations present at different levels in the channel d. Merging the functions performed at one level into the operations that take place at another level. e. Intensive or selective distribution
A
Most marketers consider a product's cost a. a minimum price b. a benchmark, or average, price. c. a maximum price. d. the price that will yield the greatest long-term profits. e. the price that is expected by marketing channel members.
A
Nonstore retailing is growing because a. consumers have less time for shopping in retail stores. b. of the decrease in the number of older consumers. c. of the wheel-of-retailing theory. d. of the success of discount stores such as Wal-Mart. e. consumers question the validity of infomercials.
A
Pricing objectives are overall goals that describe the role of price and a. Must be consistent with the organization's goals. b. Have a minimal effect on other functional areas of a business. c. Help determine the allocation of buyer's purchasing power. d. Should not have an effect on the functional areas of a business. e. Should take only profit into account.
A
Pricing objectives are overall goals that describe the role of price and a. help an organization achieve its long-range plans. b. have little effect on other functional areas of a business. c. help determine the allocation of buyers' purchasing power. d. should not have an effect on the functional areas of a business. e. help determine an organization's short-range plans.
A
Self-service, general merchandise stores such as Wal-Mart are known as a. discount stores b. warehouse showrooms c. catalog showrooms d. superstores e. specialty retailers.
A
Shannon's Health Club raised its membership fees, and the firm's total revenue decreased by $10,000. What can the marketers at Shannon conclude? a. Demand is elastic b. Demand is inelastic c. Shannon has a prestige good d. Shannon was operating below the breakeven point e. Shannon was operating above the breakeven point.
A
Superstores have been designed to sell products efficiently by means of their a. size and operating methods. b. legal advantages c. direct approach to consumers. d. services for consumers. e. services provided to producers.
A
The ability of a carrier to move goods over a specific route or network is known as its a. accessibility b. dependability c. frequency d. capability e. load flexibility
A
The manager of Warren's Bar-B-Q discovers that when the firm sells one additional sandwich, its total revenues increase by $2.75 while its total cost increase by $2.50. It should a. sell more sandwiches b. stay at the present level of sales c. cut back on sandwich sales d. look for the level at which marginal revenue increases. e. collect more data to decide if sales should increase or decrease.
A
What effect do quantity discounts have on the marketing function? a. Large purchases reduce selling costs and may shift certain storage, finance, and risk-taking functions onto buyers. b. Because discounts are usually small, they provide no incentive for intermediaries to furnish transportation, storage, or other services. c. Discounts usually decrease the total number of marketing functions that are necessary to get a product to buyers. d. Discounts are considered bribes by intermediaries, which puts producers in a bad light. e. Quantity discounts have no effect on the marketing functions.
A
Which of the following does NOT contribute to atmospherics? A) Sales commissions B) Color C) Music D) Displays E) Lighting
A
Which of the following helps identify the target market's evaluation of price? a. Understanding customer's needs, willingness, authority, and ability to buy b. Discovering the top prices customers will pay for a product. c. Stretching demand for a product d. Evaluating competitors' prices e. Discovering the lowest price customers will pay for a product
A
Which of the following is NOT a means through which retailers add value? A) Research and development B) Repair services C) Convenience D) The opportunity to comparison shop E) Credit
A
Which of the following is not one of the main tasks of order processing? a. Order verification b. Order delivery c. Order entry d. Order handling e. All of the above are main tasks of order processing.
A
Which of the following statements is false? a. Profits are what is left after expenses are paid and are included in costs to determine the breakeven point. b. The breakeven point is the point at which variable costs and fixed costs equal total revenues. c. At the breakeven point, no losses have been incurred and no profits have been accumulated. d. Breakeven analysis assumes that demand is fixed. e. Breakeven analysis requires that both variable and fixed costs be known.
A
Which of the following terms can be used to describe the marketing channel? a. Channel of distribution b. Communication channel c. Promotional channel d. Trade flow e. Vertical marketing system
A
_________________ is measured by the total time that a carrier has possession of goods. a. Speed b. Holding Time c. Lead time d. Carrying time e. Possession time
A
The purchase of cosmetics from your neighborhood Avon representative is: A) direct selling. B) direct marketing. C) catalog marketing. D) direct-response marketing. E) television home shopping.
A?
A pricing policy is a. designed to encourage purchases based on emotional reactions. b. a guiding philosophy that determines how price will be sued as a variable in the marketing mix. c. a method for calculating the base price of a product. d. a mechanical procedure for setting prices on a regular basis. e. the same thing as a pricing objective.
