Test Bank for Marketing 8th Edition by Greewal Levy by Ace Test Banks

Test Bank for Marketing 8th Edition by Greewal Levy

richard@qwconsultancy.com

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Student name:__________ 1) Kylie has been asked to write a marketing plan for a new restaurant. What questions will Kylie likely address in her marketing plan? Be specific and offer questions related to a restaurant.

2) Marcelle is a wine distributor in the United States representing primarily European vintners (wine producers). He knows his potential market is every wine drinker in the United States, but he has limited resources to market his products. Using the ideas presented in the text, what should Marcelle do as a first step when developing his marketing plan?

3) The text states, “Good marketing is not a random activity.” Create an example to respond to this statement.

4) Your friend is writing a “tell-all” book and asks you for marketing advice. You start by exploring the four Ps. What questions will you ask? Be specific.

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5) The manager of a building supply company determined prices by adding a standard markup to his costs. What might the manager be missing when it comes to effective pricing decisions?

6) As the customer service manager for a plumbing company, you are constantly bombarded with complaints about service people not showing up, not having the parts needed to make repairs, and being unable to quickly get the materials needed to fix things. You decide to bring in a marketing consultant to assist you with these problems. What area of marketing specialization would you look for in a marketing consultant and what recommendations would you expect to receive? Be specific; this is a heating and air conditioning firm.

7) As your first assignment in an advertising agency, your manager asks you to come up with messages for three billboards promoting the university you attended. The manager wants one ad for each of the three types of promotion objectives. Create an example of a one-sentence billboard advertising message for each objective: inform, persuade, and remind.

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8) Suppose that your clothing company creates a position for vice president of marketing and promotes your superior to the position. What activities will the new vice president of marketing probably be involved in? Be specific.

9) Suppose your college roommate sees you reading your marketing textbook and says, “Marketing is just advertising and selling.” How do you respond?

10) Imagine you graduate with a marketing degree and are hired by the marketing department of a large electronics company. You are initially given a two-week training program, which is an overview of what the marketing department does. What will your training program cover?

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11) How could you use marketing ideas to market yourself to potential employers after you graduate?

12)

What are the four Ps of marketing? Give an example of each.

13)

What is the fundamental purpose of marketing?

14) “Everything has a price, though it doesn’t always have to be monetary.” What else is included in a price?

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15)

How should marketers determine prices?

16)

If you were hired as a supply chain manager, with whom would you interact?

17) Describe how marketing has evolved into a major business function that crosses all areas of a firm or organization.

18) Jamie bought a coat at Jos. A Banks. Jos. A Banks bought the suit from a distributor, which bought it from a designer. The designer bought the materials to make the suit from a factory in China, and the suits were made at that same factory. The employees in the factory bought their suits directly from the factory and sold them to their friends. Explain which of these transactions were B2B, B2C, and/or C2C.

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19)

Describe a hypothetical supply chain—from manufacturer to customer.

20) Name the various stakeholders who are impacted by marketing and give one example of how each one might be impacted in a fictitious situation.

21) How does the exchange of ideas provide value, and what is the role of marketing in this process? Explain this concept using the example in the text of groups marketing bicycle helmets or choose your own scenario.

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22) Which type of orientation would you expect among ethically challenged marketers: a relational or transactional orientation? Explain.

23) Over the four marketing eras, how did the emphasis on the four Ps change? List the four eras and describe which of the four Ps were emphasized during each era.

24)

How does value cocreation provide additional value to customers?

25) During what marketing era did firms depend on heavy doses of personal selling and advertising?

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26) Explain the process of customer relationship management (CRM) in terms of how it impacts marketing activities.

27) During the past couple of decades, marketers have begun to develop a relational orientation as they have realized that they need to think about their customers in terms of relationships rather than transactions. How does Apple encourage its customers to maintain a long-term relationship with the company?

28) You are employed by a firm that is considering the use of mobile advertising as opposed to digital advertising. Describe the similarities and differences between these two approaches to advertising.

29) Suppose you worked at a coffee shop near campus, one that was popular with students, and the manager asked you to explain how the coffee shop might benefit from using locationbased social media tools. How would you answer? Version 1

30) Many U.S. companies now use social media tools for marketing purposes. Demonstrate your knowledge of social media by describing a small company and the ways you would use social media to produce, promote, place, and price your goods or services.

31) You are employed by a marketing firm that needs to become more value-driven. How is this accomplished?

32) The publisher of the well-known Winnie-the-Pooh series wants to celebrate the 100th anniversary of the series, initiating a $200,000 campaign. This initiative represents the ________ component in the four Ps.

A) product B) place C) price D) promotion E) presentation

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33) Mattie is the marketing manager for a spice company. While on vacation in Brazil, she visited food stores in Rio de Janeiro. Most of her company’s products were available, except for baking spices, like vanilla. When she returned to work, she mentioned this observation to her international sales manager. Mattie was providing the important marketing function of

A) cocreating an investment portfolio. B) selling products from one business to another. C) engaging customers, developing long-term relationships. D) identifying opportunities to expand. E) enhancing the customer experience.

34) Dream Home Solutions has been a successful small home-remodeling firm for years. The owner pays subcontractors slightly more than the usual rate for different tasks, reducing the company’s gross margin. Dream Home rarely changes subcontractors, has relatively few complaints from home buyers, and is able to get quick responses from subcontractors when buyers do have problems. Dream Home is engaged in

A) a traditional transactional orientation. B) C2C value-driven marketing. C) effective supply chain management. D) value cocreation. E) a virtual monopoly.

35) If a radio station holds an online contest in which you must log in to its website and submit personal details such as name, phone number, and e-mail in order to participate, the radio station is

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A) offering an exchange. B) behaving unethically. C) hoping to receive feedback. D) implementing a CRM program. E) overstepping its role.

36)

Which of the following is true of marketing?

A) Marketing affects various stakeholders. B) Marketing plays no role in creating value. C) Marketing is about satisfying the company’s needs and wants. D) Marketing requires place, product, promotion, and perception decisions. E) Marketing is performed by organizations, not individuals.

37) Traditionally, marketing activities have been divided into product, price, place, and promotion. Select the term that best describes the four Ps.

A) marketing mix B) marketing channel C) marketing plan D) marketing era E) marketing implementation

38) Internet sites, physical stores, and kiosks are most closely associated with which element of the marketing mix?

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A) place B) price C) product D) promotion E) proximity

39) The primary purpose of the ________ plan is to specify the marketing activities for a specific period of time.

A) marketing B) business C) strategic D) organizational E) resource

40)

Marketing enriches society by

A) focusing solely on maximizing profits. B) creating charitable campaigns. C) recognizing that the firm can do very little by itself, and so it should stay focused on its own core competencies. D) facilitating the smooth flow of goods through the supply chain. E) coordinating marketing functions with other functional areas in the company.

41) Marketing traditionally has been divided into a set of four interrelated decisions and consequent actions known as the

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A) marketing philosophies. B) marketing mix. C) marketing fundamentals. D) target markets. E) marketing channels.

42) How a product or service will be conceived or designed, how much it should cost, where and how it will be promoted, and how it will get to the consumer are all elements of

A) production management. B) a marketing exchange. C) supply chain logistics. D) a marketing plan. E) delivery of the value proposition.

43) The activity, set of institutions, and processes for creating, capturing, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large is called

A) marketing. B) marketing research. C) market share analysis. D) market segmentation. E) market positioning.

44) Jeffrey is going to sell sporting apparel, which he has already purchased from manufacturers, and has signed a deal agreeing to the volume he will sell monthly. He has researched his competition, talked to some customers, and decided on prices he will charge. Jeffrey has also developed a plan for promoting his business. Based on this description, which element of the marketing mix does Jeffrey still need to work on?

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A) planning B) product C) price D) promotion E) place

45) Vikram opened a shoe store and signed a lease on the property. He also signed an agreement with the manufacturer on the amount of merchandise he will sell and the promotions he will conduct. Based on this description, which aspect of the marketing mix does he still need to work on?

A) price B) place C) promotion D) product E) prototype

46) sale.

When Starbucks sells its coffee and mugs to the public on its website, it is a ________

A) B2B B) B2C C) C2C D) C2B E) C2F

47) Even though they operate on a limited schedule and offer few extra services, discount, no-frill airlines like Allegiant have been successful. Consumers obviously consider

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A) the extra services offered by these airlines to be the most thorough in the industry. B) the long-term relationships established by these airlines to be a critical benefit. C) the prices to be slightly lower, but not low enough to have much influence. D) the benefit of lower prices to be greater than the cost of reduced services and less convenience. E) the major airlines to be worthless.

48) Francine, the delivery and sales representative for a wine distributor, is calling on a retailer and sees the shelves are almost empty. An unexpected home and table event held nearby resulted in a huge increase in sales. She calls her company’s distribution manager and requests a special delivery for her customer. Francine is providing the important marketing function of

A) customer relationship management. B) supply chain management. C) capturing value. D) communicating the value proposition. E) business-to-business marketing.

49)

Marketing involves conducting exchanges, satisfying customer needs and wants, and

A) redesigning workflow. B) simplifying a product line. C) creating value. D) hiring sufficient manufacturing staff. E) production scheduling.

50) Cliff sells construction equipment. Whenever he calls on his building contractor customers, he asks if they are having any problems. In doing so, Cliff is addressing which of the following core aspects of marketing?

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A) satisfying customer needs and wants B) completing the exchange function of marketing C) making product, place, promotion, and price decisions D) making decisions about the setting in which marketing takes place E) creating value

51) Leanne is considering a career in marketing. She is concerned about the image of marketers as fast-talking, high-pressure people who care only about making a sale. When reading about the core aspects of marketing, Leanne is pleased to see that in marketing

A) all parties to the transaction should be satisfied. B) promotion is the most important consideration, followed by pricing decisions. C) decisions are made regarding how a product is designed. D) customers are not considered until the product is ready for sale. E) distribution is controlled by customers.

52) Alan is analyzing potential market segments. He should carefully seek potential customers who have both an interest in his products and

A) a thorough knowledge of his brand messages. B) the ability to buy them. C) knowledge of competing products. D) the ability to negotiate discounts. E) are removed from traditional marketing alternatives.

53)

When referring to “exchange,” marketers are focusing on

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A) the location where products and services are traded. B) the price charged, adjusted for currency exchange rates. C) location-based tactics for creating value. D) promotional offers designed to stimulate barter. E) the trading of things of value.

54) Whenever Kristy has a new manicure customer, she invites the person to be on her e-mail distribution list. In the process, in addition to exchanging her manicure service for payment, Kristy is gathering

A) information. B) promotional capital. C) pricing data. D) value cocreation. E) feedback.

55)

Which of the following is a core aspect of marketing?

A) satisfying as many needs as possible B) creating a product that everyone will want to buy C) setting prices lower than all competitors D) making product, place, promotion, and price decisions E) increasing the company’s profit

56) Marketing has traditionally been divided into a set of four interrelated decisions known as the marketing mix, or four Ps, including product, place, price, and

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A) presentation. B) production. C) performance. D) promotion. E) promise.

57) The four Ps make up the marketing mix, which is the __________ set of decisions or activities that the firm uses to respond to the wants of its target markets.

A) unpredictable B) external C) internal D) controllable E) global

58) The fundamental goal of marketers when creating goods, services, or combinations of both is to

A) defeat the competition. B) serve all consumers. C) operate according to government regulations. D) stimulate short-term sales. E) create value.

59) Ivana is struggling with the choice of publishing her new book, Slovak Cuisine, as an ebook or a paperback. Ivana is addressing which core marketing aspect?

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A) developing a promotional plan B) managing the exchange function of marketing C) making product decisions D) satisfying a need but not a want E) pricing the product

60)

The basic difference between a good and a service is that a good

A) provides intangible benefits. B) can be physically touched. C) is always less expensive than a corresponding service. D) generates greater interest among consumers. E) is more quickly forgotten by consumers.

61) Nice ‘n Easy sells handcrafted furniture. They have also recently begun offering appraisals of customers’ antiques. Nice ‘n Easy is

A) expanding from offering just services to also offering goods. B) implementing a market segmentation strategy. C) capturing value through multiple pricing strategies. D) expanding from offering just goods to also offering services. E) increasing customer value through inflated appraisal evaluations.

62) Marketers must determine the price of a product carefully, based on potential buyers’ beliefs about

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A) its value. B) the environment. C) the cost to manufacture the product. D) the economic outlook. E) the product’s new advertising campaign.

63) Some discount stores put products in large bins and let consumers hunt and find bargains. The price these consumers pay includes

A) only the actual price they pay at the register. B) the value of their time and energy. C) the excitement they experience in finding an item they desire. D) the savings to the store of not having to display the products neatly on shelves. E) when the product was listed at full price and didn’t sell.

64) Justine offers design and consulting services on a fee-only basis. She has found that different customers are willing to pay different rates for her services. This shows that her pricing decisions should depend primarily on

A) choosing an average price that she will charge all her clients. B) changes in technology allowing consumers to manage their own affairs. C) how different customers perceive the value of her services. D) changes in the economy. E) how much her competitors charge for similar services.

65)

Marketing channel management is also known as

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A) endless chain marketing. B) a transactional orientation. C) wholesaling. D) production management. E) supply chain management.

66) ________ represents all the activities necessary to get the product to the right customer when that customer wants it.

A) Place B) Promotion C) Social media D) Value cocreation E) Supply chain marketing

67) Not only does GIS technology help Starbucks determine the ideal locations for new stores, but it also can enable the company to decide

A) the age of its target market. B) which kinds of stores to open. C) the type of coffee to sell. D) the type of food to sell. E) how many new locations it should open.

68) The marketing goal of getting the “right quantities to the right locations, at the right time” relates to

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A) communicating the value proposition. B) managing the supply chain. C) performing service marketing. D) capturing value. E) managing price and performance.

69) Many marketing students initially overlook the importance of marketing channel management because

A) marketing has no responsibility for supply chain management. B) marketing channel management doesn’t add much value for customers. C) companies do not want customers to know anything about the supply chain. D) many of these activities take place behind the scenes. E) marketing channel management is already transparent.

70)

Which element of the marketing mix deals with supply chain management?

A) product B) price C) promotion D) production E) place

71) UPS, FedEx, and other shipping companies support other firms’ ________ marketing goals.

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A) supply chain management B) value communication C) value capture D) retail management E) promotion

72) ________ is communication by a marketer that informs, persuades, and reminds potential buyers about a product or service so as to influence their opinions and elicit a response.

A) Pricing B) Promotion C) Placement D) A relational orientation E) Value cocreation

73)

Effective promotion enhances a product or service’s

A) supply chain management system. B) wholesaling capabilities. C) perceived value. D) design features. E) trialability.

74)

By promoting jeans based on youth, style, and quality, Levi’s is attempting to

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A) influence social norms regarding age. B) encourage consumers to participate in product redesign. C) stimulate supply chain management cooperation. D) increase the perceived value of its products. E) demonstrate social responsibility.

75) Retailers accumulate merchandise from producers in large amounts and sell to consumers in smaller amounts. When they sell to consumers, it is considered ________ marketing.

A) B2C B) B2B C) R2C D) C2C E) C2B

76)

Marketing channel management is related to which of the four Ps?

A) product B) price C) place D) promotion E) production

77) Dylan bought a sport jacket from a retail store. Which type of transaction was Dylan participating in?

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A) B2B B) C2C C) B2C D) R2C E) C2B

78)

According to your text, in the broadest terms, the “marketplace” refers to

A) wholesale and retail environments. B) brick-and-mortar stores and the Internet. C) the four Ps. D) channels that are accessible to a given customer. E) the world of trade.

79)

Which element of the marketing mix is most relevant to the activity “capturing value”?

A) promotion B) purchasing C) product D) price E) place

80)

Which element of the marketing mix is most relevant to the activity “delivering value”?

A) promotion B) purchasing C) product D) price E) place

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81)

Which element of the marketing mix is most relevant to the activity “creating value”?

A) promotion B) purchasing C) product D) price E) place

82) Which marketing activity is most directly served by the promotion element of the marketing mix?

A) communicating value B) creating value C) capturing value D) delivering value E) producing value

83) Elaine was tired of her leather pocketbook, so she sold it to her friend, Jeannie. This is an example of ________ marketing.

A) B2B B) B2C C) C2B D) C2C E) BBC

84) By allowing consumers to sell their unwanted goods to other consumers, auction sites like eBay, Poshmark, and Mercari cater to ________ marketing.

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A) B2B B) C2C C) D2C D) C2D E) B2G

85) Many inventors struggle with the question, “I made it; now how do I get rid of it?” They have made the error of not creating a(n)

A) marketing plan. B) value proposition. C) social media campaign. D) profit center. E) advertising campaign.

86) As use of the Internet took off, car manufacturers were tempted to sell directly to consumers, but decided instead to continue to sell through their existing dealer networks. The car manufacturers considered switching from ________ to ________ marketing.

A) B2C; B2B B) B2C; C2C C) B2B; B2C D) B2B; C2C E) C2C; B2C

87) Many universities provide physical or electronic bulletin boards to facilitate ride-sharing and exchange of used books among students. These bulletin boards increase ________ marketing.

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A) B2C B) C2B C) B2B D) C2C E) underground

88) The “Milk Life” advertising campaign, designed to increase awareness of the health benefits of milk, was intended to help market a(n)

A) service. B) firm. C) industry. D) organization. E) specific product.

89) When the publisher of the well-known Berenstain Bears books wanted to celebrate the 50th anniversary of the series, it initiated a $150,000 campaign. Which of the four Ps does this campaign represent?

A) performance B) price C) place D) promotion E) product

90) Creative locations, such as kiosks at the baggage claim in airports or small booths in grocery stores, represent Starbucks’ effort to improve its offering on which dimension of the marketing mix?

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A) product B) promotion C) price D) perception E) place

91) The idea that a good product will sell itself is associated with the ________ era of marketing.

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

92) When a sweatshirt manufacturer states, “We sell it only in gray because that way we can buy plenty of gray fabric and run our plant efficiently,” its statement reflects the views that were popular in which era of the evolution of marketing?

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) economics-oriented

93) Henry Ford’s statement, “Customers can have any color they want so long as it’s black,” typified the ________ era of marketing.

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A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

94) When clients work with their investment advisers, they ________ their investment portfolios.

A) cocreate B) discover C) initiate D) balance E) expand

95) Raoul is giving his wife a Hermès wallet for her birthday. It cost $2,000, but Raoul thinks this is a very fair value. Value here means that

A) it was convenient to purchase the wallet, even though the price is not reasonable. B) Raoul could not find a wallet that cost less. C) the product meets his needs and is offered at a price that is a fair value. D) anyone would think that the wallet is a reasonable price. E) the wallet is cheap in comparison with its competition.

96) After the previous sales representative in his territory infuriated an important customer, Sonja visited the customer once a month, never asking for business but hoping to rebuild trust through listening and expressing concern. Finally, after more than two years, the customer gave Sonja an order. Sonya was providing the important marketing function of

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A) advising production on how much product to make. B) alerting the logistics department when to ship products. C) engaging customers and developing long-term relationships. D) identifying opportunities to expand. E) synthesizing and interpreting sales, accounting, and customer-profile data.

97) The process of value ________, in which customers collaborate in product design, often provides additional value to the firm’s customers.

A) cocreation B) positioning C) delivery D) chain management E) based marketing

98) Mario works for a small computer software company. His boss is constantly improving the company’s products but neglects customers, billing, and promoting the company. Mario’s boss is probably stuck in the ________ era of marketing.

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

99) During the ________ era, firms had excess capacity and used personal selling and advertising to generate customers.

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A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

100) The prevailing marketing strategy of the ________ era was to find customers for inventories that went unsold.

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

101) Near the end of the model year, the Like New automobile dealership had an unusually high inventory level. The manager increased her advertising spending and gave extra incentives to its salespeople. Like New operates as if it were in the ________ era.

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

102)

Many U.S. companies first discovered marketing during the ________ era.

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A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

103)

Which of the following statements reflects the philosophy of the market-oriented era?

A) A good product will sell itself. B) The customer is king. C) Firms should take advantage of a seller’s market. D) Advertising and personal selling should be emphasized in order to make the sale. E) Firms should focus on value.

104) During the ________ era, manufacturers and retailers recognized they needed to give their customers greater value than their competitors did.

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

105)

A relational orientation is based on the philosophy that buyers and sellers develop

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A) a complete understanding of one another’s needs. B) a long-term relationship. C) a price-value comparison matrix. D) supply chain synergy. E) a marketing value transaction focus.

106) A local hair salon keeps information on its customers regarding their preferences for certain products, companies, and services. The salon uses this information to inform the customers when new products arrive from their favorite companies and targets them with special promotions. In this way, the salon is using ________ to build loyalty among its customers.

A) value cocreation B) customer relationship management C) transactional marketing D) B2B marketing E) the supply chain

107) If a firm adopts a CRM business philosophy, it most likely has a(n) ________ orientation with its customers.

A) transactional B) external C) relational D) internal E) divisional

108) After major hurricanes like Katrina, many ethical home repair and building supply businesses continue to charge pre-hurricane prices to their customers, even though they could charge much more due to the huge increase in demand. These firms probably recognize that

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A) they can make more money from government contracts than from sales to customers. B) a transactional orientation is the key to long-term profitability. C) none of their competitors would be raising prices. D) lifetime profitability of relationships matters more than profits from a particular transaction. E) if they raised prices they would be in violation of Commerce Department regulations.

109)

What is the focus of a firm that develops a relational orientation with its customers?

A) relating product knowledge to customers’ interests B) gaining profit from each customer transaction C) generating profits quickly before customers shop elsewhere D) working with competitors to simplify product offerings for customers E) gaining lifetime profitability from customer relationships

110)

The goal of customer relationship management is to

A) manage every customer relationship differently. B) manage every customer relationship to maximize short-term profitability. C) eliminate customers who are profitable, but not highly profitable. D) identify and build loyalty among a firm’s most valued customers. E) generate relationships with competitors’ customers.

111) Eugene uses a database software system to remind him when his customers should be ready for their next lawn and/or garden service. With this reminder system, Eugene contacts his customers when they are most likely to be “in the buying mode.” Eugene’s system is part of

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A) C2C marketing. B) customer relationship management. C) a transactional marketing orientation. D) supply chain management. E) typical production era marketing practices.

112) Many catalog companies create special-run issues based on what customers have purchased in the past. For example, customers who frequently order bedding items like sheets and pillows receive a catalog with a larger section of bedding items than do customers who mostly order kitchen tools. These special issues are an example of

A) C2C marketing. B) customer relationship management. C) a transactional marketing orientation. D) supply chain management. E) typical production-oriented era marketing practices.

113) It was during the market-oriented era that firms first discovered “marketing.” In what timeframe did this occur?

A) around the turn of the 20th century B) shortly before the Great Depression C) just after World War II D) during the Roaring Twenties E) during the civil rights movement

114) At one point in the evolution of marketing, the United States entered a buyer’s market and the customer became king. Which era is being described?

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A) market-oriented B) sales-oriented C) production-oriented D) value-based marketing E) economics-oriented

115) Tenisha sells consumer electronics. She knows her customers weigh the costs versus the benefits associated with the different options available. Tenisha decides which products to offer and what prices to charge based on the way her customers think. Tenisha operates as if she was in the ________ era.

A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

116) To build relationships, firms focus on the ________ of the relationship, not how much money is made during each transaction.

A) cost B) lifetime profitability C) length D) value E) worth

117) Juanita studies her customer profiles, market research data, complaints, and other information, attempting to better understand what her customers want. Juanita most likely operates in the ________ era of marketing.

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A) production-oriented B) sales-oriented C) market-oriented D) value-based marketing E) retailing-oriented

118)

In delivering value, marketing firms attempt to find the most desirable balance between

A) the need for value and the perception of value. B) explicit versus implicit value. C) the need to provide benefits to customers and keep down costs. D) the desire to satisfy customers and the desire to satisfy employees. E) the need for product improvement and the need for advertising.

119) Red Robin suggests that its diners check in to its locations using their phones. This demonstrates the use of ________ to market a product.

A) adding value B) social media C) marketing analytics D) value cocreation E) social responsibility

120) Social media is of increasing importance. About ________ of the world’s population uses Facebook.

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A) 80 percent B) 60 percent C) 50 percent D) 30 percent E) 20 percent

121)

Data about how, when, why, where, and what people buy refers to

A) statistics. B) demographics. C) marketing analytics. D) value-based marketing. E) relational orientation.

122) Curtis is the new restaurant manager in a major hotel. When considering changes in the restaurant that will increase value to customers, Curtis will likely attempt to either provide the same quality at a lower cost or

A) improve products and services at the same cost. B) increase prices to increase revenue. C) offset higher hotel rates with lower restaurant prices. D) reduce customer expectations through reduced service. E) lower the quality and the price.

123) Dana has just started with a travel agency, and she has been offering clients and prospective clients a range of packaged tours. She is concerned because the commissions she is earning on her sales are lower than she had hoped. Her colleague Scott, who has been with the agency for several years, is having a great deal of success by working closely with the clients, seeking their ideas, and building customized tour packages for each one based on their suggestions. Scott’s approach is based on

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A) transaction-oriented marketing. B) premium pricing. C) his seniority at the firm. D) special incentives from tour operators. E) value cocreation.

124) To become a more value-driven organization, Pequot College is holding regular coffeehour discussions with its students and surveying its graduates regarding students’ educational needs and desires. By doing so, Pequot College is becoming more value-driven through

A) sharing information across the organization. B) balancing its customers’ benefits and costs. C) evaluating strategic competitive partnerships. D) building relationships with customers. E) keeping the faculty members happy.

125) As owner of a retail franchise food store, Elena purchases supplies based on specials advertised nationally throughout the franchise system. One Monday, she was surprised to find customers asking for specials she hadn’t been informed of in advance. The franchise company failed to live up to the value-driven activity of

A) sharing information across the organization. B) balancing customers’ benefits and costs. C) evaluating strategic competitive partnerships. D) building relationships with customers. E) keeping prices below those charged by competitors.

126) By using social media ________ on their mobile phones, customers can check in with HappyCow to find nearby vegetarian restaurants.

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A) coupon B) group chat C) influencer D) location-based apps E) rating sites

127) In the past, manufacturer’s representatives did not have real-time inventory data about the products they were selling. Today, manufacturer’s representatives are often provided online access to inventory data for the companies they represent. These online inventory systems allow companies to become more value-driven by

A) sharing information across the organization. B) balancing customers’ benefits and costs. C) evaluating strategic competitive partnerships. D) building relationships with government regulators of marketing institutions. E) keeping prices below those charged by competitors.

128) One of the benefits of value-driven marketing is that attention to customer needs and wants will likely result in

A) higher prices than the market leader charges. B) increased competition. C) long-term relationships. D) strong connections among competing firms in the marketplace. E) lower prices.

129) What type of marketers constantly measure the benefits that customers perceive against the cost of their offerings?

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A) relationship-oriented marketers B) production-oriented marketers C) sales-oriented marketers D) market-oriented marketers E) value-oriented marketers

130) Makenna, the outside sales rep for a brick and stone company, reads a report stating that building permits are down dramatically in her sales territory. She had noticed that things were slowing down, but now she has data confirming her impression. Based on this information, Makenna will help her company become more value-driven if she

A) pushes her customers to buy products whether they need them or not. B) advises the production and purchasing departments to produce or order smaller quantities of products. C) avoids contacting her customers until the slowdown ends. D) avoids contact with competing firms in order to maximize value-driven marketing. E) keeps the information to herself.

131) What type of firms recognize that including a strong social orientation in business is a sound strategy that is in both its own and its customers’ best interest?

A) supply chain management firms B) socially responsible firms C) tech-savvy firms D) Internet firms E) mobile marketing firms

132)

Which of the following is true with regard to mobile advertising?

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A) Within just a couple of years, mobile advertising will be a smaller market than digital advertising. B) Within just a couple of years, mobile advertising will be a bigger market than digital advertising. C) Within just a couple of years, the mobile advertising market will be equal to that of the digital advertising market. D) Companies no longer advertise using mobile marketing. E) The approach and marketing plan of mobile advertising is the same as the approach and marketing plan of digital advertising.

133)

Value-oriented marketers constantly measure

A) promotional effectiveness against ethical advertising standards. B) the problem of price maximization against cost-efficiency. C) perceived customer benefits against the costs of their offerings. D) the desire to achieve against the need for a stable source of supply. E) the goal of efficiency against the price charged by competitors.

134)

Marketing is an activity that only large firms with specialized departments can perform. ⊚ ⊚

true false

135) The marketing plan is broken down into various components—how the product or service will be conceived or designed, how much it should cost, where and how it will be promoted, and how it will get to the consumer. ⊚ ⊚

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true false

136) Understanding the marketplace and a customer’s needs and wants is fundamental to marketing success. ⊚ ⊚

137)

true false

The four Ps of the marketing mix include product, promotion, planning, and place. ⊚ ⊚

true false

138) Supply chain management is the set of approaches and techniques that firms employ to efficiently and effectively integrate their suppliers, manufacturers, warehouses, stores, and other firms involved in the transaction into a seamless value chain in which merchandise is produced and distributed in the right quantities, to the right locations, and at the right time. ⊚ ⊚

true false

139) The power adapters Apple sells with its computers are built by small companies that specialize in power-related accessories. When Apple purchases its power adapters from these small companies, it is engaged in B2B marketing. ⊚ ⊚

140)

true false

Garage sales and online classified ads are examples of C2C marketing. ⊚ ⊚

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true false

141) As it relates to marketing, the trade of things of value between the buyer and the seller so that each is better off as a result is known as an exchange. ⊚ ⊚

true false

142) Marketing’s fundamental purpose is to create value by developing a variety of offerings that will earn income for the company. ⊚ ⊚

true false

143) Promotion deals specifically with retailing and marketing channel management, also known as supply chain management. ⊚ ⊚

true false

144) A set of approaches and techniques that firms use to make and deliver a given set of goods and services is known as a distribution network. ⊚ ⊚

true false

145) Walter likes his morning coffee, and sausage biscuit, and he always stops at Dunkin Donuts because it is on his way to work. Walter is being influenced by the place element of the marketing mix. ⊚ ⊚

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true false

146) In value cocreation, the customer participates in the creation of a good or service, which provides additional value to the customer. ⊚ ⊚

true false

147) Apple makes its innovations compatible with existing products to encourage consumers to maintain a long-term relationship with the company across all their electronic needs. ⊚ ⊚

true false

148) To build relationships, firms focus on the lifetime profitability of the relationship, not how much money is made during each transaction. ⊚ ⊚

true false

149) During the market-oriented era, manufacturers began to focus on customers’ needs before they designed or sold their products. ⊚ ⊚

150)

true false

Social media ad spending is growing and increased by 32 percent in 2018. ⊚ ⊚

true false

151) Firms have come to realize that good corporate citizenship through socially responsible actions should be a priority because it will help their bottom line in the long run.

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⊚ ⊚

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true false

Answer Key Test name: Chapter 01 Test Bank 32) D 33) D 34) C 35) A 36) A 37) A 38) A 39) A 40) B 41) B 42) D 43) A 44) E 45) A 46) B 47) D 48) B 49) C 50) A 51) A 52) B 53) E 54) A 55) D 56) D 57) D Version 1

58) E 59) C 60) B 61) D 62) A 63) B 64) C 65) E 66) A 67) B 68) B 69) D 70) E 71) A 72) B 73) C 74) D 75) A 76) C 77) C 78) E 79) D 80) E 81) C 82) A 83) D 84) B 85) A 86) C 87) D Version 1

88) C 89) D 90) E 91) A 92) A 93) A 94) A 95) C 96) C 97) A 98) A 99) B 100) B 101) B 102) C 103) B 104) D 105) B 106) B 107) C 108) D 109) E 110) D 111) B 112) B 113) C 114) A 115) D 116) B 117) D Version 1

118) C 119) B 120) D 121) C 122) A 123) E 124) D 125) A 126) D 127) A 128) C 129) E 130) B 131) B 132) B 133) C 134) FALSE 135) TRUE 136) TRUE 137) FALSE 138) TRUE 139) TRUE 140) TRUE 141) TRUE 142) FALSE 143) FALSE 144) FALSE 145) TRUE 146) TRUE 147) TRUE Version 1

148) TRUE 149) TRUE 150) TRUE 151) TRUE

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Student name:__________ 1)

Of what use is a sustainable competitive advantage to a firm?

2) The text states, “Viewing customers with a lifetime value perspective rather than on a transaction-by-transaction basis is key to modern customer retention programs.” Create an example demonstrating a lifetime value perspective. Why is customer retention almost always a profitable marketing strategy?

3) Although most people do not have a personal marketing plan, when would one be appropriate?

4) One of the benefits of taking marketing courses is the opportunity to apply marketing concepts to marketing yourself. When selling yourself, you are a product including all the skills, aptitudes, and attitudes you bring to the market. What is a sustainable competitive advantage? What can you do to give yourself a sustainable competitive advantage in the marketplace?

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5) The text describes Southwest Airlines, which operates in a competitive market but successfully differentiates itself from the competition. This gives Southwest a sustainable competitive advantage. What is a sustainable competitive advantage? Describe an example of a product or business you have encountered that has developed a sustainable competitive advantage. Why is that product’s or firm’s advantage sustainable?

6) Suppose that you and a friend decide to turn your favorite sports activity—inline skating—into a business. You plan to design a line of fashionable clothing that integrates elbow and kneepads. For each of the four macro strategies, briefly describe the most important thing your company should do if you intend to focus on that strategy. Your answers should be specific to the inline skating business.

7) Southwest Airlines is known for being the low-cost provider in the U.S. airline industry. What type of macro strategy has Southwest pursued?

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8) Every summer, university administrators attempt to estimate how many students will show up in the fall. When August arrives, they hire part-time instructors and reassign faculty to teach the courses students want. In the spring, administrators often go on a retreat to consider how to do things differently next year. What phase of the strategic planning process do they engage in during each of the three seasons (summer, fall, and spring)?

9) Your marketing professor, Dr. Somody, has been asked to participate in the university’s strategic marketing planning process. During the planning phase of the process, what questions will Dr. Somody likely ask? Be specific to the university’s strategic marketing planning process.

10) Conduct a brief SWOT analysis of your prospects of finding a good job related to your major when you graduate (if you already have such a job, think about finding a job with more responsibility). Be sure to include at least one factor representing each of the four major sections of a SWOT analysis, and be sure to label each factor to indicate which of those four sections it belongs in.

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11) Nike, the prominent athletic shoe manufacturer, relies heavily on athlete sponsorships to build demand for its products. Spectators at major sporting events—both those attending in person and those watching at home—frequently see the Nike “swoosh” logo worn by elite athletes. Given the vast worldwide audience for Olympics broadcasts, an Olympic year gives Nike increased exposure. On a Nike situation analysis in an Olympic year, would you consider this exposure to be a strength or an opportunity? Explain your reasoning; be specific.

12) Your marketing professor, Dr. Allred, has been asked to participate in the university’s strategic marketing planning process. After completing the planning phase of the process, Dr. Allred has been asked to assist with the STP analysis. What questions will Dr. Allred ask during the STP analysis? Be specific to the university’s strategic marketing planning process.

13) Your marketing professor, Dr. Garvey, has been asked to participate in the university’s strategic marketing planning process. After completing the first three steps of the process, Dr. Garvey has been asked to assist with implementing the marketing mix and allocating resources. What questions will Dr. Garvey ask? Be specific to the university’s strategic marketing planning process. Version 1

14) Ilya, a sales manager for an industrial materials company, reviews each sales representative’s performance quarterly. She knows business has been good but is surprised to see some reps are selling much more than their goals while others are not meeting their goals. What should Ilya do?

15) You and your friend Maxine work in different parts of a large firm. In a recent analysis, your area was labeled a “cash cow” and hers was labeled a “question mark.” What things would you do differently in your area than Maxine would do in hers?

16) Boston Consulting Group’s portfolio analysis classifies a company’s products or product lines into a two-by-two matrix. What are the bases of classification and what are the products or product lines in each of the four quadrants called? What marketing strategies are usually considered for each of the four classifications?

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17) In 2010, Microsoft discontinued the Kin, its social networking phone, after just six weeks of disappointing sales. During what step of the strategic marketing planning process would Microsoft have made the decision to stop offering the product?

18) Your new sales manager, who previously worked for Boston Consulting Group, directs each sales rep to “toss out the dogs,” “exploit the stars,” and “milk the cows.” Translate this into everyday English: What is the sales manager asking the sales reps to do?

19) After finishing her marketing degree, Brianna inherited the family Coffee Break snack shop. The shop is a small, local institution that residents have been coming to for decades. Brianna wants to make her business grow and is considering either a market penetration or market development strategy. Describe what Brianna will likely do if she pursues either strategy.

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20) Explain how Marvel, the superhero entertainment giant, employed a market penetration strategy using its existing marketing mix and focusing its efforts on existing customers.

21) Belmont Blues is a one-location nursery business, selling plants and flowers for home gardeners. The new owners want to grow through either a product development or diversification strategy. What will the owners likely do if they pursue either strategy?

22) When catalog companies send sale catalogs to their current customers, which type of growth strategy are they pursuing?

23) When musicians and their concert promoters began offering CDs of a live concert immediately after the concert ended, what type of growth strategy were they pursuing?

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24) Several years ago, the Florida Orange Juice Growers Association ran a promotional campaign with the slogan “Orange juice. It isn’t just for breakfast anymore.” Based on this slogan, which of the four growth strategies was the association pursuing? Briefly explain your reasoning.

25)

If a firm wants to develop a sustainable competitive advantage, it should

A) begin an aggressive campaign to buy up competitors. B) copy the innovative features of other firms that are attractive to customers. C) examine its operations and customer relations to identify significant things competitors cannot easily copy. D) increase its marketing budget so that it outspends its competitors. E) arrange to meet with competitors to discuss how to avoid direct competition.

26) The four overarching strategies to create and deliver value and to develop sustainable competitive advantages include locational, customer, operational and _______ excellence.

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A) packaging B) pricing C) promotion D) planning E) product

27) Pietro is in the marketing department of a midsized firm that develops and sells communications systems. He is proud of the human resource area in the company that provides the firm with excellent employees. Pietro himself really enjoys his work, but he knows the work of HR helps create an operational advantage for the firm because of all the following except

A) customers appreciate the kind of service that knowledgeable employees provide. B) employees play a major role in the success of the firm. C) it is easier to communicate with and inspire the customer if the employees believe in what the firm is doing. D) building customer loyalty depends on a committed workforce. E) the company provides products with a high perceived value.

28) Which of the following actions would be the most likely to support and enhance an operational excellence macro strategy?

A) Singapore Airlines installing more comfortable seats in the economy-class cabins of its airplanes B) 3M Corporation implementing new software to improve communication with its suppliers C) Adidas inviting customer suggestions to guide the design of the next generation of shoes D) Nike opening hundreds of new company stores in high-traffic shopping areas E) McDonald’s lowering prices on its coffee drinks

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29) Disney’s My Magic system, which enables visitors to swipe their Magic Band wristbands to get on rides, make purchases, and open their hotel room door, is an example of ________ excellence.

A) operational B) locational C) customer D) product E) service

30) Some banks offer special accounts designed to attract junior high school students. These kids save in such small amounts that the accounts cost banks more to maintain than they are worth; however, bankers know that consumers are creatures of habit and hope that the young people they serve now will become adult customers. These banks recognize

A) that operational excellence is an important macro strategy. B) the lifetime value of customers. C) that product excellence leads to loyal customers. D) the importance of making decisions based on short-term results. E) that as long as customers bring in some revenue, costs do not matter.

31) Avery’s, an upscale department store, has a well-known reputation for going the extra mile to serve its customers. This reputation for excellent customer service will most likely result in

A) product design excellence. B) mission statement satisfaction. C) sustainable price decreases. D) a sustainable competitive advantage. E) producer excellence.

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32) Firms achieve ________ through efficient procedures and excellent supply chain management.

A) customer excellence B) locational excellence C) customer loyalty D) value-based pricing E) operational excellence

33)

Which of the following is likely to provide a sustainable competitive advantage?

A) creating an efficient supply chain that lowers your costs B) lowering prices C) developing a strong mission statement D) using standard technology E) temporarily laying off staff

34) Even when large discount retailers enter a market, a few small, local retailers survive and prosper. These small retailers have probably developed a(n) ________ that allows them to survive.

A) advertising campaign B) plan to evaluate results C) sustainable competitive advantage D) set of performance metrics E) SWOT analysis

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35) Over the last few months, Fredo and his colleagues have analyzed the current business situation and identified target markets for his firm’s personal care products. Finally, they developed the products, prices, distribution, and promotion that should appeal to each of those target markets. In doing so, Fredo has also identified what he believes is an advantage his competitors cannot match. Fredo and his colleagues have been developing

A) a business mission statement. B) a strategic vision. C) team-building exercises. D) a marketing strategy. E) competitive assessments.

36) Marketers want their firms to develop excellent supply chain management and strong supplier relations so they can

A) persuade stores to refuse to carry competitors’ products. B) use their power within the supply chain to force weaker firms to accept less favorable pricing. C) control prices and lock in margins. D) create a sustainable competitive advantage. E) justify charging higher prices than competitors do.

37) For many years, Southwest Airlines distinguished itself as the low-cost airline. Now, many other low-cost competitors have entered the market. Similarly, Southwest was one of the first airlines to offer online ticketing. Now, all airlines have online ticketing. These examples suggest that

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A) no single strategy is likely to be sufficient to build a sustainable competitive advantage. B) a situation analysis does not accurately predict a firm’s strengths. C) customer excellence cannot be achieved. D) product excellence is the only true source of a sustainable competitive advantage. E) innovation is pointless because competitors will develop copycat offerings.

38) When Maria, the keynote speaker at a major business leaders’ conference, arrived in the middle of the night at the Ritz-Carlton, she was exhausted, and her suit was wrinkled from her 10-hour plane trip. The night clerk found someone to dry clean Maria’s suit and have it ready for her morning presentation. She has been a loyal Ritz-Carlton customer ever since. In this example, Ritz-Carlton demonstrated the macro strategy of

A) customer excellence. B) operational excellence. C) product excellence. D) promotional excellence. E) global excellence.

39)

Generally, to build a sustainable competitive advantage, companies should

A) solely focus on lean manufacturing operations. B) only be concerned about supply chain issues. C) focus on a single strategy. D) only address pricing issues. E) use multiple approaches to solidify their position.

40) Singapore Airlines seeks to differentiate itself from competing airlines, in part through innovative design of its airplane seats and in-flight entertainment systems. Through continuous innovation in these areas, Singapore Airlines is pursuing a(n) ________ macro strategy.

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A) customer excellence B) global excellence C) locational excellence D) operational excellence E) product excellence

41) Zara is a women’s clothing retailer headquartered in Spain, with stores located in many countries. Zara has developed a “quick response” system that allows store merchandise to be adjusted rapidly to fit changing customer preferences. Every aspect of Zara’s operation is optimized for this system, making it difficult for competitors like The Gap to duplicate. Zara has established

A) customer loyalty. B) locational excellence. C) a diversification growth strategy. D) a sustainable competitive advantage. E) a related diversification opportunity.

42) Town Bank prides itself on offering better service than any of its competitors. If this is accurate, and if customers recognize and value Town Bank’s superior service, the bank creates and delivers value through

A) promotional excellence. B) product excellence. C) operational excellence. D) global excellence. E) customer excellence.

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43) Sharon has gone to the same hair salon for the past ten years. She believes that her stylist, the salon owner, does a better job of cutting and styling her hair than anyone else could. Other salons have opened closer to Sharon’s home, some offering more plush facilities or lower prices, but she isn’t tempted to switch. Sharon’s attitude toward the salon is an example of

A) a sustainable competitive advantage. B) a customer retention program. C) an opportunity, in SWOT analysis. D) customer loyalty. E) the benefits of a locational excellence strategy.

44)

Customer retention programs are based on what concept?

A) Customer excellence is the easiest macro strategy to follow. B) Customer relationships should be viewed from a lifetime value perspective rather than on a transaction-by-transaction basis. C) It is important to maximize profits in the first few months of a customer relationship. D) Segmentation, targeting, and positioning analysis should not be rushed. E) Firms must spend large amounts of money to retain customers.

45) Most banks implement customer retention programs aimed at their best customers. They do this because they know that retaining customers usually results in

A) a product development growth strategy. B) an operational advantage. C) opportunities for diversification. D) increased long-term profits. E) more clearly defined market segments.

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46) Some universities offer online degree programs, competing with traditional colleges based on the convenience of taking online courses. These online programs are most likely pursuing which macro strategy?

A) customer excellence B) locational excellence C) operational excellence D) product excellence E) purchase excellence

47) When a pharmaceutical company develops a new medication, it typically applies for a patent in order to prevent competitors from developing copycat products for several years. Pharmaceutical companies apply for patents to establish

A) an operational excellence macro strategy. B) a market penetration growth strategy. C) a sustainable competitive advantage. D) an efficient supply chain. E) product efficiency.

48)

One example of a customer loyalty program is

A) a “frequent diner” card at a restaurant, offering a free appetizer for every $100 in food purchases. B) a quantity discount offered for large purchases at an office supply store. C) seasonal sales on top-selling items. D) an “everyday low price” policy on all products at a grocery store. E) an extensive customer service training program for new employees at a hair salon.

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49) Miner’s Oil Change Service Center sets itself apart from competitors by the extra attention it pays to retaining loyal customers by providing fast, courteous service in a clean, professional-looking environment. Miner’s has used this strategy for over 40 years, expanding to 15 outlets. Miner’s Oil Change Service Center has created a ________ macro strategy to create and deliver value and to develop a sustainable competitive advantage.

A) supply chain excellence B) locational excellence C) product excellence D) diversification excellence E) customer excellence

50) Which of the following is the best way to build a sustainable competitive advantage using product excellence?

A) being the first to offer customers desired features, even if competitors can copy them easily B) positioning the product using a clear, distinctive, desirable brand image C) having the most features on each model D) focusing on being cutting edge and continually eliminating older features that are still in use by customers E) copying the market leader’s features, but at a lower cost

51)

A competitive advantage based on location is often sustainable because

A) mobile marketing has not yet proven its value for most customers. B) real estate prices have been dropping. C) few marketers are aware of its importance yet. D) it is not easily duplicated. E) the Internet has diminished the importance of brick-and-mortar stores.

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52) Four companies dominate the cereal industry. These firms produce in large volumes, promote heavily, and control access to the supermarket shelves through “slotting allowances,” which are payments to retailers in return for shelf space. Combined, these four firms have

A) identical marketing mixes. B) customer excellence. C) a sustainable competitive advantage. D) achieved product excellence. E) violated laws governing competition.

53) The wine industry closely watches consumer satisfaction feedback. For years, French wineries consistently had the highest levels of customer satisfaction, creating a(n) ________ for these companies.

A) strategic marketing plan B) clear mission statement C) operational advantage D) sustainable competitive advantage E) diversification strategy

54) Because it was able to deliver merchandise overnight, in the required quantities and at a lower delivered cost than its competitors, Tim’s Sports Shack was given exclusive rights to sell clothing with school logos for the school district. Tim’s demonstrates ________ excellence.

A) product B) place C) customer D) operational E) locational

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55) During which step of the marketing planning process does a firm engage in segmentation, targeting, and positioning?

A) conduct a situation analysis B) implement marketing mix C) identify and evaluate opportunities phase D) evaluate performance using marketing metrics E) define business mission and objectives

56) Customers around the world know Pepsi and consider it a primary “go-to” brand if they want a refreshing drink. This positioning reflects Pepsi’s

A) locational excellence. B) operational excellence. C) product excellence. D) strategic business unit control. E) supply chain management.

57)

Which of the following is the third step in the marketing planning process?

A) define the business mission B) identify and evaluate opportunities C) evaluate using a matrix D) implement marketing mix and allocate resources E) perform situation analysis

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58) Audi’s mission statement addresses urbanization, the need to work on traffic flows and safety in urban areas. To that end, Audi is working with Airbus to develop the Pop.Up Next driving and flying transport system that will enable vertical individual mobility. The strategic planners are engaged in

A) performing situation analysis. B) implementing the marketing mix and allocating resources. C) identifying and evaluating opportunities. D) evaluating performance. E) defining the business mission.

59) After defining the business mission, what should a firm do next to develop a marketing plan?

A) conduct an STP analysis B) perform a situation analysis C) develop a positioning strategy D) select a target market E) implement the four Ps

60)

Hunter Corporation’s mission statement

A) evaluates the performance of its Board of Directors. B) identifies its various market segments and the advertising approaches to each. C) explains how the company plans to change to a just-in-time manufacturing process. D) is a broad description of a firm’s objectives and the scope of activities it plans to undertake. E) describes the specific actions Hunter Corporation will take to achieve its goal.

61) When conducting a SWOT analysis, in what phase of the strategic marketing process is an organization presently engaged? Version 1

A) planning B) implementation C) control D) segmentation E) metrics

62) As part of her company’s SWOT analysis, Selima is assessing the company’s internal environment, including

A) competition. B) the economy. C) strengths and weaknesses. D) demographics. E) opportunities and threats.

63) Roderick is charged with assessing his company’s external environment as part of a SWOT analysis. Roderick will study her company’s

A) strengths and weaknesses. B) sales history. C) pension plan. D) product specifications. E) opportunities and threats.

64) Manufacturers that use just-in-time manufacturing systems coordinate closely with suppliers to ensure that materials and supplies arrive just before they are needed in the manufacturing process. While just-in-time systems can offer major advantages in terms of inventory costs, they must be carefully managed. If a firm found that its just-in-time system was badly managed, leading to frequent manufacturing delays due to missing parts, this system mismanagement would represent a(n) ________ in a SWOT analysis.

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A) weakness B) opportunity C) threat D) strength E) metric

65) For U.S. businesses with strong export capabilities, expansion of U.S. trade agreements with other countries creates

A) weaknesses. B) opportunities. C) strengths. D) threats. E) strategic plans.

66) Which of the following factors, listed in a situation analysis for a major U.S. auto manufacturer, is the best example of a threat?

A) The factory that manufactures a new, popular car cannot build enough vehicles to meet the demand, while other factories have excess capacity. B) Recent consumer studies have indicated that Chinese consumers prefer American cars. C) A New York law firm has filed a $10 million class action suit against the company on behalf of car owners whose gas tanks exploded. D) Due to outdated engine technology, the company’s cars get lower gas mileage than those of major competitors. E) The company has lower manufacturing costs than its key competitors, allowing it to sell its cars at low prices.

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67) Which of the following factors, listed in a situation analysis for a major U.S. auto manufacturer, is the best example of an opportunity?

68) Ford Motor Company may be thinking of announcing that it will severely cut back its automobile production. For parts companies supplying Ford its parts, this cut back in production represents a(n)

A) weakness. B) opportunity. C) strength D) threat. E) strategic plan.

69)

The components of a SWOT analysis are

A) substance, withdrawals, options, and time. B) strengths, weaknesses, opportunities, and threats. C) sustainability, weaknesses, operations, and training. D) strengths, withdrawals, options, and tactics. E) sustainability, weaknesses, options, and threats.

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70) In a SWOT analysis, increasing gasoline prices would represent a potential ________ for manufacturers of electric cars.

A) weakness B) threat C) opportunity D) operational advantage E) locational advantage

71) During a SWOT analysis, a company should assess the opportunities and uncertainties of the marketplace due to changes in several factors, given the acronym CDSTEP. Which of the following is not one of these factors?

A) ethical B) cultural C) political D) technological E) demographic

72) The process of dividing the market into groups of customers with different needs, wants, or characteristics is called

A) target marketing. B) market segmentation. C) positioning. D) allocation. E) value capture.

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73) ________ involves the process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the product does or represents in comparison with competing products.

A) Target marketing B) Market segmentation C) Market positioning D) Allocation E) Value capture

74) A former advertising campaign for GEICO Insurance used the slogan “So easy, even a caveman could do it” to emphasize the ease of buying insurance on GEICO’s website. This campaign was part of GEICO’s

A) mission statement. B) market segmentation plan. C) product strategy. D) customer excellence strategy. E) positioning strategy.

75) Cheng is asked to conduct an STP analysis for his firm. The first step he should perform in this analysis is to

A) develop a business mission statement. B) choose the best target markets. C) reposition existing segments. D) divide the marketplace into subgroups. E) conduct a SWOT analysis.

76) Target has announced that it would begin selling organic food products. In doing so, Target is most likely trying to Version 1

A) gain government subsidies. B) attract a different market segment. C) reduce its costs. D) save the environment. E) offset cost-based pricing pressure.

77) For years, when considering new products, marketers at Bennett’s Coffee and Tea asked themselves, “What would Kelsey think?” Kelsey was a fictional character representing 25- to 50year-old educated, upper-income women who rarely watched television but did a lot of reading. “Kelsey” represented Bennett’s primary

A) mission statement. B) positioning. C) SBU. D) target market segment. E) sustainable competitive advantage.

78) After identifying various market segments that her company could pursue, Shannon evaluated each segment’s attractiveness based on size, income, and accessibility. Shannon was involved in

A) target marketing. B) situation analysis. C) diversification. D) positioning. E) market penetration estimation.

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79) Michael Jordan and Oprah Winfrey are paid huge sums of money by companies for celebrity endorsements. If endorsements by these personalities create a clear understanding among consumers of the companies’ products in comparison to competing products, they can help with the firm’s ________ strategy.

A) product excellence B) targeting C) positioning D) segmentation E) customer excellence

80) ________ involves the process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what a product does or represents in comparison with competing products.

A) Targeting B) Market segmentation C) A sustainable competitive advantage D) Positioning E) A customer excellence strategy

81) Starbucks carefully crafts its offerings and advertising message, and it strategically sets prices and selects locations to appeal to its target market. These efforts represent Starbucks’

A) value-based promotions. B) market segmentation. C) positioning strategy. D) customer excellence strategy. E) target marketing.

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82) When positioning products relative to competitors’ offerings, firms typically are most successful when they focus on opportunities

A) that build on their strengths relative to those of their competition. B) for diversification. C) in international markets. D) where value-based pricing can be ignored. E) where customer excellence can be substituted for product excellence.

83) Many small businesses whose competitors are national franchises advertise “we are locally owned” or “we have been serving the community since 1951.” These claims are part of these firms’

A) business mission. B) market segmentation strategy. C) positioning strategy. D) customer excellence strategy. E) target market.

84) Among Internet users, some do research online, some shop, some look for entertainment, and many do all three. Each of these groups would be called a

A) strategic group. B) strategic business unit. C) market segment. D) cash cow. E) marketing metric.

85)

STP refers to

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A) segmentation, tendency, and preference. B) strategy, tenacity, and place. C) segmentation, targeting, and positioning. D) substance, traffic, and pattern. E) sustainability, targeting, and product.

86) Coca-Cola sells two different zero-calorie versions of Coke: Diet Coke and Coke Zero. It has chosen to attempt to appeal to men with Coke Zero. In addition to launching an ad campaign featuring men enjoying Coke Zero, Coca-Cola also designed a masculine-looking can for Coke Zero, with bold red lettering on a black background. This specially designed can is an example of

A) positioning. B) targeting. C) segmentation. D) a market segment. E) market penetration.

87) Delta Airlines is among the companies experimenting with selling products and services on their Facebook pages. The idea is to make purchasing even easier for customers who may spend large portions of the day with Facebook active on their computers or mobile devices. There is no need even to navigate to Delta’s website—users can book a trip in Delta’s “Ticket Agent” application without ever leaving Facebook. Which element of the marketing mix does this represent?

A) product and value creation B) price and value capture C) place and value delivery D) promotion and value communication E) positioning and value promotion

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88) Suppose your university made a sizable investment in its career services—additional counselors, increased efforts to bring in recruiters, and other services aimed at helping students find jobs. This investment would enhance the university’s ________ in an attempt to create value for students and recent graduates.

A) segmentation strategy B) place strategy C) locational excellence strategy D) diversification strategy E) product value

89)

The idea of value-based marketing requires firms to charge a price that

A) covers costs and generates a modest profit. B) includes the value of the effort the firm put into the product or service. C) captures the value customers perceive that they are receiving. D) prioritizes customer excellence above operational excellence. E) matches competitors’ prices.

90) What type of analysis does management use to evaluate the firm’s various products and businesses and allocate resources according to which products are expected to be the most profitable for the firm in the future?

A) portfolio analysis B) SWOT analysis C) situation analysis D) initial analysis E) positioning analysis

91)

Value creation through place decisions for a consumer product involves

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A) putting the product in the front of the store. B) designing creative displays to capture consumers’ attention. C) pricing products differently at different stores. D) making sure the product is available in the stores where customers will want to find it, and that it is always in stock so they can buy it when they want to. E) focusing exclusively on Internet sales to reduce supply chain costs.

92) In recent years, cellular (mobile) service providers have worked hard to eliminate “dead zones,” providing customers with service wherever they traveled. By working to make the network available in more locations, cellular service companies were focusing on ________ value creation.

A) product B) price C) promotion D) place E) financial

93) When firms successfully implement poor strategies (perhaps due to good luck) or do a poor job of implementing good strategies, it can be difficult to

A) generate cost-based performance ratios. B) evaluate performance and make adjustments. C) increase product excellence without reducing customer excellence. D) develop segmentation strategies. E) choose a business mission.

94) Rashid has been directed by his regional marketing manager to cut prices on seasonal items, place an ad in the local paper, and tell distributors to reduce deliveries for the next month. Rashid is engaged in

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A) evaluating performance. B) defining the business mission. C) performing situation analysis. D) implementing marketing mix and resources. E) identifying and evaluating opportunities.

95) E-books, in addition to being an alternative product form, provide ________ value creation since they can be downloaded via the Internet immediately when and where they are needed.

A) product B) place C) promotion D) price E) primary

96) In value-based marketing, the promotion element of the four Ps communicates the ________ to customers through a variety of media.

A) mission statement B) operational excellence strategy C) value proposition D) relative market value E) target market definition

97) When marketers use a variety of communication disciplines—advertising, personal selling, sales promotion, public relations, direct marketing, and online marketing including social media—in combination to communicate a value proposition to the customer, it is referred to as

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A) integrated marketing communications. B) multimedia marketing. C) diverse marketing communications. D) comprehensive promotion. E) managed marketing communications.

98) Google and other search engines allow marketers to bid to have their ads shown when consumers search keywords related to the firm’s products. These marketers are attempting to create value through

A) product. B) price. C) promotion. D) place. E) cost-based measures.

99) Giorgio sees that his company’s quarterly sales and profits are significantly above projections and says, “That’s great. Let’s keep doing what we’ve been doing.” Giorgio is ignoring the ________ step of the marketing planning process.

A) evaluate performance B) define the business mission C) perform situation analysis D) implement marketing mix and resources E) identify and evaluate opportunities

100) is to

The first objective in the evaluate performance phase of the marketing planning process

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A) determine whether to raise or lower prices. B) adjust advertising allocations. C) find ways to cut costs. D) review implementation programs and results using metrics. E) consider changing the target market.

101) As it pertains to the marketing plan, understanding the causes of performance, regardless of whether that performance exceeded, met, or fell below the firm’s goals

A) enables firms to make appropriate adjustments. B) allows managers to demonstrate their effectiveness. C) offers insights into crafting an appropriate mission statement. D) should always be followed by eliminating underperforming SBUs. E) allows firms to better assess customer loyalty.

102) A regional manager at Sally’s Beauty Supply, a chain of retail stores selling hair and beauty products, is reviewing sales data after a recent in-store promotion. The data show success in some stores and limited response in others. To understand the differences between stores, the manager will probably next review the company’s

A) financial statements, to investigate current and past profits. B) brand awareness study, to assess national levels of awareness. C) implementation programs, to see if the promotion was handled consistently in the different stores. D) mission statement, to see if it needs adjusting. E) analysis of national trends in vitamins and herbal supplements, to help predict future sales.

103) After conducting STP analysis for her health food store and developing strategies for each of the four Ps, Nicki now has to make _____________ decisions.

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A) competitive response B) resource allocation C) market growth D) product line E) mission statement

104) Lamar owns four delis in the suburbs of Chicago, Illinois. He recently updated his STP analysis and has just finished adjusting his marketing mix based on the STP results. His next strategic marketing decision will most likely involve determining

A) how a new housing development will impact his business. B) which employees to promote or fire. C) how to allocate resources among his four stores. D) what new government regulations might create opportunities or threats. E) when to shift from a customer excellence to an operational excellence strategy.

105)

Which of the following statements about marketing metrics is true?

A) They can only be used at one level in an organization. B) They assist in comparing results among SBUs. C) They are only useful for marketing promotions. D) They never quantify trends or characteristics. E) They cannot help a firm adjust its marketing plan.

106) A product that is in a high-growth market but has a low market share would be classified as a ________ on the BCG matrix.

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A) ladder B) dog C) cash cow D) star E) question mark

107) In most companies, portfolio management is typically done at the SBU or ________ level of the firm.

A) corporate B) product line C) customer care D) sales representative E) accounting

108) Nike, the global athletic footwear market is expected to experience only very slow growth over the next several years. Nike is the market leader. According to Boston Consulting Group portfolio analysis, how should Nike treat its athletic shoe business?

A) Nike will probably have to invest heavily in the athletic shoe business, including extensive promotions and new production facilities. B) Nike should consider exiting the athletic shoe market. C) Nike should stop investing in its athletic shoe business; it has already reaped all the benefits it is likely to receive. D) Nike’s athletic shoe business still requires some investment, but it is likely to produce excess resources that can be invested in other divisions of the company. E) Nike should invest in the athletic shoe market only if it helps boost the sales of other products in fast-growing markets.

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109) Subway is a large chain of franchise sandwich shops. Elgin owns three Subway stores in a large city. At the end of the year, he notes that sales rose from 2 to 5 percent over last year’s sales at Stores 1 and 2 but fell 2 percent at Store 3. Based on this information, which of the following is the best course of action as to how Elgin should reward (or punish) his store managers?

A) He should give bonuses to the managers of Stores 1 and 2 and put the Store 3 manager on probation. B) He should ignore the sales data; they are not an appropriate marketing metric. C) He should give each manager a raise, tied to the store results. D) He should review at least 10 years of sales data about her stores’ performance before making a decision. E) He should seek more information about why the stores had different results before making a decision.

110) A(n) ________ is a group of products that consumers may use together or perceive as similar in some way.

A) SBU B) STP C) product line D) market segment E) promotional service

111) Heidi has been assessing several of her firm’s products using the Boston Consulting Group (BCG) approach to portfolio analysis. She has been trying to assess the strength in a particular market and is looking at the sales of the product and the overall market as well as the sales of competitors. Heidi is trying to determine

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A) the product’s relative market share. B) the market growth rate. C) a source of competitive advantage. D) the impact of population shifts on future demand. E) cash equivalent values for each product.

112) To determine how attractive a particular market is using the BCG portfolio analysis, ________ is(are) established as the vertical axis.

A) competitive intensity B) sales dollars C) market size D) market growth rate E) market profit potential

113) In BCG portfolio analysis, products in low-growth markets that have received heavy investment and now have excess funds available to support other products are called

A) stars. B) cash cows. C) question marks. D) dogs. E) anchors.

114) Jacob was thrilled to find out that his company had just decided to invest a great deal of money in the product he was managing. He knows that even with its recent high rate of growth and the fact that it dominates its market, he would need more money to establish it firmly. Using the BCG portfolio analysis, his product would be classified as a(n)

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A) star. B) cash cow. C) question mark. D) dog. E) anchor.

115)

Using the BCG portfolio analysis, a “dog” should be phased out unless

A) its marketing manager is a champion of the product. B) additional resources could increase its relative market share slightly. C) it complements or boosts the sales of another product. D) the market has a small chance of rebounding. E) none of these. Dogs should be phased out.

116)

The strategic marketing planning process

A) is a five-step process that should always be completed in order. B) is frequently used in reverse. C) begins with establishing specific, measurable outcomes. D) is not always sequential. E) forces marketing managers to think rationally.

117) Which of the following is one of the four major growth strategies marketers typically utilize?

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A) market penetration B) segment evaluation C) segment development D) pattern and process E) sustainability emphasis

118) Andy decides to add new sales representatives and increase advertising to increase sales in her existing market for her current line of security systems. Andy is pursuing a ________ growth strategy.

A) segment development B) market development C) market penetration D) diversification E) product development

119) A ________ growth strategy employs the existing marketing offering to reach new market segments.

A) product proliferation B) market development C) market penetration D) diversification E) product development

120) Which of the following growth strategies employs the existing marketing mix and focuses the firm’s efforts on existing customers?

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A) product penetration B) diversification C) market development D) product development E) market penetration

121) Learn to Go sells its foreign language dictionaries to college students throughout the United States. Samuel Marcus, the owner, wants to start selling these products to international students abroad. Marcus wants to pursue a ________ growth strategy.

A) product proliferation B) market development C) market penetration D) diversification E) product development

122) When Marvel launched several successful series on Netflix, including Jessica Jones, The Defenders, Iron Fist, and Luke Cage, it employed a ________ strategy.

A) product development B) customer development C) market penetration D) market development E) diversification

123) Woods, Inc. is a small, local heating and air conditioning business. The local military base is a potential source of growth, and Woods already installs and services the type of equipment the military would require, but it is difficult to get established as a certified government contractor. Woods is considering a ________ growth strategy.

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A) product proliferation B) market development C) market penetration D) diversification E) product development

124) Many states create licensing requirements for a variety of professionals (such as lawyers and accountants) designed to restrict entry into their market by professionals from other states. This strategy limits ________ growth strategies.

A) product proliferation B) market development C) market penetration D) diversification E) product development

125) Marketers who design and offer new products and services to their existing customers are pursuing a ________ growth strategy.

A) product proliferation B) market development C) market penetration D) diversification E) product development

126) Most banks now have customer relationship software that, when a customer contacts the bank, tells the service representative what types of accounts, loans, and credit cards the customer currently has. Service representatives use this information to sell some of the other services the bank currently offers to these customers. This is a ________ growth strategy.

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A) product proliferation B) market development C) market penetration D) diversification E) product development

127) Grace phoned her auto insurance agent to renew her policy. The agent told her about new types of insurance now available—to cover her apartment, or even the engagement ring she just got from her fiancé. The agent was pursuing a ________ growth strategy.

A) product development B) market development C) market penetration D) diversification E) product proliferation

128) Introducing newly developed products or services to a market segment the company is not currently serving is called

A) product development. B) market development. C) market penetration. D) diversification. E) product proliferation.

129) Marvel has increased its market penetration by expanding the distribution of its films. Marvel movies can be seen in theaters, accessed on Xfinity, and viewed on DVDs available in discount stores, grocery stores, and a host of other stores, including book and comic stores. This is an example of a ________ growth strategy.

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A) product proliferation B) market development C) market penetration D) diversification E) product development

130) Sodexo is a corporation that manages school cafeterias, university dining halls, mess halls at military bases, concession stands at sports arenas, and other large-scale food service facilities. If Sodexo were to begin to sell individual frozen meals in supermarkets, it would be pursuing a ________ growth strategy.

A) product development B) market development C) market penetration D) diversification E) product proliferation

131) Tandy’s Styles involves its customers in the process of developing new products. In this way, it can benefit from current customers’ insights and develop new products that will meet these customers’ needs. Tandy’s is pursuing a ________ growth strategy.

A) diversification B) market development C) market penetration D) product development E) product penetration

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132) Marvel was among the first content providers to launch dedicated series on Netflix, such as Jessica Jones, The Defenders, Iron Fist, and Luke Cage. It then decided to create a new channel for getting new offerings to consumers. The company was pursuing a(n) ________ strategy.

A) market development B) market penetration C) operational excellence D) customer excellence E) product development

133) Strong supplier relations and efficient supply chains help firms such as Walmart achieve operational excellence. ⊚ ⊚

true false

134) iTunes software is often credited with the success of Apple’s iPod MP3 player, because it made the iPod easier to use than competing players and was difficult for competitors to duplicate. This is an example of a sustainable competitive advantage. ⊚ ⊚

135)

true false

It is not always necessary to go through all the steps in the marketing planning process. ⊚ ⊚

true false

136) Sandbar is a beach-themed casual restaurant group in Southern California. Most of its customers are tourists. In a SWOT analysis for Sandbar, the possibility that the recession might cut back on tourism in Southern California would be considered a weakness.

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⊚ ⊚

true false

137) Firms are typically more successful when they focus on opportunities that build on their strengths relative to those of their competition. ⊚ ⊚

true false

138) Price should be based on the value that the customer perceives as a good “deal” for the product they receive. ⊚ ⊚

true false

139) Marlena manages the electrical turbine engine division of Dynamic Enterprises Corporation. Her unit has a somewhat different objective than other units, and Marlena makes most decisions independently, without consulting headquarters. It’s likely that she manages a strategic business unit. ⊚ ⊚

140)

true false

The strategic planning process always proceeds sequentially through the five steps. ⊚ ⊚

true false

141) SanDisk’s MP3 player product line (called the Sansa) has a low relative market share. The MP3 player market is expected to decline over the next few years. In Boston Consulting Group (BCG) portfolio analysis, the Sansa would be considered a dog.

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⊚ ⊚

true false

142) Esau wants to offer his existing design customers new goods and services. He is pursuing a market development strategy. ⊚ ⊚

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true false

Answer Key Test name: Chapter 02 Test Bank 25) C 26) E 27) E 28) B 29) C 30) B 31) D 32) E 33) A 34) C 35) D 36) D 37) A 38) A 39) E 40) E 41) D 42) E 43) D 44) B 45) D 46) B 47) C 48) A 49) E 50) B Version 1

51) D 52) C 53) D 54) D 55) C 56) C 57) B 58) E 59) B 60) D 61) A 62) C 63) E 64) A 65) B 66) C 67) B 68) D 69) B 70) C 71) A 72) B 73) C 74) E 75) D 76) B 77) D 78) A 79) C 80) D Version 1

81) C 82) A 83) C 84) C 85) C 86) A 87) C 88) E 89) C 90) A 91) D 92) D 93) B 94) D 95) B 96) C 97) A 98) C 99) A 100) D 101) A 102) C 103) B 104) C 105) B 106) E 107) B 108) D 109) E 110) C Version 1

111) A 112) D 113) B 114) A 115) C 116) D 117) A 118) C 119) B 120) E 121) B 122) A 123) B 124) B 125) E 126) C 127) A 128) D 129) C 130) D 131) D 132) E 133) TRUE 134) TRUE 135) TRUE 136) FALSE 137) TRUE 138) TRUE 139) TRUE 140) FALSE Version 1

141) TRUE 142) FALSE

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Student name:__________ 1) Explain how social media has changed how firms communicate with their customers relative to traditional forms of marketing products.

2) Explain the 4E framework for digital marketing and identify the social and mobile media tools that are most effective for accomplishing each of the 4Es.

What forms of digital marketing are good choices for “exciting” the customer?

4) A local manufacturer has developed a scented USB drive targeted strictly at male consumers. The scents include options such as pine, bacon, and beer. Using the 4E framework, briefly describe the target client, and outline a complete digital marketing program for this new product.

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Explain how YouTube helps customers “experience” a product or service.

In terms of the 4E framework, what is the significance of “engaging” the customer?

7) Suppose that Samsung wants to create a social media program to build consumer engagement around a new line of smartphones. Using the 4E framework, explain (with examples) how Samsung could build this program.

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8) Discuss why mobile marketing should be considered significant by companies and marketing firms.

9) Firms use primary online channels for a variety of goals that reflect the 4Es. Describe the 4Es and the online channels that reflect these goals.

10) Give an example of how digital marketing can be used to provide improved customer service.

11) Compare the role of corporate, professional, and personal bloggers regarding a new product. Choose one product/service and use this as an example in your explanation.

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12)

What is the purpose of search engine marketing (SEM)?

13) Describe a crowdsourcing and provide an example of how it is used to build community in online marketing.

14)

Describe the Wheel of Social Media Engagement.

15) Provide an example of how a company, such as Coca-Cola, might engage a customer through the use of beacon technology.

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16)

How do companies like American Express utilize corporate blogs? Provide an example.

17) Marketers rely on different types of online marketing strategies. Describe when a thought-sharing site would be particularly effective.

18)

List and describe the seven primary motivations for mobile app usage.

19) Select four of the seven primary motivations for mobile apps and provide examples of apps that correspond to each motivation.

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20) Explain the concept of “showrooming,” including what type of app it is associated with and what primary motivation need it fulfills.

21)

List and describe the four basic ways of generating revenue from apps.

22) You are the owner of a new pizza restaurant that encourages customers to “build their own pizza.” What social and mobile media tools could you use to enhance your business?

23) Briefly describe the three-stage process for engaging customers using online, social, and mobile media.

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24) Burger King has become known for launching edgy—and often risky—advertising and social media campaigns. How might Burger King use sentiment analysis to gain insights into consumers’ reactions to a new ad campaign?

25) Suppose that a restaurant near campus wants to use social media to get more students to visit the restaurant. The manager plans to offer a free dessert to anyone who “likes” the restaurant’s Facebook page. Describe some data the restaurant should collect to measure the effectiveness of the campaign.

26) Suppose that Don’s Donuts near campus wants to use social media to get more people to visit the store. The manager plans to offer a free donut to anyone who “likes” the store’s Facebook page. In this situation, how would you measure the conversion rate?

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27)

List, in order, the steps involved in developing a digital marketing campaign.

28) Burcham’s Lawn & Garden Tools has a strong online presence. What type of influencer would Joe Burcham want to use to further promote his product line and why?

29)

Explain one of the ethical situations that can arise when using influencers.

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30) While waiting to be seated at Joes’ Bar and Grill, Nadine receives a customer loyalty coupon through an app on her mobile phone for half off an appetizer or dessert with the purchase of an entrée. This use of a location-based software application is designed to promote which of the 4E framework objectives?

A) engage B) energize C) excite D) experience E) educate

31) Amelia wants a very professional look for an interview with an accounting firm. A friend tells her about Your Look, a site that allows potential customers to virtually try on clothes and see what looks best. It even offers an interactive “custom fit” feature. After checking out her options, Amelia takes her measurements and orders a pantsuit without ever leaving her office. Virtually trying on a suit best describes which of the 4E framework objectives?

A) engage B) energize C) excite D) experience E) educate

32) It is not unusual to see firms offering free product samples in grocery stores to let customers try the product before buying it. Similarly, in today’s world of digital marketing, one can read a chapter of a book before buying it or watch YouTube videos on different ways to use a product. All of these scenarios are aimed at which aspect of the 4E framework?

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A) engage B) energize C) excite D) experience E) educate

33) Maxim’s Complete Cameras offers its customers an interactive website to help them choose the best camera for their lifestyle. But the site’s most-used feature is its user blog in which customers—both satisfied and unsatisfied—talk about products they have purchased, and the service received at Andrew’s. The user blog best describes which of the 4E frameworks for the store’s customers?

A) engage B) energize C) excite D) experience E) educate

34) Best Buy provides their loyal customers with a relevant coupon based on previous purchases through their mobile phone, while they are in the store. This represents the _____ aspect of the 4E framework of digital marketing.

A) engage B) energize C) excite D) experience E) educate

35)

A ________ is an example of a thought-sharing site.

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A) freemium app B) network effect C) blog or microblog D) connective impact E) sentiment analysis

36)

Thought-sharing sites are also known as

A) blogs. B) beacon technology. C) showrooming. D) crowdsourcing. E) hits.

37)

An example of a popular microblogging site is

A) Google Analytics. B) Twitter. C) Yahoo. D) Adobe Campaign. E) Microsoft Edge.

38) A ________ can educate customers when discussing their products or services and create excitement when they promote special offers.

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A) freemium app B) network effect C) corporate blog D) page search E) professional blog

39)

Twitter is considered a

A) microblog. B) corporate blog. C) professional blogs. D) freemium app. E) search engine.

40)

For companies, what digital marketing tool can both educate and excite customers?

A) corporate blog B) microblog C) weblog D) professional blog E) personal blog

41) Yanie is developing a marketing campaign for an organic stain-removal product. As “stain removal” is rather dull, she is trying to educate consumers about the value and uniqueness of the product, and appeal to the environmentally conscious. Which of the following is the best social media application for this task?

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A) Twitter B) LinkedIn C) blog D) Instagram E) Facebook

42) Manufacturers, retailers, and service providers have created and maintain websites, blogs, and _________ to enable customers to interact with them over the Internet.

A) software applications B) product reviews C) hardware applications D) a social media presence E) social bookmarks

43) Which of the following is the most powerful and influential online marketer in the United States?

A) YouTube B) Google C) Amazon D) Facebook E) Twitter

44) American Express Open Forum site invites business experts to share their wisdom in various posts. This is an example of what type of blog?

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A) microblog B) corporate blog C) personal blog D) weblog E) professional blog

45)

The most loyal customers use

A) websites. B) mobile apps. C) multiple channels. D) desktop computers. E) in-store channels.

46)

Which of the following would be considered informational content on a website?

A) design B) navigation C) font D) color E) audio

47)

Which of the following is a traditional contextual element of website design?

A) graphic B) video C) audio D) color E) text

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48)

What is the basis of any marketing strategy?

A) content B) goals C) community D) commerce E) connection

49) What Amazon innovation might suggest replenishment of a previously ordered item, facilitate the purchase of a tool that the shopper is missing for a DIY project, or even recommend alternatives to consistently purchased products and brands?

A) Spark B) Alexa C) Amazon ecosystem D) Pinterest E) Twitter

50) Dianna decides to use Twitter to market her custom jewelry to other women on her campus. She sets up a Twitter account with the name @oneofakindbydianna and posts this on her Facebook page, making sure to tweet every few days. Soon Dianna is selling a lot of jewelry. Dianna’s Twitter account is an example of

A) microblogging. B) media-sharing. C) thought-sharing. D) professional networking. E) social bookmarking.

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51) This type of blog typically provides the highest level of digital marketing control for companies.

A) professional blog B) corporate blog C) personal blog D) microblog E) weblog

52)

From a marketing perspective, what role is played by professional bloggers?

A) engaging customers on behalf of companies B) introducing new products to the marketplace C) sharing videos and photos of products D) recruiting employees E) reviewing and giving product and service recommendations

53) Of the various types of blogs, which one do marketers have the lowest level of control over?

A) personal B) corporate C) professional D) corporate microblogs E) professional microblogs

54) Which of the following encourages visitors to delve deeper into a website, to explore other pages and, in general, spend more time on the site?

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A) downloadable bar codes B) mobile apps C) call-to-action buttons D) corporate blogs E) posted videos

55)

What is a microblog?

A) a blog whose owner doesn’t post very often B) a blog that supports only links to other posts C) a blog run by a small business D) a blog that allows people to share their thoughts, opinions, and feelings E) a blog that targets a very small consumer group

56) Apple operates a blog called Apple Newsroom, where you can read news, find updates and see videos on Apple products. The information is both engaging and educational. Apple Newsroom is an example of a

A) corporate blog. B) network blog. C) personal blog. D) professional blog. E) social blog.

57) Gracie loves to read and write. She started a blog about young adult books, including writing hints and book reviews. The readership of her blog gradually increased, and eventually publishers started sending her new books, hoping she would review them. Over time, Gracie’s blog has changed from a __________ blog to a __________ blog.

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A) professional; network B) professional; personal C) personal; professional D) personal; social E) social; network

58) Mercedes-Benz bypassed Facebook for ________ for its social media campaign since its professional audience is more in line with Mercedes’ target customer base.

A) Amazon B) LinkedIn C) Twitter D) YouTube E) Google Analytics

59) The ________ is the outcome of social media engagement in which every time a firm or person posts information, it is transferred to the poster’s vast connections across social media, causing the information to spread instantaneously.

A) commerce force B) commerce impact C) connected effect D) community condition E) contextual element

60) An example of the ___________ effect is when BMW gained in-depth information about visitors to a popular Chinese social media site and used that information to determine which visitors were likely to be luxury car buyers and targeted advertising toward them.

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A) media B) information C) connected D) social E) interconnected

61) Individuals achieve the ________ effect when they check in, post a picture to Instagram, upload a video to YouTube, or share a link to an article they have liked on Facebook.

A) media B) information C) connected D) social E) interconnected

62) Coca-Cola relies on _________ technology to offer their customers a free Coke at the moment they walk through a movie theater.

A) network B) dynamic C) radar D) satellite E) beacon

63) At the Mallana Resort, located in Florida, a Twitter concierge stays in constant contact with its guests. If a guest has a problem or question, the answer is just a hashtag away. This is an example of the impact of which of the following?

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A) dynamic effect B) network effect C) connected effect D) interconnected effect E) information effect

64) What effect of social media engagement is achieved when individuals post a picture to Instagram, upload a video to YouTube, or share a link to an article they have liked on Facebook?

A) timelessness effect B) dynamic effect C) network effect D) information effect E) connected effect

65) If Katy Perry tweets a close-up of her eyelashes, lengthened by using a Cover Girl mascara product, then Cover Girl will have instantly reached all her millions of followers. What effect of social media engagement is this an example of?

A) timelessness effect B) dynamic effect C) network effect D) information effect E) connected effect

66) The Wheel of Social Media Engagement includes the following five effects as drivers of social media: ________, Connected, Network, Dynamic, and Timeliness.

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A) Information B) Communication C) Experience D) Community E) Commerce

67) In Candy Crush Saga, you get five lives to play in the game. When you lose a life, it takes 30 minutes in real-life time to get that life back, or you can spend $0.99 to get all five lives back. Candy Crush Saga is an example of

A) paid app. B) freemium app. C) ad-supported app. D) paid app with in-app purchases. E) microblog app.

68)

Which of the following is a pricing model for apps discussed in your text?

A) cost-plus B) ad-supported C) premium D) per-use E) data-driven

69) Of the seven primary motivations for mobile app usage, which one do people spend the most amount of time on each month?

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A) need for “me time” B) need for socializing C) need for shopping D) need for accomplishing E) need for self-expression

70) In a process called _______, a customer visits a store to touch, feel, and even discuss a product’s features with a sales associate, and then instantly compares the prices online to see whether a better deal is available.

A) deal-finding B) window-shopping C) highlighting D) matching E) showrooming

71)

Which of the following apps would help consumers fulfill their “need to accomplish”?

A) Snapchat B) Google Calendar C) Flipboard D) MyFitnessPal E) SkyMap

72) Apps like calendars, trip planners, and flight trackers help consumers fulfill which primary motivation?

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A) to prepare B) to accomplish C) to discover D) to work E) to organize

73) ________ are free to download, but appear as ads on the screen; they generate revenue while users interact with the app.

A) Ad-supported apps B) Freemium apps C) In-app purchases D) Paid apps E) Paid apps with in-app purchases

74)

Which app pricing model is used by the app Candy Crush Saga?

A) ad-supported apps B) freemium apps C) in-app purchases D) paid apps E) paid apps with in-app purchases

75)

Claire is watching a movie on her Netflix app. Which need is Claire satisfying?

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A) discover B) self-express C) accomplish D) shop E) “me time”

76) Meryl is 27 years old and loves to use WeChat to share videos with her friends overseas. Meryl is fulfilling her need to

A) discover. B) socialize. C) accomplish. D) self-express. E) have “me time.”

77) The three-stage process that firms use to engage customers through social, online, and mobile media involves

A) listening analyzing, and correcting. B) listening, analyzing, and doing. C) listening, accomplishing, and reviewing. D) reviewing, analyzing, and implementing. E) implementing, reviewing, and correcting.

78) Which of the following is a category of analysis used for understanding data collected from social media?

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A) Checking to see if the user has more than 250 friends. B) Comparing the data to the user’s shopping list on Amazon. C) Determining the amount of user traffic accessing the site. D) Identifying the number of dating sites accessed. E) Noting the time of day that the user is on the computer.

79)

When designing a digital marketing campaign, the first step is to

A) develop the budget. B) develop the campaign. C) monitor and change. D) identify the strategy and goals for the program. E) identify the target audience.

80) The development of strong, eye-catching images and designs is important in the ________ step of developing a digital marketing campaign.

A) identify the target audience B) identify the strategy and goals C) monitor and change D) budget development E) campaign development

81) ________ allow marketers to analyze data from content sites like Facebook, Twitter, online blogs, and reviews to collect consumer comments about companies and their products.

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A) Sentiment analysis B) Keyword analysis C) Click paths D) Bounce rates E) Conversion rates

82)

The elements of the digital marketing engagement process are

A) listening, reacting, and correcting. B) exciting, listening, and doing. C) analyzing, developing, and engaging. D) listening, engaging, and evaluating. E) listening, analyzing, and doing.

83) Companies can find out a lot about customers using sentiment analysis on sites like Facebook and Twitter to

A) develop beacon technology. B) create accurate keyword analysis. C. engage in promoting their new products. C) analyze content to assess the favorableness or unfavorableness of the sentiments. D) get an accurate count of clicks.

84) One important measure of social media’s effectiveness is the percentage of site visitors who take the action the site owner hoped for—making a purchase, subscribing to a service, or donating money, for example. This measure is called the site’s

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A) conversion rate. B) extended network. C) bounce rate. D) hits. E) click paths.

85) When a company that uses social media runs a contest online, it will measure its effectiveness in a variety of ways. One such measure is the conversion rate. The conversion rate for the contest promotion would be

A) the number of people who entered the contest. B) the number of people who entered the contest plus the number of people who visited the page describing the contest. C) the number of people who visited the page describing the contest. D) the percentage of visitors to the page describing the contest who entered the contest. E) the percentage of fans of the company’s page who learned about the contest.

86) Suppose that Hardee’s wanted to evaluate social media content to find out how well its most recent advertising campaign was being received by consumers. This could be done using

A) Google Analytics. B) sentiment analysis. C) click path analysis. D) keyword analysis. E) bounce rate.

87) Despite its innovative graphic design, the website for Shabby-Chic Decor did not seem to attract customers who lingered. In fact, most website visitors left the site before they made a purchase. Which measure does the owner need to address?

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A) sentiment analysis B) page views C) bounce rates D) keyword analysis E) mobilization rates

88) One measure of traffic from visitors on sites, the total requests for a page, is measured in units called

A) clickers. B) hits. C) paths. D) tweets. E) impressions.

89) Vivek has developed a better type of medication vial for travelers. He is not sure how to develop a marketing program for his product, as there are a few similar ones on the market. What technique can Vivek use to analyze data from his competitor’s websites, particularly to learn how people search for similar products online?

A) click path data B) sentiment analysis C) social influence D) keyword analysis E) budget analysis

90)

What is a bounce rate?

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A) how users proceed through information on the site B) percentage of times a visitor leaves the site after viewing one page C) measure that indicates what percentage of visitors or potential customers act as the marketer hopes D) number of unique visitors to the site E) amount of traffic on the site

91)

How is the cost to companies and entrepreneurs using Google Analytics calculated?

A) a few cents per 100 hits B) correlation to conversion rates of website C) flat fee D) free for individuals; corporate rates based on usage E) free for everyone

92)

The first step in the process of creating a digital marketing campaign is to

A) develop a budget. B) identify the target audience. C) set goals. D) design the elements of the campaign. E) monitor the program.

93)

The final step in the process of creating a digital marketing campaign is to

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A) develop a budget. B) identify the target audience. C) set goals. D) design the elements of the campaign. E) monitor the program.

94) When developing a digital marketing campaign, what is unique about the copy and images to be used that is more critical with social media that other forms of IMC?

A) They need to be humorous. B) They need to be updated almost constantly. C) They need to feature only young actors. D) They must appear only in color (not black and white). E) They must appeal to a diverse, multicultural audience.

95) A disadvantage for companies using a “daily budget” such as that offered by Facebook to its advertisers is that it

A) has poor cost control. B) is unable to make adjustments. C) may limit exposure if ad is very successful. D) is unattractive to consumers. E) encourages negative feedback.

96) Firms that hire (or encourage) well-known names to promote brand messages to their networks of followers are using

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A) influencer marketing. B) the information effect. C) social listening. D) freemium apps. E) the network effect.

97) Central Style wants Joanna Gaines from HGTV to mention their reclaimed wood furniture in her blog. They are willing to pay her top dollar because of her popularity. This is an example of

A) social distancing. B) the information effect. C) social listening. D) influencer marketing. E) demographic targeting.

98) Counting followers may not be sufficient to determine the value of an influencer, since there is a growing problem of fraud, such as when unethical “click farm” service providers offer to sell followers to social media personalities. So companies need to consider the 4Rs, which are

A) relevance, reach, response, and return. B) relationship, rapport, response, and relativity. C) rapport, reach, response, and return. D) relevance, relationship, response, and return. E) relevance, rapport, response, and relationship.

99) Michele’s Beauty Secrets is a new, organic-based makeup line. Michele would like to hire Cassie Thorpe, a renowned makeup artist, to demonstrate the use of Michele’s Beauty Secrets in her blog. Michele knows that Cassie’s followers will be highly interested in her product line. Which factor is Michele considering at this point?

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A) the response that is generated B) the reach of Cassie’s blog C) the number of hits to Cassie’s blog D) the relevance of Cassie’s background E) the anticipated return

100) An entertaining post likely spreads further than a basic, informational one. This factor contributes to

A) reliability. B) response. C) return. D) relevance. E) reach.

101) The type of influencer that has a large following and is widely recognized is usually known as a ________ influencer.

A) specialized B) social media C) blog D) celebrity E) micro

102)

The term social media refers exclusively to social networking sites like Facebook. ⊚ ⊚

Version 1

true false

103) Firms actively use social networks such as Facebook, Pinterest, and WhatsApp to communicate deals that are likely to engage consumers. ⊚ ⊚

104)

true false

The focus of social media efforts targeted at customer interaction is building connections. ⊚ ⊚

true false

105) The objectives of the 4E framework for digital marketing are excite, educate, engage, and evaluate. ⊚ ⊚

106)

A blog is an example of a thought-sharing site. ⊚ ⊚

107)

true false

The most popular microblogging site is Google Analytics. ⊚ ⊚

true false

108) An advantage of a corporate blog is that all content on the blog can be completely controlled by the company.

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⊚ ⊚

true false

109) The dynamic effect of social media engagement expands the impact of the network effect by examining how people flow in and out of networked communities as their interests change. ⊚ ⊚

true false

110) The connected effect is the outcome of social media engagement in which every time a firm or person posts information, it is transferred to the poster’s vast connections across social media, causing the information to spread instantaneously. ⊚ ⊚

true false

111) The Wheel of Social Media Engagement includes the following five effects as drivers of social media: Information, Connected, Network, Dynamic, and Timeliness. ⊚ ⊚

112)

true false

One of the seven primary needs that apps meet is the need to deliver. ⊚ ⊚

true false

113) The three-stage process that firms use to engage customers through social, online, and mobile media involves listening, analyzing, and correcting. ⊚ ⊚ Version 1

true false 34

114) When discussing the pricing models of paid apps and freemium apps, it currently appears that the best pricing model is the paid app. ⊚ ⊚

115)

true false

The value of an influencer may be determined by the number of followers they have. ⊚ ⊚

Version 1

true false

Answer Key Test name: Chapter 03 Test Bank 30) C 31) D 32) D 33) A 34) C 35) C 36) A 37) B 38) C 39) A 40) A 41) C 42) D 43) C 44) B 45) C 46) E 47) D 48) B 49) B 50) A 51) B 52) E 53) A 54) C 55) D Version 1

56) A 57) C 58) B 59) C 60) B 61) C 62) E 63) A 64) E 65) C 66) A 67) B 68) B 69) A 70) E 71) D 72) A 73) A 74) B 75) E 76) B 77) B 78) C 79) D 80) E 81) A 82) E 83) C 84) A 85) D Version 1

86) B 87) C 88) B 89) D 90) B 91) E 92) C 93) E 94) B 95) C 96) A 97) D 98) A 99) D 100) E 101) D 102) FALSE 103) FALSE 104) TRUE 105) FALSE 106) TRUE 107) FALSE 108) FALSE 109) TRUE 109) FALSE 109) TRUE 109) FALSE 110) FALSE 111) TRUE 112) FALSE Version 1

113) FALSE 114) FALSE 115) FALSE

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Student name:__________ 1)

Distinguish between business ethics and marketing ethics.

2) As stated in your text, conscious marketing encompasses four overriding principles. Which do you feel is the most important, and why?

3) Emilio, owner of a local plumbing repair company, wants to improve his company’s reputation for corporate social responsibility. What could Emilio do?

4) Name at least two examples of socially responsible behavior that you have witnessed in a company or heard about through the media. How do these instances meet the criteria for socially responsible behavior as outlined in the text?

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5) When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming conscious marketers. How might they engage in CSR in an effort to mitigate the damage that their products cause?

6) Describe how Walmart engages in CSR efforts to mitigate the criticism it receives for being the worst-paying company in the United States.

7) Describe three ways in which corporate social responsibility differs from conscious marketing.

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8) How would you distinguish a firm that practices corporate social responsibility from one that practices conscious marketing?

9) What is the difference between government regulation of business and corporate social responsibility?

10) Bernard wants to work for a firm that demonstrates corporate social responsibility. Draw up a list of questions Bernard could use in an interview to determine the level of commitment of potential employers.

11) A local deli has decided that it wants to become more socially responsible. For three of the stakeholder groups listed in the chapter, suggest socially responsible actions the deli could take to serve those stakeholders.

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12) Identify how a company might evaluate whether or not to support the United Way, a program that collects donations and distributes them to a wide range of charities.

13) The CEO of your firm, a distributor for a domestic beer manufacturer, has asked you to take on a special project. She has been hearing about a growing trend toward corporate social responsibility, but she wonders if this is a reasonable investment for the firm. Outline the costs and benefits in general terms and draw your own conclusion for her consideration.

14) Avoiding a GMO label might help companies sell more of their products. Thus far, many food manufacturers seem to be fighting GMO labeling. However, despite the fact that removing GMOs may increase production costs, companies such as General Mills have removed GMOs from some of their products, and grocers such as Whole Foods have committed to issuing GMO labels by 2018. Who are the stakeholders in this situation?

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15)

Briefly describe how CSR affects the various stakeholder categories.

16) During which phase(s) of the strategic marketing planning process are issues related to conscious marketing likely to be addressed?

17) Burt’s Bees mission is to be a “Natural, Earth-Friendly Personal Care Company.” As part of that mission, Burt’s Bees has a “Zero Waste to Landfill” initiative. During which phase of the strategic marketing planning process would this initiative be pursued?

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18) After a series of embarrassing and unprofessional actions by her marketing team, Ming wants to align personal and corporate ethics goals within her firm. What general and specific actions will she need to take?

19) Briefly describe the three phases of the strategic marketing planning process and give one example of an ethical dilemma that might arise during each phase.

20) Funeral home businesses have been criticized for accepting payments from medical parts companies for assisting them in finding families who would allow materials to be harvested from deceased family members. Although not illegal, the payments raised ethical questions. How should the funeral industry go about addressing these questions?

21) Barbra has just learned that a brand of clothing she has been selling for years in her store is being made by workers in sweatshops, who work under inhumane working conditions and are paid subsistence wages. Which of the questions in the ethical decision-making metric will most likely affect her decision to discontinue the brand?

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22) Describe the four steps in the ethical decision-making framework and include some questions that should be asked in each step.

23)

The principle that decisions be ethically based is part of the concept of

A) marketing analytics. B) individual consumer issues. C) conscious marketing. D) the triple bottom line. E) corporate social responsibility.

24)

Conscious marketing encompasses which of the following overriding principles?

A) The recognition of marketing’s focus on sales at any cost. B) Ignoring the company’s bottom line. C) The lack of consideration for stakeholders and their interdependence. D) The presence of corporate leadership, creating a corporate culture. E) The understanding that decisions are solely based on economics.

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25)

Marketing ethics is concerned with

A) the sale of products or services that may damage the environment. B) the use of well-paid labor. C) representing the good that a product can do. D) marketing products that are safe for children. E) distinguishing between right and wrong actions in a business setting.

26)

For corporate leaders, their firm’s ability to ________ must be of paramount importance.

A) balance profits and expenses B) balance employees’ needs with the needs of the environment C) balance shareholder interests with the needs of society D) benefit shareholders only E) make a profit

27) The sale of products that may damage the environment, the use of sweatshop labor, and the marketing of dangerous products are examples of

A) internal, controllable marketing issues. B) issues that don’t even need to be discussed in ethical firms. C) marketing issues but not ethical issues. D) marketing ethical issues. E) ethical issues but not marketing issues.

28) When Walmart issued new standards for livestock products that were raised on food without antibiotics or artificial growth hormones, it considered multiple ________, including the ranchers that supply the food, its customers, and animal welfare groups.

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A) stakeholders B) investors C) marketing executives D) bankers E) corporate shareholders

29) Elena is the CEO of a small manufacturing firm. She is concerned with meeting the investment objectives of the firm’s shareholders and sees no value in corporate social responsibility. Elena’s attitude is

A) insupportable in the 21st century. B) consistent with the views of other critics of corporate social responsibility. C) typical of nearly all manufacturers. D) a reaction to regulatory directives of the U.S. government. E) unethical.

30) ________ entails a sense of purpose for the firm that is higher than simply making a profit by selling products and services.

A) Corporate social responsibility B) Conscious marketing C) Triple bottom line D) Marketing analytics E) The four Ps

31)

Which of the following statements regarding corporate social responsibility is true?

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A) Firms believe that they have legal and economic duties in addition to responsibilities to society. B) A firm’s responsibilities to society are not associated with the demands, expectations, requirements, and desires of various stakeholders. C) CSR can be defined as distinguishing between right and wrong actions and decisions that arise in a business setting. D) Today, very few companies engage in some form of CSR. E) CSR actions are mandated by law.

32) For every consumer who purchases a pair of TOMS shoes, the company promises that a needy child will receive a pair of shoes. TOMS shoes is actively engaging in

A) corporate social responsibility. B) business ethics. C) marketing ethics. D) environmental marketing. E) overpricing of its products.

33)

The definition of corporate social responsibility addresses

A) employee salaries. B) the golden bottom line. C) the profit motive. D) environmental impact. E) social media.

34) When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming

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A) ethical human beings. B) conscious marketers. C) profitable. D) successful. E) recognized.

35) According to one definition, CSR can be described as context-specific actions and policies, taking stakeholders’ expectations into account, to achieve what is referred to as the triple bottom line. The triple bottom line includes ________ performance.

A) economic, social, and environmental B) economic, social, and political C) financial, economic, and social D) social, environmental, and political E) financial, social, and environmental

36)

Which of the following statements regarding corporate social responsibility is true?

A) It incorporates higher purpose and a caring culture. B) It takes a holistic, ecosystem view of business as a complex adaptive system. C) It understands that decisions are ethically based. D) Social responsibility is at the core of the business through the higher purpose and viewing the community and the environment as stakeholders. E) It sees limited overlap between the business and society, and between business and the planet.

37)

Which of the following statements regarding conscious marketing is correct?

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A) It recognizes that business is a subset of society, and that society is a subset of the planet. B) It sees limited overlap between the business and society, and between business and the planet. C) It is often grafted on to traditional business model, usually as a separate department or part of PR. D) It reflects a mechanistic view of business. E) It is independent of corporate purpose or culture.

38) Ironically, while the leaders of Enron Corporation were manipulating the company’s finances for their personal benefit, the company was a major donor to Houston area charities. Enron had unethical business practices but was also

A) practicing marketing ethics. B) falsifying the company’s finances through charitable donations. C) creating a local ethical business climate. D) demonstrating corporate social responsibility. E) manipulating the public sentiment for its own benefit.

39)

What is the most basic corporate social responsibility to employees?

A) to ensure the highest pay for the work performed B) to ensure a safe working environment C) to ensure all potential conscious marketing issues are raised D) to assess each employee’s level of confidence E) to ensure the firm primarily serves the community in surrounding neighborhoods

40) Walmart donates more than $1 billion in cash and in-kind items to charitable causes every year. This form of social responsibility most directly impacts

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A) marketers. B) prospective employees. C) supply chain partners. D) shareholders. E) customers.

41) When Walmart pressured its vendors to supply it with environmentally friendly merchandise with labels to prove it, this effort most relates to the concept of

A) conscious marketing. B) public relations. C) business marketing. D) business ethics. E) sustainability.

42) How might a technology company like Apple ensure that it behaves in a socially responsible way toward its employees?

A) It can pay at least minimum wage when the law requires it. B) It can adhere to government-mandated safety standards in the workplace. C) It can ensure that pay practices are fair at all levels of the company. D) It can ensure that its packaging materials are recyclable. E) Social responsibility isn’t relevant where employees are concerned; they are paid for their work and that’s enough.

43) How might a technology company like Apple ensure that it behaves in a socially responsible way toward its customers?

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A) It can protect the privacy of personal information collected on its website. B) It can adhere to government-mandated safety standards in its stores. C) It can ensure that it pays its employees fairly. D) It can ensure that its packaging materials are recyclable. E) Social responsibility isn’t relevant where customers are concerned; it has to do with serving society as a whole.

44) When companies embrace ________, they appeal not only to their shareholders but also to all of their key stakeholders.

A) social media B) conscious marketing C) CSR D) profit-sharing E) conscious advertising

45) How might Starbucks ensure that it behaves in a socially responsible way toward members of its supply chain?