B
A trade discount is a. A deduction from the list price that reflects the economies of buying in large quantities. b. A reduction off the price given to an intermediary by a producer for performing certain functions. c. A price reduction to the buyer given for prompt payment or payment in cash. d. Considered unethical and has been outlawed in some states. e. The only means to satisfy intermediaries.
B
According to the text, a product such as a low-priced pen is most likely to be sold through a. selective distribution b. intensive distribution c. exclusive distribution d. channel distribution e. competitive distribution
B
According to the text, price is a. Purchasing power. b. The value exchanged for products in a marketing transaction. c. The utility associated with a product. d. How much something costs in monetary terms. e. Money paid or some other financial consideration.
B
An advantage of knowing competitor's prices is that it a. eliminates a marketer's need to develop cost objectives. b. can enable a marketer to set prices slightly lower and thus increase sales. c. ensures profits for a marketer who charges the same price. d. ensures an accurate estimate of sales. e. ensures that all firms engage in price competition.
B
Boris Popov recently entered into an agreement with The Blue Lagoon, a chain of upscale seafood restaurant in return for 20 percent of the profits. Based on the scenario, Boris is a(n) a. franchiser. b. franchisee. c. independent retailer. d. outlet manager. e. operations supervisor
B
Channel leaders are responsible for a. Physical possession b. Coordination of channel members and activities c. Market risks d. Market possession e. Channel noise
B
Decreased flexibility is one of the limitation inherent in a. Physical distribution b. Horizontal channel integration c. Marketing channel leadership d. Multiple marketing channels e. Using agents
B
For what types of products would it be a good idea to lower prices? a. Prestige products b. Products with elastic demand c. Products that exhibit a direct, positive relationship between price and quantity demanded d. Products with inelastic demand e. It is never a good idea to lower prices because it makes your product look cheap.
B
If Carrier develops a new air-conditioning compressor that lasts twice as long as existing compressors while using half of the electricity, it will probably establish its pricing objective based on a. Cash flow b. Product quality c. Survival d. Return on investment e. Market share
B
In direct-response marketing, a. party plans are often used. b. products must usually be priced above $20 to justify advertising and distribution costs. c. it is important for the retailer to maintain a fleet of delivery vans. d. franchises must negotiate annually with their franchisers. e. supermarkets offer consumers discount coupons at checkout stands.
B
JC Penney's and Sears are examples of A) independent stores. B) chain stores. C) specialty retailers. D) franchise stores. E) discount stores.
B
Kwan and Sylvia King, owners of the King Dairy Farm, recently signed a contract to supply raw milk to a milk processing plant in the next state-over 600 miles away. They are concerned about the best way to transport their milk to the processing plant. The King Farm is located next to a regional airport, three major interstate highways, and a major rail line. Which transportation mode would you recommend to Kwan and Sylvia? a. Air b. Truck c. Waterways d. Railroad e. Pipeline
B
Marketers at Vogue Department Store regularly check prices in other stores and then set their own prices 6 percent lower than those of competitors. Vogue uses a. cost-oriented pricing b. competition-oriented pricing c. demand-oriented pricing d. superficial discounting e. odd-even pricing
B
Mighty Max Car Wash is considering a pricing method and decides to make $1.00 profit on all services. The management estimates that total costs of providing a basic car wash to be $4.00 and charges the customer $5.00. Mighty Max is using which of the following pricing methods? a. Price lining b. Cost-plus pricing c. Price differentiation d. Systematic pricing e. Competition-oriented pricing
B
Murray's Lawn Care had sold twenty lawnmowers during the first three weeks of the month. Murray calculated a total revenue for the mowers of $4000, a per unit cost of $100, and overhead of $1000. A customer came in just before closing on the last day of the month and bought one more lawnmower. The additional $200 Murray received from that sale is called a. marginal cost. b. marginal revenue c. total revenue d. fixed cost e. variable cost.
B
Off-price retailing can be a source of tension between department stores and manufacturers when off-price stores a. locate in factory outlet malls b. obtain in-season, top quality merchandise c. refuse to extend credit d. remove labels from products. e. provide delivery services.
B
Online retailing a. is illegal in many states. b. allows consumers to place orders through their computer terminals and modems. c. requires in-depth computer knowledge. d. deals primarily with the marketing of computer products. e. relates only to the products of a few retailers.
B
Organizational profit is maximized on a unit of goods when a. marginal revenue = total cost b. marginal cost = marginal revenue c. marginal revenue > marginal cost d. marginal costs > marginal revenue e. fixed costs < variable costs
B
Price fixing was made illegal by the a. Robinson-Patman Act. b. Sherman Antitrust Act c. Clayton Act d. Federal Trade Commission Act e. Consumer Goods Pricing Act
B
Specialty stores differ from department stores in that specialty stores usually have a very narrow product a. line b. mix c. type d. perspective e. angle
B
The Hall Company is engaged in operations associated primarily with nonstore retailing. It is probable involved in which of the following types of retailing? a. Catalog showroom b. Automatic vending c. Specialty retailing d. Off-price retailing e. Boutique
B
The Mark Corporation recently purchases Walls distributing, a wholesaling operation in Mark's channel of distribution. Mark now controls all the channel functions from production to warehousing, to distribution to final consumers. What type of change has Mark's marketing channel undergone? a. Vertical channel distribution b. Vertical channel integration c. Horizontal channel integration d. Horizontal channel dispersion e. A vertical leveraged buyout
B
The advantage of knowing a competitor's prices is that a. It eliminates a marketer's need to develop cost objectives. b. It helps the firm adjusts its prices in relation to competitor's prices. c. It ensures profits for a marketer who charges the same price. d. It ensures an accurate estimate of sales. e. Industry profits are known to all.
B
The physical elements in a store's design that appeal to customers' emotions are collectively termed A) imaging. B) atmospherics. C) ambience. D) wheel of retailing. E) retail positioning.
B
To increase customer service and lower costs, Rogers Distributing would like to integrate its order processing, inventory, accounting, and transportation planning into a total information system. Which of the following systems would you recommend to Rogers Distributing so that the company can meet its objectives? a. A just-in-time (JIT) system b. An electronic data interchange (EDI) system c. A computer-based planning (CBP) system d. A manual order processing system e. A materials handling system
B
What type of integration brings together the processes and functions of two or more stages of the channel under one management? a. Conventional b. Vertical c. Traditional d. Horizontal e. Concentric
B
Which of the Following occurs when one of the members of a marketing channel fails to fulfill its expected role? a. Channel cooperation b. Channel conflict c. Channel leadership d. Channel integration e. Channel distribution
B
Which of the following is an example of a pricing decision that is compatible with the marketing objective of increasing unit sales by 10 percent by the end of the next year? a. Setting a price equal to the average market price when buyers are price-sensitive b. Reducing a price below the average market price when buyers are price-sensitive c. Increasing a price above the average market price when buyers are not price- sensitive e. Increasing a price above the average market price when buyers are price-sensitive
B
Which of the following is most likely to cause delivery delays and thus loss of sales and customers? a. Wide assortments of bulky goods b. Stockouts c. Late delivery d. Failure to use air freight e. Distant business location
B
Which of the following is not a criterion in selecting a transportation mode? a. Dependability b. Variety c. Frequency d. Accessibility e. Load Flexibility
B
Which of the following is the broadest and most fundamental pricing objective? a. Market share b. Survival c. Profit d. Return on investment e. Cash flow and recovery
B
Which of the following pricing objective relates to adjusting prices so that the firm can increase sales volume to match organizational expenses? a. Profit b. Survival c. Return of investment d. Market share e. Cash flow
B
Which of the following statements is false? a. When a retailer allows expenses and prices to increase, vulnerability to competition from new institutions also increases. b. Today there is a sharp delineation between discount stores and department stores. c. The wheel-of- retailing hypothesis requires that retailers adjust in order to survive and compete. d. Retailers are customers of wholesalers and producers. e. There are more than 1.5 million retail stores operating in the United States, according to the text.
B
You would find the greatest variety of services at a A) discount store. B) department store. C) supermarket. D) warehouse club. E) factory outlet store.
B
66. The buyer in a retail transaction is A) the producer. B) a wholesaler. C) the ultimate consumer. D) a department store. E) a chain store.
C
76. Which of the following accounts for less than 2 percent of all retail sales? A) Specialty retailing B) Catalog marketing C) Automatic vending D) Telemarketing E) Franchising
C
A market structure that allows no flexibility in setting prices is a. an oligopoly b. an unregulated monopoly c. perfect competition d. monopolistic competition e. nonprice competition.