A) It can pay its employees minimum wage as required by law. B) It can use cups made from recycled paper. C) It can offer healthy drinks and snacks in its stores. D) It can purchase coffee beans from suppliers who pay coffee growers a fair price. E) Social responsibility isn’t relevant where channel partners are concerned; it has to do with serving society as a whole.

46) Cookie Cutter, a firm that manufactures high-end mixers, donates $10 per mixer sold to a local food bank. This is a form of

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A) public relations. B) corporate social responsibility. C) business ethics. D) pandering to the public. E) tax relief.

47) Many corporations are shifting from defined benefit to defined contribution retirement programs. When considering changes to retirement programs, the primary stakeholders are the

A) shareholders. B) employees. C) customers. D) marketing managers. E) competition.

48) The ________ for natural skin care company Burt’s Bees is to “create natural, Earthfriendly personal care products formulated to help you maximize your well-being and that of the world around you.”

A) mission statement B) market analysis C) company description D) financial plan E) executive summary

49) In the ________ stage, a firm will decide what level of commitment to its ethical policies and standards it is willing to declare publicly and how the firm plans to balance the needs of its various stakeholders.

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A) brainstorming B) implementation C) planning D) control E) evaluation

50) When integrating conscious marketing into a marketing strategy, a key task is to ensure that all managers are evaluated on their actions from a conscious marketing perspective. This action would take place during which stage of the strategic marketing planning process?

A) brainstorming phase B) planning phase C) implementation phase D) control phase E) revision phase

51) During the ________ phase of the strategic marketing planning process, marketers utilize systems to check whether each conscious marketing issue raised in earlier phases was addressed.

A) implementation B) control C) planning D) assessment E) social responsibility

52) Laurine is considering the question, “Did our actions have a negative impact on any stakeholder group?” She is addressing marketing ethical issues in the ________ phase of the strategic marketing planning process.

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A) planning B) control C) implementation D) brainstorming E) situation analysis

53) Every year, General Mills issues a report discussing how the firm has performed against its own standards of conscious marketing. This report is part of General Mills’ ________ phase of its strategic marketing planning process.

A) planning B) implementation C) control D) evolution E) marketing mix

54) Charges that firms are using “sweatshop” labor to produce their products are likely to occur during the ________ phase of the strategic marketing planning process.

A) planning B) implementation C) control D) evolution E) marketing mix

55) If Martine decides to sell the best ice cream on earth, and intends to establish a strong ethical climate in her organization, during which phase of the strategic marketing planning process should she introduce ethical considerations?

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A) planning B) implementation C) control D) experience E) ethics

56) Vikram’s company manufactures industrial ladders. He is concerned that consumers who do not understand ladder safety will purchase these extra-tall ladders and injure themselves. During which phase of the strategic marketing planning process should this issue be addressed?

A) control B) planning C) implementation D) design E) ethics

57) Marketers that include ethical policies and standards in the firm’s mission or vision statements are introducing these concepts at which stage of the strategic marketing planning process?

A) implementation phase B) control phase C) planning phase D) evaluation phase E) idea generation phase

58)

Which of the following descriptions embodies conscious marketing principles?

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A) not socially responsible B) questionable firm practices, yet donates a lot to the community C) neither socially nor ethically responsible D) not involved with the larger community E) both ethically and socially responsible

59) New real estate disclosure regulations require sellers and their agents to tell prospective buyers about any existing problems with the property. Previously, they were expected only to answer buyers’ questions. The new regulation addressed the marketing ethics problem of

A) high-pressure sales techniques. B) deceptive pricing tactics. C) misrepresentation of company data. D) misleading advertising. E) withholding information.

60) When making decisions, managers often have to decide between doing what is beneficial for themselves (and possibly the firm) in the short run and doing what is right and beneficial for the firm and for society in the long run. To address this conflict, a firm

A) must evaluate its quarterly profit statement from an ethics standpoint. B) must state its long-term goals in general terms, so as to not interfere with managers’ short-term goals. C) must always put society’s needs ahead of the firm’s needs. D) must align the short-term goals of each employee with the long-term, overriding goals of the firm. E) should adhere rigidly to legal standards in its industry.

61) ________ provides a detailed, multipronged “Statement of Ethics” that can serve as a foundation for marketers.

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A) Johnson & Johnson B) The American Marketing Association C) The Mayo Clinic D) A group of well-respected marketing executives E) The Advertising Association of America

62) To avoid having ethical situations become problematic for a firm, the short-term goals of each employee must

A) be aligned with the long-term goals of the firm. B) be overridden by the overall goals of the firm. C) become secondary to the needs of the remaining stakeholders. D) be reviewed on an annual basis. E) change on a regular basis.

63)

Compared to the average company, firms with strong ethical climates tend to

A) employ more business development consultants. B) offer more goods and services. C) be more socially responsible. D) invest more in sales training software. E) have higher turnover.

64) Simons & Co. prides itself on a strong ethical climate. Compared to many companies, Simons

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A) has a higher turnover. B) offers far fewer goods and services. C) does not worry about onboarding. D) is the target of more protests. E) is likely more socially responsible.

65) Courses of action such as halting the market research project, making responses anonymous, and instituting training on the AMA Code of Ethics for all researchers would be identified during the ________ stage.

A) planning B) identification C) implementation D) brainstorming E) evaluation

66)

The decision-making metric includes

A) the publicity test. B) the business ethics test. C) the employee satisfaction test. D) the triple bottom line test. E) the critical observer test.

67) Tander Inc. is in Step 4 of its ethical decision-making process. Executives were asked to take the Publicity Test using an ethical decision-making metric. All scores were in the “No” column. What does this mean?

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A) The situation is not ethically troubling to the executives. B) The executives need to step back and reflect on how they wish to proceed. C) The situation is ethically troubling to the executives. D) The executives need to retake the test or take the moral mentor test instead. E) The results are invalid, and the executives need to take the transparency test.

68)

The ethical decision-making framework includes

A) identify issues. B) promote the firm’s corporate social responsibility efforts. C) describe the firm’s business ethics. D) hiring a marketing firm. E) adding people to the board of directors.

69) Gerard has just purchased a beer distributorship. He wants to increase the visibility of his firm in local markets, but he knows there are a number of regulations and socially accepted practices associated with promoting alcoholic beverages. The first thing Gerard should do is to

A) identify issues that need to be addressed. B) promote the firm’s corporate social responsibility efforts. C) gather information and identify stakeholders. D) brainstorm alternatives. E) choose a course of action.

70) Anders picks up the local newspaper and reads a stinging letter to the editor criticizing his beverage company for supporting a sporting event for children with disabilities. The letter writer is critical of a banner displayed at the event with the logos of alcoholic beverages and Anders’ company name. Anders never considered that this problem might arise. His company failed to

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A) identify issues. B) promote the firm’s corporate social responsibility efforts. C) analyze the needs of the industry. D) brainstorm and evaluate alternatives. E) choose a course of action.

71) The Bedford County School Board is concerned about deteriorating school facilities, combined with a shrinking budget. The board began by studying the issue, and then identified parents, children, teachers, staff, and taxpayers as groups who have a vested interest in the problem. The school board has listened to each group’s concerns. In the ethical decision-making framework, its next action should be to

A) identify issues of concern to lawmakers. B) assess impact of its actions beyond the classroom. C) engage in brainstorming alternatives. D) choose a course of action. E) evaluate the legal ramifications.

72) After a firm has identified the various stakeholders and their issues and gathered available data related to an ethical decision-making situation, ________ should engage in brainstorming and evaluating alternatives.

A) the senior managers most involved B) key customers C) elected officials D) all parties relevant to the decision E) any individuals with competing interests

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73) After a firm has identified the various stakeholders and their issues and gathered available data related to an ethical decision-making situation, all parties relevant to the decision should

A) engage in legal discourse. B) vote, with the majority deciding the best course of action. C) reidentify the issues. D) choose a course of action. E) brainstorm for alternatives.

74) After a firm has identified the various stakeholders and their issues and gathered the available data, all parties relevant to the decision should engage in brainstorming and evaluating alternatives. ________ then review and refine these alternatives and choose a course of action.

A) Company leaders and managers B) The firm’s lawyers C) Key customers D) Community leaders E) All stakeholders

75) Kenisha’s company is facing a difficult ethical issue. The firm has identified the various stakeholders and their issues and gathered the available data. Everyone with an interest in the issue has engaged in brainstorming and evaluating alternatives. Management reviewed and refined the alternatives. It should now choose the course of action that

A) maximizes profits. B) creates the least possible publicity. C) involves the fewest employees. D) minimizes costs. E) seems best after weighing the concerns of all stakeholders.

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76) Binder & Sons is considering buying out a competing firm and closing most of the competitor’s factories. The firm has identified the various stakeholders and their issues and gathered the available data. Everyone with an interest in the issue has engaged in brainstorming and evaluating alternatives. Management reviewed and refined the alternatives, and then chose a course of action. If the managers are not confident about the decision, they should

A) lower their offering price for the competing firm. B) reexamine their alternatives. C) consult customers. D) trust their instincts and move forward. E) choose the least risky option.

77) Imagine the use (or misuse) of data collected from consumers by a marketing research firm. One of the issues that might arise is the way the data are collected. At what step in the framework for ethical decision making would this issue be identified by the marketing research firm?

A) Step 1—identifying issues B) Step 2—gathering information and identifying stakeholders C) Step 3—brainstorming alternatives D) Step 4—choosing a course of action E) Step 5—reviewing outcome of decision

78) Matthew has been asked to approve a marketing campaign that, although it is not illegal, promotes food products to children. He is concerned that the food products are not particularly nutritious, although they are not as bad for children as some others sold by competitors. By using the ethical decision-making metric, Matthew will

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A) ignore the metric as unworkable, since the campaign might pass some of the tests and fail others. B) consider the profit potential first; then explore the vague tests in the metric. C) not worry about the children; their parents are likely to make the buying decision, and they should be able to decide for themselves. D) evaluate the alternative using a series of questions. E) consult the firm’s code of ethics for guidance and leave personal ethical considerations out of the decision-making process.

79) When Volkswagen owners began to report problems with rear coil springs, Volkswagen at first ignored or rejected the claims. Eventually, the company evaluated the issue and issued a recall. Which of the four steps of the ethical decision-making framework was Volkswagen performing when it recalled several of its models?

A) assess risk B) identify issues C) gather information and identify stakeholders D) brainstorm and evaluate alternatives E) choose a course of action

80) A meat-packing company discovers that six months ago it unknowingly distributed meat from a cloned cow. The firm is unaware of any specific risks to humans consuming the meat; however, some scientists have raised questions, and some consumers are afraid of possible future problems. The meat company has to decide whether or not to make this matter public. How should it begin the process of making an ethical decision?

A) Brainstorm the available alternatives. B) Ask its managers to vote for or against public disclosure. C) Let the board of directors decide what to do. D) Identify the issues raised by the situation. E) Find out who purchased the meat and offer them refunds in return for their silence.

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81)

The ethical decision-making metric poses which of the following questions?

A) Would I want to see this action described on the front page of the local paper? B) Will this action help advance my career? C) Would the person I despise most engage in this activity? D) Do I need to make excuses for this decision? E) Am I happy to make more money because of this decision?

82) Which test asks the question, “Would I like to be on the receiving end of this action and all its potential consequences?”

A) The Transparency Test B) The Golden Rule Test C) The Moral Mentor Test D) The Publicity Test E) The Person in the Mirror Test

83) In the ethical decision-making metric, the question that asks, “Would I want the person I admire most to see me doing this?” applies to the

A) publicity test. B) admired observer test. C) moral mentor test. D) transparency test. E) person in the mirror test.

84) The purpose of conscious marketing is to make a product by selling products and services.

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⊚ ⊚

true false

85) The consideration of stakeholders and their interdependence is one of the four overriding principles of conscious marketing. ⊚ ⊚

true false

86) Marketing ethics is concerned with distinguishing between right and wrong actions and decisions that arise in a business setting, according to broad and well-established moral and ethical principles that might arise in a business setting, and any special duties or obligations that apply to persons engaged in commerce. ⊚ ⊚

true false

87) Marketing ethics can involve societal issues such as the sale of products or services that may damage the environment or global issues such as the use of child labor. ⊚ ⊚

true false

88) Google uses Google.org funds to sponsor nonprofit entrepreneurship in Africa as well as Global Fishing Watch. These initiatives illustrate CSR programs. ⊚ ⊚

true false

89) A common view in today’s business climate is that the only responsibility of a business is to its shareholders, so its only purpose is to make a profit.

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⊚ ⊚

true false

90) One way in which conscious marketing differs from corporate social responsibility (CSR) is that CSR takes a holistic, ecosystem view of business as a complex, adaptive system. ⊚ ⊚

true false

91) Ethos Water donates 2 percent of its profits to children in need of clean water. This action demonstrates that Ethos Water is a firm with a strong ethical climate. ⊚ ⊚

true false

92) From a conscious marketing perspective, social responsibility is at the core of the business through the higher purpose and viewing the community and the environment as stakeholders. ⊚ ⊚

true false

93) A fence company agreed to complete a job in one week and collected a 50 percent deposit, but never showed up to do the job. The same fence company then donated $5,000 to a local children’s hospital. The fence company could be considered socially responsible. ⊚ ⊚

true false

94) Among the key differences between conscious marketing and CSR is the unique view on shareholders that is absolutely critical to CSR.

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⊚ ⊚

true false

95) Stakeholders typically include the firm’s employees and their families, customer groups, members of the community, the environment, and the firm’s partners, and competitors. ⊚ ⊚

true false

96) Key corporate social responsibility (CSR) stakeholders include employees, customers, the marketplace, and society. ⊚ ⊚

true false

97) Comlight Computer Company decided to market its tablet computers to preschoolers, even though the tablets were better suited for much older children. This potentially unethical activity takes place during the control phase of the strategic marketing planning process. ⊚ ⊚

true false

98) Once the marketing strategy is implemented, controls must be in place to be certain that the firm has actually done what it has set out to do. ⊚ ⊚

true false

99) Conscious marketers have no need for contingency plans that reflect their conscious leadership and conscious culture.

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⊚ ⊚

true false

100) The first step in ethical decision making is to gather information and identify stakeholders. ⊚ ⊚

true false

101) In the ethical decision-making framework, brainstorming occurs immediately following the identification of issues. ⊚ ⊚

true false

102) Roanoke Hardware was planning on raising the pay of its managers but not its frontline employees. To determine the potential ethical issues, it should first identify the issues involved so that it can gather facts related to those issues. ⊚ ⊚

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true false

Answer Key Test name: Chapter 04 Test Bank 23) C 24) D 25) A 26) C 27) D 28) A 29) B 30) B 31) A 32) A 33) D 34) B 35) A 36) E 37) A 38) D 39) B 40) E 41) E 42) C 43) A 44) B 45) D 46) B 47) B 48) A Version 1

49) C 50) D 51) B 52) B 53) C 54) B 55) A 56) C 57) C 58) E 59) E 60) D 61) B 62) A 63) C 64) E 65) D 66) A 67) C 68) A 69) A 70) A 71) C 72) D 73) E 74) A 75) E 76) B 77) A 78) D Version 1

79) E 80) D 81) A 82) B 83) B 84) FALSE 85) TRUE 86) FALSE 87) TRUE 88) TRUE 89) FALSE 90) FALSE 91) FALSE 92) TRUE 93) TRUE 94) FALSE 95) TRUE 96) TRUE 97) FALSE 98) TRUE 99) FALSE 100) FALSE 101) FALSE 102) TRUE

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Student name:__________ 1) Imagine that you have just been made the marketing manager for your university. Your first task is to assess your university’s immediate environment. What questions will you likely ask?

2) Stephanie is a general practice physician. Her office includes a number of nurses, clerical assistants, and a physician’s assistant. She runs a well-organized practice, but she depends on a variety of corporate partners to create value for her patients. Who are likely to be Stephanie’s corporate partners and how do they help or hinder her efforts to create value?

How can marketers identify potential opportunities?

4) Raoul is the new marketing director for a local theater. One of his major responsibilities is to monitor and manage aspects of the theater’s immediate environment. What will Raoul monitor and manage?

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5) Nau makes modern urban and outdoor apparel from renewable sources such as sustainably harvested eucalyptus and recycled plas-tic bottles. Identify the social trend being addressed by Nau.

6) Marketers in the United States are learning that Hispanic and other minority groups are not alike. How do cultural differences affect purchase decisions?

7) International marketers new to the United States often struggle to define American culture. What would these international marketers need to study in order to define the term and what would they be likely to learn?

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8) Because of immigration and increasing birthrates among various ethnic and racial groups, the United States continues to grow more diverse. Approximately 80 percent of all population growth in the next 20 years is expected to come from African American, Hispanic, and Asian communities. What challenges do marketers face in assessing U.S. culture?

9) Digital Natives represent a tremendous opportunity for today’s marketers. Who are the Digital Natives? Based on their age, what types of products would be of interest to them?

10) “Income distribution in the United States has grown more polarized.” What does this mean in general, and what does it mean especially to marketers in the United States?

11)

Describe the buying power and characteristics of the Hispanic consumer.

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12) As demographic factors, why are marketers interested in the education level, occupation, and income of consumers?

13) Grace is studying the demographics of the students attending the local elementary school. What information will Grace study?

14)

Describe Digital Natives and explain the impact of technological advances on this group.

15) As the marketing manager of the ABC company, which cohort group would you target that varies most in age from teenagers to adults who have their own families? Version 1

16)

In recent decades, how has income distribution changed in the United States?

17)

Why are generational cohorts important to marketers?

18) As the marketing manager of the ABC company, you understand that gender roles are not as clear as they were years ago. What factors do you consider in your promotion of the company’s products to women?

19) How is the balance of ethnicities in the U.S. population changing, and what implications does this have for marketers? Version 1

20) You are the marketing manager of a fast-food business that wants to appeal to consumers focused on improving their health. Citing an example from the text, what marketing initiatives would you suggest the company take?

21) At almost every major university, some group on campus pressures the university to become “greener.” What does this mean? What does it usually involve? Why would a university want to become greener?

22) Identify three tactics that a mid-priced motel chain might employ to take advantage of the social trends discussed in the text, in hopes of increasing its business. For each tactic, identify the social trend it is based on.

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23) Name the various social trends that impact marketing and give one example that demonstrates how each one influences marketing practices.

24) Every year Pamela reassesses the economic situation in the target markets her company serves. What factors will Pamela likely assess?

25) Discuss the political and regulatory environment of business as it relates to the protection of consumers. Name and describe at least two laws that had a major impact on fair competition, consumer protection, or industry-specific regulation.

26) How do the economic factors of inflation, foreign currency fluctuations, and interest rates affect firms’ ability to market goods and services?

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27) Name one technological advance that has impacted how consumers research and buy products. Give an example from your own experience.

28) Discuss how privacy concerns have become a current social issue. What technological invention has prompted the rise in concern over privacy?

29) As a retail clothing store manager, Ricardo frequently asks his staff what customers are saying and what they are asking for. He also attends the quarterly clothing show at the regional merchandise mart. Ricardo’s efforts will likely help him

A) avoid cognitive dissonance. B) implement just-in-time marketing promotions. C) identify potential opportunities. D) avoid the need to understand regional culture. E) achieve cost savings.

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30)

The centerpiece of the marketing environment analysis framework is

A) the economy. B) corporate partners. C) culture. D) competitive intelligence. E) consumers.

31)

A firm’s macroenvironment includes

A) competition. B) physical environment. C) company. D) economics. E) corporate partners.

32)

One of the goals of value-based marketing is

A) to provide the greatest value for the least profit. B) to sell products for the highest possible price. C) to offer greater value than competitors offer. D) to determine the value of the brand. E) to sell to all consumers, regardless of their needs.

33) Mario knows that one of the goals of value-based marketing is to provide greater value to consumers than competitors offer. To accomplish this goal, Mario’s firm must look at everything it does

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A) in order to value each person in the organization. B) for each generational cohort. C) to avoid cultural clashes. D) from a consumer’s point of view. E) to sensitize organization members to ethical values.

34) Elena knows her firm must look at everything it does from a consumer’s point of view. One major difficulty is that consumers’ ________ change(s) over time.

A) ethnic background B) needs, wants, and ability to purchase C) culture D) just-in-time processes E) demographics

35)

In the immediate marketing environment, the first factor that affects the consumer is

A) demographics. B) cultural values. C) social trends. D) the company’s capabilities. E) technological advances.

36)

Successful firms focus their efforts on satisfying customer needs that

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A) are easiest to satisfy. B) provide minimal core value. C) are important to all generational cohorts. D) competitors have tried and failed to satisfy. E) match their core competencies.

37) The Mayo Clinic in Minnesota is known for top-quality medical care. For decades, even presidents and dictators from around the world flew to the Mayo Clinic to utilize its services. The Mayo Clinic used its reputation to create additional medical facilities in Jacksonville, Florida, and elsewhere. This is an example of a firm focusing its efforts on satisfying customer needs that

A) are easiest to satisfy. B) provide minimal core value. C) are important to all generational cohorts. D) competitors have tried and failed to satisfy. E) match its core competencies.

38)

Nau works with its ________ to develop socially responsible outdoor and urban apparel.

A) corporate partners B) consumers C) competitors D) marketers E) legal team

39) Parties that work along with the focal firm to provide goods and services to consumers are viewed as

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A) cultural cohorts. B) corporate partners. C) cartels. D) cooperatives. E) customers.

40) Sandstone Trucking provides transportation services for Betty’s Best Bagels so that Betty’s stores always have fresh stock. Sandstone Trucking is an example of a

A) cultural cohort. B) corporate partner. C) cartel. D) cooperative. E) customer.

41)

The center of all marketing efforts is

A) profits. B) the consumer. C) corporate social responsibility. D) top management. E) the firm.

42) To promote their greener practices, nearly 60 private-sector companies have partnered with the ________, which seeks to reduce the deforestation caused by the production of many consumer products that rely on palm oil, soy, tree pulp, and paper.

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A) EarthShare B) World Wildlife Foundation C) Tropical Forest Alliance D) Greenpeace E) Environmental Protection Services

43) Simone, who lives in Boston, refers to Coke as “tonic,” while Dwayne, who lives in Chicago, calls it “pop.” These different terms are an example of

A) regional culture differences. B) demographic differences. C) different economic situations. D) different social trends. E) country culture differences.

44) The shift of population from the Rust Belt in the North to the Sun Belt in the South and Southwest will likely

A) decrease national cultural identity. B) reduce regional cultural differences. C) make it difficult to collect demographic information. D) create a demand for a new generational cohort. E) make it more difficult for companies to differentiate their products.

45)

Typical demographic data include all of the following except

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A) gender. B) income. C) race. D) education. E) language differences.

46) When marketers look at advertising media, they often begin with viewer or listener profiles such as age, gender, race, and income. They then compare the media profile with their target audience. These marketers are using ________ to see if the media “fit” with their advertising agenda.

A) country culture B) regional culture C) demographics D) micromarketing measures E) scenario planning

47) Generational cohorts are groups of people of the same generation who have similar ________ because they have shared experiences and are in the same stage of life.

A) regional cultures B) inflationary expectations C) political affiliations D) purchase behaviors E) cultural values

48) Viewers of the World Series are likely to see ads for beer and cars, and viewers of the Academy Awards broadcast are likely to see ads for clothing and hair care products, due to

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A) cultural expectations. B) male domination in corporate boardrooms. C) differing demographic data for potential and past viewers. D) marketers’ general perceptions. E) multiyear advertising contracts that cannot be broken.

49) ________ is(are) distinguished from the other generational cohorts in that the group’s oldest members are now collecting Social Security.

A) Baby Boomers B) Generation W C) Generation X D) Generation Y E) Generation Z

50) Marketers wanting to use social media to reach consumers should understand that people in the ________ group were born into a world that was already full of electronic gadgets and digital technologies such as the Internet and social networks.

A) Baby Boomers B) Generation W C) Generation X D) Generation Y E) Generation Z

51)

The first “latchkey” children belong to which generational cohort?

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A) Baby Boomers B) Generation W C) Generation X D) Generation Y E) Generation Z

52)

Macroenvironmental factors include culture, demographics, social trends, and the

A) corporate partners. B) competition. C) company. D) physical environment. E) economic situation.

53) According to your text, the wealthiest 10 percent of the population control approximately what percentage of Americans’ total net worth?

A) 5.2 percent B) 15.8 percent C) 26.9 percent D) 76 percent E) 51.9 percent

54) Tennorn Company knew that its customers were interested in environmentally friendly business practices, so it began marking all of its products as environmentally friendly because they were made with all-natural ingredients, even though Tennorn’s plant was one of the worst polluters in town. The term for this practice is

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A) deceptive advertising. B) greenwashing. C) environmental exploitation. D) virtual greening. E) enviromarketing.

55) When considering income as a demographic variable affecting marketing efforts, marketers need to recognize that

A) everyone is equal. B) income in the United States has become more unevenly distributed. C) everyone has been equally affected by the recession. D) there is increasing purchasing power among lower-income groups. E) middle-income consumers are quickly becoming upper-income consumers.

56)

Select the statement that best describes the key traits of Generation Y.

A) This generation varies the most in age, ranging from teenagers to adults who have their own families. B) This generation is the largest population of 50-plus consumers. C) This generation is the group that was born immediately after World War II. D) This generation was the first generation of latchkey children. E) Members of this generation—also known as Digital Natives—have had access to the Internet for their entire lives.

57) The difference between a firm’s immediate marketing environment and its macroenvironment is that the macroenvironment

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A) is external. B) is easier to understand. C) is easier to control. D) has fewer components. E) is internal.

58)

Which of the following is true of changing gender roles?

A) Women consistently underperform scholastically compared to men. B) Women graduate from high school and college at greater rates than men. C) Less than 10 percent of gamers are female. D) Women have become less prominent in politics. E) More than 50 percent of married women earn more than their husbands.

59) Sanders Inc. claims that it only uses organic cleaning products in its janitorial services. In reality, the company buys whatever is cheapest in bulk. This is an example of

A) environmental safety. B) sustainability. C) greenwashing. D) marketing. E) sales promotion.

60)

Marketers in the United States are paying increasing attention to ethnic groups because

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A) they represent a majority of the population in nonurban areas of the country. B) approximately 80 percent of all population growth in the next 20 years is expected to come from minority groups. C) they are more susceptible to marketing messages. D) government subsidies assist marketers attempting to communicate value to these groups. E) country culture is replacing regional culture as a key marketing consideration.

61) Marketers are more likely to find higher concentrations of foreign-born Americans and recent immigrants in

A) rural areas. B) smaller states. C) New York, Los Angeles, San Francisco, and Chicago. D) coastal resort areas. E) Great Lakes agricultural areas.

62) Though Asian Americans comprise only about 5.6 percent of the U.S. population, they represent

A) the fastest-growing minority population. B) the easiest minority group to access. C) a large proportion of the minorities in the Midwest. D) a uniform group of consumers with a common language and cultural background. E) All of the answers are correct.

63) Leticia, a marketing executive who was born in 1955, advocated that her company focus on a print campaign for its new line of lipsticks rather than spending money on online ads. This point of view may be attributed to the fact that she is a member of which generational cohort?

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A) Baby Boomer B) Gen X C) Gen Y D) Gen Z E) Millennials

64)

Which generation’s members are also known as Millennials?

A) Baby Boomer B) Gen X C) Gen Y D) Gen Z E) the Digital Natives

65)

The poorest 25 percent of the U.S. population earned ________ or less per year in 2016.

A) $48,500 B) $50,000 C) $30,500 D) $59,039 E) $24,002

66)

Which statement about the changing ethnicity in the United States is true?

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A) Minorities now represent almost half of the population in the United States. B) In spite of an increase in the Hispanic population, Hispanic buying power is expected to maintain its current level. C) Hispanics differ vastly from other groups in America in terms of consumer behavior. D) A majority of black Americans now live in the suburbs. E) Asian Americans are the slowest-growing minority population.

67) Strategic efforts to supply consumers with environmentally friendly merchandise are called

A) reduce, reuse, recycle. B) green marketing. C) the green generation. D) the inconvenient truth. E) earth marketing.

68) ________ is/are transmitted by words, literature, and institutions from generation to generation.

A) Demographics B) Economics C) Culture D) Social trends E) Technology

69) their

The shared meanings, beliefs, morals, values, and customs of a group of people constitute

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A) social concerns. B) culture. C) demographics. D) generational cohorts. E) religion.

70) Political candidates are notorious for appealing to the different beliefs and values of groups of potential voters in different areas of the country. These politicians are appealing to differences in

A) popular culture. B) regional culture. C) demographics. D) generational cohorts. E) country culture.

71) See the World, a line of travel books, provides travelers with background information about people’s beliefs, values, and customs in various parts of the world. See the World’s books educate travelers about a country’s

A) social concerns. B) political parties. C) demographics. D) generational cohorts. E) culture.

72) Astute marketers recognize that the increasing disparity of income between upper- and lower-income groups

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A) will create inflationary expectations. B) will disappear as ethnicity becomes a stronger cultural determinant. C) creates opportunities to provide value to each group. D) will vanish once the recession ends. E) is attributable to technological expertise of immigrant groups.

73) Population estimates show that by the year 2030, nearly 72 million of the population in the United States will come from which group?

A) Hispanics B) Asians C) Pacific Islanders D) Native Americans E) Eastern Europeans

74) For some products, marketers can combine education level with other data like occupation and income to obtain

A) a sense of consumers’ regional culture. B) consumers’ value sensitivity quotient (VSQ). C) the educational value equation. D) complete profiles of individual consumers. E) accurate predictions of purchase behavior.

75) Which ethnic group in the United States tends to earn more, have more schooling, and be more likely to be professionally employed or own a business?

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A) Northern European B) Middle Eastern C) Hispanic D) Asian American E) African American

76) Which ethnic group tends to be not only more affluent and suburban than previously thought, but also younger, with 57 percent between the ages of 15 and 49 years?

A) Caucasian B) Pacific Islander C) Hispanic D) Asian E) African American

77)

A generational cohort is a group of people

A) who purchase only one brand of a product throughout their lifetime. B) who grew up and went to school together. C) with the same beliefs and values. D) who are of the same generation. E) who are not open to new things.

78) Marketers know that, compared to high school graduates who are working full time, college students

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A) will earn less over their working lifetime. B) spend their disposable dollars differently. C) are less likely to buy textbooks. D) have almost identical spending patterns. E) are more likely to drink beer and less likely to drink wine.

79)

Which of the following is true regarding modern gender roles?

A) Gender roles are a constant cultural norm. B) Modern standards require firms to produce gender neutral advertising for every product. C) Gender roles have been blurred in the past several years. D) Gender boundaries should never be crossed in marketing efforts. E) Gender roles are unimportant to marketers.

80)

When studying culture, the challenge for marketers is to determine whether culture

A) can help identify a particular group that might be interested in the marketer’s products. B) is regional or subregional. C) reinforces stereotypes. D) is related to educational achievement. E) offers opportunities for competitors.

81)

Which of the following is an example of greenwashing?

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A) A company markets a product made from recycled glass bottles. B) A company charges more for a hybrid car than for a similar gas model. C) A company donates money to a school reading project so it can advertise itself as environmentally friendly. D) The Smiths installed energy-saving lightbulbs in their rental apartment buildings. E) The corner Laundromat stocks only phosphate-free detergent in its vending machines.

82) Late in the day on September 11, 2001, the day of the World Trade Center attacks, Americans purchased all the American flags Walmart stores had available, nationwide. These purchases were indicative of

A) regional culture. B) generational cohort characteristics. C) country culture. D) a red/blue marketing campaign. E) the Walmart Effect.

83)

Which of the following is a critical ethical consideration for green marketers?

A) capability B) dependability C) availability D) sustainability E) profitability

84) Many American consumers are replacing older versions of washing machines and dishwashers with water- and energy-saving models and to invest in phosphate-free laundry detergent and mercury-free and rechargeable batteries. These consumers

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A) value contributing to a greener environment. B) are economically irrational. C) are responding to global corporate pressure for social responsibility. D) would prefer an SUV. E) are greenwashing.

85) Approximately 80 percent of all population growth in the United States the next 20 years is expected to come from African American, Hispanic, and Asian communities. The challenge for marketers is to determine whether a group’s culture

A) is socially important. B) is passed from generation to generation orally or by written guides. C) competes with or complements U.S. traditional culture. D) can be used as a relevant identifier for a particular target group. E) is an important immediate marketing environment variable.

86) When considering the use of a radio commercial in England that was designed for U.S. markets, a marketer would likely need to consider which of the following aspects of culture that might be different between the two countries?

A) dress B) symbols C) demographics D) language E) social trends

87) In Boston, foot-long sandwiches are called “grinders,” while in many other parts of the country they are called “subs.” This is an example of the impact of

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A) regional culture. B) country culture. C) generational factors. D) social trends. E) regulatory factors.

88) Which of the following statements accurately describes the current income distribution in the United States?

A) The purchasing power of lower-income groups has been steadily rising. B) The middle class is outpacing all other income groups. C) Wealthy households are outpacing both poor and middle-class households. D) The income distribution among all households is becoming more equal. E) Wealthy households are declining rapidly in purchasing power.

89) Golden Gate Hair Company keeps track of the gender and age of its customers so it can target emails to them and be sure to have the right hair products in stock when they visit. This is an example of the use of ________ in marketing.

A) innovation B) sustainability C) competition D) demographics E) competency

90) Whereas it took 38 years for the radio to be adopted by 50 million people and 13 years for television, it only took 2 years for the same number of consumers to sign up for

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A) Google. B) Amazon. C) Facebook. D) smartphones. E) Netflix.

91) Which of the following groups has never lived without easy access to the Internet and other digital technologies?

A) Baby Boomers B) Generation W C) Generation X D) Generation Y E) Generation Z

92)

Which of these is a macroenvironmental factor?

A) culture B) corporate partners C) competition D) company E) competencies

93) When Kimberly-Clark introduced rolls of toilet paper without the cardboard core, what social trend did this product respond to?

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A) green marketing B) time-poor society C) cultural diversity D) technological advances E) regulatory issues

94) Some companies have been accused of taking advantage of the current social trend of green marketing, positioning their products as environmentally friendly when this may not actually be the case. This practice is called

A) fake greening. B) greenwashing. C) greenbaiting. D) green puffery. E) red marketing.

95) Part of the social trend toward health and wellness is a concern about the increasing degree of obesity in the United States. Related to this concern, the text notes the increasing popularity of

A) flu shots. B) high-carbohydrate diets. C) yoga. D) cooking shows on TV. E) juicing.

96) For most makers of ________, especially those that resonate strongly with consumers’ sense of nostalgia and childhood memories, changing ingredients to healthier options represents a grave risk.

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A) processed foods B) organic foods C) alcoholic beverages D) bottled water E) original recipes

97) If McDonald’s wanted to change its marketing strategy in response to the social trends outlined in the text, it might consider which of the following?

A) offering an expanded menu of fried foods B) making nutritional information readily available to consumers. on packages and menus C) using plastic boxes in its food packaging D) adding more traditional fluorescent lighting to its restaurants E) creating an advertising campaign targeting elementary schoolchildren

98) The U.S. Centers for Disease Control and Prevention (CDC) estimates that approximately 87.5 percent of U.S. adults are

A) diabetic. B) obese. C) unhealthy. D) athletic. E) healthy.

99) In what country was a law recently passed requiring grocery stores to donate food to charity that would otherwise be tossed?

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A) France B) the United States C) China D) England E) Germany

100)

One of the UN Sustainable Development Goals is to

A) reduce stress through yoga. B) promote healthy meals. C) reduce hunger. D) eliminate artificial dyes from food. E) use only natural ingredients in foods.

101)

The Fairtrade mark is a certification that is granted to products that are determined to

A) promote sustainable farming. B) make nutritional information readily available to consumers. C) use recycled paper in food packaging. D) provide educational opportunities to combat obesity in children. E) create advertising campaigns targeting elementary schoolchildren.

102)

Which of the following is a social trend listed in the text?

A) thrift B) health and wellness C) environmental legislation D) economic concerns E) technological advances

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103) When you register your telephone number with the National Do Not Call Registry, you are responding to a need for

A) privacy. B) enhanced information flow. C) lower phone bills. D) marketing contact. E) tactical communication skills.

104) Every time a consumer surfs the web and clicks on a site, online marketers can place ________ on that user’s computer, showing them where the user starts, proceeds, and ends the online encounter—as well as what the user buys and doesn’t buy.

A) web portals B) cookies C) browsers D) bookmarks E) pirates

105) Which of the following are commonly found in distribution and fulfillment centers to fill orders for stores or individual customers?

A) mobile devices B) robots C) drones D) smartphones E) mobile hotspots

106)

The persistent increase in the prices of goods and services is known as

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A) purchasing power. B) interest rates. C) inflation. D) global competition. E) macroeconomics.

107) When marketers monitor the economic situation affecting their target markets, they are likely to monitor changes in all of the following except

A) purchasing power. B) interest rates. C) inflation. D) age. E) currency exchange rates.

108) If the inflation rate in Mexico was twice the rate in the United States, but the Mexican monetary authorities kept the peso–dollar exchange rate almost constant, which of the following would be true?

A) The high inflation rate in Mexico would increase its citizens’ purchasing power. B) The high inflation rate in Mexico would mean that its products would cost less overall. C) Mexican products would be less expensive, while U.S.-made products would become comparatively more expensive. D) Mexican products would be more expensive, while U.S.-made products would become comparatively less expensive. E) U.S.-made products would become less attractive to purchase.

109) Laws that prohibit the formation of monopolies or alliances that would damage a competitive marketplace benefit consumers through

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A) increased choices. B) higher prices. C) protection from false advertising. D) fair debt collection practices. E) fewer competitors.

110) The political/regulatory environment comprises political parties, governmental organizations, and

A) legislation and laws. B) citizens. C) interest groups. D) for-profit and nonprofit businesses. E) international influences.

111)

In 2016, in response to the threats of climate change, the United Nations rectified the

A) Robinson-Patman Act. B) Paris Accord. C) Clayton Act. D) Sherman Act. E) Federal Trade Commission Act.

112) The government has enacted laws that promote both fair trade and competition by prohibiting the formation of monopolies or alliances that would damage a competitive marketplace, fostering fair pricing practices for all suppliers and consumers. These actions are part of the ________ environment of business.

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A) communication B) political/regulatory C) constitutional D) social E) technological

113)

Which of the following specifically prohibits monopolies?

A) Sherman Antitrust Act B) Federal Trade Act C) Robinson-Patman Act D) Financial Reform Law E) Consumer Product Act

114)

What is most likely to happen when inflation increases?

A) Consumers buy more discretionary merchandise. B) Consumers buy fewer personal care and home entertainment products. C) Off-price and discount retailers suffer from lower sales. D) Consumers buy lower-priced foods. E) Consumers buy less food.

115) ________ is the cost to the customers or the fee the bank charges those customers for borrowing money.

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A) Interest B) A service charge C) Tax D) Tariff E) A user fee

116) In the summer of 2002, the euro was valued at slightly less than US$1. By 2008, it had risen to an all-time high of $1.60, but in late 2017, the euro was once again slightly less than $1. This change in value is called

A) interest destabilization. B) inflation. C) recession. D) foreign currency fluctuations. E) global financial impact.

117) When Darnell went to college, tuition was $650 per semester. Now that same college charges $6,500 per semester. This number reflects a persistent increase in price known as

A) currency fluctuation. B) inflation. C) recession. D) interest. E) deflation.

118)

The Child Protection Act

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A) prohibits the sale of harmful toys and components to children. B) limits the number of commercials shown during children’s programming. C) requires food manufacturers to display nutritional contents on product labels. D) prohibits the manufacture or sale of adulterated or fraudulently labeled food and drug products. E) regulates safety standards for consumer products.

119) By paying close attention to customer needs and continuously monitoring the business environment in which it operates, a good marketer can identify potential opportunities. ⊚ ⊚

true false

120) Consumers’ needs and wants, as well as their ability to purchase, depend on a host of factors that remain consistent over time. ⊚ ⊚

121)

true false

Parties that work with the focal firm are its corporate partners. ⊚ ⊚

true false

122) When analyzing the immediate environment and the macroenvironment, marketers must be careful to keep the firm at the center of all analyses. ⊚ ⊚

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true false

123)

In the immediate environment, the competition has no effect on consumers. ⊚ ⊚

true false

124) The four elements of the consumer’s immediate environment are the company, competition, corporate partners, and the physical environment. ⊚ ⊚

true false

125) Demographic profiles of customers provide an easily understood snapshot of the typical consumer in a specific target market. ⊚ ⊚

126)

true false

Baby Boomers are also called Millennials. ⊚ ⊚

true false

127) As the children of the Baby Boomers, Generation X is the biggest cohort since the original post–World War II boom. ⊚ ⊚

128)

true false

The members of Generation X are also referred to as Digital Natives. ⊚ ⊚

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true false

129) Culture can broadly be defined as the shared meanings, beliefs, morals, values, and customs of a group of people. ⊚ ⊚

true false

130) Socially responsible marketing involves a strategic effort by firms to supply customers with environmentally friendly sustainable merchandise and services. ⊚ ⊚

true false

131) Firms that disingenuously market products or services as environmentally friendly, with the goal of gaining public approval and sales rather than actually improving the environment, are engaging in greenwashing. ⊚ ⊚

true false

132) According to trend watchers and marketing researchers, consumers are concerned about the vast disparity in income. ⊚ ⊚

true false

133) Sustainability, health and wellness, and how to more efficiently utilize and distribute food are all considered political trends. ⊚ ⊚

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true false

134) Amazon’s Alexa and Google Home are examples of technology that enable consumers to call out a command to deal with all sorts of in-home tasks. ⊚ ⊚

true false

135) The 1890 Sherman Antitrust Act prohibits monopolies and other activities that would restrain trade or competition and makes fair trade within a free market a national goal. ⊚ ⊚

true false

136) As the euro becomes more expensive relative to the dollar, Americans are likely to purchase more European wines. ⊚ ⊚

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true false

Answer Key Test name: Chapter 05 Test Bank 29) C 30) E 31) D 32) C 33) D 34) B 35) D 36) E 37) E 38) A 39) B 40) B 41) B 42) C 43) A 44) B 45) E 46) C 47) D 48) C 49) A 50) E 51) C 52) E 53) D 54) B Version 1

55) B 56) A 57) A 58) B 59) C 60) B 61) C 62) A 63) A 64) C 65) E 66) D 67) B 68) C 69) B 70) B 71) E 72) C 73) A 74) E 75) D 76) E 77) D 78) B 79) C 80) A 81) C 82) C 83) D 84) A Version 1

85) D 86) D 87) A 88) C 89) D 90) C 91) E 92) A 93) A 94) B 95) C 96) A 97) B 98) B 99) A 100) C 101) A 102) B 103) A 104) B 105) B 106) C 107) D 108) D 109) A 110) A 111) B 112) B 113) A 114) D Version 1

115) A 116) D 117) B 118) A 119) TRUE 120) FALSE 121) TRUE 122) FALSE 123) FALSE 124) TRUE 125) TRUE 126) FALSE 127) FALSE 128) FALSE 129) TRUE 130) FALSE 131) TRUE 132) FALSE 133) FALSE 134) TRUE 135) TRUE 136) FALSE

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Student name:__________ 1) Marketers believe that the decision-making process begins with a consumer’s need recognition. Not everyone agrees. How would you answer critics who believe marketers can force people to buy things they don’t want?

2) The appliance retailer Diamonte encourages people to test out faucets in the store before installing them in their homes. What process does this demonstrate?

3) Describe how CVS has changed its image to be more positive and the plans in the future to expand on that positive image.

4) Marketers often use the principles and theories from other disciplines to understand consumer actions and develop marketing strategies. According to the text, what disciplines are most useful to marketers trying to understand consumer behavior?

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5) You are shopping for a new truck. Using the steps in the consumer decision process, describe what you would do at each step during the purchasing experience.

6) What is the difference between a functional need and a psychological need? How can getting a college education fulfill both types of needs?

7) After his first year in college, Kaelin wants to decide on a major. What internal and external sources of information will he use to help him in making a decision?

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8) Mercedes-Benz knows that many of its customers today are younger professional people who want the pride of owning a Mercedes. Mercedes-Benz also appeals to its more traditional market: conservative luxury car owners. To be successful, Mercedes-Benz needs to appeal to which type(s) of needs?

9) When Jodi has business in Denver, she often goes out for a fancy meal. When deciding where to go, the restaurants she usually chooses are the local steak house and the elegant seafood restaurant. Do these two restaurants represent her universal, retrieval, or evoked set of choices?

10) Using refrigerators as an example, explain the differences between universal, retrieval, and evoked sets, and identify the one that is most important to marketers.

11) Provide two decision-making examples: one of an occasion when a consumer might use a compensatory decision rule, and one when the consumer might use a noncompensatory decision rule. For each, briefly identify the characteristics of the decision that would make a compensatory or noncompensatory rule the best choice. Be specific.

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12)

What evaluative criteria would consumers be likely to use in choosing a family dentist?

13) When AnneMarie decides which airline to use to fly from Baltimore to San Diego, she considers the price, number of stops, and frequent-flyer miles she will earn. However, earning frequent-flyer miles is the most important factor for her. Is AnneMarie using a compensatory or noncompensatory decision rule? Explain your reasoning.

14) Demonstrate your understanding of the terms internal locus of control and external locus of control by giving an example of each.

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15) Define the term postpurchase cognitive dissonance and give an example of when this happened to you. Then explain what the company could have done to lessen your dissonance.

16)

Why is it dangerous for marketers to set unrealistically high consumer expectations?

17) Gianni operates a fishing resort in New Zealand. Few guests visit this remote resort more than once, but Gianni has his assistant email recent customers each month to see how satisfied they were with their stay at his resort. Why would Gianni spend effort on past customers if few guests come more than once?

18) Assume you are the manager of a resort property that is close to the beach, to several historic attractions, and to a few luxury restaurants and stores. How would you manage customer expectations to enhance postpurchase satisfaction? Be specific.

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19) Mike’s Plumbing Service is considering using the slogan, “We fix it the first time, every time.” Why might this slogan be a bad idea if Mike wants to maximize postpurchase satisfaction? Create a better slogan for Mike.

20) At a convenience store, Kylie bought a bag of chips she had never tried before. Driving down the road, Kylie opened the bag, took a bite, and realized she had purchased pork rinds by mistake. Being a vegetarian, Kylie threw away the chips. Kylie felt very little buyer’s remorse and soon forgot about the experience. Why?

21) Often political candidates position themselves as “outsiders,” not part of the establishment. These candidates assume that voters have a negative attitude toward incumbent politicians (i.e., those currently in office). Describe three components of attitudes voters might have toward incumbent politicians.

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22)

Why are attitudes important in consumer decision making?

23)

How does the sensory situation affect consumer behavior?

24) Whenever major tennis professionals use a new racket, sales of that racket jump rapidly. What type of social influence do Pro Tennis professionals represent for average players?

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25) Several years ago, BMW produced The Hire, a series of short films that were distributed online. The purpose of the film was to make the BMW brand relevant to young males who, BMW hoped, would become interested in the brand and would be more likely to purchase a BMW in the future. The films were directed by popular action-film directors of that time, and showed the BMW engaging in high-speed chases and other high-adrenaline situations. No actual product information was provided. BMW made it easy for site visitors to share the videos with friends. The films were viewed millions of times, and BMW considered it a highly successful promotion. Of the factors affecting the consumer decision process, which ones were the primary factors this campaign sought to use to affect the consumer decision process of those who watched the films?

26) The text lists five psychological factors that can influence purchase decisions. List and give an example of each.

27) Budweiser is well known for the use of humor in its ad campaigns for Bud Light beer. Based on the use of humor in advertising for beer, does Budweiser believe that beer is a highinvolvement or low-involvement purchase for most consumers? Explain your answer using the elaboration likelihood model.

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28) Dana knows that habitual purchasers make great customers for her coffee shop. How can Dana attract and maintain habitual purchasers?

29) Using examples, describe the difference between impulse buying and habitual decision making.

30) For years Cliff sold new cars, but he and his wife recently grew tired of city life and moved to a beach town. Now he sells pottery (made by his wife) at an open-air market near the ocean. To be successful, what will Cliff have to recognize about the difference between consumers’ problem-solving processes for cars and costume jewelry?

31) For many American consumers, the purchase of a personal computer has shifted from an extended problem-solving decision to a limited problem-solving decision. How does this change the way retail stores should display and sell computers?

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32) Marketers often use principles and theories from sociology and psychology to better understand consumers’ actions and to

A) develop basic strategies for dealing with their behavior. B) contribute to the theoretical knowledge in those disciplines. C) avoid cultural reference group problems. D) maximize postpurchase cognitive dissonance. E) satisfy ritual consumption needs while avoiding overconsumption.

33)

Generally, people buy one product or service instead of another because they

A) want to get the lowest price possible. B) perceive it to be the better value for them. C) prefer to avoid doing extended problem solving. D) have conducted a thorough internal search for information. E) are unaware of key determinant attributes.

34)

The consumer decision process model represents

A) the concept of habitual decision making. B) the retrieval of an evoked set based on physiological needs. C) the steps that consumers go through before, during, and after making purchases. D) the shift from an internal to an external locus of control. E) the types of decisions all consumers must make.

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35)

The consumer buying process begins when

A) a consumer enters a store. B) consumers’ functional needs are greater than their psychological needs. C) a consumer’s performance risk is minimized. D) a consumer recognizes an unsatisfied need. E) learning follows perception.

36) When Karina realized her cat had fleas and the pet store did not stock flea medication, Karina was faced with

A) a social-perceptual incongruence. B) a psychological need. C) a cognitive learning failure. D) a universal shopping need. E) an unsatisfied need.

37) The greater the discrepancy between a consumer’s needy state and the desired state, the greater

A) time needed to satisfy the need. B) the effort consumers will invest in searching for alternatives. C) the consumer’s need recognition will be. D) the size of the universal set will be. E) the amount of external information search will be needed.

38) The greater the discrepancy between a consumer’s ________, the greater the consumer’s need recognition will be.

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A) financial risk and performance risk B) search for alternatives and alternatives found C) needy state and desired state D) universal set and evoked set E) external and internal information search

39) Upscale men’s and women’s clothing stores like Burberry are more likely to appeal to consumers’ ________ needs.

A) functional B) postpurchase C) safety D) psychological E) situational

40) When scuba divers purchase equipment for diving, their purchases are primarily addressing ________ needs.

A) functional B) prepurchase C) social D) psychological E) functional and psychological

41) Ed has an almost-new economy car, but he wants a Ford Mustang because he thinks it would be exciting to own one. If he decides to purchase a sports car such as the Mustang, he will be primarily fulfilling a ________ need.