C
Best's Entertainment, Inc. has just produced a new virtual reality product that will hook directly into a home computer. The demand is so high, Best has a hard time filling orders. Best decides to use a price skimming policy, which can be described as a. skimming off the price for introductory products. b. charging the lowest possible so hesitant buyers will pay. c. charging the highest possible price that buyers who most desire the product will pay. d. offering the most inflexible introductory base price. e. charging the highest possible price so that large research and development costs will be covered.
C
Chevy markets heavy duty cargo trucks directly to businesses. This is an example of a a. Producer-to-agent-to industrial-buyer channel b. Producer-to-industrial-distributor-distributor-to-industrial-buyer channel c. Producer-to-industrial-buyer-channel d. Producer-to-agent-to-industrial-distributor-to-industrial-buyer channel e. Consumer channel
C
Craven's Department Stores offers wool sweaters for sale at $15.00, $16.50, $18.75, $19.95, and $ 37.50. Apparently, the person in charge of setting these prices is unfamiliar with or is unwilling to use a. odd-even pricing b. customary pricing c. price lining d. penetration pricing e. pioneer pricing
C
Dave North's company buys machine tools from larger producers and sells them to several Southwestern manufacturing companies. The company Dave works for carries inventories of the tools, which reduces capital requirements for the producers. Dave's company is a(n). a. Manufacturer b. Retailer c. Industrial distributor d. Manufacturer's agent e. Wholesaler's agent
C
Factory outlet malls are A) wheel centers. B) neighborhood shopping centers. C) nontraditional shopping centers. D) regional shopping centers. E) community shopping centers.
C
Given that Nissan operates in the oligopolistic automotive industry, when Nissan lowers the price of its Sentra, other automobile makers likely to do what with their own comparable models? a. Raise prices b. Reduce fixed costs c. Match the price reduction d. Reposition their own products e. Focus on larger automobiles
C
Home Depot, a chain of large specialty stores, competes on low prices, service, and enormous product availability. It is a(n) A) hypermarket. B) off-price retailer. C) category killer. D) warehouse club. E) discount store.
C
Idaho Forestry Products offers a cash discount to its customers on the terms 2/10 net 30. this means that the customer must a. pay 2 percent of the bill within 10 days and the rest within 30 days. b. pay all of the bill in 10 days or be charged an extra 2 percent. c. pay within 10 days to receive a 2 percent cash discount or pay the entire amount within 30 days with no discount. d. pay interest of 2 percent on the bill for any time after 10 days that the bill is not paid. e. pay interest of 2 percent on the bill for any time after 30 days that the bill is not paid.
C
If General Motors decides to give consumers a discount of $1,000 off the list price of the Oldsmobile Aurora, this discount would be considered a(n) a. seasonal discount b. cumulative discount c. allowance d. cash discount e. trade discount
C
If Perrier notices a change in the price of a six-pack of bottled water from $2.75 to $4.25 increases the quantity demanded of the product by 21 percent, this item is probable a(n) ______________ product. a. normal b. breakeven c. prestige d. highly competitive e. value-priced
C
M Corporation has engaged in pricing goods to its customers by offering to pay all or part of the actual freight costs. This is considered to be a type of a. trade allowance pricing b. trade discount pricing c. geographic pricing. d. goods absorption pricing. e. zone pricing.
C
Milewski Plastics, Inc., needs a new warehouse to add to its distribution system. Milewski's products require special handling and storage features. In addition, the company wants to maintain complete control over the design and operation of its new warehouse. What type of warehouse should it use? a. A public warehouse b. A distribution center c. A private warehouse d. A combination warehouse e. A public-limited warehouse
C
Nonprice competition is workable for a particular brand if a. the firm promoting the brand has a limited promotion budget. b. a lower-priced brand with similar product features is available. c. the firm can distinguish the brand through unique product features that are difficult for competitors to imitate. d. buyers fail to recognize the brand's unique features. e. buyers do not want the brand's unique features.
C
Over the first eight months of the year, Davis Men's Shop has purchased sixteen dozen pairs of trousers from Thompson's Slacks. If Davis can order another four dozen by the end of December, it will receive a 10 percent discount on all pants ordered during the year. What type of discount is Thompson's offering in this instance? a. Cash b. Trade] c. Cumulative d. Noncumulative e. Seasonal
C
Professional pricing a. is a pioneer pricing policy b. is a form of psychological pricing c. often involves standard, rather than hourly, fees. d. assumes that demand is elastic. e. is penetration pricing.