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A) functional B) postpurchase C) safety D) psychological E) functional and psychological

42) A key to successful marketing is determining how to meet the correct balance of ________ needs that best appeals to the firm’s target markets.

A) functional and social B) postpurchase and prepurchase C) safety and situational D) psychological and physiological E) functional and psychological

43) By producing cars that do more than get riders to their destinations and back, MercedesBenz is addressing consumers’ ________ needs.

A) functional and social B) postpurchase and prepurchase C) safety and situational D) psychological and physiological E) functional and psychological

44) When the floor rusted through on her old car, Claire knew she had a problem. Logically, Claire’s next step in the consumer decision process would be to

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A) identify her need. B) search for information about cars. C) evaluate alternatives. D) purchase a new car. E) assess her satisfaction with the car she purchased.

45) When Yana began searching for a new car to replace her old, rusty one, she probably relied on ________ sources of information.

A) interpersonal and sensual B) compensatory and noncompensatory C) ritual and spiritual D) psychological and functional E) internal and external

46) When Chris decided he needed a new car, he immediately called his old college roommate, who owns a Toyota dealership, to ask questions about options and financing. Chris was searching for information from

A) an external source. B) an internal locus of control. C) a reference source. D) an internal source. E) a situational factor group.

47) Paulette wanted an unbiased source of information to help her decide what brand of appliances to buy for her new condominium. Paulette would most likely search for information from

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A) the Sears catalog. B) the Consumer Reports website. C) the local Better Business Bureau. D) the website for Best Buy. E) Psychology Today magazine.

48) Americans often equate “bigger” with “better,” and prefer larger cars, TV screens, homes, even meals. Researchers suspect that in doing so, we are trying to reduce ________ risk in the consumer decision process.

A) psychological B) financial C) performance D) social E) physiological

49) Zappos online shoe and clothing store has a unique way of dealing with abandoned shopping carts. If a site visitor places items into the shopping cart and then leaves the site without making a purchase, several days later Zappos sends a humorous email saying, “Let us show you what your shopping cart did while you were gone,” along with a photo of a cute dog intended to represent the shopping cart. This attention-getting device is designed to improve the site’s

A) postpurchase dissonance. B) selective perception. C) conversion rate. D) reference group influence. E) position in the evoked set.

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50) Once consumers have recognized a need, they begin to search for ways to satisfy that need. The internal search is characterized by

A) looking through the internal records of a firm, often found on the company website. B) examining personal memories and knowledge. C) using the Internet to find what other consumers feel about a specific product or service. D) consulting close friends and families before expanding the search to a wider, external group. E) being influenced by advertising.

51) Every time Kerry wants to eat salad for lunch, she and her friends go to Garden Grove, but if she’s craving dessert, she heads straight to Cupcake Station. In making these choices, she relies on a(n)

A) perceived benefits analysis. B) external locus of control. C) exceptional marketing campaign. D) external source of information. E) internal search for information.

52) Dick believes he is responsible for his actions, and he will conduct extensive searches before making a purchase. Maxine’s favorite phrase, when confronted by the need to make a decision, is “Whatever.” In marketing terms, Dick is said to have a(n) ________ and Maxine a(n) ________.

A) obsessive personality; laissez-faire approach B) formal search function; casual search function C) increased search anxiety; decreased search anxiety D) internal locus of control; external locus of control E) focused sense of information; unfocused sense of information

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53) In the consumer decision process, we decide how much time and effort to expend searching for information based partly on

A) postpurchase dissonance. B) the outcome of the alternative evaluation process. C) the degree of perceived risk associated with the product or service being considered. D) the results of habitual decision making. E) the results of the external search.

54) Gracie has naturally curly hair and has often been disappointed with the haircuts she has received. When she moved to a new town, she approached her new office mates and several strangers with curly hair and asked them where they had their hair cut. She chose to spend considerable effort finding a new hair stylist based on the ________ associated with her purchase decision.

A) evoked set B) reference group C) physiological risk D) performance risk E) financial risk

55) Before flying, Whitman researches the types of planes the airline uses, scans the plane for defects as it taxis up to the terminal, and follows the pilot and crew as they come through the airport. He has no experience as a pilot or airplane mechanic. Whitman probably has a misguided sense of his

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A) postpurchase dissonance. B) locus of control. C) reference group identification. D) attribute sets. E) social risk.

56) Every year before he starts his lawnmower, Stefan has a repairman put a new battery in the lawnmower. Stefan is most likely concerned with ________ risk.

A) psychological B) financial C) performance D) social E) physiological

57) Selma is a travel agent. Whenever she sells an expensive vacation package, she encourages the customer to buy travel insurance, which provides reimbursement in case of trip cancellation due to illness or another emergency. Selma is trying to reduce her customers’ ________ risk.

A) psychological B) financial C) performance D) social E) physiological

58) Cezar was afraid his new condominium would look shabby to his future in-laws, so he had it painted just before their visit. Cezar was addressing his ________ risk.

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A) social B) financial C) performance D) psychological E) physiological

59) Consumers consider universal, retrieval, and evoked sets during which stage of the consumer decision process?

A) need recognition B) postpurchase evaluation C) information search D) situational analysis E) evaluation of alternatives

60) When Sasha decided to buy a new computer, she considered all the brands she could recall seeing advertised. The products she recalled represent Sasha’s ________ set.

A) universal B) retrieval C) evoked D) deterministic E) behavioral

61) When Darlene decided to buy a new computer, she thought about all the brands she could recall seeing advertised, but she would consider only those brands she could buy at her local Best Buy electronics store. The brands she considered represent Darlene’s ________ set.

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A) universal B) retrieval C) evoked D) deterministic E) behavioral

62) An online retailer needs to be able to measure how well its website converts purchase intentions into actual purchases. This is known as the

A) conversion rate. B) collection ratio. C) consumer index. D) customer total. E) buyer quotient.

63) Zappos.com constantly reminds customers of recently viewed items and informs them when stock is low in an effort to entice the customer to make a purchase. Zappos is trying to improve its

A) conversion rate. B) collection ratio. C) consumer index. D) customer total. E) culture quotient.

64)

Marketers particularly want their brands and products to be in consumers’ ________ sets.

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A) universal B) retrieval C) evoked D) deterministic E) behavioral

65) Tamara is in the process of buying a new truck. There are many possible trucks to choose from, but she is focused on the few she would actually consider buying. These make up her ________ set.

A) universal B) retrieval C) immediate D) evoked E) focus

66) The W all Street Journal provides a set of guidelines each year for purchasing a laptop computer. The guidelines include recommendations for hard disk capacity, memory size, battery life, and several other attributes. The Wall Street Journal is providing consumers with

A) an evoked set. B) psychological needs. C) social concerns. D) evaluative criteria. E) biased information.

67) ________ attributes are product or service features that are important to buyers and that are used to differentiate among choices.

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A) Retrieval B) Financial C) Social D) Determinant E) Safety/performance

68) Fatima and Yusef got married a year ago and are ready to move out of their apartment and into a new home. After looking at several houses, they have developed a list of features that are important to them and that are different among the homes they have visited. The features on their list are called

A) an evoked set. B) determinant attributes. C) short lists. D) perceived risk factors. E) trade-off elements.

69) Pierre prefers shirts made with 100 percent cotton, but he will sometimes buy shirts with less cotton if they are less expensive. Pierre uses ________ to decide which shirts to buy.

A) a compensatory decision rule B) a noncompensatory decision rule C) habitual decision making D) social factors E) temporal factors

70) Carly flies regularly between Chicago and Dallas. She almost always uses American Airlines and has lots of American Advantage Miles credits (American’s frequent-flyer program). Still, she uses an online fare comparison website each time to see if a competitor has a better price or a more convenient schedule. Carly uses ________ to decide which airline to fly.

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A) a compensatory decision rule B) a noncompensatory decision rule C) habitual decision making D) social factors E) temporal factors

71) Thomas is buying a laptop computer to take on trips. Although he has looked at several brands, he refuses to buy a computer that weighs more than five pounds. Thomas is basing his decision on

A) a compensatory decision rule. B) a noncompensatory decision rule. C) habitual decision making. D) social factors. E) temporal factors.

72) There are five types of risks associated with purchase decisions. Which of the following best describes a situation where your new car stalls in the middle of a busy intersection?

A) physiological risk B) social risk C) financial risk D) functional risk E) psychological risk

73) Leo is considering buying a hybrid car, but he’s not sure that he believes the gas mileage estimates. Leo is concerned about

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A) physiological risk. B) social risk. C) financial risk. D) safety risk. E) performance risk.

74) What attributes are product or service features that are important to the buyer and on which competing brands or stores are perceived to differ?

A) determinant B) evaluative C) ethereal D) multi E) universal

75)

________ are the three types of attribute sets.

A) Universal, retrieval, and evoked B) University, relatives, and expression C) United, relations, and exploration D) Urban, random, and exchange E) Unanimity, rule, and express

76) While on vacation, Barbra had her camera stolen. Not wanting to waste vacation time shopping for a new camera, Barbra simply purchased another camera just like her old one. For Barbra, the ________ was low.

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A) perceived benefit versus perceived cost of search B) locus of control for this decision C) determinant attribute for this decision D) universal set of camera options E) prepurchase dissonance factor

77)

Another name for physiological risk is

A) social risk. B) financial risk. C) universal risk. D) compensatory risk. E) safety risk.

78)

Marketers are particularly interested in postpurchase behavior because it

A) involves both compensatory and noncompensatory consumers. B) offers insights into information search methods. C) avoids situational conflicts. D) involves actual rather than potential customers. E) involves both actual and potential customers.

79) Sometimes consumers have second thoughts after buying goods that are expensive, infrequently purchased, or associated with a high level of risk. This is an especially critical time for marketers, as their customers are dealing with

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A) criteria reevaluation. B) buyer’s remorse. C) competitive leverage. D) purchase uncertainty. E) consumer vulnerability.

80) Many teenagers, both male and female, have clothes they purchased in the past that they “would not be caught dead in” today. When they occasionally see those clothes hanging in the back of their closet, these teenagers probably feel

A) cognitive bias. B) postpurchase cognitive dissonance. C) psychological risk. D) need recognition. E) physiological risk.

81)

Postpurchase cognitive dissonance is especially likely for products that are

A) cheap, poorly made, and made of plastic. B) personally valuable, antique, or foreign-made. C) simple, easily copied, and new. D) psychologically soothing, purchased impulsively, and part of a consumer’s evoked set. E) expensive, infrequently purchased, or associated with high levels of risk.

82) Curt greets his regular customers by name every morning when they come in for coffee. He offers them a taste of anything special he is cooking that day. He has a database with their birthdays and offers them free meals on their birthdays. Curt hopes that this attention to his “regulars” will encourage them to

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A) assist him in meeting his functional needs. B) always include his firm in their universal set. C) extend problem solving beyond ritual consumption. D) internalize impulse attitudes. E) spread positive word of mouth.

83) “Black Friday,” as the day after Thanksgiving has come to be known in the United States, is a day marked by many special deals in most retail stores, including deep-discounted products available in limited quantities, called “doorbusters,” and designed to get shoppers into the store. But one danger of running out of the doorbuster deals is that a shopper may become angry or discouraged at failing to get the special item and decide not to do any more shopping. This is an example of the impact of ________ on the consumer decision process.

A) the purchase situation B) lifestyle C) setting high expectations D) perception E) learning

84)

Marketers frequently design customer relationship management programs to

A) improve profit margins. B) attract consumers who have safety needs. C) reinforce postpurchase cognitive dissonance. D) increase internal information search. E) retain loyal customers.

85)

Marketers fear negative word of mouth because when consumers are dissatisfied, they

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A) are less likely to say something than when they are satisfied. B) often want to complain to many people. C) buy more of the product to prove they were correct in their criticism. D) often file a lawsuit. E) don’t buy any of the company’s other products.

86) Most firms maintain customer complaint services online, in the store, or over the telephone. Firms attempt to respond quickly to complaints, hoping to

A) get themselves into the universal set. B) reduce the cost of postpurchase advertising. C) minimize negative word of mouth. D) extend decision rules to the customer complaint desk. E) offset performance risk with financial risk.

87)

Which of the following statements is true?

A) Customers are more likely to talk about service that exceeded their expectations than about service that did not meet their expectations. B) Habitual decision making describes a purchase decision process in which consumers engage in a great deal of conscious effort. C) Customers are more likely to talk about service that did not meet their expectations than about service that exceeded their expectations. D) Evolved decision making describes a purchase decision process in which consumers engage in little conscious effort. E) The retrieval stage is the consumer’s degree of interest in the product or service.

88) Maslow’s hierarchy of needs includes physiological needs at the lowest level and selfactualization at the top. The three levels in between are

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A) material goods, safety, and love. B) community, family, and self. C) safety, stability, and striving. D) health, wealth, and happiness. E) safety, love, and esteem.

89) After Harriet graduated from college, she found a steady and good-paying job, got married and began to raise a family, and began to receive recognition at work and in the community. Eventually, she began to devote more time and effort to intellectual and aesthetic pursuits. Harriet is moving up to what level on Maslow’s hierarchy of needs?

A) self-fulfillment B) self-esteem C) self-confidence D) self-actualization E) self-care

90)

A(n) ________ is a need or want strong enough to cause a person to seek satisfaction.

A) locus of control B) motive C) attitude D) perception E) learning curve

91) There are approximately 1 billion people living in India. It is estimated that only about 200 million of these people earn more than the equivalent of $1,000 per year. According to Maslow’s hierarchy, most of the other estimated 800 million Indian consumers are primarily addressing their ________ needs.

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A) social B) personal C) psychological D) esteem E) physiological

92)

Negative attitudes are typically difficult for marketers to change because

A) most consumers’ attitudes depend on prices. B) consumers weigh performance risk against functional needs when assessing their attitudes. C) attitudes are learned and long lasting. D) attitudes shift consumers from limited to extended problem-solving situations. E) consumers’ attitudes are derived from unchanging decision rules.

93) Although he has never owned a Jaguar, Hussein thinks they are poorly made and have many mechanical problems. For Jaguar to sell Hussein a car, the company would need to change the ________ component of Hussein’s attitude.

A) social B) affective C) functional D) cognitive E) physiological

94) Apple computer users tend to like the company and love its products. Apple has nurtured this ________ component of its customers’ attitudes.

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A) social B) affective C) psychological D) cognitive E) physiological

95) ________ refer(s) to the process by which consumers select, organize, and interpret information to form a meaningful picture of the world.

A) Attitude B) Learning C) Perception D) Values E) Consumption

96) American visitors to the Indonesian island of Bali are often aghast when they see the sign for the Swastika resort. Americans associate the swastika symbol with Nazi Germany while Indonesians associate the symbol with the four major elements on Earth. The two groups have different

A) lifestyles. B) risk factors. C) perceptions. D) factual norms. E) postpurchase dissonance.

97)

Learning refers to a change in a person’s thought process or behavior that arises from

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A) attitudes. B) experience. C) risk analysis. D) cultural norms. E) postpurchase dissonance.

98) Donnie wanted to impress Abby with the perfect engagement ring. He had been saving money for months, and he noticed his attitudes and perceptions about diamond rings changing as he began paying attention to ads for rings. Marketers call this process

A) consumer confidence building. B) self-actualization. C) a decision rule. D) reducing prepurchase dissonance. E) learning.

99) Among the factors affecting the consumer decision-making process is the way consumers spend their time and money to live, otherwise known as

A) lifestyle. B) conspicuous consumption. C) the demonstration effect. D) external validation. E) life standards.

100) Nathan bought Timberland boots because he felt they were perfect for his outdoor activities. Jack bought the same kind of boots because he felt they were stylish, especially with the logo clearly visible. The psychological factor driving Jack’s behavior is

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A) a functional need. B) lifestyle. C) his universal set. D) learned behavior. E) his evoked set.

101)

A consumer’s external social environment includes

A) impulse, habitual, and limited problem-solving processes. B) functional and psychological needs. C) universal, retrieval, and evoked sets. D) cognitive, affective, and behavioral environments. E) the customer’s family, reference groups, and culture.

102) Sophie’s spending decisions are heavily influenced by her family, her peers, and her religious education. These influences on her spending decisions are all ________ influences.

A) psychological risk B) external social environment C) physiological need D) cognitive need E) evoked set

103) Meredith and her fiancé Jerome are planning their wedding. She knows her mother wants her to have a traditional church wedding with a Roman Catholic priest officiating. Meredith would like to have an informal ceremony on the beach, since that type of wedding has become popular with her friends. Furthermore, Jerome is from Thailand and would like to have a monk officiate. Meredith and Jerome’s wedding decisions are most influenced by

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A) impulse, habitual, and limited problem-solving processes. B) functional and psychological profit. C) universal, retrieval, and evoked sets. D) cognitive, affective, and behavioral environments. E) family, reference groups, and culture.

104) Many Hollywood movie stars were among the first to buy electric and hybrid vehicles. These stars often become ________, influencing other consumers’ behavior.

A) reference groups B) internal loci of control C) cultural icons D) cognitive parameters E) evoked images

105) its

The shared meanings, beliefs, morals, values, and customs of a group of people constitute

A) reference group. B) family. C) culture. D) cognitive frame. E) evoked set.

106) Beverage firms sometimes hire attractive young people to sit at fashionable bars, sipping the company’s latest product offering. The firms hope these “models” will serve as a(n) ________ and influence consumers.

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A) reference group B) risk avoider C) cultural determinant D) cognitive learning experiment E) evoked set

107) Before going on his first business trip to China, Albert asked his Chinese American friend to advise him on customs and values common among the Chinese businesspeople he will likely encounter. Albert is trying to avoid ________ business blunders.

A) reference group B) situational C) cultural D) cognitive E) evoked

108) Where Violet grew up, everyone knew everyone else, no one locked their doors, and a person’s word could be trusted. When she went to work in another part of the country, she was surprised by how few people had similar values and beliefs. Violet had to adjust to ________ differences.

A) reference group B) situational C) cognitive D) cultural E) evoked

109) The traditional marketing strategy of selling umbrellas when it is raining is an example of how ________ factors influence consumers’ decisions.

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A) situational B) psychological C) shopping D) interpersonal E) economic

110)

________ factors override or at least influence psychological and social issues.

A) Situational B) Extended habitual C) Postpurchase dissonance D) Interpersonal E) Economic

111) Izzie is about to open a new housewares store. She is making decisions regarding lighting, colors, and layout of merchandise. Izzie knows these ________ factors will influence consumers’ purchase decisions.

A) interpersonal B) extended habitual C) postpurchase dissonance D) sensory E) social

112) Jakob wasn’t sure what kind of salsa he wanted to get for his upcoming Super Bowl party. It seemed like there were dozens of varieties to choose from. He noticed that he could sample a few at a station in the store. He tried four, rejected two, and bought several jars of the two he really liked. He also ended up buying a different—and more expensive—kind of tortilla chip after tasting it. Marketers identify this as a success story of the

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A) visual sense. B) olfactory sense. C) auditory sense. D) tactile sense. E) taste sense.

113) A home security company will advertise the need for home surveillance products to appeal to which level of Maslow’s hierarchy of needs?

A) safety B) love C) esteem D) self-actualization E) physiological

114) Holly lives according to her own rules, unconcerned about designer labels, brand names, and luxury items. Holly is at which level in Maslow’s hierarchy of needs?

A) self-actualization B) safety C) love D) esteem E) physiological

115) Some websites allow consumers to shop while getting opinions from online friends. Which of the influences on the consumer buying process does this represent?

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A) psychological B) social C) situational D) motives E) perception

116)

What is the first sense triggered in a new setting?

A) tactile sense B) taste sense C) visual sense D) olfactory sense E) auditory sense

117) Tomas, a bank employee, doesn’t feel that his coworkers accept him. He decides to dress more casually, as they do, hoping to be accepted. Which level of Maslow’s hierarchy of needs is Tomas trying to work on?

A) esteem B) physiological C) safety D) love E) self-actualization

118) Many states have laws regulating the prices businesses charge during emergencies like hurricanes. These laws are designed to protect consumers whose ________ state may impair their ability to make sound purchase decisions.

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A) shopping B) social C) theoretical D) temporal E) physical

119) There is a saying “Never go to the grocery store hungry.” This saying suggests that a consumer’s ________ state may adversely affect purchasing decisions.

A) shopping B) social C) theoretical D) external E) temporal

120) According to Maslow’s hierarchy of needs, which needs are the needs that people first seek to meet?

A) safety B) self-actualization C) physiological D) esteem E) love

121) Consumers use and process different aspects of advertising or messages. ________ yields greater attention and deeper processing and leads to strong attitudes and purchase intentions.

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A) An external locus of control B) High involvement C) Low involvement D) Differential content E) Internet advertising

122)

The three components of an attitude are

A) cognitive, affective, and behavioral. B) connected, applicable, and bearable. C) confident, achievable, and believable. D) consistent, affordable, and particular. E) controlled, uncontrolled, and visible.

123) Consuela makes a donation to the Autism Research Institute. Which component of Consuela’s attitude toward autism research does this represent?

A) behavioral component B) affective component C) cognitive component D) affordable component E) connected component

124) A(n) ________ is one or more persons whom an individual uses as a basis for comparison regarding beliefs, feelings, and behaviors.

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A) cultural group B) reference group C) situational group D) motivational team E) emotional support team

125)

Consumers involved in habitual decision making engage in

A) inconsistent impulse buying. B) external locus of control. C) little conscious decision making. D) extensive need recognition. E) psychological risk.

126) The consumer’s level of involvement can lead to two types of buying decisions: ________ or ________.

A) extended problem solving; limited problem solving B) culturally influenced; autonomous C) economic; social D) physiological/safety; esteem/self-actualization E) habitual; extended

127) Kai has to decide which college to attend. This is the most important, riskiest, and most expensive decision he has ever made. He will be engaged in

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A) low-involvement decision making. B) extended problem solving. C) habitual decision making. D) prepurchase dissonance. E) limited problem solving.

128)

Limited problem solving usually relies on

A) past experience more than on external information. B) situational stimuli and attitudes. C) external searches for information. D) financial analysis of performance risk. E) evaluation of the universal set.

129) Last semester, Brita bought her textbooks over the Internet and saved a considerable amount of money. Classes start in a few days, and she needs to decide right away how and where to purchase her books. Brita will most likely engage in a(n) ________ process.

A) impulse buying B) limited problem-solving C) extended problem-solving D) ritual consumption E) affective decision

130) Most big box retailers regularly move products from one aisle to another. They also put personal care products in the pharmacy area, many aisles away from the grocery products. They do this because consumers who spend more time walking through the store are likely to buy things they hadn’t planned to buy, or make

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A) impulse purchases. B) limited problem-solving decisions. C) extended problem-solving decisions. D) ritual consumption purchases. E) affective alternative decisions.

131) Marketers love consumers who engage in ________, buying their company’s product with little thought or consideration of alternatives.

A) compensatory decisions B) personal problem solving C) extended problem solving D) reference group consumption E) habitual decision making

132)

To attract and maintain habitual purchasers, marketers spend considerable effort

A) analyzing consumer data for postpurchase dissonance signals. B) creating strong brands and store loyalty. C) cultivating cultural decision making. D) reducing financial risk and increasing psychological payout. E) offering alternative brands.

133) For which of the following purchases would consumers most likely engage in limited problem solving?

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A) college courses B) a new car C) a home D) coffee to go, for a regular coffee drinker E) a location for a large wedding reception

134) Generally, people buy one product or service instead of another because they perceive it to be a better value. ⊚ ⊚

135)

true false

The consumer decision process begins with a comparison of available alternatives. ⊚ ⊚

true false

136) The greater the difference between a consumer’s unsatisfied need and the desired state, the greater the need recognition will be. ⊚ ⊚

true false

137) Angele wants a new car that will be dependable transportation and look good. She wants to satisfy both functional and psychological needs. ⊚ ⊚

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true false

138) When Rudy asked Maryam where she wanted to go for dinner, she said Outback because she went there at least once a week and always liked it. Maryam conducted an internal search for information. ⊚ ⊚

true false

139) When making an important purchase, consumers often consult friends and family. This is considered an external search for information. ⊚ ⊚

true false

140) When Mario is thirsty, he always buys a Pepsi. Like many consumers, Mario engages in considerable alternative evaluation when buying habitual products like his Pepsi. ⊚ ⊚

true false

141) Vivian didn’t go see the movie Gravity because her friends all said she wouldn’t be able to handle it. When she found out how good it was, she blamed her friends. Vivian is demonstrating an internal locus of control. ⊚ ⊚

142)

true false

One benefit of having satisfied customers is that they may spread positive word of mouth. ⊚ ⊚

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true false

143) Setting high customer expectations is a good strategy that will help avoid customer dissatisfaction in the long run. ⊚ ⊚

true false

144) Maslow’s hierarchy of needs is an interesting concept for psychology, but it has little relevance for marketing. ⊚ ⊚

true false

145) Situational factors sometimes override psychological and social factors in the consumer decision process. ⊚ ⊚

true false

146) Harvey will not consider purchasing an “American” car brand based on negative comments made by his family; therefore, he has developed a negative attitude toward American brand cars. ⊚ ⊚

true false

147) Gina is out of bread and butter and needs to decide what is for dinner. She will be stopping at the grocery store on the way home. Gina will likely engage in limited problem solving. ⊚ ⊚

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true false

148) As manager of a local bakery, Nathan greets his regular customers by name and often begins making their order when he sees them drive into the parking lot. Nathan knows habitual purchasers with strong store loyalty are great customers. ⊚ ⊚

true false

149) Wilhelm is visiting universities before applying to schools. He is likely to be involved in an impulse buying process. ⊚ ⊚

true false

150) After purchasing expensive golf clubs, you may question whether or not these clubs are really any better than the less expensive clubs you could have purchased instead. This is an example of postpurchase cognitive dissonance. ⊚ ⊚

true false

151) Lamar usually buys Adidas shoes, so when his friend asked him what shoes he should buy, Lamar naturally said Adidas because it was the first brand he thought of. Lamar’s response was an evoked set. ⊚ ⊚

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true false

Answer Key Test name: Chapter 06 Test Bank 32) A 33) B 34) C 35) D 36) E 37) C 38) C 39) D 40) A 41) D 42) E 43) E 44) B 45) E 46) A 47) B 48) A 49) C 50) B 51) E 52) D 53) C 54) D 55) B 56) C 57) B Version 1

58) A 59) E 60) B 61) C 62) A 63) A 64) C 65) D 66) D 67) D 68) B 69) A 70) A 71) B 72) A 73) E 74) A 75) A 76) A 77) E 78) D 79) B 80) B 81) E 82) E 83) C 84) E 85) B 86) C 87) C Version 1

88) E 89) D 90) B 91) E 92) B 93) D 94) B 95) C 96) C 97) B 98) E 99) A 100) B 101) E 102) B 103) E 104) A 105) C 106) A 107) C 108) D 109) A 110) A 111) D 112) E 113) A 114) A 115) B 116) C 117) D Version 1

118) D 119) E 120) C 121) B 122) A 123) A 124) B 125) C 126) A 127) B 128) A 129) B 130) A 131) E 132) B 133) A 134) TRUE 135) FALSE 136) TRUE 137) TRUE 138) TRUE 139) TRUE 140) FALSE 141) FALSE 142) TRUE 143) FALSE 144) FALSE 145) TRUE 146) TRUE 147) TRUE Version 1

148) TRUE 149) FALSE 150) TRUE 151) FALSE

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Student name:__________ 1) Anthony owns a bike rental business at a mountain resort destination. He is looking at the number of upcoming bookings to the resort to help him figure out how many new bikes to purchase for next season. What type of demand is he facing?

Identify and give an example of each of the four B2B markets.

3) Define derived demand and give an example of how demand for B2B sales is often derived from B2C sales.

4) Michelin Tire Company produces a variety of tires at factories in South Carolina. Name three B2B markets in which Michelin might sell its tires.

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5) LinkedIn is well known for connecting businesspeople; it is the largest network of business professionals, with global reach. It includes at least one executive from all of the Fortune 500 companies. Its promise for networking, whether individually or for the company, is virtually unsurpassed. Such networking entails several key groups. Describe these networking groups.

6) Derived demand reflects the link between consumers’ demand for a company’s output and the company’s purchase of necessary inputs to manufacture or assemble that particular output. Provide an example which demonstrates this concept.

Describe the four B2B markets and explain how their transactions differ.

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8) Explain the advantages and disadvantages of using the RFP process, both for the buying organization and the vendor.

9) Simon used to sell cars at an automobile dealership. Now he sells repossession services to automobile dealers. To be successful, what changes in the buying process will Simon have to adjust to?

10) Meryl is asked to create a vendor analysis process for a dermatologist in private practice, evaluating suppliers of products such as medical supplies. What should Meryl include in a formal vendor analysis using metrics?

11) Suppose that six months ago, Wrangler Jeans began working with a new vendor for zippers, snaps, and other hardware used on its jeans. Now the buying center wants to assess the new vendor’s performance. Describe how Wrangler Jeans might perform this assessment. Be specific. Version 1

12)

How are the B2B and B2C buying processes different?

13)

How is vendor analysis different from a consumer’s postpurchase evaluation?

14) Manufacturers like Volkswagen often have testing departments that test incoming parts and supplies. The primary reason for these premanufacturing tests is to avoid using faulty materials in the manufacturing process that can cause major problems later on. How might Volkswagen also use these results in the business-to-business buying process?

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15) Elias wants his company to consider using Verizon for VOIP telephone calls instead of its existing telephone provider. He approaches his supervisor, the telecomm manager, and suggests this change. Describe the role that Elias plays in the buying center concept.

16) Create a realistic example of a B2B buying center, describing the different roles played by members of the team.

17) The buying center concept has parallels in business-to-consumer buying situations when groups are making buying decisions. Describe a situation where a group of consumers will make a purchasing decision and explain how consumer roles might mirror those in a buying center.

18) When Elias proposed switching the company to Verizon for VOIP telephone calls, he had to approach Matthias, assistant to the firm’s head of the purchasing department, to find out how to proceed. Everyone in the company knows that nothing gets purchased without going through Matthias first. Explain Matthias’ role in a buying center.

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19)

Why is it important for marketers to identify who plays which role in a buying center?

20) A team of people are brought together to purchase new pews for a church. Father Peter has been trying for years to get the church to buy new pews, so he is thrilled. Mrs. Flanders, Father Peter’s longtime secretary, feels very strongly that the pews need to be made of maple to match the old pews, and they need to have cushions for the older people. Everyone is a little afraid of Mrs. Flanders because she manages Father Peter closely and no one gets to him without her okay. Mr. Hunter called the meeting and is the chair of the committee, so he will ultimately choose which pews they will purchase. Mrs. Somody is the treasurer for the church and does all of the ordering. Using the six categories of roles within the buying center, state which person is fulfilling each role.

21)

Briefly describe the four types of buying centers and give an example of each.

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22)

Name three ways a B2B marketer can enhance customer relationships.

23) As a business-to-business marketer, would you prefer to market to a firm with an autocratic or a consensus buying center culture, and why?

24) Imagine that you are a sales representative for IBM, selling consulting services. Which of the four types of buying center cultures do you think it would be easiest to sell to? Using the characteristics of the buying center culture you chose, explain why it was your choice, and how you would approach selling to that type of buying center.

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25) Faith is a textbook company salesperson about to call on the Stamford School District. She would like to know in advance whether the school district’s buying center is autocratic or democratic. What types of behavior might she observe that would help her to tell which of these two types of buying centers it is? How should she change her sales approach depending on which type it is?

26) The World Trade Organization creates proposals that are then discussed by more than 150 member countries and not approved until the proposal is agreeable to all. Describe the type of organizational culture that exists in the WTO.

27) Identify the four general types of organizational buying center cultures and explain how these may impact the approach taken by a salesperson.

28)

Of the three buying situations, in which one is a salesperson most likely to be involved?

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29) When Cerebral College built its first dormitories, it hired a consulting engineer to advise the university in choosing an architectural firm and contractor. For Cerebral College, building its first dormitories represented what kind of buying situation?

30) Why is it important for sales representatives to know whether a potential business customer is making a new buy or a modified rebuy decision?

31)

What is a new buy, and what steps in the buying process does it typically go through?

32)

Describe a straight rebuy situation and explain how it differs from a modified rebuy.

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33) Business-to-business marketing involves buying and selling goods or services by all of the following except

A) manufacturers. B) consumers. C) retailers. D) producers. E) wholesalers

34) As the largest network of business professionals, with global reach, this company includes at least one executive from all of the Fortune 500 companies. Which of following social media platforms is well known for connecting businesspeople?

A) LinkedIn B) Amazon C) Twitter D) Snapchat E) Facebook

35) Lucas bought a pickup truck to transport his equipment on weekend fishing trips. He also bought a trailer for his lawn maintenance business. His purchases were

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A) both B2C purchases since he is the user in both situations. B) both B2B purchases since he is the user in both situations. C) neither B2C nor B2B since he is the consumer and his uses might be mixed. D) B2C and B2B, respectively. E) B2B and B2C, respectively.

36) Indea works as a sales rep for a company that produces and sells steel used in building construction. Indea is in ________ sales.

A) G2B B) B2C C) B2B D) C2C E) G2G

37) Sales of electric components manufactured by Sean’s company depend on sales of new cars. Sean’s company faces ________ demand.

A) synthetic B) situational C) monopolistic D) contrived E) derived

38) Daphne has developed a successful business selling appliances to homebuilders. She carefully monitors the issuance of new home permits to anticipate how many appliances she will need to buy in order to supply her customers. Daphne is concerned with ________ demand.

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A) modified B) secondary C) rebuy D) derived E) delayed

39)

Whether targeting consumers or resellers, marketers need to focus on

A) creating value for their customers. B) buying center synergy. C) private exchange efficiency. D) corporate profit sharing. E) reducing derived demand.

40) Unlike manufacturers, ________ buy products from other businesses but do not significantly alter the form of the products they buy before selling them.

A) producers B) consumers C) resellers D) raw materials suppliers E) gatekeepers

41) A ________ is a type of reseller, a business that buys from other businesses but does not significantly alter the form of the products it buys.

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A) manufacturer B) producer C) consumer D) wholesaler E) factory

42) Luis buys overrun clothing from factories around the South. He sells the clothes to discount retailers. Luis is a

A) manufacturer. B) producer. C) consumer. D) factory agent. E) reseller.

43)

Hospitals, schools, and religious organizations are examples of ________ buyers.

A) manufacturing B) retail C) institutional D) factory agent E) reseller

44) To maximize efficiency, farmers send their produce to a ________ who handles sales and shipments to supermarkets.

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A) distributor B) fabricator C) contractor D) trafficker E) manufacturer

45)

Which of the following is an example of an institutional buyer?

A) Mayo Clinic Hospital B) Procter & Gamble C) U.S. Marine Corps D) Nucor Steel Corporation E) Walmart

46)

Which of the following is an example of a government buyer?

A) Mayo Clinic Hospital B) Procter & Gamble C) the Department of Defense D) Nucor Steel Corporation E) Walmart

47) When the Tesla electric cars first entered the marketplace, dealers kept waiting lists of people wanting one and the factories had to ramp up production and order more raw materials. Increased factory product indicates

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A) derived demand. B) autocratic buying. C) a reorganization. D) new distribution. E) consensus buying.

48)

A wholesaler is an example of a

A) reseller. B) merchandiser. C) reference group. D) manufacturer. E) retailer.

49)

What type of B2B organization is a retail store such as Marshalls?

A) Internet B) institution C) government D) manufacturer E) reseller

50)

In most countries, ________ is(are) among the largest purchasers of goods and services.

A) the largest retailer B) the central government C) construction firms D) the intelligence agency E) hospitals

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51) Which of the following details is(are) included in the order specification stage of the B2B buying process?

A) prices and delivery dates B) vendor performance assessment C) the RFP D) bids for supplying the required components or parts E) reasons for choosing a selected vendor

52)

Both the B2B and B2C buying processes begin with

A) central planning. B) need recognition. C) postpurchase dissonance. D) alternative evaluation. E) order specification.

53) B2B partners often connect to each other on the Internet through special ________ designed to facilitate information exchanges and transactions.

A) search engines B) web masters C) web portals D) web routes E) gatekeepers

54) Compared to the B2C process, the information search and alternative evaluation steps in the B2B process are

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A) decentralized. B) less focused on customer value creation. C) identical. D) more formal and structured. E) based on derived supply analysis.

55)

Typically, B2B buyers ask potential suppliers to

A) write the RFP for the buyer. B) submit formal proposals. C) sponsor interviews with final customers in order to determine product needs. D) always be involved in reselling. E) organize themselves into selling cooperatives.

56) Arlene knows it is important to approach business buyers at the right time, often during the first stage of their buying process, which is

A) need recognition. B) the RFP process. C) proposal analysis. D) vendor negotiation and selection. E) product specification.

57) After need recognition, a business develops ________ that suppliers might use to develop their proposals.

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A) derived demand B) initiator instructions C) determinant attributes D) product specifications E) focal alternatives

58) Normally, Tyler & Co. attaches plastic labels to its bottles. However, a new regulation requires that the company now use fabric labels. To use this latest innovation, Tyler & Co. must now source these fabric labels from another company. This is an example of

A) a modified rebuy situation. B) vendor analysis. C) need recognition. D) a straight rebuy situation. E) an RFP.

59) the

Formal performance evaluations of the vendor and the products sold generally occur in

A) product specification segment. B) RFP process. C) B2B buying process. D) proposal analysis segment. E) B2C buying process.

60) After Hurricane Sandy, many states reevaluated their coastal area building requirements. These new building codes represented __________ that building materials companies used to develop new products.

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A) derived demand B) initiator instructions C) determinant products D) product specifications E) focal alternatives

61) Darwin is hoping to get a chance to bid on supplying key components to Chuck’s business. He is eager to move forward, but he must wait until

A) Chuck completes vendor negotiations. B) Chuck develops a list of product specifications. C) Chuck’s buying center has an opening. D) Chuck agrees to move Charlie’s firm from the evoked set to the retrieval set. E) Chuck completes the order specification process.

62) After need recognition and product specification, many firms using the B2B buying process

A) identify contract specifications. B) issue a request for proposals from invited suppliers. C) proceed to proposal analysis. D) enter vendor negotiation and selection. E) revise their need recognition analysis.

63)

During the RFP stage, B2B buyers

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A) recognize obstacles that the firm must work around. B) revise their need recognition analysis. C) invite suppliers to bid on supplying what is requested. D) proceed to vendor analysis. E) negotiate contract terms.

64) The process through which organizations invite alternative vendors or suppliers to bid on supplying their required components or specifications is formally referred to as

A) specification review. B) contract development. C) a bidding initiative. D) request for proposals. E) invitation to review.

65) After posting an RFP for telecommunications equipment, Comstock Corporation received six proposals from qualified vendors. Next, Comstock will

A) recognize obstacles that must be circumvented. B) reevaluate the firm’s needs. C) give one vendor a purchase order. D) conduct vendor analysis. E) evaluate the proposals and narrow the choice to a few suppliers.

66) The buying center for Comstock Corporation is in the process of discussing price, quality, and delivery schedules with potential suppliers. They are in the ________ stage of the business-to-business buying process.

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A) vendor negotiation B) product specification C) need recognition D) vendor performance assessment E) RFP

67) An Internet site whose purpose is to be a major starting point for users when they connect to the web and is often used by smaller companies in the RFP process is referred to as a(n)

A) podcast. B) Internet channel. C) web portal. D) buying center. E) search engine.

68) Tanya has just received a major order from Northrop Corporation for her firm’s hydraulic lift equipment. After reviewing the order information, Tanya will

A) send an acknowledgment that the order has been received. B) rewrite her firm’s proposal. C) submit a competitive bid. D) proceed to vendor analysis. E) evaluate performance.

69)

The final stage in the business-to-business buying process is to

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A) place the order. B) select the vendor. C) assess vendor performance. D) address additional needs. E) prepare an RFP.

70) As purchasing manager for Barcelette Manufacturing, Eduardo is required to submit a vendor performance analysis every three months. To meet this requirement, Eduardo will most likely

A) interview vendors and seek their feedback. B) specify and weight performance factors and score the vendors. C) develop an RFP for vendor analysis. D) recruit new suppliers. E) use a modified rebuy vendor form.

71) Suppose that Volkswagen is preparing an RFP for a hands-free phone connection for a new car model. All of the following would be included in the RFP except

A) a description of the required features for the device. B) a time frame when the devices are needed. C) specifications for connecting the device to the car. D) a vendor analysis. E) instructions for preparing proposals.

72) Because they do so much driving while visiting doctors’ offices and hospitals, pharmaceutical sales representatives are often given company cars to drive. When a pharmaceutical company like Merck is preparing to purchase new company cars, sales reps’ feedback will be sought on car models and features, but the final decision will be made by higher levels of management. What role(s) do the sales reps play in the buying center?

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A) users B) initiators C) influencers D) users and influencers E) users and initiators

73)

B2B buying decisions are often made by

A) governors. B) influencers. C) committees. D) resellers. E) consumers.

74) As the owner of a small business with 70 employees that makes custom area rugs, Nadine makes all of the buying decisions. Nadine is most likely the

A) reseller. B) user. C) influencer. D) decider. E) initiator.

75) When Patel’s Advertising Co. decided to upgrade its computer network, many people were involved in the decision. In B2B buying systems, decisions are often made

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A) quickly. B) by a single expert. C) at auction sites. D) by a committee after considerable deliberation. E) through community debating organizations.

76) In most large organizations, several people are responsible for making a purchase decision. This group is called the

A) supply chain. B) reselling team. C) decider group. D) buying center. E) expediters.

77) The chair of the board of the local historical association chose the bank where the organization keeps its money; however, the office manager is the primary person who makes deposits, writes checks, and balances the account every month. The office manager is the ________ in the buying center for the bank account.

A) initiator B) decider C) gatekeeper D) user E) influencer

78) Wanda is the director of human resources for a small electronics firm. She has a strong personal interest in technology and is known throughout the firm as the one with the most knowledge about new kinds of communications technologies. If the firm decides to upgrade its network, Wanda will probably function in what role in the firm’s buying center?

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A) leader B) initiator C) influencer D) decider E) gatekeeper

79) Toppers Construction needs heavy-duty equipment to install a new pipeline in northern Minnesota. Toppers’ engineers have been asked to provide detailed specifications and recommendations for the equipment needed. The Toppers engineers will primarily play the ________ role in the company’s buying center.

A) buyer B) initiator C) influencer D) user E) gatekeeper

80) The office policy and procedure states that any purchase requests that are $3,000 and over must be given to Dennis O’Donnell, who will obtain authorization from the chief financial officer. Dennis serves as a(n) ________ in the buying center.

A) gatekeeper B) decider C) buyer D) user E) initiator

81) The president of the Carlington Academy student body made a formal request to the IT department for additional computers in the main computer lab. The student body president is the ________ in the buying center.

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A) initiator B) gatekeeper C) decider D) buyer E) gateway

82) The Carlington Academy IT department is planning to buy additional computers for the computer lab. Pedro Alonzo, manager of the lab, is asked for a recommendation, and he suggests buying Apple computers instead of Windows PCs. What role does Pedro play in the buying center?

A) gatekeeper B) influencer C) decider D) buyer E) initiator

83) At many universities, education faculty members were among the first to ask for personal computers. These faculty members were ________ in the buying center.

A) buyers B) initiators C) influencers D) deciders E) gatekeepers

84) Toppers Construction needs heavy-duty equipment to install a new pipeline in northern Minnesota. After a vendor is chosen, Wayne will handle the paperwork and send out the purchase order. Wayne plays the role of ________ in the buying center.

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A) buyer B) initiator C) influencer D) user E) gatekeeper

85) Kenisha is the sales representative for a major textbook publisher. When she calls on the business faculty at Overlon University, her first stop is to chat with Gina, the business department secretary. From Gina, Kenisha learns which professors have left the university or have newly arrived. Gina also helps Kenisha make appointments to see professors to discuss textbook choices. Gina acts as the ________ in the business department buying center.

A) buyer B) initiator C) influencer D) user E) gatekeeper

86) Kenisha is the sales representative for a major textbook publisher. When she calls on the business faculty at Overlon University, she also tries to meet with several students to get their feedback on textbooks. She passes this feedback to her managers to guide the development of the publisher’s future textbooks. The students are the ________ in the buying center.

A) deciders B) initiators C) influencers D) users E) gatekeepers

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87) Many health insurance policies require patients to call their insurance company to get preapproval for tests or procedures. The health insurance company acts as a(n) ________ for the purchase of these medical services.

A) decider B) initiator C) influencer D) user E) gatekeeper

88) Unlike a firm’s mission statement or employee handbook, a firm’s organizational culture often

A) lists specific job tasks for employees. B) is of no importance to purchase decisions. C) exists as a set of unspoken guidelines. D) is ignored by the vast majority of employees. E) determines the order specification process.

89) Pat Stavol founded Glenders Leasing Company, three decades ago. Although he is now in his seventies, he still has a “hands on” management style. His employees have learned that there isn’t much point in making purchase recommendations for new equipment, because Pat is going to choose whatever he thinks is best regardless of their views. Glenders has a(n) ________ buying center culture.

A) autocratic B) democratic C) consultative D) consensus E) bureaucratic

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90) A buying center that makes its decisions by majority vote is a(n) ________ buying center.

A) autocratic B) democratic C) consultative D) consensus E) bureaucratic

91) The local skiing team is buying new equipment. The team’s coach has invited all team members to make recommendations, after which he will select the successful vendor. The skiing team’s buying center has a(n) ________ organizational culture.

A) democratic B) consultative C) consensus D) autocratic E) bureaucratic

92)

A firm’s organizational culture reflects

A) B2C dynamics. B) an RFP process. C) a buying center philosophy. D) a set of values, traditions, and customs. E) a derived set of influences.

93) While no one in the firm has discussed it, Nando notices everyone else seems to dress more casually on Fridays during the summer. Nando is observing part of his firm’s Version 1

A) organizational culture. B) governing principles. C) human resource policy. D) employee obligations. E) code of ethics.

94) ________ buying centers use one person to make a decision but solicit input from others before doing so.

A) Autocratic B) Democratic C) Consensus D) Derived demand E) Consultative

95) While training for her new job as a pharmaceutical sales representative, Amira spent several days shadowing an experienced company rep. She watched the rep focusing on the benefits of the new drugs while not volunteering pricing information, side effects, or comparison data. Amira assumed that this reflected part of the pharmaceutical firm’s

A) buying center. B) culture. C) mission statement. D) corporate social responsibility. E) RFP process.

96)

Which of the following is a type of organizational culture?

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A) modified B) derived C) marketing D) capitalist E) consensus

97) The customer whom Sandra is calling on today has a(n) ________ buying center culture. This means that the decision process will involve reaching agreement among all members of the buying center.

A) consensus B) autocratic C) consultative D) republican E) democratic

98) Deleito Publishing is known for its consultative buying center culture. Recognizing this corporate culture, someone attempting to sell to Deleito Publishing should

A) treat all members of the buying center as equally important. B) address the concerns of all members of the buying center with particular attention to the decision maker. C) focus on providing information to and making the sales approach to the one decision maker. D) attempt to facilitate the collective agreement of all members of the buying center. E) focus attention on the gatekeeper in the buying center’s team.

99) Roanoke Hardware is known for its consensus buying center culture. Recognizing this corporate culture, someone attempting to sell to Roanoke Hardware should

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A) focus exclusively on the head of the buying center. B) address the concerns of all members of the buying center with particular attention to the decision maker. C) focus on providing information to and making the sales approach to the one decision maker. D) attempt to facilitate the collective agreement of all members of the buying center. E) attempt to get one “friend” on the committee to support his products.

100) At the main campus of a large university, faculty always refer to one another as “Dr.,” wear suits, and guard their academic domains against one another. This leads to frequent namecalling and strenuous debates. Meanwhile, at the various branch campuses, faculty members call one another by their first names, dress casually, and support one another’s scholarly efforts. This example illustrates the differences in ________ that can exist within an organization.

A) supply chain communication B) autocratic buying center culture C) organizational culture D) business missions E) corporate social responsibility

101) The goal of ________ is to provide valuable information that a potential B2B buyer can easily understand and that will help the company address its problems with new solutions.

A) white papers B) LinkedIn.com C) Twitter D) a democratic buying center E) microblogs

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102) Not knowing the roles of key players in the buying process could cause a sales representative to

A) bid too high a quantity. B) fail the vendor analysis. C) respond to an RFP too quickly. D) waste time and alienate people. E) misdirect his or her product.

103) Synergies Technologies, a firm providing software and services to information technology departments, maintains a corporate blog. How can this blog help Synergies Technologies with B2B marketing?

A) as a place to post responses to RFPs B) by building brand awareness among potential customers C) by simplifying vendor performance assessment D) by streamlining purchasing and distribution E) by matching buyers’ requests and sellers’ offers

104)

LinkedIn is mainly used for ________ in the B2B marketplace.

A) requests for proposals B) vendor evaluation C) communication with customers D) professional networking E) competitive analysis

105) When Valeria gave her presentation to the Overlook buying center team, she focused on answering Daniella’s questions, since Daniella is the decision maker. What type of buying center does Overlook employ?

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A) democratic B) consultative C) consensus D) autocratic E) authoritative

106) Ossie was buying the company’s first digital copier, and she involved all of the company’s department heads in the decision. Ossie spent weeks evaluating options, inviting RFPs, and negotiating with vendors before she finally made a purchase decision. This buying situation would most likely be classified as a

A) new buy. B) modified rebuy. C) straight rebuy. D) modified buy.

107)

Most B2B buying situations can be categorized as new buys, modified rebuys, and

A) generic buys. B) straight rebuys. C) ordinary rebuys. D) adapted buys. E) minor buys.

108)

The RFP stage of the B2B buying process is not required for

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A) a new buy. B) a modified rebuy. C) a straight rebuy. D) either a new buy or a modified rebuy. E) an adapted buy.

109) The buying decision is likely to be most complex and take longest to complete in a(n) ________ B2B buying situation.

A) new buy B) modified rebuy C) straight rebuy D) adapted buy E) generic buy

110) In which buying situation is the buyer most likely to proceed through all six steps in the buying process?

A) new buy B) modified rebuy C) straight rebuy D) generic buy E) adapted buy

111) Greenwich University is buying a distance learning system. Previously, the school had no distance learning technology. For Greenwich University, this represents a(n) ________ situation.

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A) adapted buy B) modified rebuy C) straight rebuy D) new buy E) generic buy

112) Renata is the sales rep for OTO Telecomm Systems. She wants to bid on the RFP issued by Greenwich University for distance learning technology. She knows she will need to provide considerable information and demonstrations of her firm’s technology because Greenwich University is in a new buy situation and does not have

A) the money to afford it. B) any experience with the product it wishes to purchase. C) anyone interested in the technology. D) any derived demand for the system. E) any students who might be interested in distance learning.

113) When Olga took over as facilities manager for Warders Manufacturing, she was shocked to see the factory was still heated with a coal-fired boiler. She made an immediate decision to upgrade the heating system to something more efficient and began to research available options. For Olga and Warders, this represented a(n) ________ situation.

A) adapted buy B) modified rebuy C) straight rebuy D) generic buy E) new buy

114) In a(n) ________ situation, the buyer has purchased a similar product in the past but has decided to change some specifications.

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A) new buy B) modified rebuy C) straight rebuy D) adapted buy E) generic buy

115) When a business buyer decides to change specifications such as quality or options associated with products purchased in the past, the buyer is engaged in a(n) ________ situation.

A) new buy B) modified rebuy C) straight rebuy D) adapted buy E) side-by-side

116) When Walmart considers reordering items for its stores, its buyers are instructed to negotiate price concessions, quality improvements, and/or added options. In this situation, Walmart buyers are engaged in a(n) ________ situation.

A) new buy B) modified rebuy C) straight rebuy D) adapted buy E) generic buy

117) In a modified rebuy situation, ________ are likely to have an advantage in getting the order.

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A) consumers B) resellers C) current vendors D) gatekeepers E) new vendors

118) When Jamie sees the RFP issued by one of his customers, he is concerned that the company has changed its specifications since it placed a previous order with him. His company’s products do not meet the new specifications. In this situation, being the current vendor

A) will necessitate renegotiating price and delivery terms. B) allows for a straight rebuy. C) offsets a consensus buying center culture. D) will probably not be an advantage in getting the new order. E) will allow Hal to get the order even though his products do not meet the specifications.

119) A(n) ________ occurs when the purchasing agent orders additional units of products that have previously been purchased.

A) new buy B) modified rebuy C) straight rebuy D) adapted buy E) generic buy

120) If a B2B customer is satisfied with an existing supplier, it will probably engage in a(n) ________ to purchase additional quantities of the item.

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A) new buy B) modified rebuy C) adapted buy D) straight rebuy E) generic buy

121) Yasmine uses her customer relationship management (CRM) system to predict when her business customers will need more of her company’s packaging materials. When she thinks a customer should be ready to make another order, she contacts them. Yasmine is using CRM to encourage customers to engage in a(n)

A) new buy. B) modified rebuy. C) adapted buy. D) straight rebuy. E) generic buy.

122) Otto put down the phone and told Alicia, “I just love that customer. I got another big order, and they just keep on coming.” Otto is most likely selling to a firm in what kind of buying situation?

A) new buy B) modified rebuy C) straight rebuy D) generic buy E) adapted buy

123) When a business customer engages in a straight rebuy, the member of the buying center most likely to be involved in the purchase is the

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A) decider. B) initiator. C) influencer. D) user. E) buyer.

124) In established businesses, a large proportion of B2B purchases fall into the ________ category.

A) straight rebuy B) new buy C) adapted buy D) modified rebuy E) generic buy

125)

The three types of buying situations

A) create confusion among B2B sellers. B) suggest that B2B sellers should develop one marketing mix to use for all situations. C) require business sellers to be consistent in their marketing mixes. D) are theoretical and have little relation to what happens in the real world. E) call for different marketing and selling strategies.

126) The ________ situation usually involves more members of a buying center and involves more time to complete than the other buying situations.

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A) modified rebuy B) new buy C) adapted buy D) straight rebuy E) generic buy

127) A(n) ________ situation in B2B marketing is similar to limited problem solving in the B2C process.

A) adapted buy B) new buy C) modified rebuy D) straight rebuy E) generic buy

128)

For B2B salespeople, usually the easiest sale is a(n) ________ situation.

A) adapted buy B) new buy C) modified rebuy D) straight rebuy E) generic buy

129) Firms typically repurchase office supplies (paper, ink cartridges, pens, etc.) through straight rebuys on their supplier’s website. Should an office supplies sales rep stay in close touch with his or her current customers? Why or why not?

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A) No; this is a waste of time since straight rebuys are straightforward and easy to handle. B) No; the sales rep should be looking for new customers instead. C) Yes; straight rebuys require a lot of the sales rep’s assistance. D) Yes; the sales rep might learn about a new opportunity in the need recognition stage. E) Yes; history has shown that online reordering can’t be trusted.

130) Janelle has just learned that Peale’s Coffee is looking for a new source of commercialgrade coffee makers, one of the products she sells. She knows Peale’s has been in business for many years, but she has not been able to get any business from them. When developing her marketing strategy, Janelle will probably assume that this represents a(n) ________ situation for Peale’s Coffee, and she will want to find out why Peale’s is considering alternatives.

A) adapted buy B) new buy C) modified rebuy D) straight rebuy E) generic buy

131) Greenwood High School has recently decided to sponsor a tennis team. It is in the process of considering where to buy the uniforms. This purchase is a ________ situation.

A) straight rebuy B) new buy C) straight new buy D) modified new buy E) modified rebuy

132)

Which step in the buying process is most likely to happen in a straight rebuy situation?

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A) product specification B) RFP process C) need recognition D) proposal analysis E) supplier selection

133) As Lucia’s business grew, she needed to find a new way to manage payroll for her employees, so she researched payroll companies to see which one would best meet her needs. What type of buying situation was Lucia involved in?

A) straight buy B) modified rebuy C) new buy D) modified buy E) straight rebuy

134) Arlete Racing Bikes needed more bicycle seats. It decided to order gel seats in addition to the traditional seats it had always ordered. What type of buying situation does this represent?

A) straight rebuy B) modified buy C) straight buy D) new buy E) modified rebuy

135) Business-to-business (B2B) marketing refers to buying and selling goods or services to consumers. ⊚ ⊚

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true false

136) Toys4U buys fabric from China and sells it to clothing manufacturers in the United States. Toys4U is a retailer. ⊚ ⊚

137)

B2B marketing involves manufacturers, wholesalers, and retailers. ⊚ ⊚

138) sell.

true false

Resellers differ from producers in that resellers significantly alter the form of goods they

⊚ ⊚

139)

true false

Public institutions do not engage in B2B relationships. ⊚ ⊚

true false

140) Peoples College realized it needed to upgrade the computers in the campus libraries. This represents the product specification stage of the B2B buying process. ⊚ ⊚

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true false

141) A small business may use a web portal as a means of forming a supply chain that can respond to its needs. ⊚ ⊚

142)

Once a vendor receives an order from a firm, it responds by immediately filling the order. ⊚ ⊚

143)

true false

The B2B buying process tends to be more formal than B2C buying. ⊚ ⊚

144)

true false

The RFP process is used by buyers to allow customer input into value creation. ⊚ ⊚

true false

145) The final step of the business-to-business buying process is a formal vendor performance analysis. ⊚ ⊚

true false

146) A CAD programmer working for a large firm requests specific computer software to produce designs, drawings, and other technical information for his clients. The CAD programmer probably serves as a gatekeeper in the buying center.

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⊚ ⊚

147)

true false

When you go to the hospital for an operation, you are the decider in the buying process. ⊚ ⊚

true false

148) A buying center whose members reach a decision based on a collective agreement is known as an autocratic buying center. ⊚ ⊚

149)

true false

Organizational culture may vary by geography. ⊚ ⊚

true false

150) Most B2B buying situations can be categorized into three types: new buys, structured rebuys, and automatic rebuys. ⊚ ⊚

true false

151) In both new buy and straight rebuy situations, several members of a buying center will be intensely involved in the purchasing decision. ⊚ ⊚

Version 1

true false

152) A small business decides to upgrade its aging phone system. The business will probably place a straight rebuy order. ⊚ ⊚

Version 1

true false

Answer Key Test name: Chapter 07 Test Bank 33) B 34) A 35) D 36) C 37) E 38) D 39) A 40) C 41) D 42) E 43) C 44) A 45) A 46) C 47) A 48) A 49) E 50) B 51) A 52) B 53) C 54) D 55) B 56) A 57) D 58) C Version 1

59) C 60) D 61) B 62) B 63) C 64) D 65) E 66) A 67) C 68) A 69) C 70) B 71) D 72) D 73) C 74) B 75) D 76) D 77) D 78) C 79) C 80) A 81) A 82) B 83) B 84) A 85) E 86) D 87) E 88) C Version 1

89) A 90) B 91) B 92) D 93) A 94) E 95) B 96) E 97) A 98) B 99) D 100) C 101) A 102) D 103) B 104) D 105) D 106) A 107) B 108) C 109) A 110) A 111) D 112) B 113) E 114) B 115) B 116) B 117) C 118) D Version 1

119) C 120) D 121) D 122) C 123) E 124) A 125) E 126) B 127) C 128) D 129) D 130) C 131) B 132) C 133) C 134) E 135) FALSE 136) FALSE 137) TRUE 138) FALSE 139) FALSE 140) FALSE 141) TRUE 142) FALSE 143) TRUE 144) FALSE 145) TRUE 146) FALSE 147) FALSE 148) FALSE Version 1

149) TRUE 150) FALSE 151) FALSE 152) FALSE

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Student name:__________ 1) It seems that you cannot pick up a newspaper without reading about globalization. What fundamental changes are contributing to the growth of global markets?

2) You have been asked to evaluate the economic potential of a new global market. What economic measures would you use? Explain each measure.

3) Assume you are advising the Botswana government about trade policies. What options does the government have? Which would you recommend to stimulate the domestic economy?

4) As a global company, Airbnb’s offerings are available in hundreds of countries and tens of thousands of cities. Approximately two-thirds of the bookings on the site take place across national borders. How can Airbnb create some basic consistency in its offerings?

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5) What are Geert Hofstede’s six cultural dimensions concepts? What is the value of his cultural dimensions concept to global marketers?

6) What kinds of sociocultural concerns are raised in international marketing that go beyond promotion and advertising?

7) Shania has been asked to evaluate the economic potential of Monaco as a market for her company’s products. What three categories of economic factors will she assess?

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What does purchasing power parity mean?

9) Describe the purpose of trade agreements and give an example of the changes that are occurring in these agreements.

10) Describe the process of exchange control and explain how it affects a country’s ability to conduct global business.

11) What is the difference between a trade deficit and a trade surplus? If a firm wants to manufacture in another country, which of these trade situations would it prefer?

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12) Briefly describe the four key elements of a country’s infrastructure that would concern marketers.

13)

Why is a country’s infrastructure an important consideration to global marketers?

14)

How do tariffs affect markets?

15) The United States, Australia, Canada, and the United Kingdom cluster high on individualism but low on power distance on Hofstede’s cultural dimensions graph. What does this mean to someone looking to market a product in these countries?

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16)

How is the retail landscape in India changing?

17) You have been hired to pursue international marketing for a small furniture manufacturing firm. The owner, who is reaching retirement age, does not like to take on risky business ventures. Her son, though, likes to take risks; he feels it’s a good way to earn a greater return. What entry strategy would the owner want to pursue, and what entry strategy would the son want to pursue? How might you resolve the differences?

18) Nardina is assessing global entry strategies for her gourmet spice business. She does not have significant capital for expansion and does not want to take a lot of risk. She is also willing to limit her control of international stores. What are her global entry options? Given her situation and priorities, which option is most logical? Why?

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19) When and why do many American firms begin their global expansion efforts by exporting?

20)

What is the difference between a strategic alliance and a joint venture?

21)

What are the pros and cons of a franchising agreement for global expansion?

22) Once a company has decided to sell in a foreign country, it must determine the best mode of entry. List each mode of market entry and give an example for each.

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23)

What are the risks associated with global franchising?

24) Once a company has decided to pursue a global market, it will explore the four Ps. List the potential global product strategies a firm can employ.

25) How could a marketer adapt a product to appeal to international markets? Give a specific example.

26)

Explain why language can be particularly vexing to advertisers.

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27) What would it mean if Oreo adopted a glocalization strategy for global sales of its cookies?

28) The text states that even among English speakers, there can be significant differences in the effectiveness of advertising campaigns. Why is this true?

29) Give a reason and an example of why a product would require a more localized advertising approach.

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30) In what three ways are global segmentation, targeting, and positioning more complicated than domestic STP?

31) Globalization refers to the processes by which goods, services, capital, people, information, and ideas

A) are onshored and offshored. B) flow across national borders. C) are integrated through IMF facilitation. D) are similar in various markets. E) affect corporate culture.

32)

The components of global market assessment include

A) the maximum amount of direct investment. B) infrastructure and technological analysis. C) the value of exports. D) a minimum number of franchises in operation. E) no obvious trade alliances

33)

The Big Mac Index

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A) compares the infrastructure and technological capabilities of several countries on the same continent. B) measures the economic health of a country. C) simplifies the supply chain needed to make goods and services available. D) suggests that exchange rates should adjust to equalize the cost of a basket of goods and services all over the world. E) determines how consumers decide to make their purchases.

34) Ravi is gathering information about the general economic environment in Bangladesh. In doing so, he will look for information about the general economic environment, market size and population growth rate, and

A) culture. B) real income. C) airport capabilities. D) political status. E) religious institutions.

35)

To determine the market potential for its particular product or service, a firm should use

A) GDP data. B) unemployment data. C) purchasing power parity data. D) inflation data. E) as many metrics as it can obtain.

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36) When Porsche filmed an advertisement in which its vehicles ran over the Great Wall of China, Chinese consumers were left more confused than intrigued. To address or avoid such issues, one important cultural classification scheme that firms can use is Geert Hofstede’s cultural dimensions concept. Hofstede proposes that cultures differ on all of the following dimensions except

A) conservatism. B) individualism. C) masculinity. D) time orientation. E) indulgence.

37) Manufacturers would prefer to produce in a country with a trade ________, because it signals a greater opportunity to export products to more markets.

A) surplus B) deficit C) discrepancy D) bonus E) balance

38)

The most common measure of market potential of an economy is a country’s

A) GNI. B) GDP. C) PPP. D) CPI. E) APR.

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39) To reach more customers in India, which represents a vastly promising market but where the GDP is less than $2,000 per capita, Netflix offers subscription plans priced lower than those offered in the United States. This market is known as

A) globalization. B) glocalization. C) purchasing power parity. D) top of the pyramid. E) bottom of the pyramid.

40)

The United States imports more goods than it exports. This is known as

A) gross national income (GNI). B) a trade surplus. C) gross domestic product (GDP). D) a trade deficit. E) an import imbalance.

41)

GDP is defined as

A) the value of a country’s exports minus its imports. B) the difference between two country’s exchange rates. C) the market value of goods and services produced in a country in a year. D) national income minus national taxes. E) the gross purchasing power of domestic goods and services plus international income.

42)

Gross national income (GNI) consists of GDP

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A) minus net consumer spending. B) plus government spending on international trade. C) minus purchasing power parity. D) plus the net income earned from investments abroad (minus any payments made to nonresidents who contribute to the domestic economy). E) plus gross domestic international investment.

43) According to purchasing power parity theory, if ________ is(are) in equilibrium, products will cost the same in each country.

A) imports and exports B) consumer spending C) interest rates D) domestic products E) exchange rates

44) Economic measures like GDP and GNI do not fully account for a country’s economic health because they measure only

A) material output. B) international trade. C) global expectations. D) purchasing power parity. E) poverty potential.

45)

Today, many developed countries are experiencing ________ population growth.

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A) slight B) zero or negative C) rapid D) moderate E) significant

46) Logan is working on a global marketing assessment team looking out well into the future to help determine the most attractive market areas around the world. He is evaluating market sizes and growth rates. Based on population growth rates in different regions, he should consider that

A) countries with high purchasing power today may not continue to show the same growth in the future. B) the United States and Western Europe will have dramatic increases in population growth leading to overcrowding. C) the middle class in India will continue to shrink as the rich get richer and the poor get poorer. D) in places like India, urban population centers will become increasing unattractive and the rural areas will experience major growth in population. E) the global population is expected to grow at staggering rates indefinitely.

47) The shift of population from rural to urban areas in countries such as India helps global marketers by

A) decreasing pollution. B) simplifying the supply chain needed to make goods and services available. C) increasing the human development index. D) decreasing competition for intellectual capital. E) increasing nonmaterial GDP output.

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48) When considering global marketing opportunities in Bangladesh, Thomas asked the question, “How will we get it there?” Thomas is concerned about ________ capabilities in Bangladesh.

A) production capacity B) pricing C) advertising D) infrastructure E) cultural

49) When Nigeria’s economy suffered because of a drastic fall in oil prices, the government encouraged people to buy more local products by

A) instituting high tariffs. B) developing a social media campaign. C) importing from neighboring countries. D) advertising “green” options. E) offering family stipends.

50) When Roger evaluated the commercial infrastructure in Korcula, a small Croatian island, he considered its

A) population control measures. B) legal, banking, and regulatory systems. C) retailing capabilities. D) per capita income estimates. E) climate and culture.

51)

Changes in tariffs and quotas are

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A) business actions stimulating imports. B) corporate strategies designed to maximize profits. C) government actions that reduce competition from international firms. D) efforts to stimulate choices among government agencies. E) a means of slowing outsourcing.

52)

Tariffs protect domestic producers by

A) making imported products more expensive. B) increasing brand recognition. C) reducing the cost of production. D) offering subsidies to exports. E) avoiding regulation.

53)

The term trade deficit refers to

A) a country that exports more goods than it imports. B) an indicator of the quality of life in a country. C) a level of population growth that impacts exports. D) the sum of all goods and services handled in a country. E) higher levels of imports than exports.

54) When shopping for a car you notice a significant price gap between domestic and imported cars, with the imported cars being much more expensive. This could be the result of

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A) a tariff. B) a boycott. C) overseas consolidation. D) globalization. E) franchising.

55)

In most cases, countries use tariffs to reduce foreign competition, but tariffs are also used

A) to shorten supply chains. B) as a response to perceived unfair trade practices. C) to offer domestic discounts. D) to stimulate consumer demand. E) as a way to equalize quotas.

56) A ________ limits the quantity of imported merchandise, thus minimizing competition faced by domestic products.

A) tariff B) duty C) trading bloc D) trade agreement E) quota

57)

When ________ are reduced, it is meant to bolster foreign trade.

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A) comparative inflation rates B) countertrade exchanges C) quotas D) tariffs E) currency exchange rates

58) When the value of the dollar declines in relation to other currencies, it benefits U.S. marketers who

A) export goods to other countries. B) import goods from other countries. C) engage in countertrade. D) enforce import quotas. E) outsource labor.

59)

Which of the following is a major trade agreement affecting global marketing?

A) PPP B) CPU C) USMCA D) GNI E) GDP

60) Marketers considering operations and trade with a specific country must consider whether or not the country belongs to a trading bloc. A trading bloc is a group of countries

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A) that have established a formal agreement to manage trade activities. B) using the same currency. C) with similar cultural shopping patterns. D) located next to each other. E) with similar political views.

61) Which of these trade agreements represents the highest level of integration among participating nations?

A) USMCA B) EU C) GNI D) ASEAN E) CAFTA

62) Global businesses often find it particularly difficult to understand the ________ of a country’s culture.

A) symbols B) underlying values C) ceremonies D) exhibited behavior E) visible artifacts

63) According to Hofstede’s cultural dimensions concept, which BRIC country posts high scores in the dimension of power distance and low on individualism?

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A) Russia B) Brazil C) India D) China E) Iran

64) Robin laughed at some of the cultural mistakes companies made in advertising and promotion in international trade while he was in school. Now he was trying to determine what had gone wrong with the campaign he had planned in Latin America for his company’s product, and it didn’t seem quite as amusing. He narrowed the issues to sociocultural factors. He was looking at both ________ and ________.

A) product uses; currency rates B) language; trading blocs and social structure C) potential tariffs; symbols D) visible artifacts; underlying values E) verbal communication; logistics

65) Geert Hofstede’s cultural dimensions concept focuses on six dimensions of ________ in a country.

A) symbols B) underlying values C) buying patterns D) personality E) visible artifacts

66)

Which of the following is included in Hofstede’s cultural dimensions?

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A) power distance B) certainty assurance C) self-actualization D) belonginess E) esteem

67)

Marketers sometimes use Hofstede’s cultural dimensions to design marketing campaigns

A) with low individualism symbolism when confronted with a time-oriented culture. B) that use uncertainty avoidance to reduce power distance. C) with significant power distance. D) consistent with underlying cultural values in a country. E) with more consistent time orientation.

68)

Culture affects

A) how consumers decide to make their purchases. B) what consumers decide to purchase. C) when consumers decide to make their purchases. D) where consumers decide to make their purchases. E) every aspect of consumers’ purchase decisions.

69)

Why should marketers be aware of the BRIC countries?

A) They are a microcosm of the rest of the world. B) They represent almost half the world’s population. C) They are likely to be the source of most market growth. D) They have had the most dramatic changes in culture and consumer buying patterns. E) They have stable population growth, which makes them easier to study.

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70)

Which statement about India’s population is true?

A) With a median age of 61, India has one of the oldest populations in the world. B) India’s young people mostly live in rural areas in large families. C) India’s workforce is highly skilled, especially in technical fields. D) India claims more than 25 percent of the world’s population. E) Most Indian citizens shop in large retail outlets.

71) ________ is one of the fastest-growing markets and has one of the youngest populations in the world.

A) Russia B) South Africa C) India D) China E) Brazil

72) Despite multiple upturns and downturns in its economy, Russia’s overall growth prospects appear promising, especially as a consumer market. However, there are still multiple dilemmas for firms trying to market their goods and services. These dilemmas include

A) a very young population. B) growing lower class. C) international tariffs. D) involvement in China. E) fluctuations in oil prices.

73)

What do the BRIC countries have in common?

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A) They participate together in a trading bloc. B) They have suffered more than most other countries in the recent recession. C) They are Asian countries experiencing explosive population growth. D) They are the four countries known for the highest levels of bribery in business and government. E) They are experiencing significant levels of economic growth.

74)

Which of the following is currently a negative factor for foreign investment in Russia?

A) The Russian population is poorly educated. B) Russian consumers have little interest in online shopping. C) Russia is known for corruption, creating ethical dilemmas for firms. D) Russian consumer markets are saturated, offering few opportunities for goods from U.S. companies to sell well. E) Few Russians have access to the Internet due to heavy regulation.

75)

Which of the following is currently a negative factor for foreign investment in India?

A) India’s population is fairly old and aging fast. B) India’s retail environment lacks modern supply chain management facilities and systems. C) India prevents foreign investors from entering into joint ventures. D) India has no shopping malls or other large commercial centers. E) India lacks a skilled workforce.

76)

Which of the following is a potential negative factor for foreign investment in China?

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A) China’s population is aging and is likely to continue to do so for many years. B) China drastically restricts the goods it allows U.S. companies to export to China. C) China’s standard of living has dropped over the past 30 years. D) China has imported fewer goods from the United States each year for the past decade. E) Chinese consumers are not interested in purchasing products from the United States.

77) A company is assessing opportunities in the BRIC countries and determines that ________ is one of the youngest populations in the world and is increasingly adopting global attitudes.

A) Russia B) Brazil C) India D) Italy E) China

78) A publishing company plans to outsource its production-related tasks to a BRIC country. They are assessing opportunities and are attracted to this country due to its population of young, well-educated, technically-skilled workers who are fluent in English.

A) Russia B) China C) Brazil D) India E) Chile

79)

Which of the following statements is true with regard to growth in global markets?

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A) A country’s infrastructure does not impact growth in the global market. B) The number of Russian Internet users is decreasing at a rate of 10 percent annually. C) Russia’s population is expected to increase by one-third in the next half century. D) Changes in technology, especially communications, have been a driving force for growth in global markets for decades. E) Brazil does not welcome foreign investors.

80) Which BRIC country’s economic growth in the 21st century can largely be attributed to the expansion of its literate population and the impositions of social programs that have allowed more than half of its 201 million citizens to enter the middle class?

A) Brazil B) Russia C) India D) China E) Chile

81)

Domino’s growth plan has focused on Mexico partially because

A) there are no pizza competitors. B) pizza and Mexican food have similar flavors. C) advertising is cheaper in Mexico than in any other Latin American country. D) 80 percent of the population is middle class with a large discretionary income. E) there is a growing penetration of Internet technologies.

82) A U.S. firm is analyzing its business prospects in China. Marketing executives understand which of the following to be true of this potential market?

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A) China’s leadership, which maintains communist political ideals, has not embraced market-oriented economic development, which has led to startlingly slow gains. B) Recent developments in China have led to dramatically decreased living standards and levels of personal freedom. C) China struggles with unequal economic distribution. D) China’s economy has recently seen a substantial decrease in its Global Retail Development Index (GRDI). E) China’s growth in its gross domestic market has increased.

83) Which country has embraced market-oriented economic development in spite of maintaining communist political ideals?

A) Brazil B) Russia C) Iran D) China E) Afghanistan

84)

Which country has a rapidly aging population due to its one-child policy?

A) Brazil B) Russia C) India D) China E) Japan

85) next

Once a firm has done an analysis of the most viable markets for its products, then it must

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A) determine the competition and develop strategies to overcome it. B) conduct an internal assessment of its capabilities. C) conduct an external analysis of the target market’s economy, culture, and regulatory barriers. D) develop a product to meet the needs of those markets. E) achieve success with the product in its home market.

86) Martine wants to sell her products in Europe, since they are doing well in the United States. She does not have a lot of capital and is risk-averse, so she most likely would choose to begin with

A) opening a franchise. B) exporting her products. C) forming a strategic alliance with another company. D) entering a joint venture with a local firm. E) making a direct investment in another country.

87) Dartel, a former retailer, has been living in the United States for five years and wants to start a business. He does not have an existing firm or a product, and he doesn’t have a lot of capital, but since he loves McDonald’s food, he decides to

A) open a McDonald’s franchise. B) directly invest in McDonald’s. C) export McDonald’s products to other countries. D) form a strategic alliance with McDonald’s. E) form a joint venture with McDonald’s.

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88) Claire’s Classy Accessories has 59 stores in the United States and wants to expand globally. Claire’s wants to achieve the highest possible returns and is not concerned about pursuing a high-risk strategy as long as it maintains complete control over its stores. The best global entry strategy for Sydney’s is most likely

A) exporting. B) a strategic alliance. C) a joint venture. D) direct investment. E) franchising.

89)

Generally, firms entering foreign markets begin with

A) less risky strategies first. B) direct investment. C) importing. D) decentralized production. E) the riskiest, but most profitable endeavor.

90)

When entering a foreign market, the least risky strategy is

A) franchising. B) exporting. C) joint venture. D) direct investment. E) strategic alliance.

91)

Global expansion often begins with

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A) franchising. B) exporting of goods. C) joint ventures. D) direct investment. E) strategic alliances.

92) Many of the best-known American retailers, like Starbucks and McDonald’s, have contractual agreements with another firm or individuals, allowing its businesses to operate overseas. These companies expanded globally using

A) franchising. B) exporting. C) joint ventures. D) direct investment. E) strategic alliances.

93) Gerry is assessing global entry strategies for his gourmet sandwich business. He does not want to take a lot of risk and he is willing to limit his control of international stores. Gerry will most likely use a(n) ________ strategy.

A) franchising B) exporting C) joint venture D) direct investment E) strategic alliance

94) Domestic firms developing a global entry strategy might consider franchising; however, the disadvantages need to be considered. Which of the following is a disadvantage of franchising?

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A) A foreign nation will want to be a cofranchisee. B) The franchisee will never become a competitor. C) Franchising limits profit potential, since profits will have to be split with the franchisee. D) Franchising is the riskiest way to enter a foreign market. E) The franchisee is tied to the agreement for the lifetime of the franchise.

95) When a firm pools its resources with that of a local firm to enter a new market, they create a(n)

A) franchise. B) export promotion. C) joint venture. D) direct investment. E) strategic alliance.

96) India, like some other countries, may require entering firms to create ________ when expanding into their markets, limiting outsiders’ control of businesses.

A) franchises B) export promotions C) joint ventures D) direct investments E) strategic alliances

97)

Of the five strategies for entering new markets, direct investment creates the

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A) least investment cost. B) greatest potential risk. C) most franchisee control. D) best opportunity for strong strategic alliances. E) greatest coordination of efforts of global and local partners.

98)

Which of the following is one of the global entry strategies?

A) direct investment B) countertrade C) offshoring D) infrastructure development E) trade agreements

99) When a company decides to minimize risk and enter a global market by shipping its products to buyers in other countries, this is known as

A) exporting. B) franchising. C) a strategic alliance. D) a joint venture. E) direct investment.

100)

Which of the following best describes the direct investment global entry strategy?

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A) With direct investment, a firm maintains total ownership of its plants, operation facilities, and offices in a foreign country. B) Direct investment occurs when a firm enters a new market by pooling its resources with those of a local firm to form a new company in which ownership, control, and profits are shared. C) Direct investment refers to depositing payroll funds in a foreign bank. D) Direct investment designates the maximum quantity of a product that may be brought into a country during a specified time period. E) Direct investment occurs when a producer sells its offering in a foreign market at a price less than its production cost.

101) When Cisco Systems Inc. of San Jose, California, and Tata Consultancy Services of Mumbai, India, entered into a relationship, they both continued to develop market-ready infrastructure and network solutions for customers, but they relied on each other to provide the training and skills that one or the other might have lacked. This relationship is best described as

A) USMCA. B) a strategic alliance. C) CEU. D) an international partnership. E) a joint venture.

102)

________ offers the firm complete control over its operations in the foreign country.

A) A joint venture B) Franchising C) A strategic alliance D) Exporting E) Direct investment

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103) ABC, Inc. wants to expand into the Central American market. It has the financial resources, wants to control business operations, and has had considerable success marketing to Hispanics in the United States. ABC will likely use ________ to expand into the Mexican market.

A) franchising B) exporting C) a joint venture D) direct investment E) a strategic alliance

104) When entering into a franchise agreement, what term is used to refer to the firm that is granted the right to operate a business using the franchise name and business concept?

A) franchisee B) franchisor C) franchise agent D) franchise partner E) franchised owner

105) Which of the following statements best describes global expansion through a strategic alliance?

A) In a strategic alliance, a firm enters a new market and forms a new company with shared ownership, profits, and controls. B) A strategic alliance is a relationship in which two firms collaborate on a business opportunity but do not invest in each other. C) In a strategic alliance, two firms enter into a franchise agreement. D) In a strategic alliance, a firm in one country sends products to a firm in another country. E) In a strategic alliance, a firm signs a trade agreement with a firm in another country.

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106) The Quantum Company is collaborating with a competitor on a globally based opportunity for mutual benefit, but the two competitors are not investing in one another. This is an example of

A) franchising. B) a joint venture. C) a strategic alliance. D) a direct investment. E) an equity partnership.

107)

The Big Mac Index is a novel measure of

A) GDP. B) purchasing power parity. C) per capita GNI. D) economic growth. E) international trade surplus.

108)

In a(n) ________, the burden of ownership, control, and profits are shared.

A) exporting venture B) direct investment C) joint venture D) direct investment E) strategic alliance

109) Global segmentation, targeting, and positioning (STP) are more complicated than local STP, in part because

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A) consumers may view their roles differently in different countries. B) there are fewer franchising opportunities in global markets. C) global consumer markets are almost totally homogeneous, making segmentation difficult. D) most governments have rules against targeting consumers. E) positioning almost always fails when attempted in a foreign country.

110) As noted in your text, global segmenting, targeting, and positioning are more complicated than domestic segmenting and positioning because of cultural nuances, significant subcultures within countries, and

A) currency differences. B) antidiscrimination regulations prohibiting segmentation and targeting in developing countries. C) differences in the way consumers see themselves and in the way they see products and services. D) complications due to franchising issues. E) the taxes imposed by some foreign countries on marketing activities.

111) Cultural nuances, subcultures, and consumers’ different views of their roles in different countries can make ________ complicated.

A) purchasing power parity B) segmentation, targeting, and positioning C) trading bloc coordination D) exchange control planning E) reducing trade surpluses

112) Which of the following statements regarding global segmentation, targeting, and positioning is true?

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A) Companies must continually adjust products and marketing strategies to meet the changing needs of global markets. B) Global segmentation, targeting, and positioning activities are far less complicated than the same activities in the domestic market. C) When developing a global STP strategy, it is best to define segments by geography alone. D) Segmentation, targeting, and positioning activities for global markets do not differ substantially from that of domestic markets. E) The “golden rule” for global STP activities for firms is to never alter a firm’s marketing mix to serve the needs of global markets.

113)

Which of the following are the two components of a global marketing strategy?

A) understanding foreign currency fluctuations and developing products that can be priced accordingly B) determining which target markets to pursue and developing a marketing mix to obtain a competitive advantage C) understanding the supply chain and distribution networks in foreign markets D) developing culturally appropriate advertising messages and cultivating “domestic” habits among foreign consumers E) adapting to foreign regulations and targeting as many people as possible

114) be

The most important consideration when a firm chooses a global product strategy should

A) opportunities for countertrade. B) the effectiveness of the marketing team. C) the needs of the target market. D) the overall cost of the strategy. E) WTO regulations.

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115) The number of firms with which the seller needs to deal to get its merchandise to the consumer determines the complexity of a

A) global communication strategy. B) channel. C) currency exchange policy. D) home-country market. E) product strategy plan.

116)

Cultural differences such as food preferences, language, and religion also play a role in

A) STP strategy. B) domestic marketing strategy. C) product strategy planning. D) global communication strategy. E) global marketing strategy.

117)

Tariffs, quotas, antidumping laws, and currency exchange policies affect global

A) offshore product design. B) pricing strategies. C) advertising. D) logistics. E) promotion.

118)

Global pricing strategies should strive to be consistent with

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A) offshore distribution facilities. B) the cost of materials. C) positioning strategies. D) domestic pricing. E) trade surplus guidelines.

119)

Global marketers are under constant pressure to simplify distribution channels in order to

A) improve promotion efficiency. B) reduce trade deficits. C) afford tariffs. D) meet trade agreement guidelines. E) reduce costs.

120) Global marketers typically find distribution in developing countries is more complex because

A) they must go through many different types of distribution channels. B) distribution is more heavily regulated in developing countries. C) most consumers in developing countries live in densely populated cities. D) the infrastructure is more advanced in most developing countries. E) consumers in developing countries have very specific preferences.

121) Nenisha had developed an extremely successful advertising and promotion campaign for a client in the United States. The client wanted to roll out the same campaign to markets worldwide, but Denisha cautioned against doing this, most likely because

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A) differences in languages, customs, and culture might make the campaign meaningless and ineffective in some markets. B) copyright and intellectual property concerns prevented him from wanting to share his good ideas outside of the U.S. market. C) she had not applied for or received international certification that was required for working outside the United States. D) she was unfamiliar with the code of ethics for advertising in other countries. E) she did not have the budget for a global rollout.

122)

Glocalization refers to

A) a global marketing strategy in which each of the four Ps is customized for each country. B) the infrastructure in most developing countries. C) the direct investment of payroll funds in a foreign bank. D) the selling of the same product or service in both the home-country market and the host country. E) the international certification required for working outside the United States.

123) Referred to as ________, some firms standardize their products globally but use different promotional campaigns to sell them.

A) glocalization B) globalization C) adaptation D) global communication strategy E) marketing applications

124) Brands can be extremely valuable domestically but challenging internationally. Companies can help overcome language difficulties in using brands by

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A) keeping the brand name the same in all languages, regardless of meanings, as long as the brand logo and symbol are displayed prominently. B) avoiding the use of the brand name in advertising and focusing on feature and benefits. C) translating advertising copy for the entire ad except the brand name. D) developing brand names that have no preexisting meaning in any known language. E) adhering to the UN Convention on Naming Rights.

125) When IKEA opened its store in India, it added some features geared to Indian culture, such as offering vegan Swedish meatballs. This was part of IKEA’s global ________ strategy.

A) communication B) pricing C) distribution D) exchange E) product or service

126) Bainbridge Wood Products decided to sell its dining sets around the globe. Which of the following would be an example of glocalization of these dining sets?

A) The same product design and features, and the same basic promotional campaign, used in all countries. B) Variations in the product design country by country, with the same basic promotional campaign used in all countries. C) The same product design and features in all countries, with variations in the promotional campaigns country by country. D) Variations in the product design and the promotional campaign country by country. E) The same marketing mix for all of the four Ps used in all countries.

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127) The level of economic development, as well as differences in product and technical standards, helps determine the need for and level of product

A) glocalization. B) adaptation. C) segmentation. D) globalization. E) regulation.

128) If you visit a Kentucky Fried Chicken restaurant in China, along with KFC’s regular menu items, you will find congee, a rice porridge that can feature pork, pickles, mushrooms, and preserved egg, on the menu. This is an example of which global product strategy?

A) sell the same products in both the home country market and the host country B) sell only products native to the home country C) sell a product similar to that sold in the home country, but include minor adaptations D) sell only products native to the various global markets E) sell totally new products or services

129) Warren’s Tires sells the same tire globally, but it uses different advertisements based on the country and culture. This is an example of

A) cultural shift. B) glocalization. C) ethnic sensitivity. D) promotional flex. E) unethical marketing practices.

130)

Which of the BRIC nations is most literate?

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A) Russia B) South Africa C) Brazil D) India E) China

131) Kanton Publishing Company learned that when selling overseas, local fulfillment can be more cost-effective, and it also can decrease delivery time and improve customer service. This is an example of a global ________ strategy.

A) communication B) product C) promotion D) distribution E) pricing

132) In China, state control of media is high, so companies are challenged to find ways to get their message to customers. This demonstrates one of the difficulties in crafting a global ________ strategy.

A) communication B) product C) cultural D) distribution E) pricing

133) China has three main languages, and many more dialects. This presents a particular challenge to developing a global ________ strategy.

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A) communication B) product C) cultural D) distribution E) pricing

134) Firms would prefer to manufacture in a country that has a trade surplus, or a higher level of exports than imports. ⊚ ⊚

true false

135) The greater the wealth of a country, generally, the better the opportunity a firm will have in that particular country. ⊚ ⊚

true false

136) Rafi wants information about the infrastructure in the countries his company is planning to export to, so he should gather information about the transportation and communications capabilities in each country. ⊚ ⊚

137)

true false

Tariffs artificially lower prices and make goods more competitive. ⊚ ⊚

Version 1

true false

138) Among the various international trade agreements, the USMCA represents the highest level of integration across individual nations. ⊚ ⊚

139)

true false

The BRIC countries are Bolivia, Russia, Italy, and China. ⊚ ⊚

true false

140) Even as growth in its gross domestic product has slowed, China maintains a thriving retail market of the same magnitude as the United States. ⊚ ⊚

true false

141) Brazil is characterized by strong upper and lower classes, but the middle class has declined in recent years. ⊚ ⊚

142)

true false

Russia lags behind most European countries in use of the Internet. ⊚ ⊚

true false

143) Global expansion often begins when a firm receives an order for its product or service from another country.

Version 1

⊚ ⊚

true false

144) Exporting refers to a situation where a company maintains ownership of its plants, operational facilities, and offices in a foreign country in which it sells its products. ⊚ ⊚

true false

145) Entering into a global franchise agreement exposes a company to higher risk than if the company had entered into direct investment in the country. ⊚ ⊚

true false

146) There is only one global product strategy: to sell a product or service similar to that sold in the home country but include minor adaptations. ⊚ ⊚

true false

147) An effective global pricing strategy can be easily established by setting the same prices in every market around the world. ⊚ ⊚

true false

148) To maximize potential, segments and target markets can and should be defined by more than just geography. ⊚ ⊚

Version 1

true false 45

149) In most European countries, retailers can’t sell below cost, and in others they can’t advertise “before” prices if the product hasn’t been sold at that price for two weeks. ⊚ ⊚

true false

150) Firms with global appeal can run global advertising campaigns and simply translate the wording in the advertisements and product labeling. ⊚ ⊚

true false

151) Global distribution networks that involve wholesalers, exporters, importers, and different transportation systems generally lower costs and prices for products. ⊚ ⊚

Version 1

true false

Answer Key Test name: Chapter 08 Test Bank 31) B 32) B 33) D 34) B 35) E 36) A 37) A 38) B 39) E 40) D 41) C 42) D 43) E 44) A 45) B 46) A 47) B 48) D 49) B 50) B 51) C 52) A 53) E 54) A 55) B 56) E Version 1

57) D 58) A 59) C 60) A 61) B 62) B 63) B 64) D 65) B 66) A 67) D 68) E 69) C 70) C 71) C 72) E 73) E 74) C 75) B 76) A 77) C 78) D 79) D 80) A 81) E 82) C 83) D 84) D 85) B 86) B Version 1

87) A 88) D 89) A 90) B 91) B 92) A 93) A 94) C 95) C 96) C 97) B 98) A 99) A 100) A 101) B 102) E 103) D 104) A 105) B 106) C 107) B 108) C 109) A 110) C 111) B 112) A 113) B 114) C 115) B 116) C Version 1

117) B 118) C 119) E 120) A 121) A 122) D 123) A 124) D 125) E 126) C 127) B 128) E 129) B 130) A 131) D 132) A 133) A 134) TRUE 135) TRUE 136) TRUE 137) FALSE 138) FALSE 139) FALSE 140) TRUE 141) FALSE 142) FALSE 143) TRUE 144) FALSE 145) FALSE 146) FALSE Version 1

147) FALSE 148) TRUE 149) TRUE 150) TRUE 151) FALSE

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Student name:__________ 1) Why must a firm’s STP strategy be consistent with and derived from the firm’s mission and objectives?

2) Assume you are the marketing consultant for your college, which wants to focus its marketing efforts on retention of current students. You have a choice of segmenting the undergraduate student market on either a geographic or psychographic basis. What is the difference between the two? Which would you recommend, and why?

3) Assume you are the marketing consultant for your university, which wants to focus its marketing efforts on recruiting new students. You have a choice of segmenting the undergraduate student market on either a demographic or benefit basis. What is the difference between the two? Which would you recommend, and why?

4) Develop a lifestyle segmentation scheme for students at your university, and label and describe three segments. You can think of this as developing your own version of the VALS tool, but specifically for college students. Version 1

5) Segmentation, targeting, and positioning involve a number of processes, many decisions, and many different options. With all that effort, why are marketers so concerned with STP?

6) Marketers find psychographics a valuable segmentation approach. What are some of the limitations of psychographic segmentation and what can marketers do to offset those limitations?

7) The text states that “geodemographic segmentation can be particularly useful for retailers.” Use a local retailer to describe how geodemographic segmentation could be useful.

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8) Why does loyalty segmentation make so much sense? Describe how a local bakery and coffee shop could employ loyalty segmentation.

Create an example of geodemographic segmentation.

10) Your business is best described as an entrepreneurial start-up venture with limited resources. It sells fall-themed sweaters for children. Describe the marketing strategy that is most beneficial for your company.

11) Identify two methods used in segmenting markets and give an example of a situation where each might be used.

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12)

List the steps in the segmentation, targeting, and positioning process.

13) As the marketing manager of your firm, you are responsible for evaluating segments based on their attractiveness. Identify the five criteria and explain how your firm would use this information to determine if a segment is worth pursuing.

14) Which of the segmentation attractiveness criteria is addressed when Wild Wood Pizza asks the question, “Are there enough employees in the government center to justify targeting the center for lunch delivery service?”

15) Which of the segmentation attractiveness criteria is addressed when Wild Wood Pizza asks the question, “Are private food service companies allowed to deliver pizzas on the military base?”

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16) A laptop manufacturer is considering designing and marketing a left-handed laptop, with the keyboard rearranged to better suit left-handed people. The CEO is left-handed and has pointed out to senior management that over 10 percent of the population is left-handed. It will be expensive to design this new model, so the laptop manufacturer wants to make sure that this is an attractive segment. For each of the five criteria of segment attractiveness, list a question the laptop manufacturer will want to consider in evaluating the attractiveness of “left-handed laptop users” as a segment.

17) Canton’s Canoes identified active retirees living in the retirement community nearby as one of their potential target markets. The company knows it can tailor their service and marketing message to the schedules and interests of this audience. How will Canton’s evaluate the attractiveness of this segment?

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18) Kaelin is looking to expand his lawn-mowing business and wants to evaluate the profitability of a potential new market. The area he is looking at has 400 homes and Kaelin estimates that 10 percent of them would be likely to use his service. He charges $25 per mowing and on average customers mow their lawns 20 times a year. Kaelin estimates the variable costs to expand his business will be $5 per mowing and his fixed costs are $2,000. How much profit would Kaelin make on this new segment?

19) Segment profitability asks marketers to consider segment size, segment adoption percentage, purchase behavior, profit margin percentage, and fixed costs. Select three of these five elements and explain where marketers will find solid quantifiable information to make the calculations.

20) You are employed at a hotel near the University of Virginia and want to increase the hotel’s appeal to the parents of university students. How could the hotel market itself to these parents?

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21) Which of the segmentation attractiveness criteria is assumed by the statement, “Build it, and they will come”?

22) Mobility Matters markets health-care aids such as walkers, crutches, and portable oxygen tanks. It is located in a large city with branches in neighboring suburbs. It needed to determine if one of its stores was profitable or if it should close it. What is the formula for determining profitability?

23) In theory, why is micromarketing the ultimate in STP strategy? What is the weakness associated with micromarketing?

24) Imagine that you are a marketing executive for a company that manufactures baking products, including flour and sugar. What type of marketing strategy would you consider for these products, and why?

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25) Marissa is developing an Internet-based printing business. After establishing her objectives, describing potential market segments, and evaluating the attractiveness of each segment, Marissa now has to choose which target market to focus her efforts on. What factors should influence her decision?

26) Dana is the marketing manager of a company that manufactures salt. How can Isabel use a differentiated targeting strategy?

27) Evaluate why a company would use a micromarketing strategy versus an undifferentiated strategy.

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28)

Write a value proposition for your favorite restaurant.

29) Choose a fast-food restaurant chain that does business in your area. Describe the company’s target market and explain how its marketing mix is designed to appeal to this target market.

30) Create a positioning strategy for your school’s science program. How do you want potential students to view your program?

31) UPS, FedEx, DHL, and the United States Postal Service are four major competitors in the private package delivery market. Choose one of the four firms and describe its positioning efforts.

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32) You are the marketing manager of a company that sells outdoor furniture. When developing the company’s positioning strategy, you choose to position the company’s offerings against the offerings of your competitors. What would you expect your competitors to do?

33) Imagine that you are a marketing executive at a cosmetic company. How would you create and use a perceptual map? What positioning criteria might you use in creating it?

34)

In a perceptual map of two dimensions, how are these dimensions determined?

35)

Why do marketers often use perceptual maps when developing positioning strategies?

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36) Social networking sites that compete directly with Facebook have a difficult time surviving; however, LinkedIn has survived by focusing on the needs of business professionals, who seek to network with colleagues, share their expertise, post online résumés, and look for new jobs. Write a value proposition for LinkedIn.

37) Sanjay is in the new marketing department of a midsized accessories company. He is working on the first marketing plan the firm has ever used. He has defined the mission and objectives, and he just finished a situation analysis for the firm. The next step is to

A) develop an advertising plan to promote the upcoming sales. B) find marketing interns or hire new staff to help with implementation. C) create pro forma financial statements to complete the package. D) identify and evaluate opportunities by conducting segmentation, targeting, and positioning analysis. E) use the Internet, catalogs, and vendor information to draw up a list of new products.

38) Marketers have found that ________ segmentation is often more useful for predicting consumer behavior than ________ segmentation.

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A) demographic; psychographic B) geographic; geodemographic C) psychographic; demographic D) demographic; behavioral E) demographic; benefit

39) Although marketers have found that psychographics are often more useful for predicting consumer behavior than demographics, psychographic segmentation

A) is available only in limited geographic areas. B) is rarely used and unproven. C) offers only one-to-one marketing potential. D) involves knowing and understanding self-values, self-concept, and lifestyles. E) is still an unproven area.

40) ________ segmentation is the segmentation method most directly related to satisfying consumers’ needs and wants.

A) Geographic B) Demographic C) Psychographic D) Benefit E) Geodemographic

41) Let’s Dish is a meal-preparation service operating in three states. Customers visit a Let’s Dish store to select and partially prepare their meals, which are then packaged for the freezer. At home, the customer can pull a meal out of the freezer and warm it in the oven or microwave. If Let’s Dish wanted to expand into new areas of the United States, what segmentation method would probably be most useful in choosing new locations?

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A) loyalty segmentation B) benefit segmentation C) psychographic segmentation D) geodemographic segmentation E) demographic segmentation

42) Social networking sites that compete directly with Facebook have a difficult time surviving; however, LinkedIn has survived by focusing on the needs of business professionals, who seek to network with colleagues, share their expertise, post online résumés, and look for new jobs. What segmentation method is LinkedIn using?

A) loyalty segmentation B) benefit segmentation C) psychographic segmentation D) geodemographic segmentation E) demographic segmentation

43) A university using benefit segmentation and targeting students who want to get a degree quickly while still working full-time would most likely focus on

A) providing classes at convenient times and offering online courses. B) discount pricing for students taking more than 12 credit hours. C) the higher average salaries earned by college graduates. D) the great variety of classes offered. E) the number of Nobel Prize winners on the faculty.

44) The light beer commercial with the slogan “less filling, tastes great” was based on ________ segmentation.

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A) geographic B) geodemographic C) psychographic D) benefit E) loyalty

45) Toothpastes sold in supermarkets and pharmacies promise various results, such as whiter teeth, protection against gum disease, tartar control, or fresh breath. Toothpaste marketers are using ________ segmentation.

A) benefit B) geodemographic C) psychographic D) loyalty E) demographic

46) Best Life Vitamin Corporation targets consumers living in Florida who are over age 65. Golden Years is using ________ segmentation.

A) benefit B) self-actualization C) psychographic D) loyalty E) geodemographic

47)

The first step in the STP process is to

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A) identify the segmentation methods to be used. B) produce a list of strengths and weaknesses of the firm’s past marketing strategies. C) establish the overall strategy or objectives. D) select target markets. E) develop a marketing mix, so that an appropriate segment can later be identified.

48) If values provide an end goal, and self-concept is the way one sees oneself in the context of that goal, lifestyles are

A) visual images of how we should live our lives. B) our underlying motivations. C) how we live our lives to achieve our goals. D) motivations turned into perceptual maps. E) determined by demographics.

49)

Segmentation, targeting, and positioning

A) are terms that can be used interchangeably in developing marketing plans. B) are part of a firm’s marketing strategy. C) should be done simultaneously so synergies can help streamline the effort. D) are part of the marketing plan but bear little direct relationship to the marketing mix. E) are optional elements of a marketing plan.

50) When Derek’s Hardware, a New Jersey-based discount hardware chain, sent snow blowers to its Augusta, Georgia, store in April, it was engaged in

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A) concentrated segmentation. B) geodemographic segmentation. C) benefit segmentation. D) psychographic segmentation. E) misguided geographic segmentation.