C
Radison Distribution, Inc. a wholesaler of plants, trees, shrubbery, just finished buying the last remaining wholesaler in its distribution channel. By combining all its holdings, Radison now controls all plant wholesaling operations in the southwestern United States. What type of change has Radison's marketing channel undergone? a. Vertical channel dispersion b. Vertical channel integration c. Horizontal channel integration d. Horizontal channel dispersion e. A horizontal leveraged buyout
C
Run-Tex focuses on providing a large assortment of shoes for runners, joggers, and walkers. It is a(n) A) department store. B) discount store. C) traditional specialty retailer. D) off-price retailer. E) category killer.
C
Some firms establish a customer service policy of minimum order sizes to ensure that a. surplus inventory does not build up b. orders can be shipped at full carload rates. c. transaction is profitable d. product quality remains high. e. sales are not lost to competitors.
C
Stereos are generally marketed through _______________ distribution. a. Concentrated b. Intensive c. Selective d. Exclusive e. Cooperative
C
The Container Store has identified an attractive market segment and is attempting to serve it in a way that differentiates the retailer from others in consumers' minds. This illustrates A) niche positioning. B) niche retailing. C) retail positioning. D) merchandise policy. E) scrambled merchandising.
C
The Limited, Hickory Farms, and the Disney Store carry a very focused product line and many product items. They are examples of retailers offering a. broad product lines with limited depth within those lines. b. limited product lines with great depth within those lines. c. limited product lines with great depth within those lines. d. broad product lines with great depth within those lines. e. none of the above.
C
The demand curve illustrates the effect of a. a change in price caused by an equal change in total revenue. b. different pricing policies. c. one variable, price, on the quantity demanded. d. dependent variables, such as the environment and buying behavior, on price. e. price on the amounts of products supplied by producers.
C
The least flexible of the strategic retailing issues is a. store image b. atmospherics c. location d. products assortment e. customer services
C
When Taco Bell reduced its menu prices to focus on 59-cent, 79-cent, and 99-cent items, its pricing objective was most likely a. return on investment. b. profit. c. market share d. cash flow. e. survival.
C
Which of the following is NOT a form of direct marketing? A) Catalog marketing B) Telemarketing C) Personal selling D) Online retailing E) Automatic vending
C
Which of the following is a fundamental assumption of breakeven analysis? a. Price sensitivity is minimal b. An exact optimal price can be determined. c. Quantity demanded is basically fixed. d. The major tack in setting prices is to recovered fixed costs. e. The major task in setting prices is to recover variable costs.
C
Which of the following is not one of the functions performed by a warehouse? a. Identifying goods b. Sorting goods c. Bearing the loss of damage to goods while in storage d. Recalling, selecting, or picking goods from storage e. Dispatching shipments
C
Which of the following price objectives is oriented to the quick recovery of cash through rapid sales? a. Return of investment b. Profit c. Cash flow d. Market Share e. Status quo
C
Which of the following statements about physical distribution is true? a. Physical distribution usually deals with physical movement of goods and raw materials between storage and production facilities within a firm. b. Physical distribution deals only with the holding of inventory until it is needed. c. Physical distribution deals with the movement of products from products from producers to consumers and end users. d. Physical distribution concerns the sorting, grading, sampling, and physical movement of goods within and among intermediaries. e. Physical distribution deals only with the physical movement of goods from producer to ultimate consumer.
C
Which of the following statements best describes a customer's view of a traditional specialty store? a. The customer wants to compare both products and store product mixes. b. The customer will buy any brand at the most accessible store. c. The customer prefers both a particular product and a particular store. d. The customer likes the wide product mix found there. e. The customer has no concept of a specialty store.
C
Which of the following statements is false? a. Market share, or sales in relation to competition, is a meaningful benchmark of success for a company. b. An organization's sales can increase while its actual market share decreases. c. Market share is important but cannot be considered a pricing objective. d. Market share can increase even when sales for the total industry are decreasing. e. Market share is an important determinant of a company's relative strength.
C
Which of the following statements is true? a. Selective distribution is commonly needed for convenience goods b. Intensive distribution uses just a few outlets in a given area c. Consumers are likely to devote more time and effort when shopping for products available through selective distribution than for those available through intensive distribution. d. Only products that are marketed through exclusive distribution require special services or information e. Selective distribution uses most of the available resellers.
C
A major disadvantage of price competition is that a. it does not provide the flexibility to alter prices in response to changes in the firm's costs. b. it cannot be used as a method of gaining market share. c. it is unworkable for a particular brand if competitors can easily imitate the brand's unique product features. d. competitors have the same flexibility to adjust prices. e. the Robinson-Putman Act prohibits the firm from cutting its price to a particular buyer to meet competitors' prices.
D
A penetration price a. is a price established primarily by tradition b. is a price that is set artificially high to provide a certain image. c. is used by persons who have great skill in a particular field. d. can help a marketer gain a larger market share and discourage competitors from entering a market. e. usually requires the firm to employ a price leader.
D
A welcome change for consumers dissatisfied with the impersonal nature of large retailers can be found in the close personal contact at a. superstores b. department stores c. supermarkets d. traditional specialty stores. e. fast-food franchises.
D
An exceptionally large specialty store that concentrates on a single product line and competes on the basis of low prices and enormous product availability is called a(n) a. off-price retailer b. hypermarket. c. traditional specialty retailer. d. category killer e. combination store.
D
Benetton is a manufacturer of knitwear that operates several plants in Europe. Which of the following would be an example of a fixed cost for Benetton? a. Yarn b. Overtime labor c. Shipping cartons d. Rent for the plant e. Dye
D
Companies in a volatile environment may use pricing as a flexible marketing strategy because a. Price is determined by demand b. Price is not always money c. Price is determined by value of the product d. Price is the only variable in the marketing mix that can be quickly adjusted e. Price is the only variable in the marketing mix that marketers can directly control.
D
Dave trades his old lawn mower to his next-door neighbor, Peter, for Peter's electric sander. This transaction is known as. a. Pricing b. Selling c. Marketing d. Barter e. Reciprocity
D
Economic order quantity (EOQ) a. reduces the inventory carried in stock b. minimizes the cost per unit of inventory c. guarantees a sufficient inventory level at all times. d. minimizes the total cost of ordering and carrying inventory. e. minimizes only total carrying costs.
D
If Nike wants to focus its marketing efforts on price competition, the firm's long- range success will depend on having a. lower prices than its competition. b. lower prices than it has historically charged. c. a promotional campaign for lower prices. d. a lower cost structure than its competitors. e. a top-quality product with attractive packaging.
D
If a supplier drops a dealer for resisting anticompetitive practices, the supplier is engaging in a. Restricted selling b. Exclusive dealing c. Dual distribution d. Refusal-to-deal actions e. Tying agreements
D
If an intermediary wants to carry ivory soap and Procter & Gamble agrees only if the suppliers purchases P&G's entire line of soap products as well, the company is engaging in which of the following channel management practices? a. Refusal to deal b. Dual distribution c. Exclusive dealing d. Tying agreement e. Restricted sales territories
D
In using a cost-oriented pricing method, a firm determines price a. by using marginal analysis. b. based on the level of demand for a product. c. based on competitors' prices. d. by adding a dollar amount or a percentage to the cost of the product. e. by determining the breakeven point.
D
Large retail organizations characterized by wide product mixes and departmentalized organizations are classified as A) specialty stores. B) superstores. C) warehouse clubs. D) department stores. E) discount stores.
D
Large retailers such as Target, J.C. Penney, and Sears are most likely to participate in which of the following channels? a. Producer, industrial distributors, retailers, consumers b. Producer, agents, wholesalers, retailers, consumers c. Producer, wholesalers, retailers, consumers d. Producer, retailers, consumers e. Producer, consumers
D
Selective distribution is the form of distribution utilized with a. Specialty products b. Infrequently purchased products c. Convenience products d. Products that require controlled sales and special services e. Products that have a high replacement rate
D
The Robison -Patman Act a. prohibits the use of price maintenance agreements among producers and resellers. b. prohibits conspiracies to control prices. c. prohibits deceptive pricing. d. limits the use of price differentials. e. limits the conditions under which the federal government can invoke price controls.
D
The oldest form of exchange is A) pricing. B) purchasing. C) buying. D) barter. E) credit.
D
The percentage change in quantity demanded caused by a percentage change in price is much greater for a. inelastic demand than elastic demand b. electricity than for sportswear c. competition-oriented pricing than for customary pricing d. elastic demand than for inelastic demand. e. loss-leader pricing than for unit pricing
D
The text indicates that transit time affects a marketer's ability to a. select a suitable marketing mix b. increase sales volume. c. utilize a carrier to capacity d. provide service. e. transport the largest quantity of goods to the marketplace.