51)

Differences in weather and climate create opportunities for

A) concentrated targeting. B) geographic segmentation. C) benefit segmentation. D) psychographic segmentation. E) demographic segmentation.

52) Kellogg’s marketing communications about its Special K cereal appeal almost exclusively to women. This is an example of ________ segmentation.

A) geographic B) psychographic C) demographic D) benefits E) behavioral

53) ________ segmentation is the most common basis of consumer market segmentation because these segments are easy to define and usually easy to reach.

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A) Geographic B) Psychographic C) Behavioral D) Benefits E) Demographic

54) Beer marketers know that high-school-educated, working-class males from the ages of 25 to 40 make an attractive market for their products. This is a ________ segment of the beer market.

A) demographic B) psychographic C) behavioral D) benefits E) geographic

55) Television advertising has recently expanded to include “mini-ads,” which are short ads lasting five to ten seconds. These ads are most useful in advertising to men, since men are more likely than women to channel surf during commercial breaks. Given this fact, this type of advertising will be more useful to marketers engaged in ________ segmentation.

A) demographic B) psychographic C) behavioral D) benefits E) geographic

56)

Demographic segmentation is segmentation based on

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A) product benefits. B) self-value. C) country. D) income. E) lifestyle.

57)

Psychographics is the segmentation method that delves into how consumers

A) adjust to demographic changes. B) allocate scarce incomes to a variety of goods and services. C) describe themselves. D) value their livelihoods. E) believe other people see them.

58) The phrase “birds of a feather flock together” captures the idea of ________ segmentation.

A) geodemographic B) benefit C) psychographic D) loyalty E) geographic

59) The Tapestry ™ Segmentation system divides and sorts small geographic areas into categories using 65 or more demographic and lifestyle characteristics. This market research tool is an example of ________ segmentation.

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A) geodemographic B) benefit C) psychographic D) loyalty E) geographic

60) Which of the following segmentation methods is being used when M&M’s offers special wedding-themed packaging for customized M&M’s (imprinted with the names of the bride and groom)?

A) occasion segmentation B) geographic segmentation C) lifestyle segmentation D) benefit segmentation E) loyalty segmentation

61) Godiva Chocolates produces specially decorated boxes of candies for Valentine’s Day, Easter, and Christmas. This is an example of ________ segmentation.

A) occasion B) loyalty C) geographic D) psychographic E) demographic

62) Sarita is opening an upscale women’s clothing store in a growing suburban residential area. Sarita knows her target market is upper-income women living within 20 miles of her store. She can’t afford to purchase Tapestry analysis, so she will most likely use ________ as a basis for targeting her market.

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A) voter registration lists B) the city phone book C) real estate values by subdivision D) public school enrollment data E) new construction data

63) Geodemographic segmentation can be particularly useful for ________, because customers typically patronize stores close to their neighborhood.

A) Internet marketers B) wholesalers C) retailers D) consumer goods manufacturers E) cable TV networks

64) Retail store chains often use ________ data to tailor each store’s assortment to the preferences of the local community.

A) geodemographic B) benefit C) psychographic D) loyalty E) geographic

65) Marketers often create a special marketing mix for loyalty segments because these segments are

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A) too large to service with ordinary targeting. B) difficult to identify. C) costly to acquire. D) generally profitable. E) constantly changing.

66) When Mario complained to his bank about the unprofessional behavior of one teller, the branch manager added a code into his accounts alerting all tellers that Mario was a valued customer and to provide whatever service he requests. The branch management included Mario in its __________ segmentation.

A) benefit B) geodemographic C) psychographic D) loyalty E) geographic

67) When airlines created frequent-flyer programs, they were among the first retailers to embrace

A) geographic segmentation. B) education segmentation. C) lifestyle segmentation. D) convenience segmentation. E) loyalty segmentation.

68)

One of the reasons marketers use loyalty segmentation is

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A) the high cost of obtaining new customers. B) government tax incentives. C) accounting difficulties associated with identifying new customers. D) rapid population increases. E) the failure of micromarketing as a workable strategy.

69) While demographic and geographic segmentation of retail customers are relatively easy, these characteristics do not help marketers determine

A) how old their customers are. B) what their customers need. C) where their customers live. D) which customers have young children. E) what income brackets their customers are in.

70) Canton’s Canoes initially identified active retirees living in the retirement community nearby as one of its target markets. Canton’s then tailored their service and marketing message to the interests and schedules of that audience. Canton’s initially used ________ segmentation and then used ________ segmentation.

A) micromarketing; loyalty B) lifestyle; macromarketing C) geodemographic; lifestyle D) geographic; loyalty E) behavioral; geodemographic

71) Marketers often employ a combination of segmentation methods, using ________ to identify and target their customers, and ________ to design products and messages to appeal to them.

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A) loyalty segmentation; demographics B) undifferentiated targeting; differentiated targeting C) loyalty segmentation; geodemographics D) demographics and geography; lifestyle or benefit segmentation E) lifestyle segmentation; geographic segmentation

72)

To develop psychographic segments, the marketer must understand consumers’

A) age, income, and education. B) gender, race, and religion. C) disposable personal income, benefit perceptions, and alternative egos. D) self-values, self-concept, and lifestyles. E) buying patterns and behaviors.

73) Vittorio is considering psychographics as a way to segment the market for his small travel agency. This approach to segmentation offers him an advantage because

A) it is based on underlying motivations of target customers. B) it is easier to use than demographics. C) the travel business doesn’t respond well to other approaches to segmentation. D) psychographics is the preferred method for service businesses. E) psychographic segmentation is the least expensive method.

74) Education marketers know that the primary motivations of most nontraditional college students are self-respect and self-fulfillment, so they craft their marketing message to emphasize the benefits these consumers are looking for in a college education. What type of segmentation method was used to segment this market?

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A) psychographics B) demographics C) geographics D) geodemographics E) behavior

75) Baby Boomers represent a huge demographic segment for travel marketers. Baby Boomers are also heavily motivated by self-fulfillment, which creates the possibility of ________ segmentation.

A) geographic B) self-concept C) psychographic D) benefit E) behavioral

76) Beverage companies often use television commercials with images of young people laughing and enjoying themselves on a beach or in a club. These images are designed to appeal to consumers’ ________, suggesting “be like me.”

A) geographic choices B) self-concepts C) loyalty references D) benefit perceptions E) demographics

77) Edmund has found that both commercial and residential real estate buyers respond positively to his marketing communication message. Edmund has identified ________ that respond similarly to his marketing efforts.

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A) mass customization consumers B) geographic segments C) market segments D) self-concept customers E) geodemographic segments

78)

The first step in the segmentation process is to

A) select a target market. B) identify and develop a positioning strategy. C) use a particular method or methods to segment the market. D) articulate the vision or objectives of the company’s marketing strategy clearly. E) evaluate the segment’s attractiveness.

79) Boho Clothing an online trendy women’s clothing site, targets college-educated women between 25 and 40 years old with average household income of $70,000 or more. This is a form of ________ segmentation.

A) benefit B) geodemographic C) psychographic D) demographic E) geographic

80) When Talbots, an upscale women’s clothing store, tries to portray an image of “traditional, conservative, and with good taste,” it is appealing to its target market’s

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A) lifestyle. B) geodemographics. C) demographics. D) loyalty. E) Tapestry segment.

81)

Overriding desires that drive how we live our lives are called

A) self-values. B) self-concept. C) self-esteem. D) self-confidence. E) self-control.

82) When Kellogg’s offers different cereals, such as Cocoa Krispies and Special K, it is segmenting the market by ________ segmentation methods.

A) demographic B) geographic C) loyalty D) geodemographic E) occasion

83) When evaluating the attractiveness of the segment, if a segment is expected to react positively to the firm’s offering, we say that the segment is

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A) responsive. B) identifiable. C) reachable. D) substantial. E) reactive.

84) College students can be a less ________ market segment because students’ media habits are quite diverse, and firms might have to use a wide variety of media to attract this segment.

A) substantial B) perceptive C) identifiable D) reachable E) quantifiable

85) For a segmentation strategy to be successful, the customers in the segment must react similarly and positively to the firm’s offering. In other words, the market segment must be

A) substantial. B) perceptive. C) identifiable. D) reachable. E) responsive.

86) When Starbucks first opened, many critics suggested, “No one will pay $4 for a cup of coffee.” Starbucks’s critics suggested consumers would not be ________ to the company’s offerings.

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A) responsive B) perceptive C) identifiable D) reachable E) quantifiable

87) The manager of Oceanside Yacht Club wanted members of the very upscale club to use the bar and dining facilities more frequently. He offered a two-for-one “happy hour” special, but few members showed up. The manager did not have a grasp of what would make his target market

A) substantial. B) responsive. C) identifiable. D) reachable. E) quantifiable.

88) Venicia is assessing market growth, market competitiveness, and market access for each segment she has identified. Venicia is assessing the ________ of each potential market segment.

A) substance B) responsiveness C) identification D) reach E) profitability

89) After assessing the market growth potential in Brazil for his company’s baby products, Jaime wanted to evaluate market competitiveness. To do this, Jaime would consider

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A) mass marketing of distribution potential and logistical support. B) the current size of the market and the expected growth rate. C) ease of pricing control and number of promotional outlets. D) the number of competitors, entry barriers, and product substitutes. E) profitability and customer buying behavior.

90) After assessing the market growth potential and market competitiveness in Brazil for his company’s baby products, Jaime wanted to evaluate market access. To do this, Jaime would consider

A) ease of accessing or developing distribution channels and brand familiarity. B) the current size of the market and the expected growth rate. C) ease of pricing control and number of promotional outlets. D) the number of competitors, entry barriers, and product substitutes. E) profitability and customer buying behavior.

91)

Which of the following would be used in calculating the profitability of a segment?

A) segment perceptions B) segment size C) geographic segmentation D) demographics E) product positioning

92) Justin is looking to expand his pet grooming business and wants to evaluate the profitability of a potential new market. The area he is looking at has 2,000 homes and Justin estimates that 20 percent of them would be likely to use his service. He charges $45 per grooming and on average customers groom their pets six times a year. Justin estimates his variable costs to expand his business will be $10 per grooming and his fixed costs are $10,000. How much profit would Justin make on this new segment?

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A) $72,240 B) $98,000 C) $108,000 D) $128,000 E) $410,000

93) Fiona is trying to determine whether the segments she is considering for her day care center will be profitable. Which of the following will specifically help her in this analysis?

A) the number of children needing day care in the immediate area B) the number of sports programs available for teenagers C) the percentage of parents in the area who home school their children D) the average number of school-age children in families sending a child to the day care center E) the number of new births predicted in the next decade

94) Automobile manufacturers could build cars specially designed for very short people (for example, under five feet), but it is likely that this segment

A) is not substantial. B) is unreachable. C) is not identifiable. D) will not be responsive. E) is not quantifiable.

95) Darlene has identified four potential market segments for her Don’t Do It Yourself handyman service. The next step is to

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A) categorize each market segment by consumer demographics. B) establish her overall objectives. C) decide on a targeting strategy. D) develop a positioning strategy. E) evaluate the attractiveness of each segment.

96) Darlene has identified four potential market segments for her Don’t Do It Yourself handyman service. She will now evaluate whether or not each segment is attractive relative to all of the following except

A) substantial. B) responsive. C) profitable. D) reachable. E) realistic.

97) Juan has identified four potential market segments for his Rent-A-Mom service. He will now compare the segments to see if they are distinct from each other. Juan is evaluating whether or not each segment is

A) identifiable. B) responsive. C) profitable. D) reachable. E) substantial.

98) Suzanna is concerned that one of the potential market segments she has identified for her mobile veterinary service is too small and has too little income to have sufficient buying power. Suzanna is concerned with whether the segment is

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A) substantial. B) responsive. C) profitable. D) reachable. E) identifiable.

99) Wang wants to sell personal website services to American soldiers in the Middle East. Because of the difficulty of communicating with people in a combat zone, Wang may have trouble with this segment not being

A) substantial. B) perceptive. C) identifiable. D) reachable. E) quantifiable.

100) With access to the Internet nearly universal in the United States, many potential market segments have become more

A) substantial. B) perceptive. C) identifiable. D) reachable. E) quantifiable.

101) Maintaining a unique ________ can be sustained in the long term only in monopoly situations or monopolistic competition situations.

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A) market position B) value proposition C) salient attribute D) marketing communication E) market segmentation

102)

A company that sells only herbal iced tea should use a(n) ________ targeting strategy.

A) concentrated B) differentiated C) micromarketing D) mass E) undifferentiated

103) For products like pencils, which provide the same benefit for all consumers, marketers should probably use a(n) ________ strategy.

A) concentrated targeting B) lifestyle segmentation C) benefit segmentation D) undifferentiated targeting E) differentiated segmentation

104) In a classic example of segmentation strategy, years ago Swift Meat Company transformed turkey meat into “Butterball” turkeys. In doing so, the company

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A) differentiated its product. B) streamlined its delivery process. C) created a new class of micromarketing. D) defined consumers’ basic needs. E) redefined mass customization.

105) Adidas Group owns Reebok, Rockport, and TaylorMade brands. Adidas uses the different brands to pursue a(n) ________ strategy.

A) concentrated targeting B) micromarketing C) benefit targeting D) differentiated targeting E) undifferentiated targeting

106) Adidas Group owns Reebok and Rockport—both of which offer different types of shoes. Having a variety of brands allows Adidas to use a differentiated targeting strategy to

A) engage in micromarketing for hard-to-fit shoe customers. B) obtain a bigger share of the shoe market. C) use mass marketing techniques. D) utilize geographic segmentation. E) generate economies of scale in advertising expenditures.

107) One of the benefits of a differentiated targeting strategy is that it allows the firm to diversify its business and

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A) decrease advertising spending. B) focus on a single market segment. C) lower overall risk. D) use undifferentiated strategies in micro markets. E) more widely market basic commodities.

108) A differentiated targeting strategy can allow a firm to obtain a bigger share of the overall market; this strategy

A) is the cheapest option. B) requires the use of advanced advertising techniques. C) rarely works. D) is likely more costly than an undifferentiated strategy. E) is ineffective without multiple brand names.

109)

Firms use a differentiated targeting strategy because

A) it is easier than mass marketing. B) it helps obtain a bigger share of the market. C) it is better than focusing on individual or small groups of potential customers. D) most market segments are too small to be profitable. E) banks are more willing to extend credit to companies with this strategic approach.

110) When Curt’s Catering first opened, the owner decided to target only events at resorts in its geographic region. Curt’s Catering was using a(n) ________ targeting strategy.

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A) concentrated B) micromarketing C) benefit-driven D) differentiated E) undifferentiated

111)

________ is an extreme form of a targeting strategy.

A) Macromarketing B) Micromarketing C) Benefit marketing D) Differentiated targeting E) Concentrated targeting

112) An engaged couple is meeting with a bakery to order their wedding cake. They want a cake that will represent their individual styles and tastes. Bakeries that cater to such unique requests are pursuing what kind of targeting strategy?

A) macromarketing B) micromarketing C) benefit-based D) differentiated E) undifferentiated

113) Many companies use the Internet to allow consumers to design customized products; for example, Nike allows customers to order shoes with custom color combinations. This is a form of

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A) micromarketing. B) concentrated targeting. C) psychographic segmentation. D) differentiated targeting. E) undifferentiated targeting.

114) Four frequently used targeting strategies are the micromarketing, undifferentiated, differentiated, and __________ targeting strategies.

A) geographic B) benefit-based C) economic D) global E) concentrated

115) Gerardo wants to develop an Internet-based auction business and is working through the STP process. After establishing his objectives, describing potential market segments, and evaluating the attractiveness of each segment, Gerardo now has to

A) differentiate his product line. B) consider future customer loyalty. C) create a perceptual map. D) select a target market. E) divide geographic segments into lifestyle groups.

116)

When selecting a target market, firms will be most successful if they

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A) decide between demographic and geographic segmentation methods. B) seek out opportunities to customize products. C) develop a strong communication plan. D) match the firm’s competencies with a market segment’s attractiveness. E) reposition the brand.

117)

What is the best situation in the Circles for a Successful Value Proposition framework?

A) The firm’s benefits overlap with both customer needs/wants and competitors’ benefits. B) The firm’s offering overlaps with customer needs/wants but not with competitors’ offerings. C) The firm’s offering overlaps with competitors’ benefits but not with customer needs/wants. D) Customer needs/wants overlap with both the firm’s benefits and competitors’ benefits. E) None of the three circles overlaps.

118) In the Circles for a Successful Value Proposition framework, the value proposition is represented by

A) the intersection between customer needs/wants and competitors’ benefits. B) the intersection between the firm’s benefits and competitors’ benefits. C) the intersection between customer needs/wants and the firm’s product’s benefits. D) the intersection between all three of the circles. E) the part of the firm’s benefits that doesn’t overlap with anything.

119) In the Circles for a Successful Value Proposition framework, the portion of the customer needs/wants circle that doesn’t overlap with anything else represents

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A) the firm’s value proposition. B) competitors’ value propositions. C) low-priority needs and wants that customers are willing to give up. D) unmet customer needs/wants. E) unknown customer needs/wants that the firm does not understand.

120)

Which of the following sis a main component of a value proposition?

A) the target market B) the location of the company headquarters C) the ability to mass market D) the price of the product or service being offered E) the financial state of the company

121) ________ involves defining the firm’s marketing mix variables so that target customers have a clear, distinctive, desirable understanding of the firm’s offerings relative to competitors’ offerings.

A) Processing B) Perceptualizing C) Positioning D) Proportioning E) Prospecting

122)

________ compares the price of a product to its benefits.

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A) Market position B) A mass marketing strategy C) A perceptual map D) Value E) A concentrated targeting strategy

123)

Which of the following defines a value proposition?

A) the unique value that a product or service provides to customers B) a special discount offer dropping the price C) an advertisement that talks about value D) a display of the position of products or brands in the consumer’s mind E) the one feature that will prompt a customer to buy the product

124)

Which of the following is a key component of a value proposition?

A) purchase behavior B) intersection of psychology and demographics C) offering name or brand D) loyalty references E) geographic location

125) For each target market, Showall Corporation, a manufacturer of imaging equipment, will engage in positioning, adjusting its marketing mix variables in order to give customers

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A) a more flexible supply chain strategy. B) a perceptual map of the imaging landscape. C) more product features than the competition offers. D) lower prices than the competition offers. E) a clear, distinctive, and desirable understanding of their products relative to competing products.

126) Whenever Liam calls on potential pest control customers, he emphasizes the fact that, unlike the national franchise competitors, he is a local businessperson and has been in business over 20 years. Liam is ________ his business relative to his competition.

A) segmenting B) packaging C) positioning D) pricing E) targeting

127) Vanessa wants to position her financial services company. She can position her services according to

A) the value proposition. B) neighboring retail outlets. C) number of employees. D) an undifferentiated targeting strategy. E) profitability.

128) Whenever the president of the local public university promotes the institution, he emphasizes the university’s price (much lower than neighboring private colleges) and high quality. He is positioning the institution based primarily on

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A) the value proposition. B) product attributes. C) symbols. D) competitive comparisons. E) profitability.

129) We often see advertisements touting a product as being made with natural ingredients or being long-lasting. Marketers using these types of promotions are positioning their products based primarily on

A) the value proposition. B) product attributes. C) symbols. D) competitive comparisons. E) profitability.

130) Frederico was assigned to help create a positioning strategy for his employer’s products based on product attributes. He should consider

A) the features the engineers feel are most important. B) the ways the sales representatives have been positioning the firm’s products. C) the characteristics that helped his firm win a statewide award for excellence in manufacturing. D) what the target market would consider the most important features. E) the safety record of the firm and its products.

131) Almost all U.S. political candidates use some combination of red, white, and blue in their campaign posters. They are trying to position themselves in voters’ minds using

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A) the value proposition. B) salient attributes. C) symbols. D) the competition. E) perceptual maps.

132)

Thomas wants to position his firm against his competitors. In doing so he should

A) never select a competitor in the same neighborhood. B) avoid making the competitor’s product look undesirable. C) avoid looking too much like the competitor so as not to confuse the target segment. D) avoid discussing the strengths of his product so that competitors won’t be aware of his product quality. E) avoid discussing the weaknesses of his competitors, so they won’t retaliate.

133) A ________ is often used to illustrate the position of a firm’s products or brands in consumers’ minds.

A) mass marketing analysis B) psychographic profile C) perceptual map D) loyalty timeline E) Tapestry analysis

134) When a marketer adjusts the marketing mix to give customers a clear, distinctive, desirable understanding of what the product does, the marketer is engaging in

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A) market positioning. B) psychographic segmentation. C) competitive analysis. D) geographic segmentation. E) micromarketing.

135) As it relates to positioning, a _________ displays the position of products or brands in the consumer’s mind.

A) segmentation map B) SWOT analysis C) geographic display D) self-values map E) perceptual map

136) Within a perceptual map, a(n) ________ represents where a particular market segment’s desired product would lie.

A) point of parity B) strategic target C) Tapestry cluster D) ideal point E) benefit centroid

137) “Why create a perceptual map?” asked Don. Andrea, the senior marketing manager, gave him four reasons. Which of the following are valid reasons ?

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A) “It sets our company up for successful micromarketing in 10 years.” B) “It shows how we should segment our market.” C) “It develops an undifferentiated targeting strategy.” D) “It’s a way to show the position of the company throughout the product’s life cycle.” E) “We can easily show where we are positioned and how large the market is.”

138)

The perceptions of ________ are being measured in a perceptual map.

A) competitors B) strategic planners C) the company’s executive team D) the current R&D team E) consumers

139) Of the various methods for segmenting, or breaking down, the market, demographic segmentation is the one that delves into how consumers actually describe themselves. ⊚ ⊚

140)

true false

It would be logical for bathing suit marketers to use geographic segmentation. ⊚ ⊚

true false

141) NASCAR redirected its marketing efforts when a survey indicated that almost 50 percent of its fans were female. This is an example of psychographic segmentation. ⊚ ⊚

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true false

142)

The STP process is made up of strategy, targeting, and promotion. ⊚ ⊚

true false

143) The Value and Lifestyle Survey (VALS) conducted by Strategic Business Insights (SBI) is a widely used tool for geographic segmentation. ⊚ ⊚

true false

144) Giant Food Stores in suburban Washington, DC, adjusts its ethnic food aisle offerings based on the ethnic groups living near each store. Giant Foods is using geodemographic segmentation. ⊚ ⊚

true false

145) A complex product that is best described in writing will be difficult to explain to consumers who are unable to read. For this reason, a segment in which many consumers could not read would be considered unattractive because the consumers would not be responsive. ⊚ ⊚

true false

146) For products like sugar or pepper, marketers should probably use an undifferentiated targeting strategy. ⊚ ⊚

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true false

147) When deciding how to promote his new medical oncology center, Dr. Smith decided that he did not need to throw a large grand opening reception. Instead, he promoted the center to the internal medicine doctors in the area, who were the doctors most likely to refer patients to the center. Dr. Smith was engaged in a concentrated targeting strategy. ⊚ ⊚

true false

148) Positioning strategies generally focus either on how the product benefits the consumer or on how it is better than competitors’ products. ⊚ ⊚

true false

149) Perceptual maps include positions of current brands as well as ideal points where a consumer segment would want a product to be. ⊚ ⊚

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true false

Answer Key Test name: Chapter 09 Test Bank 37) D 38) C 39) D 40) D 41) D 42) B 43) A 44) D 45) A 46) E 47) C 48) C 49) B 50) E 51) B 52) C 53) E 54) A 55) A 56) D 57) C 58) A 59) A 60) A 61) A 62) C Version 1

63) C 64) A 65) D 66) D 67) E 68) A 69) B 70) C 71) D 72) D 73) A 74) A 75) C 76) B 77) C 78) D 79) D 80) A 81) A 82) A 83) A 84) D 85) E 86) A 87) B 88) E 89) D 90) A 91) B 92) A Version 1

93) A 94) A 95) E 96) E 97) A 98) A 99) D 100) D 101) B 102) A 103) D 104) A 105) D 106) B 107) C 108) D 109) B 110) A 111) B 112) B 113) A 114) E 115) D 116) D 117) B 118) C 119) D 120) A 121) C 122) D Version 1

123) A 124) C 125) E 126) C 127) A 128) A 129) B 130) D 131) C 132) C 133) C 134) A 135) A 136) D 137) E 138) E 139) FALSE 140) TRUE 141) FALSE 142) FALSE 143) FALSE 144) TRUE 145) FALSE 146) TRUE 147) TRUE 148) TRUE 149) TRUE

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Student name:__________ 1) During a recent budget cutting session, the finance manager at Topline Mortgage proposed eliminating the marketing research budget. You are the marketing director. What general arguments would you use to defend expenditures on marketing research?

What are the most important elements in the presentation of marketing research results?

3) Kalani was extremely embarrassed. She was giving a presentation on certain research findings to the senior executives of the company. The CEO of the company stopped her in the middle of the presentation and said, “This is not what I asked for or needed. This meeting is over. Reschedule the meeting when you’re prepared.” What do you suppose could have gone wrong, and what should Kalani do?

4) Why would a researcher want to change the sequence of steps in the marketing research process?

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5) Marketing researchers should assess the costs and benefits of conducting research as they define objectives and research needs. What are key benefits and costs?

What is the difference between data and information?

7) If senior management already has made its decision, should marketing research be conducted? What questions should be considered?

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8) If your manager asked you to review invoice data for the last six months to look for any trends or changes, what kind of marketing research activity would you be engaged in? List and fully define the process.

9) Mario is analyzing census data, looking for demographic segments that he can target for his new insurance products. For Mario, what are the advantages of using census data?

10) The CEO of a bank in Wisconsin approaches the marketing director, explaining that the bank is considering expanding into Minnesota. The CEO asks the marketing director to design a research project to collect demographic data about Minnesota residents by county and zip code. What is an inexpensive option for collecting this data?

11) The text lists a number of major syndicated data services including Nielsen and IRI. Obviously, these firms provide value to marketers or they would go out of business. What advantages do syndicated data services provide relative to marketers conducting primary research to address their research needs? What are the disadvantages associated with using syndicated data services?

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12)

What kinds of internal information might be of value to a marketing researcher?

13) With a huge influx of Hispanic consumers into his marketplace, Marcus Wilson, owner of Wilson Motors, wants to know if Hispanic consumers make car purchase decisions differently from his other customers. Assuming that the information does not already exist, which primary data collection method would you recommend and why?

14) Define qualitative research and list two examples of qualitative data collection techniques.

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15) A creative use of social media for marketing research involves building online communities for companies. What are the advantages of an online community?

16)

How might Apple use sentiment mining to identify ways to improve its customer service?

17) McDonald’s introduced its Favorites Under 400 Calories menu, attempting to change consumers’ negative views of McDonald’s as a seller of unhealthy food. It would like to survey customers to see if attitudes are changing, but it would like to collect some qualitative data first. Suggest two approaches—one offline, and one online—that McDonald’s could use to collect qualitative data before designing a survey.

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18) Pete decided to open a health club. His girlfriend Miranda, a marketing manager at a small company, tried to convince him to do some marketing research, but he said, “I know what I don’t like about health clubs; that’s all the information I need. Besides, I can’t afford an expensive research project.” He opened the club in a shopping center about 15 miles from his home. Six months later, his club had very few members and he was running out of cash. List some key types of primary and secondary data Pete could have collected before opening his club that might have helped him be more successful, keeping in mind his limited budget.

19)

What are some of the problems with using secondary data?

20)

In what type of research situations would marketing researchers use in-depth interviews?

21) Carrie has just conducted a focus group for American Airlines, asking participants their opinions regarding new changes that American Airlines is offering its passengers. American’s marketing manager wants to use the results of this focus group to justify immediate changes and new promotional strategies. As the marketing researcher, how would you respond?

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22)

How can developing a questionnaire be part art and part science?

23)

Why are more and more marketing researchers using online surveys?

24) In-depth interviews are expensive and time-consuming. Why do marketing researchers sometimes use in-depth interviews in spite of these disadvantages?

25) Annette is putting together a focus group to discuss students’ concerns about the science curriculum. What should her focus group include?

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26) What is the major advantage of primary data collection, compared to the use of secondary data?

27) Claire is teaching a marketing course at YVS College. She is discussing the vast amount of digital data to which retailers, service providers, and manufacturers have access. How can she describe the way in which firms have incorporated big data?

28)

Describe the purpose and importance of data analytics.

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29) Marketing researchers have access to a great deal of information about consumers. What kinds of pressure might be brought to bear on a marketing researcher that might cause ethical dilemmas?

30) Consumer have once-a-year free access to their credit reports. Many consumers who access their credit reports are surprised by the amount of information collected. What can marketers and marketing researchers do to minimize consumers’ privacy fears?

31) Marketers often have huge amounts of information about their customers. What ethical issue should marketers include in their decisions regarding how to use this information?

32)

The first step of the marketing research process is

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A) designing the research. B) defining the objectives and needs. C) analyzing the data. D) developing an action plan. E) developing insights.

33) Political consultants have been using marketing research for decades to help their candidates understand

A) who makes up the voting public and how to reach them. B) what ethical lapses they can get away with. C) which consumers spend the most money. D) how large their campaign signs should be. E) how to buy the votes they need.

34) Talia subscribes to an Internet service that alerts her whenever other firms in her industry are quoted in the media. Talia is using this type of marketing research primarily to

A) provide a link between her and her production center. B) help her understand the needs of her customers. C) monitor her competitors. D) increase profits through the sale of syndicated data. E) decide how to price her new products.

35) Every month, Dr. Christie takes his staff to lunch and asks them to share patients’ comments and concerns. Dr. Christie uses the lunches as an informal marketing research effort intended primarily to

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A) provide a link between himself and his profession. B) help him understand the needs of his customers. C) monitor his competitors. D) decrease the uncertainty associated with decision making. E) improve profitability.

36)

Data collection begins

A) only after completing the research design process. B) after determining whether there are any objections. C) whenever the researcher wants to. D) after creating the presentation format. E) after analyzing the data.

37)

The marketing research process follows five steps, and researchers

A) may not always go through them in the exact sequence if the situation changes or new information is discovered. B) should maintain the integrity of the process by following each step sequentially and thoroughly. C) often collect data before defining the research objectives. D) should be prepared to present the results before completing the analysis if they are under a great deal of pressure to meet a deadline. E) may follow the process by completing all steps at once instead of planning the process first.

38) The first question a marketing researcher should ask before embarking on a research study is

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A) Who will pay for it? B) Will the research be useful? C) What is the due date? D) What sample size will be needed? E) Should we use structured or unstructured questions?

39) Assuming that a marketing research study will answer important questions and reduce the uncertainty associated with a proposed project, a major question that needs to be addressed before starting the study is

A) How will the results be presented? B) Will observational research be considered intrusive? C) Is top management committed to the project and willing to abide by the results of the research? D) How will the questions be defined? E) Who will manage the research?

40) Just as marketers create value by meeting the needs and wants of consumers, marketing researchers create value if

A) the research is expensive. B) all participants like the research design. C) the research does not cost too much. D) the results will be used in making management decisions. E) the research is finished quickly.

41) Ilana and Gabi are working on a research project to anticipate customer attitudes toward a proposed new product line for their company. They have worked with the marketing manager to determine the answers that are needed and have created a detailed design of the project. Their next logical step will be to

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A) develop a budget. B) begin to collect data. C) summarize their preliminary conclusions to present to managers. D) begin recommending changes to the new product line. E) analyze the data.

42) Academic researchers often jump at the opportunity to conduct a research study, curious to learn more and address unanswered questions for the sake of general knowledge. Businesspeople tend to be more cautious before embarking on a marketing research study, recognizing that primary research is often

A) beyond most managers’ ability to comprehend. B) expensive and time-consuming. C) an academic exercise of little real value. D) an impediment to decisive management. E) of little use in real marketing situations.

43) When Adele decided to open up a tea shop in the center of town, she chose a group of customers who represent her customers of interest. This group is called a

A) sample. B) focus group. C) target market. D) demographic. E) potential customer.

44) You work for a company that sells jewelry. Your manager asks you to conduct research on furniture sales in your area. The problem with this research objective is that

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A) it is irrelevant to the jewelry company. B) the information is available from external sources. C) it will lead to a set of unstructured questions. D) it probably can’t be determined with any level of accuracy. E) the research will be costly.

45) Marketing executives at Duracell want to analyze the number of Energizer customers who switch to its battery when Duracell is offered at a deep discount. What data would likely show this information?

A) secondary panel data B) internal secondary data C) primary panel data D) primary internal data E) scanner data

46) The manager of a company selling Internet service in rural U.S. markets asks you to conduct survey research into the question, “What percentage of people in Iowa live in communities of fewer than 10,000 people?” The problem with this research objective is that

A) it is irrelevant to the cellular company. B) it is already known and available from the U.S. Census Bureau. C) it will lead to a set of unstructured questions D) it probably can’t be determined with any level of accuracy. E) the research will be costly.

47) After defining objectives and research needs, the next step in the marketing research process involves

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A) research evaluation. B) data collection. C) data analysis. D) research design. E) report writing.

48) During the research design step of the marketing research process, researchers identify the type of data needed and

A) the statistical software to be used. B) the dates when data will be collected. C) the forum in which the data will be presented. D) the identities of research participants in the project. E) the type of research necessary to collect the data.

49) Raoul’s custom auctioneering service provides online auction selling assistance. Raoul plans to conduct marketing research to determine which auction site is best for his customers. His next step is to

A) identify the type of data he needs. B) determine the statistical software he will use. C) outline the presentation format he will use. D) collect data. E) define his privacy policy.

50)

Company sales invoices, census data, and trade association statistics are examples of

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A) primary data. B) data mines. C) secondary data. D) tertiary data. E) qualitative data.

51) If a wireless company had 100 million subscribers at the end of the year, and 2 million of its subscribers left its service, it would have a churn rate of

A) 1 percent. B) 2 percent. C) 5 percent. D) 10 percent. E) 20 percent.

52) Before deciding on a new promotional campaign, Sonny’s Cards looked at its customers’ buying patterns over a 15-year period as determined by their use of a loyalty card. What method did Sonny’s use to make sense of the data that were available?

A) biometrics B) neuromarketing C) data mining D) data warehousing E) panel data

53) Scanner data are used in quantitative research obtained from scanner readings of Universal Product Code (UPC) labels at checkout counters. The data from these purchases are likely to be acquired by leading marketing research firms such as ________, which use this information to help leading consumer packaged-goods firms (e.g., Kellogg’s, Pepsi, Kraft) assess what is happening in the marketplace.

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A) MediaMark Research and NOP World B) NOP World and Yankelovich C) Roper Center for Public Research and Research and Markets D) Yankelovich and Research and Markets E) IRI and Nielsen

54) Both major political parties have developed proprietary databases that contain vast information about voters, broken down by demographic and geographic information. This kind of information is

A) primary data. B) secondary data. C) syndicated data. D) neuromarketing. E) qualitative research.

55) Eduardo needs to find information about income and age distribution in Dallas County, Texas. The best source of secondary research of use to Eduardo is likely to be

A) door-to-door surveys. B) focus group interviews. C) syndicated data. D) sales invoices at public libraries. E) U.S. Census data.

56)

Commercial research firms, such as IRI and Nielsen, are sources of

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A) primary data. B) internal secondary data. C) data mining. D) syndicated data. E) public data.

57) Nelson is looking for data to help with a new marketing research study. When reviewing existing secondary data from a past research study, Nelson should pay careful attention to

A) how the secondary data were collected. B) where the data were warehoused. C) whether or not the Census Bureau has certified the research. D) whether the data were transformed into information. E) how often primary data were substituted for secondary data.

58)

A marketing research project often begins with a review of the relevant ________ data.

A) primary B) secondary C) quantitative D) unfocused E) structured

59) Imagine that you currently operate a coffee shop, and you want to add another shop in a new location. You need to obtain data to determine the size of your potential market. Which data source would you use?

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A) U.S. Bureau of the Census B) J.D. Power and Associates C) NOP World D) Mediamark Research Inc. E) National Purchase Diary Chanel

60) With more than 310 million active customers and billions of pieces of shopping data, Amazon qualifies as a

A) big data user. B) syndicated data user. C) mining data user. D) panel data user. E) survey data user.

61) Roberto is reviewing secondary data his company collected about seasonal variations in consumer spending because he is thinking about developing a new product line. The advantages of using these data include

A) they are new and can be used to project overall demand. B) they can be quickly accessed at a relatively low cost. C) they are historical data that can be used to accurately predict future trends. D) they have been collected specifically for the purpose Roberto is using it for. E) their high cost can be justified by the results.

62) Through analysis of sales data, Lots of Lots retail store found that customers who bought peanut butter also tended to buy bananas. Lots of Lots was engaged in

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A) syndicated surveying. B) focus group analysis. C) behavioral analysis. D) data mining. E) structured sampling.

63) Walmart is known for its efficient logistical systems. Every time consumers buy something, that purchase is recorded and sent to company headquarters, where it is used to generate reorders to vendors. In addition, customers’ billions of purchases are analyzed to uncover patterns of consumers’ purchasing behavior. This is an example of

A) data isolation. B) data mining. C) secondary data collection. D) sentiment mining. E) qualitative research.

64) If a firm has demographic and purchasing information about its customers, the firm can use data mining techniques to

A) understand psychographic motivations. B) create marketing mixes based on consumer self-values. C) build separate marketing programs for different demographic segments. D) determine which syndicated data warehouse services to purchase. E) find out which competitors its customers purchase from.

65) Eduardo needs to find information about income and age distribution in Dallas County, Texas. The best source of secondary research of use to Eduardo is likely to be

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A) door-to-door surveys. B) focus group interviews. C) syndicated data. D) sales invoices at public libraries. E) U.S. Census data.

66) Jaleel is the marketing manager for a moderately well-known rock band. He wants to know more about industry trends including sales by different musical styles, online downloads, and concert attendance. Jaleel will most likely use ________ to gather this type of data.

A) focus groups B) observation C) syndicated data D) sales invoices E) census data

67) Each time you go to the grocery store and have your purchases scanned while using a loyalty or bonus reward card, you are contributing to a database that can help marketers determine

A) what a typical shopping list looks like. B) what types of vacation you prefer. C) your interest in the stock market. D) the college that you attended. E) other stores where you buy similar products.

68) Supermarkets collect information about individual customers through their use of loyalty cards, and then analyze the data to look for patterns in purchases. This is an example of

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A) data mining. B) data recovery. C) data entry. D) data analysis. E) data modeling.

69)

Which of the following statements best describes secondary data?

A) Secondary data are pieces of information that have been collected prior to the start of the focal research project. B) Secondary data are those data collected to address specific research needs. C) Secondary data collection is always extremely time-consuming and expensive. D) Secondary data will always meet the researchers’ needs. E) Secondary data include only qualitative research.

70) The number of participants who discontinue their use of a service divided by the average number of total participants is called

A) churn. B) customer retention. C) customer lifetime value. D) cancellation cost. E) customer loyalty.

71)

Which of the following data sources would be considered external secondary data?

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A) in-depth interviews B) focus groups C) newspaper articles D) observation E) experiments

72) Which of the following types of data would be the best choice for McDonald’s fast-food restaurants if the headquarters office wants to know how many hamburgers versus chicken sandwiches it has sold in past years?

A) internal secondary data B) external secondary data C) survey responses D) focus group data E) primary data

73) A restaurant chain is working on improving the quality of its food and service. To track its progress, it recruits customers who agree to respond to customer satisfaction surveys once every three months over the next two years. What kind of data is the restaurant chain collecting?

A) panel data B) internal secondary data C) focus group data D) external secondary data E) scanner data

74) The term ________ refers to the enormous amount of information that firms now have access to but cannot handle using conventional data management and data mining software.

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A) big data B) churn C) data mining D) data dump E) information overload

75) Fisher-Price wanted to determine if a new toy would appeal to preschoolers, so it put six 4-year-olds in a room with several toys and waited to see which ones they played with. What form of research is this?

A) experiment B) focus group C) observation D) neuromarketing E) panel

76)

When a research team has gathered data for specific research needs, this is known as

A) primary data. B) data mining. C) secondary data. D) data recovery. E) data modeling.

77)

Which of the following is an unstructured question?

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A) “What are the most important characteristics for choosing a brand of shampoo?” B) “How satisfied were you with your last shampoo purchase: very unsatisfied, unsatisfied, neutral, satisfied, or very satisfied?” C) “Were you happy with the quality of the shampoo you purchased (Yes/No)?” D) “On a scale from 1 to 5 (with 1 being very unimportant and 5 being very important), how important is fragrance when choosing a shampoo?” E) “How many brands of shampoo have you purchased in the past year: 0, 1, 2, 3, 4, 5, or more than 5?”

78) McDonald’s introduced a Favorites Under 400 Calorie Menu as part of an attempt to reverse the perception that McDonald’s sells only unhealthy food. Suppose that McDonald’s, as a follow-up, collects and analyzes social media posts from Facebook, Twitter, and similar sites, hoping to understand whether or not consumer perceptions are improving. This would be an example of

A) quantitative research. B) an online focus group. C) sentiment mining. D) neuromarketing. E) an experiment.

79)

How might a book publisher use blogs in its marketing research efforts?

A) as a place to report marketing research results to top management B) as a source of reviews of its latest releases C) as a location for holding online focus groups about its books D) as a location for conducting online experiments about book purchasing patterns E) as a substitute for large-scale surveys about future book topics

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80) What type of interview contains a small group of participants and a trained moderator that guides the conversation?

A) panel B) syndicated C) observational D) focus group E) sentiment

81) Which of the following provides the information needed to confirm insights and hypotheses and help managers pursue appropriate courses of action?

A) quantitative research B) qualitative research C) observation research D) in-depth interviews E) social media monitoring

82)

Which of the following types of research would be considered quantitative research?

A) experimental research B) observational research C) focus group research D) social media monitoring E) in-depth interviews

83) Once a marketing researcher is ready to move beyond preliminary insights to specific, informed questions, the researcher is ready to conduct

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A) quantitative research. B) data warehousing. C) syndicated marketing surveys. D) qualitative research. E) research design.

84)

Which of the following are considered qualitative research?

A) experiments B) panel data C) focus groups D) surveys E) scanner

85) When the marketing research problem is not clearly defined, a researcher will likely engage in ________ research.

A) data mining B) qualitative C) survey D) quantitative E) experimental

86) Recently, the number of students enrolled in the marketing program dropped while enrollment in the science program increased. The chair of the marketing department will probably use ________ as a first step to gain a better understanding of why enrollments are changing.

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A) experimental research B) data warehousing C) syndicated data D) qualitative research E) structured questionnaires

87)

Quantitative research offers a means to confirm ideas through

A) surveys or experiments. B) in-depth interviews. C) data mining. D) qualitative research. E) informal analysis.

88) Dianne’s Discount Clothing store is in a strip mall. She wants to know what other businesses in the strip mall her customers visit when they come to her store. To collect information for this objective, Dianne will most likely use

A) door-to-door surveys. B) focus group interviews. C) observation. D) sales invoices. E) census data.

89)

Which of the following is true about quantitative research?

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A) It is always conducted using primary data collection. B) It revises the research objective based on data mining. C) It confirms insights and hypotheses generated via qualitative research. D) It offers conclusions that are always correct. E) It includes focus group interviews.

90) The purpose of ________ is that it provides information needed to confirm insights and hypotheses generated and helps managers pursue appropriate courses of action.

A) primary data collection B) data mining C) qualitative research D) quantitative research E) statistical sourcing

91) Bethany’s Bakery is trying to determine what price to charge for its cookies, so Bethany places a low price on them and raises it each week, keeping track of how many she sells. Then she determines what her cost was for the cookies and determines which price was the most profitable. What form of research was Bethany conducting?

A) observation B) survey C) scanner-based D) an experiment E) a panel

92)

Qualtrics, SurveyMonkey, and SurveyGizmo are examples of

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A) online survey software. B) biometric data companies. C) data warehouses. D) syndicated data companies. E) focus group programs.

93)

Which of the following is an example of an unstructured question?

A) “Would you buy this product (Yes/No)?” B) “Would you buy this product (A. definitely, B. maybe, C. definitely not)?” C) “What would convince you to buy this product (A. lower price, B. larger packaging, C. better taste)?” D) “Please rate the attributes of this product that are important to you (rate 1–5, with 1 being most important and 5 being least important).” E) “Why did you buy this product?”

94) When consumers are ________, observation becomes particularly useful in understanding consumers’ preferences.

A) unwilling to participate in research B) confused by questionnaires C) unable to articulate their experiences D) interviewed too frequently E) highly educated

95) When consumers are unable to articulate their experiences, ________ becomes particularly useful in understanding consumers’ preferences.

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A) observation B) surveying C) in-depth interviewing D) primary data mining E) a focus group

96) Using ________, trained researchers ask questions, listen to and record the answers, and then pose additional questions to clarify or expand on a particular issue.

A) questionnaires B) experiments C) in-depth interviews D) primary data mining E) observation

97) Omar is responsible for marketing and marketing research for a midsized manufacturer of assemblies for the housing market. His boss has asked him to cut back expenses, especially in marketing research: “Why can’t you just use information off the Internet? There’s plenty out there.” What is Omar’s best response to try to get his boss to change his mind? A) “We can try, but if it’s wrong it’s not my fault.” B) “Those are secondary data, and they may not be as timely, accurate, and relevant as what we need.” C) “I’d rather not use any data at all than use secondary data.” D) “This is a matter of principle. I quit.” E) “You should never use any information from the Internet in marketing research.”

98) Social media monitoring, in-depth interviews, and focus groups are all ________ research methods.

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A) quantitative B) data warehousing C) syndicated marketing D) qualitative E) structured

99) Jerome wants to collect considerable information about the current opinions of his ten most important customers. Jerome will probably use the ________ research method.

A) social media monitoring B) experimental C) in-depth interview D) primary data mining E) observation

100) Which of the following research methods would be best in helping a marketer understand how people feel about a product or service on an individual, detailed level?

A) focus groups B) surveys C) social media monitoring D) primary data mining E) in-depth interviews

101) When the detailed opinions of a few industry experts or experienced consumers are needed, ________ is(are) often the best qualitative research method.

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A) observation B) surveys C) social media studies D) in-depth interviews E) secondary data mining studies

102)

A typical focus group has ________ members.

A) 2 to 4 B) 4 to 6 C) 6 to 8 D) 8 to 12 E) 12 to 15

103) Vikram stood outside the mall and asked people which stores they visited and if they bought anything. If they said yes, he asked them what they bought and how they came to the decision to buy that item. What form of research was Vikram most likely conducting?

A) questionnaire B) in-depth interviews C) experiment D) focus group E) biometrics

104)

Firms that are engaged in sentiment mining are analyzing data collected from

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A) experiments. B) in-depth interviews. C) focus groups. D) social media sites. E) observations.

105) Rod wants to do an online survey of college professors about the factors that influence their textbook selection. He would like to use a structured survey but is not sure what responses to include for each question. Rod could use ________ to help him develop his survey.

A) in-depth interviews B) experiments C) surveys D) observation E) primary data mining

106) Helene manages an upscale women’s clothing store. She wants more information about her customers’ general feelings about upcoming fall fashions. Helene will most likely use ________ to gather this type of data.

A) door-to-door surveys B) focus group interviews C) syndicated data D) sales invoices E) census data

107) After reviewing the existing data on seasonal spending by his company’s customers, Nelson decided he needed new information collected to address his research questions. Nelson will need ________ data to address the questions in his marketing research study.

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A) primary B) secondary C) mined D) syndicated E) warehoused

108) A(n) ________ is a small group of people brought together for an intensive discussion of a topic.

A) focus group B) social media site C) experiment D) data mining session E) in-depth interview

109)

In a focus group, researchers usually videotape or audiotape the session in order to

A) evaluate the potential for in-depth interviews. B) catch any patterns of verbal or nonverbal responses. C) post the videos on the corporate website. D) avoid asking repetitive questions. E) create survey instruments to send to the participants.

110) Samson is concerned about a competitor’s new line of outdoor barbeque grills that provide most of the same features as his products. Samson might consider using ________ to gather qualitative information from consumers about the competitor’s offerings.

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A) industry surveys B) experiments C) focus groups D) observation E) primary data mining

111) Chen has hired a marketing research company to bring together a small group of soft drink consumers and get feedback on the three new advertising slogans his firm is considering. The marketing research firm might conduct a(n) ________ to provide the information Chen has requested.

A) industry survey B) experiment C) focus group D) observational study E) primary data mining analysis

112) When conducting a research study attempting to understand what features were most important to automobile consumers, O’Malley Research used a questionnaire containing ________ questions, with a predetermined set of response options.

A) structured B) in-depth interview C) open-ended D) free-form E) unstructured

113) Gabriel had no idea how consumers would respond to a survey about attitudes toward a program opening up space travel to private citizens. He could use ________ to allow respondents to answer in their own words.

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A) secondary data B) an observational study C) an experiment D) a structured questionnaire E) a survey with open-ended questions

114) The owner of Gilmo BMW Dealership wanted to know why consumers chose his company to purchase a car. He was fairly sure that most customers had one of three reasons— service, reputation, or location—but wanted to know which was revealed as the most frequent reason for purchasing. Gilmo will probably use a survey with ________ questions to address his research problem.

A) observation-based B) open-ended C) experimental D) closed-ended E) unstructured

115) In the infamous Coke-New Coke taste test, 54 percent of consumers, using a blind taste test, preferred the New Coke formula to the existing formulation. This is an example of a(n) ________ marketing research method.

A) qualitative B) quantitative C) observational D) syndicated E) invalid

116)

Which of the following are guidelines for developing a marketing research questionnaire?

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A) Questions should not be able to be answered easily. B) Include multiple issues in each question to save space. C) Leading questions will help you get the results you want. D) Questions should use vocabulary respondents are familiar with. E) Make sure your question only presents one side of an issue.

117) In questionnaire design, a question such as “When was the first time you went to a dentist?”

A) is a question that respondents cannot easily or accurately answer. B) is a question that respondents are reluctant to answer because the information is sensitive. C) leads respondents to a particular response. D) asks two questions at once. E) is complex and something respondents may be unfamiliar with.

118) In questionnaire design, a question such as “Advertising is the best part of the business program, isn’t it?”

119) In questionnaire design, a question such as “Do you like Burger King’s hamburgers and fries?”

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A) is a question that respondents cannot easily or accurately answer. B) is a question that respondents are reluctant to answer because the information is sensitive. C) steers respondents to a particular response. D) asks two questions at once. E) is complex and something respondents may be unfamiliar with.

120) In questionnaire design, a question such as “Do anti-lock braking systems reduce car accidents?”