D
To buyers, speed of delivery, service, and dependability are often a. less important than the cost of the product. b. more important than the quality of the product. c. unimportant when compared to price. d. as important as the cost of the product. e. of no significance whatsoever.
D
When a retailer adds unrelated products and product lines to the existing product mix this is termed A) range expansion. B) mix scrambling. C) merchandise extension. D) scrambled merchandising. E) freestanding merchandising.
D
When produce companies to reduce transportation, information management, and administrative costs. To accomplish this goal, channel members need to a. Channel integration b. Channel leadership c. Channel cooperation d. Channel with competitors e. Customer relationships
D
Whenever the Olive Garden Company sells a restaurant franchise, it intends that the franchisee buy equipment and supplies as well. The Olive Garden Company justifies this policy as being necessary for quality control and protection of the company's reputation. This arrangement exemplifies a. Exclusive dealing b. A restricted sales territory c. Dual distribution d. A tying agreement e. Refusal to deal
D
Which of the following has as one of its primary functions accepting merchandise delivered from outside transportation or an attached factory and taking responsibility for it? a. Public warehouse b. Wholesaler c. Channel member d. Warehouse e. Field warehousing company
D
Which of the following has the widest product mixes and deepest product lines? A) Traditional business districts B) Neighborhood shopping centers C) Community shopping centers D) Regional shopping centers E) Nontraditional shopping centers
D
Which of the following is a promotional pricing? a. Penetration pricing b. Odd-even pricing c. Customary pricing d. Superficial discounting e. price lining.
D
Which of the following policies is most effective at gaining maximum unit sales volume when introducing a new product? a. Price skimming b. Psychological pricing c. Customary pricing d. Penetration pricing e. Professional pricing
D
Which of the following statements best characterizes superstores? a. They have three times the sales and four times as many products as department stores. b. They are a blend of specialty store and supermarket. c. They carry few nonfood products. d. They are low-cost, high volume operations, combining features of discount stores and supermarkets. e. They are the original mass merchandisers.
D
Which of the following statements is false? a. Price can be changed quickly to respond to changes in demand. b. Price has a psychological impact on customers and can be used symbolically to emphasize a product's quality. c. Price is important in determining profits. d. Price is commonly used as a tool to raise production costs. e. None of the above statements is false.
D
A commonly employed pricing method among retailers is a. price skimming b. demand-oriented pricing c. competition-oriented pricing d. penetration pricing e. markup pricing
E
A lower price may be required to generate sales of a particular product if a. the product is viewed as superior to most of the competing brands. b. the product has many loyal buyers. c. marketing channel members believe the product is more profitable than competing products. d. the status associated with ownership of the product is related to its high price. e. buyers have a slightly unfavorable view of the product.
E
All members of the supply chain should identify their partners and their roles and establish partnerships that focus on a. Shifting costs to suppliers b. Maximizing costs c. Maximizing technology implementation d. Cooperation with competitors e. Customer relationships
E
Almado Brothers Distributing has a big problem with its product being damaged or broken during handling and transportation. This indicates that the company has a problem with the __________________ of its products. a. order processing b. shipment c. handling d. quality e. internal packaging
E
Angie Nalley of Fresh Wholesale Foods has been selling Weight Watchers frozen entrees two different grocery chains at different prices. Under the Robinson-Patman Act, which of the following circumstances would help her explain that her pricing practices are not discriminatory? a. The price differentials help one of the stores gain a competitive advantage. b. The two stores are competitors c. Nalley's fixed costs differ for the two chains. d. The chains do not have stores in the same block. e. The lower price at one of the chains was needed to meet competitors' prices.
E
Cobra's manufactures high-quality handmade golf clubs, which sell for approximately $1000 a set. Such a pricing strategy could be considered most specifically a. professional pricing b. price lining c. customary pricing d. psychological pricing e. prestige pricing
E
Fun-time Music Distributors has been accused of price discrimination because it has charged different prices to retail music store chains than to department stores. Management of Fun-time responded that price differentials were legal when they can be justified a. by reciprocity agreements. b. through nonprice competition. c. by zone pricing. d. through barter agreements. e. based on cost savings.
E
Georgia Pacific provides regional pricing of its lumber, which would be classified as a. base-point pricing b. uniform geographic pricing c. freight absorption pricing d. F.O.B. factory pricing. e. zone pricing.
E
Greg gets a shopping list from his wife. On the list are a potted plant, fresh mushrooms, motor oil, bread, wine, and a birthday cake. To make just one stop to save time, Greg should go to a(n) a. convenience store. b. off-price retailer c. warehouse showroom d. category killer e. supermarket
E
If Nordica offered a 25 percent discount to retailers that ordered ski boots in February for delivery in May, the retailers would have the option of taking advantage of which type of discount? a. Trade b. Cumulative c. Cash d. Quantity e. Seasonal
E
Loews is trying to reduce transportation, information management, and administrative costs. To accomplish this goal, channel members need to a. Work independently b. Avoid cooperation due to antitrust consideration c. Work with competitors and share information d. Increase competition among channel members and facilitating agencies. e. Cooperate and share information as well as accommodate one another's needs.
E
Price discrimination is illegal when price differentials a. Do not affect the level of competition b. Are used for customers who are not competitors c. Lessen or injure competition d. Are used to meet competitor's prices e. Are the result of different costs for different customers.
E
Remington Manufacturing decides to use a pricing method that involves setting prices to generate a desired level of profit on each item, but it does not know how many items it might sell at those prices. Remington is opting for a. demand-oriented pricing b. psychological pricing c. price lining d. price differentiation e. cost-oriented pricing
E
The Slam Dunk Company is about to introduce its new line of athletic footwear - the Aerial Cross-trainer. The company must now decide what type of market coverage it wants for the Aerial. Product differentiation and customer service are particularly important to the success of the brand. In addition, the company wants to maintain a certain degree of control over the distribution process. What type of market coverage do you recommend? a. Intensive distribution b. Inclusive distribution c. Exclusive distribution d. Controlled distribution e. Selective distribution
E
The breakeven point for Dynamo Health Club is 10,000 members per year. The annual fixed cost is $100,000, and the variable cost per person is $80. What does Dynamo charge per membership? a. $180 b. $100 c. 160 d. $110 e. $90
E
The breakeven point is the point at which a. marginal revenues equal marginal costs. b. a reasonable profit has been earned. c. all variable costs have been recovered. d. marginal revenues equal total revenues. e. the costs of producing a product equal the revenue earned from selling it.
E
The elimination of marketing intermediaries would a. Reduce the total cost to consumers. b. Reduce the total number of transactions. c. Assure consumers of higher quality. d. Be beneficial to both manufacturers and consumers. e. Require that the services they provide be performed by someone else in the marketing channel or passed on to customers.
E
The management decision to accept higher transportation costs in exchange for lower warehousing costs is an example of a. intermodal transportation b. economic order cost c. inventory management d. cost optimization e. cost tradeoff.
E
There is often a tradeoff between inventory-carrying costs and a. stockouts b. inventory-holding costs c. order lead time d. the chance of losing sales e. the probability of stockouts
E
What term is used to describe the conscious design of space to create emotional effects that encourage customers to buy? a. Merchandising b. Trading up c. Internal environment d. Store layout e. Atmospherics
E
When Northwest Airlines advertising discloses the company's on-time arrival record, contrasting it with that of the competition, Northwest is a. stressing brand identification. b. emphasizing brand reinforcement. c. engaging in price-value competition. d. competing on price. e. engaging in nonprice competition.
E
When price competition is employed, the seller a. extensively promotes the unique product features of the brand. b. expects to win over customers who prefer a competing brand because of nonprice issues. c. always uses price differentials. d. expects to build customer loyalty. e. matches or beats the prices of competitors who also emphasize low prices.
E
Which of the following allows for personal attention? A) Automatic vending B) Catalog marketing C) Online marketing D) Direct marketing E) Direct selling
E
Which of the following is NOT an advantage of franchising for the franchisee? A) Franchised outlets are usually more successful than independent firms. B) The franchisee can obtain guidance from the franchiser if problems arise. C) The franchisee receives materials to use in local advertising. D) The franchisee can capitalize on the business experience of others. E) The franchisee must give up a certain amount of control.
E
Whitney's is a popular department store chain in the southeastern United States. Like all department stores, Whitney's offers a wide variety of consumer services. Which of the following services is Whitney's least likely to offer to its customers? a. Delivery b. Personal assistance c. Pleasant atmosphere d. Credit e. Centralized checkout counters
E
______________ is the extent to which a transportation mode can provide appropriate equipment and conditions for moving specific kinds of goods and can also be adapted for moving other products. a. Cost b. Accessibility c. Speed d. Dependability e. Load Flexibility
E