121) Charlotte wants to survey recent customers about the quality of service they received at her small florist shop. She has customers’ mailing and email addresses. Charlotte will likely use an online survey primarily because it offers

A) relatively low response rates. B) the ability to share video with respondents. C) the ability to ask sensitive questions with anonymity. D) fast responses at a lower cost. E) the opportunity to survey both existing and potential customers.

122) ________ research is a type of quantitative research that manipulates variables to help determine cause and effect.

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A) Descriptive B) Syndicated C) Manipulative D) Focus group E) Experimental

123) Inez is the campaign manager for a congressional candidate. She wants to know how voters across her district feel about recent sexual harassment scandals involving politicians. Inez will most likely use ________ to gather this type of data.

A) surveys B) observation C) experiments D) voter registration data E) census data

124)

A major advantage of primary data collection is

A) it can be easily accessed through syndicated databases. B) it offers behavioral insights generally not available from secondary research. C) it takes less time to collect than secondary data. D) it is general enough to meet many different researchers’ needs. E) it is less expensive to collect than secondary data.

125) ______ is a disadvantage of secondary research, while ________ is a disadvantage of primary research.

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A) Cost; outdated information B) Time required for collection; sources not original C) Potential bias; cost D) Outdated information; information not relevant to data needs E) Sophisticated training required to obtain it; potential bias

126)

A major disadvantage of primary data collection is

A) it can be accessed only through syndicated databases or unstructured data mines. B) it cannot be tailored to meet specific research needs. C) it requires more sophisticated training and experience to design the study and collect data. D) it is too general to meet researcher’s and manager’s needs. E) it does not offer behavioral insights that can be obtained from secondary data.

127) Darnell is reviewing an accumulation of collected data. He wants to be sure that this data has been collected from trustworthy sites. On which of the five Vs of big data should Darnell focus?

A) value B) volume C) veracity D) variety E) velocity

128) A valuable use of big data involves how data collected from social media communities allows you to

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A) heighten customer service and engagement. B) be confident in the trustworthiness of the information. C) take a long time to respond to customers. D) use observation as a research method. E) gather feedback from a small number of participants.

129) A new form of self-reporting, used by Crest and other manufacturers to identify how consumers use their products, involves

A) recording the steps they take while performing a routine task. B) taking selfies while performing normal routine tasks. C) writing down the times during which they perform routine tasks. D) performing routine tasks during a Zoom interview. E) completing a daily online survey about their routine tasks.

130) What tools help marketers make sense out of the data and use it to make appropriate business decisions?

A) data mining B) marketing analytics C) syndicated data D) churn E) observation

131) Kohl’s wants to target the unique customers that shop in each store. To distribute the correct colors and styles to each area, Kohl’s uses

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A) marketing analytics. B) biometric data companies. C) data warehouses. D) syndicated data companies. E) customer selfies.

132)

What is the difference between predictive analytics tools and actions analytics tools?

A) Prescriptive analytics tools use simulations, which ask a series of what if– type questions, while action analytics tools use optimization techniques. B) Prescriptive analytics focus on organizing, tabulating and depicting available data, while action analytics focuses on artificial intelligence algorithms used to analyze input gathered from various data bases. C) Prescriptive analytics tools use simulations, which ask a series of what if–type questions, while action analytics tools use artificial intelligence to analyze input gathered. D) Prescriptive analytics organize, while action analytics use simulations for analyses. E) Prescriptive analytics uses artificial intelligence to analyze input, while action analytics organize and tabulate data.

133) Which of the following are guidelines provided by the American Marketing Association for conducting marketing research?

A) Personal information about research participants should not be shared, except with a designated member of senior management. B) Selling or fund-raising should not be conducted under the guise of conducting research. C) Researchers may misrepresent data to get the results they need. D) The research company should be allowed to modify the final presentation to better support the client’s perspective. E) Researchers should omit data that do not support their objective.

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134) Kellogg’s used ________ to record participants’ faces as they watched three different ads for its Crunchy Nut cereal. It then assessed when they smiled or frowned and their overall positive versus negative response.

A) facial recognition software B) data mining C) social media monitoring D) illegal surveillance methods E) sentiment mining

135)

What is neuromarketing?

A) the analysis of consumer comments on social media in order to understand consumers’ thoughts and opinions B) the use of psychological principles to design marketing research studies C) the process of examining consumers’ brain patterns to determine their responses to marketing communications, products, or services for the purpose of developing marketing tactics or strategies D) the use of neural networks to perform data mining and develop marketing insights E) the use of in-depth interviews to map detailed networks of information storage in the brain

136)

Which of the following is an example of secondary research?

A) surveys B) observed customer behavior C) experiments D) journal articles E) focus group interviews

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137) Kellogg’s used ________ software to assess when they smiled or frowned and their overall positive versus negative responses as they watched three different ads for its Crunchy Nut cereal.

A) social media B) neuromarketing C) facial recognition D) Internet tracking E) data mining

138) ________ plays an important part in protecting privacy and requires companies to disclose their privacy practices to customers on an annual basis.

A) The Center for Democracy & Technology B) Google C) The Electronic Privacy Information Center D) The Federal Trade Commission E) Amazon

139) ________ is the process of examining consumers’ brain patterns to determine their responses to marketing communications, products, or services for the purpose of developing marketing tactics or strategies.

A) Data mining B) Neuromarketing C) Facial recognition D) Scanning E) Qualitative research

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140) Companies are legally required to disclose their privacy practices to customers on a(n) ______ basis.

A) monthly B) quarterly C) annual D) biannual E) weekly

141) From charitable giving to medical records to Internet tracking, consumers are more anxious than ever about

A) secondary data retrieval systems. B) exploitation by foreign marketers. C) their ability to get credit cards. D) their fundamental right to privacy. E) the unstructured nature of marketing research.

142) When conducting a survey about choosing vacation destinations, Michele should ________ in order to get reluctant respondents to provide honest information.

A) choose only highly verbal consumers B) assure consumers that their individual responses will be kept confidential C) use only focus group interviews D) ask unstructured questions E) create an efficient data warehouse

143) One of the benefits of marketing research that it reduces the uncertainty under which managers make decisions.

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⊚ ⊚

true false

144) The marketing research process follows five steps, and to be effective they must be followed in order without omitting any steps. ⊚ ⊚

true false

145) Renee is looking at the results of a syndicated study conducted two years ago. She is looking at primary data. ⊚ ⊚

true false

146) Carrie is analyzing and interpreting data. In the process, she is converting data into information. ⊚ ⊚

true false

147) Data that have been collected prior to the start of the current research project are considered primary data. ⊚ ⊚

148)

true false

Primary data include external as well as internal data sources. ⊚ ⊚

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true false

149)

The terms external secondary data and syndicated data mean the same thing. ⊚ ⊚

true false

150) When companies store information on customers’ purchase histories in large computer files, it is known as data warehousing. ⊚ ⊚

true false

151) Harry is conducting a marketing research project. He is not sure what questions to ask or what types of consumers he should talk to. Therefore, Harry should begin by conducting quantitative research. ⊚ ⊚

true false

152) Melinda is in a group of 8 to 12 people and is being asked questions by a trained moderator. She is part of an in-depth interview group. ⊚ ⊚

true false

153) An example of sentiment mining is when survey data are analyzed in depth to determine consumer attitudes toward a product. ⊚ ⊚

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true false

154) A disadvantage to using secondary data is that they might not be precisely relevant to the information needed. ⊚ ⊚

true false

155) Neuromarketing is the process of examining consumer’s brain patterns to determine their responses to marketing communications, products, or services for the purpose of developing marketing tactics or strategies. ⊚ ⊚

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true false

Answer Key Test name: Chapter 10 Test Bank 32) B 33) A 34) C 35) B 36) A 37) A 38) B 39) C 40) D 41) B 42) B 43) A 44) A 45) A 46) B 47) D 48) E 49) A 50) C 51) B 52) C 53) E 54) B 55) E 56) D 57) A Version 1

58) B 59) A 60) A 61) B 62) D 63) B 64) C 65) E 66) C 67) A 68) A 69) A 70) A 71) C 72) A 73) A 74) A 75) C 76) A 77) A 78) C 79) B 80) D 81) A 82) A 83) A 84) C 85) B 86) D 87) A Version 1

88) C 89) C 90) D 91) D 92) A 93) E 94) C 95) A 96) C 97) B 98) D 99) C 100) E 101) D 102) D 103) B 104) D 105) A 106) B 107) A 108) A 109) B 110) C 111) C 112) A 113) E 114) D 115) B 116) D 117) A Version 1

118) C 119) D 120) A 121) D 122) E 123) A 124) B 125) C 126) C 127) C 128) A 129) B 130) B 131) A 132) C 133) B 134) A 135) C 136) D 137) C 138) D 139) B 140) C 141) D 142) B 143) TRUE 144) FALSE 145) FALSE 146) TRUE 147) FALSE Version 1

148) FALSE 149) FALSE 150) TRUE 151) FALSE 152) FALSE 153) FALSE 154) TRUE 155) TRUE

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Student name:__________ 1) When looking to purchase a mobile phone, describe the components that make up the total product.

2) When personal computers were new, people spent considerable time and energy learning about and investigating choices and options. Now, many consumers replace old computers with little research or investigation. In terms of types of products (specialty, shopping, convenience, and unsought goods), how have personal computers changed?

Define convenience, shopping, and, unsought products and give an example of each.

4) Differentiate between breadth and depth of a firm’s product mix by choosing a familiar company and explaining how its products exemplify these two concepts.

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5) Procter & Gamble, like any major consumer products company, is always looking for opportunities to expand its product lines. What two industry factors often influence product line expansion decisions?

6) Though most colleges are nonprofit organizations, they are engaged in marketing strategy choices, just like businesses. For example, colleges must decide if they should increase or decrease product mix breadth or increase or decrease product line depth. Using your college or university, describe a real or plausible example of each of these four potential changes.

What are the brand components used by your college/university?

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Strong brands can reduce marketing costs. How do they accomplish that?

What are the ways that brands add value?

10) Believe it or not, Walmart’s first designer label clothing brand is called George. Few Americans know the George brand, but in Britain it is well regarded and sold in stand-alone George stores. What would be the benefits to Walmart if the George brand of clothing became recognized and desired in the United States?

11)

How do marketers measure the value of a brand?

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12) Creating brand awareness is the first step in creating brand equity. Political candidates know name recognition is critical to success—particularly for incumbents to get reelected. If you were a marketing adviser to a challenger for the congressional seat in your district, what would you recommend the candidate do to create brand/name awareness?

13)

Almost every business wants brand-loyal customers. Why?

14) Think of the car you are currently driving, or an article of clothing you are wearing. Name three brand associations that are common with this car or clothing. Explain how these associations might influence someone’s decision to buy these products.

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15) What do the following brands have in common: Band-aids, Kleenex tissues, and Clorox bleach?

16) What are consumers likely to do if they perceive an inexpensive brand to have about the same quality as a premium brand?

17) Inez was surprised to learn that the mortgage company she was just hired by does not have a CRM program. Why should the company have a CRM program, and what CRM efforts should Inez recommend?

18)

Why would a huge retailer like Costco carry national brand products?

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19) The company Nils works for has just acquired a regional athletic apparel chain. The chain has a very strong reputation among consumers in the states in which it operates. The acquired company owns several private-label brands. Nils has been asked to prepare a brief about the options for retaining the private-label brands that the chain had been selling. What are the key points Nils should include?

20) Why do manufacturers like Kraft spend millions of dollars annually creating and maintaining their brands? Why don’t they just manufacture their products and sell them under store-brand labels?

21)

Provide a real-world example of a national brand and a private-label brand.

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22)

What is the advantage of a corporate or family brand? Provide an example of one.

23) Imagine you are stopping at the grocery store on your way home from class to buy food for lunches for the rest of the week. Make a shopping list, and designate which items are manufacturer brands and which are private-label brands.

24) Walt Disney Company announced it would no longer allow its characters to be used in promoting unhealthy foods. In branding strategy, what does this change? From both ethical and marketing perspectives, does this change make sense?

25) Why would a company like Walmart have a difficult time repositioning itself as a retailer of quality, stylish clothing?

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26)

What is brand extension? Provide an example of brand extension.

27)

What is cobranding? Provide an example of cobranding.

28) Burger King and Häagen-Dazs ice cream once attempted to use cobranding. What is a likely reason that it failed?

29) A currently popular trend in the wine industry is house-labeled wine. Restaurants, hotel chains, and even universities now sell wine under their brand name. Is this type of brand extension a good marketing strategy? Defend your answer. Version 1

30) If L.L.Bean allowed a travel company to market adventure travel using the L.L.Bean brand name, what would L.L.Bean be doing?

31)

What are some of the benefits provided by product labels?

32) Wes is designing a primary package for his new coffee cookies. From a consumer’s perspective, what should the packaging provide?

33)

Distinguish between primary and secondary packaging.

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34) Effective marketers recognize that a label is much more than just a sticker on a package. What can a label do for a marketer?

35) When Nestlé manufactures toffee, fruit snack and jellybeans, or when Schwinn designs bicycles, each company’s core question is

A) How do we know how good a brand is or how much equity it has? B) What makes a brand? C) How do we produce this product in the least expensive manner? D) What are the different branding strategies firms use? E) What are customers looking for?

36) Marketers need to think about the product offer on three levels. Which of the following levels includes associated services such as warranties, financing, support, and after-sale service?

A) augmented product B) core customer value C) actual product D) modified product E) core product

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37)

Which of the following is considered part of the augmented product?

A) product warranty B) features C) design D) quality E) brand name

38) When manufacturers try to understand what customers are looking for, they are thinking about the ________ component of the product offer.

A) core customer value B) associated services C) augmented products D) product support E) quality level

39)

A product is ________ that can be offered through a voluntary marketing exchange.

A) the combination of a firm’s marketing mix B) the brand associations C) the category depth D) a tangible item E) anything of value to consumers

40) What aspect of the product is being described when a used-car salesperson explains that each car comes with a one-year extended warranty and a two-year maintenance plan?

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A) actual product B) associated services C) product style D) product position E) product concept

41) Some credit cards provide free liability insurance, funded by the bank issuing the card, when a customer pays for a rental car using the card. This extra insurance is an example of

A) product style. B) the actual product. C) an associated service. D) the product position. E) the core value.

42) When a salesperson calls you to sell a cemetery plot, this is most likely what type of product?

A) unsought product B) shopping product C) convenience product D) line extension E) secondary product

43) Viola is taking a backpacking trip across Europe. She wants to make sure that the backpack she chooses is the best one for her adventure, so she is spending a considerable amount of time comparing alternatives to make sure she selects the best one. For Viola, this backpack represents what type of product?

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A) convenience B) unsought C) shopping D) luxury E) routine

44) Zappos, an online shoe company, knows shoes are typically a(n) ________ good, with consumers often spending time comparing alternatives. It overcomes that aspect of consumers’ search process by offering a free, no-questions-asked return policy.

A) specialty B) shopping C) convenience D) ritual E) impulse

45) Marketers selling milk, bread, and other consumer staples know that most customers do not spend much time searching or comparing alternatives. For most consumers, these are ________ goods.

A) specialty B) shopping C) convenience D) ritual E) impulse

46) When Winifred planned her trip to Cambodia, she spent months evaluating packages, airfares, and hotel accommodations. Winifred’s trip is an example of a(n) ________ product.

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A) specialty B) convenience C) unsought D) shopping E) sought

47) Luis likes gourmet popcorn and will spend time trying to find his favorite brand. His girlfriend, Nanette, loves popcorn but doesn’t care about brands. For Luis, popcorn is a ________ good while for Nanette it is a ________ good.

A) shopping; specialty B) convenience; shopping C) convenience; specialty D) specialty; convenience E) unique; universal

48)

The complete set of all products offered by a firm is called its

A) product line. B) product categories. C) product mix. D) product breadth. E) product line depth.

49) A ________ is a group of associated items that consumers tend to use together or think of as part of a group of similar products.

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A) product line B) product mix C) product mix breadth D) line extension E) brand extension

50) For a major university, undergraduate studies, graduate studies, and professional programs would be ________ within the university’s product mix.

A) brand associations B) family brands C) cobrands D) product lines E) private-label brands

51) Stitch Fix is a successful online clothing company. One of the difficulties in running a clothing company is the need to have significant ________, a large number of items in each product line.

A) brand equity B) product line breadth C) product line depth D) product mix depth E) product mix breadth

52)

Marketers with successful brands sometimes hesitate to expand their brands because

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A) Federal Trade Commission regulations limit the number of products that can be marketed under an individual brand name. B) it is costly to maintain many product lines, and it might weaken the brand’s meaning. C) it is often difficult to get additional marketing communications coverage for the brand. D) manufacturing divisions usually control brand expansion and are often in conflict with the marketing division. E) the current economy can support only a limited number of product options.

53)

Why would a firm eliminate an item within a product line?

A) The firm decided to refocus marketing efforts on this item. B) The firm must maintain its presence in this market. C) The product undermined its own brand. D) The product being eliminated is overly profitable. E) The firm has decided to capture new markets.

54) For many years, General Electric had a corporate strategy of being among the top three firms in any market in which it operated; if it could not achieve a top-three position, it would exit the market. This strategy often resulted in the company ________ when certain product lines failed to meet this expectation.

A) increasing product line depth B) decreasing product line depth C) decreasing product mix breadth D) increasing product mix breadth E) introducing brand extensions

55)

The decision to delete a product is never taken lightly because, generally, manufacturers

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A) have offered the product line to other firms for purchase. B) have made substantial investments in product development and manufacturing. C) have promised consumers they will maintain the product. D) have used brand repositioning to improve results. E) must meet federal standards when taking products off the market.

56)

A company’s product mix consists of

A) its various product lines. B) secondary packages. C) only cobranded products. D) brand equity. E) solely augmented services.

57) A university that has separate graduate and undergraduate admission offices recognizes that these are distinct

A) brand associations. B) product lines. C) product mixes. D) brands. E) augmented services.

58)

One important purpose of a brand is to

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A) sell advertising space. B) minimize product line depth needed to be effective. C) increase consumer recognition and awareness of product offerings. D) reduce product packaging. E) meet government regulations.

59) In addition to extensive online and outdoor advertising, Under Armour has intensified its ______ efforts by signing Washington Nationals baseball star Bryce Harper to the biggest endorsement deal for an MLB player.

A) logo B) branding C) social media D) value E) differentiation

60)

For a brand name to be effective, it needs to be

A) easy for consumers to recognize and remember. B) a catchy, tongue-twisting phrase. C) a visual image containing human characters. D) generic, so it can be applied to as many products as possible. E) associated with a sports or movie superstar.

61) It is almost impossible to watch a sporting event on television without seeing Nike’s “swoosh” check mark, which is Nike’s

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A) name. B) symbol. C) design. D) term. E) theme.

62) Denny always liked REI outerwear, so when he was shopping for a winter coat, he ordered one from REI without thinking too much about it. This demonstrates how ______ facilitate purchases.

A) private labels B) brands C) actual products D) core customer values E) associated services

63)

Brands are assets that can be legally protected through

A) brand equity. B) the Fair Packaging and Labeling Act of 1967. C) trademarks. D) the Federal Trade Commission Act of 1914. E) brand associations.

64)

One key feature of the value of a strong brand is that

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A) it can protect the firm from competition. B) it no longer needs to be supported by advertising and promotion. C) if it becomes a generic name, the brand is worth even more. D) it cannot be successfully imitated by a retailer’s own brand. E) competitors will typically abandon a sector altogether rather than compete.

65) When consumers associate a brand with a certain level of quality and familiar attributes, allowing consumers to make quick decisions, the brand

A) establishes novelty. B) is the only one the consumer will consider. C) reduces delivery costs. D) facilitates purchasing. E) creates brand dilution.

66)

Which of the following would be considered a logo without words?

A) jingle B) slogan C) symbol D) product line E) brand

67) Firms that use the same brand name for new products can spend relatively less on marketing costs for the new product because

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A) brands protect corporate copyrights. B) consumer loyalty can be bought for less now compared to the past. C) brand equity can be obtained only by means of product line depth. D) people already know what the brand means. E) well-known brands are less likely to introduce brand extensions.

68) The ABC car manufacturing company is advertising its new hybrid vehicle. It understands that its competition, Toyota’s hybrid car, the Prius, is known for being economical, a good value, stylish, and good for the environment. Toyota has the advantage of

A) copyrights and trademarks. B) brand awareness. C) brand extensions. D) generic branding. E) brand associations.

69) When Paulette shops for lipstick, she always buys Cotton Candy by Revlon. This is an example of

A) brand loyalty. B) brand awareness. C) brand association. D) brand equity. E) perceived value.

70)

How do you calculate brand equity?

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A) Subtract the sales of branded items from generic brands in a category. B) Subtract the sales of generic brands from branded items in a category. C) Add the sales of generic brands and branded items in a category. D) Subtract the product line’s depth from the product mix’s breadth. E) Add the costs of packaging and labeling to production cost.

71)

The value of a brand is often calculated by assessing the

A) difference between brand equity and brand liability. B) corporate profitability divided by the monthly brand earnings. C) earning potential of the brand over the next 12 months. D) effect of brand dilution if it occurred. E) average product line depth.

72) Marketing expenditures allocated carefully can result in greater brand recognition, awareness, perceived value, and consumer loyalty for the brand, which all enhance the brand’s

A) positioning. B) licensing. C) association. D) equity. E) solvency.

73) The Doritos advertising effort of “Live Mas,” which is Spanish for “Live More,” is meant to suggest a lifestyle aspiration. If consumers make a connection between the Doritos brand and this promotional effort, then Doritos has created

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A) brand ownership. B) a brand extension. C) brand loyalty. D) brand dilution. E) a brand association.

74) Firms spend millions of dollars annually to build brand equity, recognizing that brand equity contributes to

A) product mix breadth. B) corporate stakeholder relations. C) profitability. D) brand liability. E) perceived brand personality.

75) What is one of the main criteria used for determining how “good” a brand is, or how much equity it has?

A) brand dilution B) predictive analytics C) sustainable packaging D) brand conceptualization E) perceived value

76) If many consumers in the marketplace are familiar with a brand and what it stands for and have an opinion about the brand, the brand has considerable

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A) awareness. B) equity. C) extension. D) integration. E) depth.

77) Whether they like them or not, most U.S. automobile customers are familiar with and have an opinion about American-made cars. This familiarity makes it easier for consumers to

A) meet their self-actualization needs. B) make purchase decisions. C) consider repositioning their opinions. D) pursue generic alternatives. E) negotiate discounts.

78) Sometimes brand names become synonymous with a product itself. If that happens, the brand

A) has achieved brand stabilization. B) could lose its trademark status. C) should try cobranding to avoid brand dilution. D) should consider a new packaging strategy. E) easily eliminates all competition.

79)

In the case of Band-Aid adhesive bandages, the brand name has

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A) successfully employed private-label branding. B) distinctive brand substitutability. C) grown through private-label branding. D) become synonymous with the product itself. E) avoided brand extensions.

80) Mariska is working to create greater brand awareness for her company’s new line of sports bracelets. Which of the following is important for increasing brand awareness?

A) brand name B) cost of manufacturing C) distribution methods D) blind market research E) product history

81) Why would a firm spend over $2 million for a 30-second ad on television during the Super Bowl?

A) because of the annual competition for the most creative Super Bowl ad B) because the Super Bowl offers an opportunity to create significant brand awareness C) because the Super Bowl is a significant opportunity to be associated with global marketing D) because Super Bowl ads generate brand loyalty E) because this television ad is relatively inexpensive

82) Relatively few consumers like to go to the dentist. Dental insurance plans that pay for regular checkups increase the ________ of dental care by reducing the cost to the consumer.

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A) perceived value B) brand awareness C) brand loyalty D) generic positioning E) brand extension

83)

In a competitive market, perceived value is determined by consumers mostly

A) by quantitative analysis of brand personalities. B) in relation to the value of its close competitors. C) by weighing primary versus secondary benefits. D) by trying out different products. E) through brand association and brand licensing.

84) Darius is deciding whether to purchase brand-name sneakers or a less expensive store brand. He has purchased other shoes with the same brand name in the past but was only marginally satisfied. In this situation, Darius is likely to purchase the store-brand sneakers because they offer

A) more brand awareness. B) higher degrees of brand loyalty. C) greater perceived value. D) a better brand image. E) more product line depth.

85) Elsie was passionate about Talbot’s. It was the only place she’d buy her clothes. If anyone asked her about clothes, she would talk for what seemed like hours about why she shopped only there. From a strictly marketing perspective, this word-of-mouth is an element of

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A) social marketing. B) brand loyalty. C) self-actualization. D) motivation. E) brand extension.

86) Jeremiah always buys Boar’s Head cold cuts. He does not even consider alternatives. Jeremiah is a ________ customer.

A) price-sensitive B) brand-persuasion-oriented C) brand-association-oriented D) brand-extension-oriented E) brand-loyal

87)

Which of the following statements regarding brand loyalty is true?

A) The marketing costs of reaching loyal customers are typically very high. B) Brand-loyal customers are unlikely to switch to competitor’s brands. C) Brand-loyal customers do not usually generate positive word-of-mouth. D) Firms tend to reward new customers with extra benefits. E) Brand-loyal customers need persuasion to buy the firm’s brands.

88)

For marketers, one of the benefits of having achieved brand loyalty is

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A) recognition through industry awards. B) lower marketing costs associated with reaching loyal customers. C) increased price sensitivity among loyal customers. D) greater concern about competitors’ actions. E) few worries about copyright infringement.

89) For luxury carmakers, the lowest-end models in their product lines often represent only a small portion of their sales. Yet these models are critically important when it comes to attracting new customers and, potentially, establishing their lifelong

A) awareness of the brand. B) perceived value of the brand. C) loyalty to the brand. D) product identification of the brand. E) association of the brand.

90) Imagine that you are the marketing manager of a restaurant group that wants to implement a customer reward and loyalty program. You research the firm Guest Hospitality Solutions, which offers its services to restaurant chains to develop and execute these types of programs. Guest Hospitality Solutions is a company that focuses on

A) customer relationship management. B) building brand awareness. C) building brand associations. D) increasing perceived value. E) increasing brand equity.

91)

Frequent buyer/user award programs are used to

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A) increase price sensitivity. B) decrease cobranding costs. C) lower licensing fees. D) expand product line depth. E) maintain contact with loyal customers.

92) A tablet programmed with key customers’ birthdates, wine preferences, and food allergies is a(n) ________ tool.

A) SKU B) PDQ C) IMF D) CRM E) GATT

93)

Brands can be owned by

A) manufacturers only. B) any firm in the supply chain. C) retailers only. D) wholesalers and retailers only. E) private-label generic retailers only.

94) Del Monte, Nike, Pepsi, KitchenAid, and Sony are considered famous ________ brands because they are owned and managed by the manufacturer.

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A) national B) retailer C) international D) premium E) family

95)

Which of the following is the best example of a family brand?

A) Cadillac, GMC, and Chevrolet B) Kraft Singles and Kraft Mayo C) Kellogg’s Special K and Famous Amos Chocolate Chip Cookies D) Lifesavers Soda, Coca-Cola, and Diet Coke E) KFC/Taco Bell fast foods

96)

The basic reason manufacturers spend time and money building their own brands is to

A) create brand awareness. B) build brand equity. C) offset the power of private-label manufacturers. D) create positioning possibilities for their generic product lines. E) maximize product line depth.

97) Procter & Gamble is a huge national brand manufacturer. By owning its brands like Downy and Oral-B, P&G

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A) can monopolize store brands. B) has greater opportunity to dictate retail pricing. C) has greater control over its marketing strategy. D) can increase brand dilution. E) can eliminate any local competition.

98)

Brands that are owned by ________ are called private-label brands.

A) manufacturers B) wholesalers C) supply chain specialists D) retailers E) manufacturer’s reps

99)

________ is another term for private-label brands.

A) Store brands B) Off brands C) Manufacturer’s brands D) National brands E) Experiential brands

100)

Private-label brands are developed and managed by

A) manufacturers. B) wholesalers. C) supply chain specialists. D) manufacturer’s representatives. E) retailers.

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101) Consumers might not realize that Philadelphia cream cheese and Jell-O products are made by the same company—Kraft. Philadelphia cream cheese and Jell-O are known as

A) individual brands. B) family brands. C) corporate brands. D) traditional brands. E) umbrella brands.

102)

Private-label brands are developed and marketed by a(n)

A) individual. B) manufacturer. C) advertising agency. D) marketing agency. E) retailer.

103) of

British Airways Visa, created cooperatively by British Airways and Visa, is an example

A) cobranding. B) brand extraction. C) brand collusion. D) a generic brand. E) brand dilution.

104) Suppose that CVS (a major drug store chain) wants to introduce its own brand of cough medicine that is similar in contents and packaging to a national brand, but at a lower cost. What kind of brand would CVS be introducing? Version 1

A) national brand B) counterfeit brand C) premium brand D) private-label brand E) manufacturer’s brand

105) as

When a company launches a new product line with an existing brand name, this is known

A) a brand extension. B) a line extension. C) a multi-brand. D) a new brand. E) cobranding.

106) Which of the following brand strategies is being used when the local ice cream shop decides to add a new flavor to its menu?

A) a brand extension B) a line extension C) a copycat brand D) a premium brand E) a multi-brand

107) When a restaurant chain, Curt’s Homestyle Cooking, launches its own brand of frozen meals, this is an example of a

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A) brand extension. B) line extension. C) licensed brand. D) copycat brand. E) premium brand.

108) Which of the following best describes when Johnson & Johnson introduces a travel-sized package for its existing baby oil product?

A) line extension B) brand extension C) brand dilution D) rebranding E) cobranding

109) When Procter & Gamble added teeth-whitening products under the Crest brand, the firm was engaged in

A) corporate branding. B) brand extension. C) brand licensing. D) brand association. E) perceived value branding.

110) For a company like Pepsi-Cola, ________ occurs when it sells more product than the competition.

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A) corporate branding B) brand extension C) brand licensing D) brand association E) brand dilution

111)

Why is brand extension a popular marketing strategy?

A) It separates out the cost of brand extension from brand intention. B) It allows the firm to discontinue complementary products. C) It allows the firm to spend less on creating brand awareness and associations. D) It avoids the problem of brand dilution. E) It guarantees success for a new product.

112) A long-standing staple of ______ has been major league sports teams that play in the MLB, NBA, NFL, or NHL as well as various collegiate sports teams. rights.

A) branding B) licensing C) product line D) rebranding E) repositioning

113)

Which of the following is a potential benefit of brand extension?

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A) allowing the perception of a brand with a quality image to be carried over to the new product B) increasing marketing costs C) lowering sales of the core brand D) spending more on creating brand awareness and associations E) eliminating competition

114)

One of the categories of products for which brand extension is especially logical is

A) generic goods. B) generic services. C) commodities. D) complementary goods. E) licensed brands.

115) Matilda developed a toothpaste using only natural ingredients, and she has been quite successful selling the product in health food stores and some grocery stores. She has recently developed a toothbrush using bamboo and natural components. Matilda is considering a ________, giving the toothbrush the same brand name as the toothpaste in order to create greater brand awareness.

A) cobrand B) brand extension C) premium brand D) joint brand E) natural brand

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116) Ferrari is well known as a brand of luxury sports cars; accordingly, it has leveraged its brand name to introduce clothing offerings emblazoned with its horse logo. It has also licensed its logo to 68 different products, from sunglasses to guitars. Ferrari might be at risk of which of the following?

A) brand awareness B) perceived value C) brand extension D) brand dilution E) line extension

117) Wang tried a new fruit-flavored beverage and thought it was awful. He was especially disappointed because he had liked the dried fruit snacks marketed under the same brand name. Now he wasn’t sure he even wanted to buy the snacks he had liked before. This highlights a problem in branding known as

A) brand dilution. B) comingled brands. C) undifferentiated brands. D) approximated brands. E) unlicensed brands.

118) Harley Davidson’s cake decorating kit tried to appeal to the brand’s unparalleled consumer loyalty, but it was considered too tame by their consumer base. This is an example of

A) corporate branding. B) brand extraction. C) brand collusion. D) brand personality destruction. E) brand dilution.

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119)

A ________ refers to the use of the same brand in a different product line.

A) line extension B) brand extension C) product mix extension D) cobrand E) brand license

120)

Marketers with luxury brands use brand extension cautiously in order to avoid

A) brand licensing fees. B) exclusive cobranding arrangements. C) diluting the core brand. D) private-label branding disputes. E) product line extension limitations.

121) Efforts to change a brand’s focus to target new markets or change the image of a brand are called

A) cobranding. B) brand extraction. C) brand collusion. D) brand repositioning. E) brand dilution.

122) When Disney flooded retail stores with products based on its movie Frozen, this illustrated

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A) strategic brand alteration. B) rebranding. C) brand licensing. D) brand repositioning. E) brand scaling.

123) Greta had been using an imported brand of shampoo for several years, but she could no longer find it anywhere. As she was considering what kind of shampoo to try, she was surprised to see ads for Procter & Gamble’s Head and Shoulders being promoted as a glamorous healthoriented product. She had always thought of Head & Shoulders as an antidandruff shampoo. The new ads suggest that Head & Shoulders has most likely been

A) rebranded. B) reformulated. C) licensed to a premium shampoo manufacturer. D) extended as a brand. E) cobranded.

124)

Which of the following statements regarding secondary packaging is true?

A) It can duplicate the information to consumers found on the primary packaging. B) It is important to the retailer in terms of convenience in handling. C) It does not help to convey the brand image. D) It results in cost inefficiencies. E) It is of little value to the average consumer.

125) A ________ package is the one a consumer uses. A ________ package is used by retailers to display and sell the product.

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A) secondary; primary B) generic; private-label C) primary; secondary D) corporate; manufacturer’s E) cobranded; licensed

126)

What is a particularly important feature of sustainable packaging?

A) better protection against damage to the product B) lowers the product cost C) increases the ability to see the product in multiple retail outlets D) only using recyclable materials E) less of a negative impact on the environment

127) What U.S. government agency has the primary responsibility in reviewing food and package labels to ensure claims made by the manufacturer about the product are true?

A) Federal Trade Commission B) Federal Communications Commission C) Consumer Product Safety Administration D) Food and Drug Administration E) Interstate Commerce Commission

128) Where on a product’s packaging would one most likely find nutrient content and country of origin?

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A) inside the secondary package B) inside the primary package C) on the company website D) on the label E) on the store shelf display

129)

Returnable packaging, use of 3D printing, and flexible packaging are examples of

A) recycled packaging. B) environmental packaging. C) responsible packaging. D) sustainable packaging. E) green packaging.

130) When Kraft’s Philadelphia cream cheese changed its packaging from round to oval to ensure front-facing displays that can’t spin and to fit more into the same shelf space, this was a subtle way in which the firm ________ its product.

A) sustained B) branded C) repositioned D) individualized E) privatized

131)

Which of the following can help suppliers save on the cost of a product?

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A) rebranding B) labeling C) repositioning D) branding E) packaging

132)

A ketchup bottle is an example of a ________ package.

A) secondary B) primary C) brand positioning D) private-label E) convenience

133) A product is anything that is of value to a consumer and can be offered through a voluntary marketing exchange. ⊚ ⊚

true false

134) When purchasing a mobile phone, the product you are buying is more than just the phone. ⊚ ⊚

135)

true false

A customized mailbox for your house is an example of a convenience product. ⊚ ⊚

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true false

136) Adidas sells shoes, clothing, and athletic gear. These products represent the breadth of Adidas’ products. ⊚ ⊚

true false

137) Kellogg’s sells many different breakfast cereals, including Corn Flakes, Rice Krispies, Frosted Flakes, Raisin Bran, and Special K. This is an example of the breadth of the Kellogg’s product mix. ⊚ ⊚

138)

A decrease in a company’s product depth will always hurt its marketing efforts. ⊚ ⊚

139)

true false

A familiar brand name always helps the sales of a product. ⊚ ⊚

140)

true false

Brands enable customers to quickly differentiate one firm or product from another. ⊚ ⊚

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true false

141) The more familiar customers are with a brand, the harder their decision-making process will be. ⊚ ⊚

true false

142) Harry is a loyal Coca-Cola customer. Loyal customers like Harry require lower marketing expenditures, benefiting businesses like Coca-Cola. ⊚ ⊚

true false

143) Sales of private-label brands continue to increase, particularly in big-box stores such as Costco and Trader Joe’s. ⊚ ⊚

true false

144) In entertainment licensing, the major risk to licensees is that the brand will become overexposed. ⊚ ⊚

true false

145) If Microsoft decided to sell mobile phones under the Xbox brand (which it uses for its gaming systems), this would be an example of a line extension. ⊚ ⊚

146)

true false

A product label is just a required sticker on a package.

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⊚ ⊚

true false

147) When Nanci selects a case of Dr. Pepper at the grocery store for her party, she is attracted by the holiday-themed box featuring green and white bells. What Nanci is seeing is referred to as the secondary package. ⊚ ⊚

true false

148) Byron traded in his old car for his heart’s desire, a new Mustang convertible. The Mustang is considered a specialty product. ⊚ ⊚

149)

For the average college student, a retirement account would be a shopping product. ⊚ ⊚

150)

true false

Effective packaging and labels send consumers the signal “Buy me!” ⊚ ⊚

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true false

Answer Key Test name: Chapter 11 Test Bank 35) E 36) A 37) A 38) A 39) E 40) B 41) C 42) A 43) C 44) B 45) C 46) D 47) D 48) C 49) A 50) D 51) C 52) B 53) C 54) C 55) B 56) A 57) B 58) C 59) B 60) A Version 1

61) B 62) B 63) C 64) A 65) D 66) C 67) D 68) E 69) A 70) B 71) C 72) D 73) E 74) C 75) E 76) A 77) B 78) B 79) D 80) A 81) B 82) A 83) B 84) C 85) B 86) E 87) B 88) B 89) C 90) A Version 1

91) E 92) D 93) B 94) A 95) B 96) B 97) C 98) D 99) A 100) E 101) A 102) E 103) A 104) D 105) A 106) B 107) A 108) A 109) B 110) E 111) C 112) B 113) A 114) D 115) B 116) D 117) A 118) E 119) B 120) C Version 1

121) D 122) C 123) A 124) B 125) C 126) E 127) D 128) D 129) D 130) D 131) A 132) B 133) TRUE 134) TRUE 135) FALSE 136) TRUE 137) FALSE 138) FALSE 139) FALSE 140) TRUE 141) FALSE 142) TRUE 143) TRUE 144) FALSE 145) FALSE 146) FALSE 147) TRUE 148) TRUE 149) FALSE 150) TRUE Version 1

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Student name:__________ 1) Think back to a time when you have said, “This is great idea. How come nobody thought of this before?” Assuming no one has thought of it before, what would be the first steps to take to develop a new product idea?

2) What happens when a product has been in the marketplace for a long time? How can this be avoided?

Respond to the statement “Create or die” from a new product innovation perspective.

4) A good friend of yours wonders why you always seem to have the latest technology, long before anyone else. He then says, “I always want to wait until the bugs have been worked out. It saves me money and aggravation.” Use diffusion of innovation theory to explain how you differ as consumers, and what this means to marketers.

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5) Many car manufacturers have developed prototypes of alternative energy vehicles like hydrogen-fueled cars. When developing their marketing strategies, how can these firms use the diffusion of innovation curve in the early stages of product development?

In new product development, what advantage do first movers have?

Why are innovators important to marketers?

8) Describe your actions (or someone you know) in a situation where you (or they) were an innovator in the diffusion of innovation curve. Version 1

9) Tina carefully studies her options before buying new products. She enjoys new things, especially electronic games, and is very knowledgeable about them. Other people often ask her opinion. In the diffusion of innovation curve, which category does Tina fit in?

10)

Describe a product that is in the early majority stage of the new product diffusion curve.

11) What is a “pioneer” product, and how does this type of product impact markets and consumer preferences? Use an example to explain this concept.

12)

Why is the failure rate for new products so high?

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13)

What is the difference between an innovator and an early adopter?

14) Around 2006, hybrid cars moved from the early adopter to the early majority stage. What did this mean for marketers of hybrid cars?

15) Using the diffusion of innovation theory, what factors contributed to the rapid adoption and success of Amazon.com?

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16) General Electric is developing a new magnetic resonance imaging (MRI) device to be marketed to family practice physicians. These new machines will be much smaller and less expensive than the existing MRI machines now in most hospitals. What factors will probably affect the diffusion of these new machines?

17)

What is the difference between alpha testing and beta testing?

18) When they add products, services, and processes to their offerings, firms can create and deliver value more effectively by satisfying the changing needs of their current and new customers or by keeping customers from getting bored with the current product or service offering. How did Steve Jobs, the Apple company’s founder and visionary leader, change the phone, camera, communication, and technology markets?

19) Gina is ready to launch her company’s new product, a line of chocolate for diabetics, based on her instincts and knowledge from 30 years of marketing. Her staff is encouraging her to delay the launch until test marketing can be done. What are the advantages and disadvantages of each approach?

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20) Kelsey is about to launch a new product: herself! She is running for a local political office. First-time candidates quickly learn the importance of marketing. She has consulted with various experts, tested her campaign themes and messages with focus groups, and now is ready to do a full-scale product launch. Why is her product launch the most critical step? What will she need to do?

21)

Why do you think that many biotechnology firms license their new products?

22)

Why do marketers take the time and cost associated with test marketing?

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23) Explain the concept of outsourcing product development and give an example of when this would be a good idea.

24) Which step in the new product development process is the most critical to the survival of a firm, and why?

25) A year after expanding his celebrity surfing photography business to include ocean photography, Ashton decided it was time to evaluate results. What three interrelated factors will Ashton consider when evaluating the success of his new product?

26)

Why is it important for marketers to understand the product life cycle?

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27) Marketing is a dynamic practice. While you are watching your competitors, they are watching you. Assume that you have just redesigned a product that is in the maturity phase of the product life cycle and have identified some new market segments. How do you think your competitors will respond?

28) Many marketers think personal computers in the United States are in the maturity stage of the product life cycle. What does this mean for manufacturers of personal computers? What can they do about it?

29) Dana has just taken over a line of organic teas for her company. She looks at the company records and sees sales have peaked, profit margins are declining, and there are many new competitors in that category. Which stage of the product life cycle are her teas in?

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30) Define and describe the product life cycle stage in which laggards begin to purchase products.

31)

Fashion trends tend to experience ______ product life cycles.

A) long B) annual C) sequential D) competitive E) short

32) ________ is the process by which ideas are transformed into new products and services that will help firms grow.

A) Beta testing B) Concept testing C) Innovation D) Reverse engineering E) Competition

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33) Alain is a sales representative for an established awnings manufacturer. Business is good, but he is concerned that the company has spent little on new product development and has not created a new product in over five years. Without new products, Alain can market his current products only to his current customers or

A) diversify. B) intensify his prototyping. C) expand his early adopter market segment. D) market the same products to similar customers. E) focus on concept testing.

34) Many restaurants offer daily specials, appetizers, entrees, and desserts not listed on their standard menu. These daily specials primarily provide the new product benefit of

A) keeping up in a market where sales come mostly from new products. B) satisfying the changing needs of current and new customers. C) avoiding market saturation from products that have been on the market for a long time. D) creating diversification and reducing risk. E) reduction in cost of ingredients.

35) By adding new product lines beyond its core business of computer software, like the Surface Pro tablet and Xbox 360 game system, Microsoft primarily benefits by

A) keeping up in a market where sales come mostly from new products. B) satisfying the changing needs of the technological research staff. C) avoiding market saturation from products that have just been introduced to the market. D) creating diversification and reducing risk. E) spreading out production costs.

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36) Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products, because they know that their customers crave the “latest and greatest” games. They use this information to create new products that primarily provide the benefit of

A) keeping up in a market where sales come mostly from new products. B) satisfying the changing needs of former customers. C) avoiding market penetration from products that have been on the market for a long time. D) creating diversification and reducing risk. E) taking advantage of a long product cycle.

37)

Pioneer or breakthrough products

A) will likely result in late maturity buying. B) can change consumer preferences. C) incorporate reverse engineering outputs. D) require the use of concept testing services. E) must be geographically centered.

38) One of the potential benefits to a firm of introducing new-to-the-world products or services is

A) cost savings. B) late majority marketing. C) establishment of a completely new market. D) the ability to avoid paying pioneers for new product development. E) the ability to capitalize on existing consumer preferences.

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39) Successful first movers create a market or a product category. They often benefit from being readily recognizable to consumers and

A) not having to pay advertising expenses. B) using prototypes to dominate the market. C) not needing to do test marketing. D) establishing an early market share lead. E) motivating laggards to buy their products.

40)

In many cases, pioneers lose their market lead and initial market share to imitators who

A) capitalize on the pioneers’ weaknesses. B) create similar products with reduced value to consumers. C) utilize alpha-beta testing. D) ignore patents and copyrights. E) target late maturity consumers.

41)

Which of the following are reasons for the high failure rate of new products?

A) properly positioning the product B) doing too much product testing C) targeting a narrow segment of innovators D) overextending a firm’s abilities E) failing to introduce lower-priced alternatives

42)

Even if they succeed, new-to-the-world products are

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A) generally not profitable. B) not adopted by everyone at the same time. C) not capable of creating new markets. D) not subject to the law of first movers. E) typically very short-lived.

43) The process by which the use of a new product or service spreads throughout a market group is referred to as

A) new product introduction. B) lead user dispersion. C) diffusion of innovation. D) the product life cycle. E) product development diffusion.

44)

The diffusion of innovation theory focuses on

A) the geographic boundaries of innovation. B) the relationship between pioneer brands and imitators. C) the psychological traits of innovators. D) the rate at which consumers are likely to adopt a new product or service. E) the way a product moves through the product life cycle.

45)

Which of the following groups are included in the diffusion of innovation curve?

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A) lead users B) nonadopters C) late majority D) pioneers E) prototypers

46)

Innovators are a critical group of new product adopters because they

A) are the major source of innovation. B) act as reverse engineering consultants. C) help with test marketing. D) help the product gain market acceptance. E) extend the product life cycle.

47) Whenever Conrado considers upgrading his personal computer system, he consults with Navin, a knowledgeable friend who always has the newest technology. For Conrado, Navin is a(n) ________ in the diffusion of innovation curve.

A) innovator B) laggard C) late majority adopter D) early majority adopter E) early adopters

48) In the diffusion of innovation process, innovators enjoy taking risks and are regarded as highly knowledgeable. Marketers want to identify innovators because

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A) they prefer products from established market leaders. B) other consumers defer to their judgment, creating the opportunity for word-of-mouth referrals. C) they are especially price conscious. D) they are easily influenced by reminder advertising. E) they encourage competitors to enter the market.

49) Serena is trying to sell a new line of ultrasound imaging equipment. Unlike existing technology, these machines are compact, creating the potential for general practice physicians to have and use them in their offices. Serena is trying to identify innovators in her market, knowing these customers will most likely

A) spread positive word-of-mouth to other physicians. B) buy one for each office in their practices. C) reposition his products. D) create demand among the late majority. E) not need any service or support when using the product.

50)

For new product marketers, early adopters are important because they tend to be

A) few in number. B) the first to adopt a new product. C) opinion leaders. D) fond of prototypes. E) alpha testing enthusiasts.

51) Zoe recently bought Voice over Internet Protocol (VoIP) phone service. A few of Zoe’s friends bought VoIP before she did, but many other friends were interested in Zoe’s opinions of the new phone service. Zoe is a(n) ________ in this product category.

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A) innovator B) laggard C) late majority adopter D) early majority adopter E) early adopter

52) As it pertains to the diffusion of innovation, if the ________ group is relatively small, the number of people who ultimately adopt the innovation likely will also be small.

A) innovator B) laggard C) late majority D) early majority E) early adopter

53) When the iPad Mini came out, Yvonne spent the night in front of the store so she could get one before any of her friends. According to the diffusion of innovation, Yvonne is a(n)

A) innovator. B) early majority. C) early adopter. D) late majority. E) laggard.

54) The ________ diffusion of innovation group is crucial because few new products can be profitable until this large group buys them.

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A) innovator B) laggard C) late majority D) early majority E) early adopter

55) As soon as he saw one, Jose wanted a flat-screen television, but he was worried about making the wrong choice. He waited until there were alternatives in the market with lower prices and improved quality. Jose is part of the ________ diffusion of innovation group.

A) innovator B) laggard C) late majority D) early majority E) early adopter

56)

________ products that create new markets can add tremendous value to firms.

A) Mature B) Reverse engineered C) Prototype D) New-to-the-world E) Copycat

57) When Blu-Ray disc players were new, they could cost around $1,000 and there were a limited number of discs available that would play on them. Stef and Garth waited, concerned with limited availability of discs and wishing for more choices in the market. By the time they purchased a Blu-Ray disc player, sales had leveled off and prices had declined significantly. Stef and Garth were part of the ________ diffusion of innovation group.

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A) innovator B) laggard C) late majority D) early majority E) early adopter

58) When the sequel to a movie eventually shows up on their regular television networks, ________ might watch it.

A) laggards B) the early majority C) the late majority D) early adopters E) innovators

59) By the time BMW got into the mini-SUV market, sales had leveled off and were even starting to decline. BMW had to target its marketing efforts toward the ________ diffusion of innovation group.

A) innovator B) laggard C) late majority D) early majority E) early adopter

60) Rafael and Luisa live in the United States. Rafael recently asked for Luisa’s cell phone number, but Luisa said she didn’t own a cell phone. Luisa would probably be considered a(n) ________ in the diffusion of innovation process.

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A) innovator B) laggard C) late majority adopter D) early majority adopter E) early adopter

61) When Michaela began helping her favorite uncle Barton with his finances, she discovered her uncle was still renting a rotary-dial telephone from the phone company. Uncle Barton had paid thousands of dollars in rental fees over the previous 30 years. Uncle Barton is a(n) ________ in the diffusion of innovation process for telephones.

A) innovator B) laggard C) late majority D) early majority E) early adopter

62)

The diffusion of innovation curve begins with innovators. Who follows that group?

A) prototypers B) laggards C) late majority D) early majority E) early adopters

63)

The diffusion of innovation theory is useful to marketers in helping them

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A) adjust to the performance life cycle. B) avoid the cost of concept testing. C) predict which types of customers will buy their product immediately and later. D) predict how long it will take for a new product to gain market acceptance. E) determine a target market.

64) Early personal computer users remember the cumbersome, user-unfriendly DOS system. When Apple introduced System 1 and Microsoft introduced Windows, both of which were much easier to use, these new products diffused rapidly because of their

A) relative advantage. B) compatibility. C) observability. D) associated services. E) trialability.

65) Inkjet printers were a big improvement over the dot-matrix printers they replaced. Inkjet printers gained rapid acceptance in the marketplace primarily because of their

A) relative advantage. B) compatibility. C) observability. D) complexity. E) trialability.

66) When automobile manufacturers introduced SUVs, they distributed and promoted them in the United States, but not in Europe where gasoline is heavily taxed, and roads are much smaller. Car manufacturers recognized that this new line of cars

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A) provided equivalent relative advantage for both European and U.S. customers. B) was not compatible with European market conditions. C) did not provide benefits that were observable. D) involved technology that was too complex. E) could not be easily tried by consumers.

67) Laptop computers, personal digital assistants, and cellular phones were all readily accepted and diffused in U.S. markets where business and personal lifestyles tend to be fasterpaced, compared to many other areas in the world. These products offered ________ with consumers’ needs and priorities.

A) relative positioning B) compatibility C) observability D) complexity E) trialability

68) Many home design businesses volunteer to provide their latest products for tours-ofhomes fundraisers because they know their new products will benefit from

A) relative advantage. B) compatibility. C) observability. D) complexity. E) trialability.

69) As a promotion technique, samples are often used for new products when ________ will influence the diffusion of the product.

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A) relative advantage B) compatibility C) observability D) complexity E) trialability

70) Zappos.com, an online shoe store, offers an easy, no-hassle return procedure. This relates to the ________ of its products.

A) relative advantage B) compatibility C) observability D) complexity E) trialability

71) The Apple iPod changed the way people listen to music, but it also created an entirely new industry devoted to accessories such as cases, ear buds, docking stations, and speakers. The Apple iPod is considered a

A) pioneer product. B) introductory product. C) mature product. D) diffused product. E) early adopted product.

72) Which of the following is the correct sequence of new product adopters in the diffusion of innovation curve?

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A) innovators, early adopters, early majority, late majority, laggards B) early adopters, early majority, innovators, late majority, laggards C) innovators, early majority, early adopters, late majority, laggards D) early majority, late majority, early adopters, innovators, laggards E) innovators, late majority, early adopters, early majority, laggards

73) Which of the following adopter categories refers to the last large group of buyers to enter a new product market?

A) late majority B) early majority C) laggards D) early adopters E) innovators

74) During the ________ stage of the product life cycle, there are few but an increasing number of competitors.

A) growth B) introduction C) maturity D) decline E) innovation

75)

The Apple iPod is a ______ product.

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A) blockbuster B) early adopter C) pioneer D) market tester E) concept tester

76) If a few of Xbox’s customers are asked to try out a new video game that has not yet been released on the market; this is an example of

A) beta testing. B) market testing. C) premarket tests. D) test marketing. E) concept testing.

77) In one test before product launch, customers try a sample product and are then surveyed to understand whether or not they would buy/use the product again. This is known as

A) premarket testing. B) market testing. C) alpha testing. D) concept testing. E) prelaunch testing.

78)

Which of the following are benefits of new product development to a firm?

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A) reducing the costs of production B) satisfying the changing needs of current and new customers C) ensuring market saturation from products that have been on the market for a long time D) increasing risk of R&D cost overages E) increased market exposure to competitive products

79) Bev is assessing the results of a new product launch of a series of e-books for her bookstore. When evaluating the results, Bev is least likely to consider

A) why it took her so long to consider the new product line. B) if the e-books are generating the expected level of profit. C) if the e-books are generating the expected level of sales. D) if her customers are interested in the new books. E) if the e-books function as expected.

80) On the basis of the research it has gathered on consumer perceptions, the tests it has conducted, and competitive considerations, the XYZ firm confirms its target market (or markets) and decides how its product will be positioned. Then the firm finalizes the remaining marketing mix variables for the new product, including the marketing budget for the first year. This process illustrates

A) the product launch. B) the company’s evaluation of results. C) premarket demonstrations. D) alpha testing. E) beta testing.

81) How is consumer panel data collected during the test marketing phase of a new product introduction?

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A) Panelists complete a questionnaire about the product. B) Panelists scan their receipts on a home scanning device. C) Stores provide sales data to companies. D) Consumers voluntarily go to a website to record their preferences. E) Focus groups are held in key markets.

82) After a product has been launched, marketers must undertake a critical postlaunch review to determine whether the product and its launch were a success or failure and what additional resources or changes to the marketing mix are needed, if any. For a product that does move on, the firms can measure the success of the new product by interrelated factors that include all of the following except

A) its satisfaction of technical requirements. B) its satisfaction of performance. C) customer acceptance. D) its satisfaction of the firm’s financial requirements. E) its satisfaction of the firm’s manufacturing requirements.

83)

Firms can measure the success of a new product by

A) satisfaction of its technical requirements. B) fewer competitors in the market. C) slow sales and low profits. D) customer reluctance to accept the product. E) uneven performance.

84)

Which of the following is least likely to be a source of ideas for new products?

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A) R&D efforts B) licensing agreements C) consumer research D) geodemographic segmentation E) brainstorming

85) In the product development process, what takes place between concept testing and market testing?

A) securing financial backing B) conducting marketing research C) brainstorming D) determining potential ROI E) performing product development

86) Many restaurants roll out new ideas first in Orlando, Florida, a location that attracts a vast range of diverse tourists and thus might offer insights into what various consumer groups will like. This is an example of

A) target marketing. B) test marketing. C) product marketing. D) product launching. E) premarket testing.

87) When a global firm turns to its subsidiaries in less developed markets for new product ideas, such as when Samsung’s ActivWash was initially developed for the Indian population and is now one of the most popular washing machines in South Korea, it is engaged in

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A) a consortia. B) reverse innovation. C) competitive engineering. D) pioneering. E) beta testing.

88) Suppose that you work for an advertising agency and are brought into a meeting where everyone is asked to generate ideas for names for a new beach resort. You are engaged in ________, a form of new idea generation.

A) R&D B) licensing technology C) consumer research D) geodemographic analysis E) brainstorming

89)

One of the key characteristics of brainstorming sessions is

A) no idea is immediately accepted or rejected. B) everyone must come up with ideas. C) the first idea is almost always the best idea. D) only the marketing team is included in these sessions. E) the manager should always make the final decision.

90)

At the end of a brainstorming session, participants are often asked to

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A) identify the worst ideas. B) defer to management for the final decision. C) identify which ideas each person proposed. D) vote on the best ideas. E) propose one more new idea each.

91) ________ involves taking apart a product, analyzing it, and creating an improved product that does not infringe on the competitor’s patents.

A) Reverse innovation B) Reverse engineering C) Selective dissection D) Redistribution E) Creative destruction

92) One of the key characteristics of ________ sessions is that no idea should be immediately accepted or rejected.

A) reverse engineering B) alpha testing C) brainstorming D) prototype E) clinical trial

93) Companies that develop customized business software often work closely with their users when installing their products. This close contact often creates new product ideas through

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A) reverse engineering. B) licensing technology. C) customer input. D) R&D consortia. E) clinical trials.

94) Rinaldo sells commercial-grade tools to building contractors. Whenever he visits his customers, he looks to see if they are using his tools for other tasks or have modified the tools for some other purpose. These customers are ________, who can provide ideas for new and improved products.

A) laggards B) market testers C) lead users D) reverse engineers E) concept testers

95) The National Institutes of Health (NIH) sponsors medical foundations to conduct research to treat rare diseases. The research is then disseminated to the medical community, thus encouraging the development of drugs and therapies more quickly and at a lower cost than would be possible if the research were privately funded. This is an example of

A) early adopters. B) market testers. C) an R&D consortia. D) reverse engineers. E) concept testers.

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96) A company has a new concept for a lightweight bicycle that can be easily folded and taken with you inside a building or on public transportation. The company is currently engaged in concept testing. The most important question during this phase of product development pertains to

A) the cost of research and development. B) the price of the final product. C) the cost to manufacture the product. D) marketing and advertising costs. E) the respondent’s purchase intentions if the product were made available.

97) When conducting concept testing for her firm’s new Internet antipiracy software, which is the most important question that Wanda should ask?

A) How long will it take to bring the software to market? B) Will respondents purchase the software if it becomes available? C) Who will determine the price to be charged? D) Where should the product be sold? E) Which computer trade show will be used to introduce the product?

98) Crystal created a virtual prototype of her new line of athletic wear on a website to show to consumers. Crystal will ask consumers what they think of the clothing. Which is the most important question that Crystal should ask?

A) What retailers should be used to sell the swimwear? B) Will retailers purchase the swimwear if it becomes available? C) What wholesale price should be charged? D) What promotional plan will work best? E) In which season should we introduce the product?

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99) If a new product concept gets positive evaluations from potential customers during concept testing, the next step for a firm is

A) market testing. B) product development. C) brainstorming. D) reverse engineering. E) launching of the product.

100) Hollywood studios typically release movies targeted toward general audiences (G- or PGrated movies) during the summer when children are out of school. The timing of the release pertains to the product’s

A) premarket test. B) launch. C) evaluation. D) research and development. E) test marketing.

101) Freida is using a test model of her firm’s new inline skates to see if they work according to the design specifications. She is involved in

A) test marketing. B) product launch. C) alpha testing. D) target marketing. E) concept testing.

102) Before Segway manufactured its two-wheeled people movers, it built a prototype and had staff engineers test it for performance and stability. At this stage, Segway was involved in

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A) alpha testing. B) product launch. C) test marketing. D) beta testing. E) concept testing.

103) YouEye is developing eye tracking technology that works with an individual’s webcam. Instead of needing to spend thousands of dollars on eye tracking equipment and having customers come into labs, firms will be able to utilize everyday webcams to track not only what a person attends to on a computer screen but also his or her emotional reactions to these products. Firms such as YouEye are automating the

A) premarket testing process. B) alpha testing process. C) beta testing process. D) evaluation process. E) concept testing process.

104) Golf ball manufacturers use “Iron Mike,” a machine that swings a golf club at a constant velocity, to test the distance for new golf ball designs. When using Iron Mike, the manufacturers are engaged in

A) concept testing. B) market testing. C) premarket testing. D) product development. E) alpha testing.

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105) One reason auto companies spend millions on racing cars is that they offer the opportunity to test new designs and technology under extreme conditions. Using the cars in a real-use setting provides an opportunity for ________ the product.

A) pretesting B) beta testing C) test marketing D) alpha testing E) concept testing

106) Sarita belongs to a national consumer panel created by a market research company. She regularly receives samples of new products from a variety of firms and fills out questionnaires about the products. The national consumer panel Sarita is part of is engaged in

A) premarket testing. B) product launch. C) test marketing. D) product development. E) concept testing.

107) A marketing professor in Boston, Massachusetts, maintains a museum of failed consumer products. Most new products in this museum failed during the ________ stage of new product development, when they are introduced to a limited geographic area.

A) pretesting B) product launch C) test marketing D) product development E) concept testing

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108) When McDonald’s comes up with a new drink or sandwich for its restaurants, it often markets it in a dozen or so of its outlets. When the company does this, it is engaged in

A) pretesting. B) product launch. C) test marketing. D) product development. E) concept testing.

109) The ________ step in the product development process is critical, requiring tremendous resources and extensive coordination of all aspects of the marketing mix.

A) pretesting B) product launch C) posttesting D) product development E) evaluation of results

110)

Which of the following would be part of the launch of a new product?

A) determining the marketing budget for the first year of the product B) deciding what type of next generation products will follow C) determining how to expand current market share D) putting off any positioning aspects related to the product E) starting to make preliminary decisions about the target market

111) Because a market is saturated, firms may attempt to enter new geographical markets that may be less saturated. For example, pharmaceutical companies are realizing that they need to turn to ________ for continued growth in the coming years.

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A) BRIC countries B) third-world countries C) communist countries D) Germany E) France

112)

The product life cycle is theoretically ________ with regard to sales and profits.

A) U shaped B) Y shaped C) bell-shaped D) circular E) flat lined

113) Firms with products in the ________ stage either position themselves for a niche segment of diehard consumers or those with special needs or they completely exit the market.

A) introduction B) growth C) evaluation D) maturity E) decline

114) A product in the ________ stage of the product life cycle has a high number of competitors and competitive products.

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A) introduction B) growth C) decline D) development E) maturity

115)

Which of the following is true of profits in the maturity stage of the product life cycle?

A) They are negative. B) They are low. C) They peak or are declining. D) They are rapidly rising. E) They are slowing rising.

116)

Which of the following is included in the four product life cycle stage?

A) brainstorming B) stagnation C) prototyping D) innovation E) decline

117) Microsoft’s Windows operating system continues to dominate the market, even though it has been around for over 20 years. Windows will likely remain in the maturity stage of the product life cycle

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A) indefinitely. B) until it rules the world. C) until a superior product comes along to replace it. D) unless Microsoft repositions Windows as an introductory stage product. E) as long as the company doesn’t change it.

118) During the ________ stage of the product life cycle, sales are low, and profits are small or negative.

A) introduction B) leveling C) maturity D) growth E) decline

119)

Which of the following reflects the maturity stage of the product life cycle?

A) Sales: low; Profits: negative or low; Typical consumers: innovators; Competitors: one or few B) Sales: rising; Profits: rapidly rising; Typical consumers: early adopters and early majority; Competitors: few but increasing C) Sales: declining; Profits: declining; Typical consumers: laggards; Competitors: low number of competitors and products D) Sales: peak; Profits: peak to declining; Typical Consumers: late majority; Competitors: high number of competitors and competitive products E) Sales: peak; Profits: increase; Typical Consumers: laggards; Competitors: low number of competitors

120) Which of the following was considered a new-to-the-world product or service when introduced?

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A) washable plastic straws B) the Mercedes mini sport utility vehicle C) Fruity Cheerios D) Blu-ray E) Windows 10

121) When Dr. Sharpie invented his Get-It-There (GIT) golf putting device, he knew during the introductory stage

A) sales would rise quickly, profits would jump, and even laggards would buy his product. B) sales would level off, profits would decline, and mature golfers would be attracted to his product. C) sales would slow down, profits would peak, and early adopters of golf equipment would be his major customers. D) sales would be low and profits nonexistent, but he would attract golf equipment innovators. E) sales would be low, profits would be high, and all potential golfers would jump at the opportunity to buy his product.

122) During the ________ stage of the product life cycle, sales rise, profits rise rapidly, and there are an increasing number of competitors.

A) introduction B) leveling C) maturity D) growth E) decline

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123) When Toyota introduced hybrid cars, there were waiting lists to buy them. Then Honda and a few other manufacturers entered the market, shifting the product life cycle for hybrid cars into the ________ stage of the product life cycle.

A) introduction B) leveling C) maturity D) growth E) decline

124) Some products may stay comfortably in the maturity phase of the product life cycle until a new product emerges to replace them. An example of such a mature product is

A) e-books. B) refrigerators. C) the VCR. D) smartphones. E) none of these; no product can stay in the maturity phase and survive for very long.

125) The growth phase of the product life cycle is always dynamic. Which of the following occurs in this phase?

A) Profits decrease as sales increase. B) Profits increase as economies of scale are attained. C) No competitors will enter the market with similar products. D) There will be fewer product adopters. E) Price competition with protracted price wars will erode profits.

126) Which of the following is a characteristic of products in the maturity stage of the product life cycle?

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A) Laggards are a major focus of marketing efforts. B) Price competition is minimal. C) Marketing costs increase as firms defend their market share. D) The market may become saturated because of developing competition. E) Manufacturing costs decrease because of streamlining production.

127) During the ________ stage of the product life cycle, sales peak and profits begin to decline as competition becomes intense.

A) introduction B) leveling C) maturity D) growth E) decline

128) By the time BMW and Mercedes-Benz entered the mini-SUV market, there were many competitors, sales had peaked, and profits were declining. These firms entered the market during the ________ stage of the product life cycle.

A) introduction B) leveling C) maturity D) growth E) decline

129)

The ________ stage of the product life cycle is characterized by negative or low profits.

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A) introduction B) leveling C) maturity D) growth E) decline

130) During the ________ stage of the product life cycle, firms either position themselves for a niche segment of diehard consumers or they completely exit the market.

A) introduction B) leveling C) maturity D) growth E) decline

131) The CEO of Charisse’s firm just came back from a business seminar. He called Charisse into his office and stated, “I just found out about the product life cycle curve in a strategy seminar. This is a great tool. I want you to drop whatever you’re doing and inventory all of our products to determine exactly where they are in the product life cycle.” Charisse needs to think fast for a good answer because she knows that

A) the product life cycle is not a useful concept. B) it is often impossible to identify with precision where a product is in the product life cycle. C) the product life cycle is not helpful in companies like his that pay attention to diffusion of innovation. D) the idea has been discredited by recent research. E) the product life cycle works only for certain types of firms.

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132) In the United States, most consumer packaged goods found in grocery and discount stores are already in the ________ stage of the product life cycle.

A) growth B) pioneer C) introduction D) decline E) maturity

133)

During the introduction stage of a product’s life cycle, typical consumers are

A) early adopters. B) innovators. C) pioneers. D) early majority. E) laggards.

134) Celeste listens to music on her iPod and iPhone, but she still buys vinyl records at her local music store on occasion, although they are getting harder to find. Vinyl records are in the ________ stage of the product life cycle.

A) introduction B) growth C) evaluation D) maturity E) decline

135) Melinda has used Olay beauty products for years, even though there are many competitors on the market. She plans to purchase a recently introduced micro-sculpting cream from Olay’s Regenerist line. Olay is in the ________ stage of the product life cycle.

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A) introduction B) growth C) evaluation D) maturity E) decline

136)

When a product is successful in the introductory stage of the product life cycle,

A) it moves directly into the maturity stage. B) it is most likely to begin to launch spinoffs. C) competition becomes less important. D) it may start to see profits toward the end of this stage. E) marketing costs increase significantly.

137) As personal computers became popular, the sale of typewriters decreased significantly and now typewriters are only used by a very small segment of consumers. Typewriters are in the ________ stage of the product life cycle.

A) maturity B) evaluation C) growth D) decline E) introduction

138) New product development adds value to a firm’s products and services through innovation. ⊚ ⊚

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true false

139) Although innovation strategies may not work in the long run, overriding short-term reasons compel firms to introduce new products and services. ⊚ ⊚

140)

true false

The failure rate for new products is high. ⊚ ⊚

true false

141) The fact that the Apple iPad is easy to try—demo units are available at Apple stores as well as other retail stores—is helping it diffuse more quickly. ⊚ ⊚

142) too.

true false

When consumers see their friends using an innovation, it often persuades them to try it

⊚ ⊚

true false

143) On the diffusion of innovation curve, the first group of buyers who want to be the first on the block to have the new product are known as early adopters. ⊚ ⊚

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true false

144) On the diffusion of innovation curve, the late majority is the final group of buyers who like to avoid change and rely on traditional products until they are no longer available. ⊚ ⊚

true false

145) Even if products succeed, not all consumers adopt new-to-the-world products at the same time. ⊚ ⊚

true false

146) Test marketing refers to customers who modify existing products according to their own ideas to suit their specific needs. ⊚ ⊚

true false

147) When Pierre asked a few of his regular customers to test his prototype wine press, he was engaging in alpha testing. ⊚ ⊚

true false

148) To determine if a new product is commercially viable, a firm can conduct premarket testing. ⊚ ⊚

true false

149) The maturity phase of the product life cycle is characterized by greatly reduced competition.

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⊚ ⊚

true false

150) The most challenging part of applying the product life cycle concept is that managers do not know exactly what shape each product’s life cycle will take. ⊚ ⊚

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true false

Answer Key Test name: Chapter 12 Test Bank 31) E 32) C 33) D 34) B 35) D 36) A 37) B 38) C 39) D 40) A 41) D 42) B 43) C 44) D 45) C 46) D 47) A 48) B 49) A 50) C 51) E 52) E 53) A 54) D 55) D 56) D Version 1

57) C 58) A 59) C 60) B 61) B 62) D 63) C 64) A 65) A 66) B 67) B 68) C 69) E 70) E 71) A 72) A 73) A 74) A 75) C 76) A 77) A 78) B 79) A 80) A 81) B 82) E 83) A 84) D 85) E 86) B Version 1

87) B 88) E 89) A 90) D 91) B 92) C 93) C 94) C 95) C 96) E 97) B 98) B 99) B 100) B 101) C 102) A 103) C 104) E 105) B 106) A 107) C 108) C 109) B 110) A 111) A 112) C 113) E 114) E 115) C 116) E Version 1

117) C 118) A 119) D 120) D 121) D 122) D 123) D 124) B 125) B 126) C 127) C 128) C 129) A 130) E 131) B 132) E 133) B 134) E 135) D 136) D 137) D 138) TRUE 139) FALSE 140) TRUE 141) TRUE 142) TRUE 143) FALSE 144) FALSE 145) TRUE 146) FALSE Version 1

147) FALSE 148) TRUE 149) FALSE 150) TRUE

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Student name:__________ 1) Why is it important for marketers to pay special attention to providing excellent customer service?

2) What does it mean to say that a service is perishable? Name three services that would be considered perishable.

3) Name a profession in which it might be considered unethical to market one’s services based on the service quality of assurance. Explain why.

4) Dentists know most consumers are hesitant to use their services, in part because what they provide can be painful or uncomfortable at best, but also because much of what they provide is intangible. What is intangibility? How can dentists attempt to overcome intangibility aspects of their service?

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5) In Europe, it is common for hotel guests to ask to see the room before they agree to rent it for the night. Which difference between a service and a product does this custom help overcome?

6) One professor was known for never teaching the same course the same way twice. Which difference between a product and a service does this represent? How could the professor use this to his or her advantage?

7) How do airlines, theme parks, and movie theaters overcome the perishability of their services?

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8) Jerome manages a men’s styling salon in the Buckhead area of Atlanta. He has trained his sales staff to report comments and requests for services the store currently does not offer. Which services gap might this information help reduce?

9) The Hideaway shows photos of a wide, sandy beach on its website, leading visitors to assume the motel is located on or near the beach. However, in reality, the Hideaway is located half a mile from the beach. Which of the service quality gaps does this demonstrate?

10)

What are the potential gaps in the Service Gaps Model? What is it designed to do?

11) Mickey was impressed with the service he received at a local luggage store. He thought the salesperson was attentive and knowledgeable. His friend Pierre, who was with him and is very knowledgeable about luggage, thought the salesperson was pushy and not very experienced. What does this example suggest about customers’ service expectations?

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12) Most retail stores in the United States do 60 percent or more of their business in the period between Thanksgiving and Christmas. What can these stores do to get sales staff to provide “service with a smile” during this stressful part of the year?

13) The Federal Aviation Administration posts monthly percentage on-time arrival data for all the major airlines on its website. Some airlines are regularly on the top of the list, while others are frequently on the bottom of the list. What type of service gap does this list illustrate? What can airlines on the bottom of the list do to address this gap?

14) When visiting an art museum, you would expect to find knowledgeable museum guides who would be able to give you information on the museum’s collections and special exhibitions. If you did not find any trained museum guides to assist you, then the museum has what type of gap? Explain why you chose your answer.

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15) Cliff spoke to the customer service representative at DirectTV and was told all services, including the NFL Channel and Sport package would be included in his new plan. However, when he got his bill, he had been charged extra for these premium channels. Cliff called the company back and was told that since he didn’t record the conversation, they couldn’t verify what he was told, and he’d have to pay the bill. Explain which service gap(s) occurred in this instance.

16) Online reviews of the Sunsetter Motel by its customers indicate that the motel offered stale food, it advertised babysitting services that were not readily available, and had an assistant manager with a poor attitude. If you were the new manager of the Sunsetter Motel, how would you use the five dimensions of service quality to identify and correct the problems?

17) The school Lamar attends has an advising and registration day where students go to a large hall to sign up for classes. The school Teresa attends assigns each student to an individual faculty member who advises each student through their course of study. Teresa’s school is most likely emphasizing which of the five dimensions of service quality?

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18)

Name three ways a firm can evaluate service quality and give examples of each.

19) How can services marketers use customer complaints to better understand customer expectations?

20) What is the difference between a service standard of “be nice to customers” as compared to a service standard of “greet every customer, and if possible by name”?

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21) Sukran wants to develop a zone of tolerance analysis for her hair salon. What is a zone of tolerance in service quality? What types of questions would she need to ask to conduct her analysis?

22)

What are some of the outcomes that result from a communication gap?

23) Explain the concepts of emotional support and instrumental support. When are they important?

24) The Meridian Resort has a five-star rating and wants to keep it that way. The resort has specific standards for service and has trained its employees to deliver service according to these standards, but even one unhappy customer could endanger the resort’s reputation. What can the manager do to ensure that frontline employees offer consistent, excellent service to every visitor?

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25) Airline passengers in Europe receive much greater monetary compensation when they are bumped due to overbooking than do passengers in the United States. How do airline passengers determine what is “fair” when there is a service failure?

26) Many states have enacted “lemon” laws providing rights to consumers who purchase cars that need an excessive number of repairs. Service departments at auto dealerships quickly figure out which new models are going to create problems and often what the problems will be. If you were the service manager at a dealership, what would you do to address service problems like these?

27) Explain the concepts of distributive fairness and procedural fairness. Give an example of each.

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28) What should a service provider do when a customer gets emotional about the service failure?

29)

A service is any intangible offering that involves a deed, performance, or effort that

A) cannot be physically possessed. B) is high-priced. C) is supported solely through advertising. D) can be transformed into a physical product. E) offers benefits but not costs.

30)

By providing good customer service, firms ________ their products.

A) eliminate the communication gap for B) add value to C) reduce the assurance for D) reduce the empowerment cost associated with E) increase the perishability of

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31) Along the service-product continuum, which of the following would be considered the most service dominant?

A) grocery store B) apparel specialty store C) doctor’s office D) bookstore E) restaurant

32) Along the service-product continuum, which of the following would be considered the most product-dominant?

A) grocery store B) auto repair shop C) doctor’s office D) cell phone service provider E) restaurant

33)

Many product-dominant firms use quality service

A) as a way to minimize the cost of production. B) to support a standards gap. C) as a way to increase the perishability of their products. D) to install a voice of the customer program. E) to maintain a sustainable competitive advantage.

34)

In countries like the United States, services

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A) have almost all been replaced by technology. B) are a small portion of GDP relative to manufacturing. C) are replacing property taxes as a source of government revenue. D) will decrease in demand as the population ages. E) account for an increasing share of jobs.

35)

Food preparation, lawn maintenance, and housecleaning services are all examples of

A) services shifted abroad because costs are lower in developing countries. B) services an aging population will decrease the demand for. C) household maintenance activities that people increasingly pay others to perform. D) the price elasticity effect on services demand. E) the ability of empowerment to create tangible service products.

36)

Medical services and assisted living care are examples of

A) services shifted abroad because costs are lower in developing countries. B) services an aging population will increase the demand for. C) household maintenance activities that people increasingly pay others to perform. D) the price elasticity effect on services demand. E) the ability of empowerment to create tangible service products.

37)

Many services marketers use training and standardization to reduce service

A) knowledgeability. B) inseparability. C) intangibility. D) heterogeneity. E) perishability.

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38)

The marketing of services differs from product marketing because services are

A) tangible. B) inseparable. C) homogeneous. D) renewable. E) replenishable.

39) When marketers say that services are ________, they are referring to the fact that services cannot be touched, tasted, or seen, like a pure product can.

A) intangible B) inseparable C) heterogeneous D) perishable E) replenishable

40) Because services are ________, it is often difficult for marketers to convey the benefits to consumers.

A) heterogeneous B) inseparable C) intangible D) perishable E) substantial

41)

Which of the following refers to variability in a service’s quality?

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A) heterogeneity B) perishability C) service gap D) delivery gap E) communications gap

42) When marketers state that services are ________, they are referring to the fact that services are produced and consumed at the same time.

A) intangible B) inseparable C) heterogeneous D) perishable E) peripheral

43) The owners of hotels whose services are produced and consumed at the same time know that consumers do not have the opportunity to try out their service before purchasing. Many hotels use ________ to overcome the problem of inseparability of services.

A) promotional discounts B) zone of tolerance allowances C) perishability gap analysis D) point-of-purchase displays E) satisfaction guarantees

44) Liam relocated to take a new job, and when he got sick he needed to find a doctor. He discovered during the visit that he didn’t like the one he had chosen, and he knew he’d never go back to that doctor. From a marketing perspective, his situation highlights one of the key differences between products and services, known as

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A) intangibility. B) professional competence. C) perishability. D) inseparability. E) heterogeneity.

45) Nadine had several unpleasant experiences trying to find the merchandise she needed at a big box hardware store. The employees—when she could find them—rarely seemed to know where anything was outside of their own departments. But on her most recent visit, she was pleasantly surprised to find that the store had installed kiosks where she could get directions quickly and accurately. The store had found a technological solution to the services marketing issue of

A) intangibility. B) part-time employees. C) perishability. D) inseparability. E) heterogeneity.

46) When marketers state that services are ________, they are referring to the fact that services are not always of the same quality from one time period to another or from one service provider to another.

A) intangible B) inseparable C) heterogeneous D) perishable E) viable

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47) The old restaurant saying “You are only as good as the last meal served” reflects the fact that services are

A) intangible. B) perishable. C) heterogeneous. D) portable. E) viable.

48)

Marketers can take advantage of the variable nature of services by

A) merging services with products. B) customizing services to meet customers’ needs exactly. C) offering to expedite intangibles. D) expanding the standards gap. E) using strict standardization.

49) One approach marketers are using to reduce service ________ is to replace people with machines whenever appropriate.

A) intangibility B) inseparability C) spendability D) perishability E) heterogeneity

50) When marketers state that services are ________, they are referring to the fact that services cannot be stored for use in the future.

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A) intangible B) inseparable C) heterogeneous D) durable E) perishable

51) Because services like airline flights and hotel beds are ________, many marketers attempt to match demand with supply using pricing strategies.

A) intangible B) inseparable C) heterogeneous D) perishable E) accountable

52) Rafi manages a Sleep-Wise Inn along an interstate highway. He knows from experience that 5 to 10 last-minute customers will call after 8 p.m. each evening looking for a room and asking the price. Rafi has empowered his staff to offer discounts when the motel is largely vacant, and to quote the standard price when the motel is close to full. He knows his service is ________, meaning that if no one stays in the room, it generates no revenue that evening.

A) intangible B) inseparable C) heterogeneous D) durable E) perishable

53)

Because services like cruises and car rentals are perishable, many marketers use

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A) pricing strategies to match supply with demand. B) service quality to extend the life of the product. C) incentives to encourage staff to deliver according to standards. D) training to standardize delivery. E) machines to replace people for standard transactions.

54) Candace’s marketing research returned the finding that customers were staying away from her home goods store because of a lack of services like gift cards, return policies, and special orders. Candace was shocked. “Nobody ever asks about that stuff! If it were that important, people would ask about it.” Candace is likely suffering from a(n) ________ gap.

A) knowledge B) standards C) ethics D) delivery E) communications

55) Barnes & Noble bookstores have computers available for associates to use to search for books requested by customers and to place special orders. These computers are an example of

A) instrumental support. B) employee incentives. C) emotional support. D) line extensions. E) the delivery gap.

56) Which service gap is the Ritz-Carlton Hotel trying to address when it takes time and spends up to $1,700 to train a new employee?

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A) standards gap B) knowledge gap C) performance gap D) communication gap E) recovery gap

57)

A ________ gap always results in a service failure.

A) recovery B) standards C) knowledge D) communication. E) delivery

58) Although firms such as restaurants have difficulty controlling service quality from day to day, they do have control over

A) how they communicate the services they promise. B) the price of ingredients. C) the attitudes of customers. D) the way customers view them compared to competitors. E) the knowledge gap consumers create.

59)

If a firm promises more than it can deliver

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A) it has created an empowerment gap. B) consumers will have a knowledge gap. C) it creates a communication gap. D) it needs to enact a voice-of-customer program. E) perishability becomes a problem.

60) The ________ gap can be reduced by managing consumers’ expectations and promising only what can be delivered or possibly even a little less.

A) knowledge B) communication C) delivery D) standards E) empowerment

61) Physicians regularly overstate the expected recovery time from surgery, knowing that managing patients’ expectations will reduce the ________ gap associated with their service.

A) knowledge B) empowerment C) delivery D) standards E) communication

62) Roanoke Hardware was in bad financial shape. It owed so much money that vendors put the store on a cash-only delivery basis. As a result, the store had a dwindling inventory of goods to sell. Whenever a customer asked about an unavailable item, the owner directed the sales staff to say that it was on backorder and would be in stock next week. When the customer returned, the item was still unavailable. The owner’s policy created a(n) ________ gap.

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A) knowledge B) empowerment C) communication D) standards E) tangibility

63) The customers at Janelle’s Quik Coffee Shop want to grab a quick cup of coffee before boarding the commuter train into the city. The sign in the window promises “Quick, In-and-Out Service,” and usually Janelle keeps that promise. But one morning, customers were frustrated when the staff behind the counter showed more interest in gossiping about their social lives than in waiting on customers. Janelle’s shop is suffering from a ________ gap.

A) knowledge B) standards C) social expectations D) delivery E) communications

64) When there is a significant difference between the service customers receive and the service the firm promotes, the firm has a ________ gap.

A) knowledge B) standards C) social expectations D) delivery E) communications

65)

The Service Gaps Model is designed to highlight those areas where

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A) service providers provide the best possible service. B) manufacturers are cutting corners on product quality. C) customers believe they are getting less or poorer service than they should. D) service providers know more than their customers. E) delivered service exceeds expected service.

66) When the delivery of a service fails to meet customers’ expectations, a ________ gap exists.

A) service B) knowledge C) standards D) production E) procedural

67) For years, the Mogul Sheraton, a four-star hotel overlooking the Taj Mahal in India, offered free elephant and camel rides to hotel visitors. Few customers took advantage of this service. This is an example of a ________ gap in services marketing.

A) seniority B) knowledge C) standards D) delivery E) communication

68) Jacques manages an upscale French restaurant in the Philadelphia area. His restaurant offers a few specials each evening in addition to its regular menu. Jacques has trained his servers to report comments and requests for items that have previously been offered only as specials. Jacques uses this information to reduce the ________ gap in services marketing.

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A) seniority B) knowledge C) standards D) delivery E) communication

69)

To meet or exceed customers’ expectations, marketers must

A) know where customers live. B) know how often consumers buy their products. C) determine what those expectations are. D) recognize that expectations are tangible. E) empower customers to meet their own expectations.

70) A ________ gap reflects the difference between customers’ expectations and the firm’s perception of those customer expectations.

A) seniority B) knowledge C) standards D) delivery E) communication

71) Firms can close the ________ gap by matching customer expectations with actual service through use of marketing metrics.

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A) seniority B) knowledge C) standards D) delivery E) communication

72) The ________ gap can be closed by getting employees to meet or exceed service standards when the service is being delivered by empowering service providers, providing support and incentives, and using technology where appropriate.

A) communications B) knowledge C) standards D) delivery E) acceptance

73)

Training service providers to know exactly what a “good job” entails is setting service

A) knowledge. B) quality. C) delivery. D) standards. E) empowerment.

74) Layla is the new manager of a resort hotel. She knows from reviewing customer complaints that service quality at the hotel is not consistently meeting customers’ expectations, and she believes that the biggest problem is that her employees are not sure what is expected of them. To improve service quality, Layla will

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A) empower customers to meet their own service needs. B) establish a broad zone of intolerance to reduce customer complaints. C) narrowly define a knowledge gap. D) separate intangibles from tangibles. E) set specific, measurable goals based on customers’ expectations.

75) Services marketing managers have learned that more employees will support a qualityoriented process if

A) they are involved in setting the goals. B) perishable services are replaced with tangible services. C) they are required to diverge from existing standards. D) customers are responsible for setting service quality standards. E) the process involves both part-time and full-time employees.

76) When corporate headquarters announced new service quality standards for pizza franchise owners, Donald knew he would have trouble gaining employees’ support because

A) they were not involved in setting the goals. B) perishable services were being replaced with tangible services. C) they were not allowed to diverge from existing standards. D) customers were required to create service quality standards. E) the process involved both part-time and full-time employees.

77) When Juanita booked a room at the Wintergarden Resort, she expected that her room would be ready when she got there, the swimming pool would be heated, the advertised singer would be able to sing, and the breakfast would be fresh. When she arrived, she had to wait for her room, found the swimming pool to be 50 degrees, realized the singer could not carry a tune, and the free continental breakfast was stale. The Wintergarden Resort was experiencing a severe ________ gap.

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A) communications B) knowledge C) standards D) delivery E) expectations

78) If there is a difference between the firm’s perceptions of customers’ expectations and the service standards the firm has set, a ________ gap exists.

A) seniority B) knowledge C) standards D) delivery E) communication

79) By setting appropriate service standards and measuring service performance, firms can attempt to close a ________ gap.

A) seniority B) knowledge C) standards D) delivery E) communication

80) In services marketing, the saying “where the rubber meets the road” refers to whether or not a(n) ________ gap exists.

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A) knowledge B) quality C) delivery D) standards E) empowerment

81) Ashburn Grill is known as the premier restaurant in town. With its elegant dining area, extensive wine list, and gourmet chef, residents and tourists flock to the restaurant. Recently, Ty took a large group to the Ashburn Grill and almost every diner sent their entrée back to the kitchen. The Ashburn Grill was experiencing a(n) ________ gap in service quality.

A) knowledge B) communication C) standards D) delivery E) empowerment

82) A(n) ________ gap exists when a firm knows what it needs to do to meet customers’ service expectations, but sometimes fails to do it.

A) knowledge B) communication C) standards D) empowerment E) delivery

83) ________ means allowing employees to make decisions about how service is provided to customers.

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A) Endorsement B) Quality control C) Standardization D) Empowerment E) Authorization

84) Empowerment is when ________ are authorized to make decisions to help their customers and, as a result, service quality generally improves.

A) consultants B) middle managers C) corporate executives D) production control managers E) frontline employees

85)

Using technology and ________ are two ways a delivery gap can be reduced in size.

A) empowering employees B) variability analysis C) voice-of-customer analysis D) zone of tolerance analysis E) public relations

86)

Empowerment of employees helps address the delivery gap because

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A) employees directly involved with the customer can respond effectively at the moment the problem occurs. B) customers appreciate feeling empowered. C) management then doesn’t need to devote time and energy to resolving service delivery problems. D) employees spend less time resolving problems than managers would. E) it ultimately contributes to employee knowledge and retention.

87) When Dr. Ross checked in at the Ritz-Carlton, it was 3 a.m. He had been traveling for over 12 hours and was exhausted. His suit, which he needed for a speech that morning, looked like he had slept in it. Dorina, the night clerk, offered to find a 24-hour dry cleaner and have the suit cleaned while Dr. Ross got a few hours of sleep. Dorina’s actions are an example of

A) the variability associated with service quality performance. B) empowerment of employees to meet customers’ needs. C) procedural fairness. D) specific service standards. E) public relations to increase puffery.

88)

Empowerment becomes more important when the service is

A) institutionalized. B) repetitive. C) individualized. D) routine. E) standardized.

89)

The old cliché “Service with a smile” recognizes the fact that

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A) service providers need to be pleasant even if the customer is not. B) smiling is contagious. C) service providers should smile and not think. D) life is too short to be ugly. E) services are perishable, but a smile is forever.

90) Service providers often encounter rude and unreasonable consumers. Services marketing managers can reduce the delivery gap, even for these customers, by

A) empowering consumers. B) providing support and incentives for their employees. C) directing zone of tolerance limits for employees. D) doing effective customer screening. E) forcing rude customers to use technology.

91) After observing a customer verbally abuse a server, the first thing a manager can do to ensure quality service is to

A) throw the customer out of the restaurant. B) assume the server provoked the attack and respond accordingly. C) provide emotional support to the server. D) review the delivery support system. E) make sure services delivery expectations are consistent and coherent throughout the organization.

92) Managers of fast-food restaurants struggle with a rapid turnover of personnel. Employee turnover rates of 100 to 200 percent annually are common. The work environment is difficult, and customers can often be demanding. One of the first steps managers can take to help workers deliver quality service is to

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A) ban abusive customers from their restaurants. B) reward service providers based solely on the speed of service. C) provide emotional support and concern for their employees. D) review the delivery support system. E) make sure services delivery expectations are consistent and coherent throughout the organization.

93)

________ provides the equipment or systems needed to perform a task in a job setting.

A) Service infrastructure B) Quality mechanics C) Instrumental support D) Dynamic support E) Customer interface architecture

94) Jose was complaining to another member of the lawn crew, “I don’t know how they expect me to do an adequate job. The mower doesn’t work right, the trimmers are so dull they don’t cut anything, and the rest of the equipment is so old that we can’t get parts.” Jose’s company lacks the ________ workers need to be able to do a good job.

A) maintenance schedule B) instrumental support C) emotional support D) service infrastructure E) customer expectation mechanisms

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95) The Broadmoor Hotel in Colorado Springs, Colorado, maintains its five-star rating by focusing on five service characteristics: reliability, responsiveness, assurance, empathy, and tangibles. The hotel has been updating rooms built in the early part of the 20th century to meet the needs of 21st-century visitors. To accomplish this, it spent millions in improvements, renovating rooms, and adding a new outdoor pool complex. These renovations focus on the ________ service characteristic.

A) empathy B) reliability C) assurance D) tangibles E) responsiveness

96) The Broadmoor Hotel in Colorado Springs, Colorado, maintains its five-star rating by focusing on five service characteristics: reliability, responsiveness, assurance, empathy, and tangibles. Employees are instructed to always address a guest by name, if possible. To accomplish this, employees are trained to listen and observe carefully to determine a guest’s name. Which service characteristic is this an example of?

A) empathy B) tangibles C) responsiveness D) assurance E) reliability

97) Roberto has been directed by his boss to determine if the company is meeting customers’ service quality expectations. One of Roberto’s problems is that services are ________, making evaluation of service quality difficult.

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A) quantifiable B) substantial C) unequally distributed D) intangible E) inconsequential to customers

98) Which of the following is included in the five dimensions used by consumers to determine overall service quality?

A) assurance B) certifiability C) acceptability D) heterogeneity E) intangibility

99) Celeste will let only Martiné cut her hair. She has tried other stylists, but she knows from experience that Martiné cuts her hair well every time. For Celeste, ________ is the most important of the five service quality dimensions.

A) assurance B) reliability C) tangibles D) responsiveness E) empathy

100) Students regularly seek out Professor Hunter to advise them. She has an exceptional manner, and students are confident in her and trust her advice. For these students, ________ is the most important of the five service quality dimensions.

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A) assurance B) reliability C) tangibles D) responsiveness E) empathy

101) Garth’s Tire Service provides each employee with a clean, sharp-looking uniform. It also instructs employees to put all tools back where they belong and keep the work area clean and uncluttered. Garth’s Tire Service emphasizes ________ in the five service quality dimensions.

A) assurance B) reliability C) tangibles D) responsiveness E) empathy

102) Because services are intangible, it is often difficult for customers to determine how a service meets their expectations, which marketers call

A) service perceptions. B) service efforts. C) service quality. D) service aspirations. E) service feedback.

103) A systematic ________ program collects customer inputs and integrates them into managerial decisions.

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A) quality gap analysis B) empowerment C) zone of tolerance D) standards analysis E) voice-of-customer

104)

The building blocks of service quality are reliability, assurance, tangibles, empathy, and

A) support. B) empowerment C) customer service. D) communication. E) responsiveness.

105) Capital One Bank uses a complex polling system coupled with a customer response measurement system to assess consumers’ responses to new products and services. Capital One is using a(n) ________ program to improve service quality and service offerings.

A) quality gap analysis B) empowerment C) zone of tolerance D) standards analysis E) voice-of-customer

106) When choosing where to eat lunch, Bart’s major service criterion is speed: being seated promptly and served his meal quickly. For Bart, ________ is the most important of the five service quality dimensions.

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A) assurance B) reliability C) tangibles D) responsiveness E) empathy

107) The service dimension called ________ refers to the ability of the firm’s employees to convey trust and confidence.

A) assurance B) reliability C) responsiveness D) empathy E) tangibles

108) The new hotel manager asked the pastry chef, “Are you sure you know how to cook Baked Alaska?” Which of the service dimensions was the hotel manager expressing concern about?

A) reliability B) responsiveness C) assurance D) empathy E) tangibles

109) Danielle was looking for a venue for her wedding reception. When she visited one potential location, she noticed that the landscaping was not complete, and there was stained carpet in the lobby. Which of the service quality building blocks caused Danielle to select an alternative venue?

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A) tangibles B) reliability C) responsiveness D) assurance E) empathy

110) When Jamie checked into his Orlando hotel, the front desk clerk informed him that his room would not be ready for another 20 minutes. Jamie didn’t mind waiting; he had arrived well ahead of the standard check-in time and this wait time fell within his ________, the area between his expectations regarding desired service and the minimum level of service he will accept.

A) zone of tolerance B) delivery gap C) zone of intolerance D) service gap E) patience zone

111) To define the zone of tolerance, firms ask a series of questions about each service quality dimension that relate to

A) the perishability of the service. B) the level of empowerment customers get. C) customers’ perceptions of how established the company is. D) the importance of communication. E) the desired and expected level of service for each dimension, from high to low.

112) Curtis knows his restaurant is understaffed today. He is hoping to get through the day without falling below his customers’________, the difference between what his customers want and what they will accept before going elsewhere.

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A) voice-of-customer quotient B) empowerment standard C) tangibles gap D) zone of tolerance E) quality gap

113) Customers have a defined ________ when it comes to waiting in line at a retail checkout counter. The amount of time consumers are willing to wait varies with the type of store.

A) voice-of-customer quotient B) empowerment standard C) tangibles gap D) zone of tolerance E) quality gap

114) An excellent, inexpensive, and readily accessible method for assessing customers’ service expectations is

A) customer complaints. B) syndicated data services. C) employee empowerment programs. D) distributive fairness analysis. E) management by objective programs.

115) What is the problem associated with service quality standards such as “be nice” or “do what the customers want”?

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A) They create low expectations. B) They are not specific. C) They do not allow for the voice-of-customer process. D) Most employees are unwilling to do what customers want. E) They create a delivery gap.

116) By changing a standard from “be nice to customers” to “greet every customer, and if possible by name,” a services marketing manager has created a(n) ________ goal.

A) insurmountable B) invisible C) empowerment D) measurable E) inseparable

117) Today, almost every sales representative can immediately check the company’s inventory and production schedule electronically. This allows sales reps to sell what is available and make promises to customers that they can keep. This technology has improved service delivery through

A) access to a wide variety of services. B) greater control by customers over service delivery. C) increased zone of tolerance. D) greater ability to obtain information. E) saving customers time.

118) When Camden Bank required all customers to use its online banking services, over 30 percent of its customers closed their accounts. In this scenario, Camden Bank’s service fell outside customers’

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A) zone of tolerance. B) delivery gap. C) zone of intolerance. D) service gap. E) patience zone.

119) When Lemor arrived at her hotel room and saw that the bed sheets had not been changed from the last hotel guest and there were cockroaches in the bathroom, she chose to go elsewhere. An undone, bug-infested room was not in Lemor’s ________, which is the difference between what she really wants and what she will accept before looking for another hotel.

A) zone of tolerance B) delivery gap C) zone of intolerance D) service gap E) patience zone

120) When managers understand what their service providers are facing on a day-to-day basis by directly observing them and talking to customers, it is called management by

A) empowerment. B) marketing research. C) high expectations. D) walking around. E) being responsive.

121)

Effective service recovery entails

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A) arguing with the customer. B) estimating the damage. C) providing a solution that benefits the company. D) resolving the problem quickly. E) sending the problem to mediation.

122)

Sometimes all that needs to be done to satisfy a customer complaint is to

A) listen to the customer. B) demonstrate loyalty. C) empower the customer. D) respond in a straightforward manner. E) get management involved.

123)

Effective service recovery efforts can lead to

A) lower purchase intentions. B) increased positive word of mouth. C) decreased customer satisfaction. D) higher levels of satisfaction than prior to the service failures. E) increased dependence on technology to prevent future service failures.

124) Chen was called in to meet with his boss, Amira. He was afraid he was going to be fired for the mistake he had made dealing with an important customer of the store. Instead, Amira explained that he had handled the situation well, listening to the customer and finding a fair solution. Amira told him that, even more important, working the way he did to correct the error could result in

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A) a smaller empowerment gap. B) increased customer purchases and positive word of mouth. C) a full refund for the customer. D) a larger service gap. E) less instrumental support.

125) When confronted with an angry and emotional customer, the best first step toward service recovery is to

A) call security in case it is necessary to escort the person from the building. B) match the person’s voice in intensity and volume to gain control of the confrontation. C) gently but firms tell the person you will not tolerate being addressed in that tone of voice and turn away until he or she calms down. D) listen carefully and with empathy until the customer feels he or she has been heard. E) ask a coworker to take over handling the complaint to get a neutral perspective.

126) Service employees at the airlines’ flight cancelation desks frequently encounter travelers who get emotional about canceled or delayed flights. The first thing these employees should do is to

A) listen to the customer. B) contact a supervisor. C) estimate the damage. D) provide a fair solution. E) resolve the problem quickly.

127) When travelers are bumped from overbooked flights, they are frequently offered vouchers good for future travel. The dollar value of the voucher is the airline’s estimate of

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A) perishable value. B) distributive fairness. C) empowerment. D) procedural justice. E) the size of the knowledge gap.

128) Because customers have different needs and expectations, the key to distributive fairness in service recovery is to

A) listen to the customer. B) contact a supervisor quickly. C) estimate the damage. D) provide a fair solution. E) resolve the problem quickly.

129)

________ is the first step in service recovery.

A) Contacting the supervisor B) Listening to the customer C) Estimating the damage D) Providing an acceptable solution E) Resolving the problem

130) Stefan arrived at the hotel to find that, although he had a guaranteed reservation, the hotel had no rooms available. He became angry when the hotel made him a reservation at a more expensive hotel but refused to pay the difference in room rates. Stefan was upset because, in his opinion, the hotel’s solution did not incorporate

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A) intangible fairness. B) distributive fairness. C) procedural fairness. D) service fairness. E) empowerment fairness.

131) Most customers want to achieve a fair solution following a service failure. Which of the following factors affect a person’s perceptions of “fairness” in these kinds of situations?

A) increased zone of tolerance B) the customer’s experience with other firms C) the firm’s policy on service recovery D) existence of a voice-of-customer (VOC) program E) understanding the company’s standards gap

132) ________ fairness refers to the perceived fairness of the process with which a firm handles customer complaints.

A) Procedural B) Intangible C) Distributive D) Service E) Empowerment

133) Because of ________, many companies have altered their “no questions asked” return policies to include time limits, “restocking” fees, and store-credit-only refunds.

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A) government regulations B) Better Business Bureau guidelines C) high costs D) accounting concerns E) well-publicized liability cases

134)

One of the reasons service failures need to be addressed quickly is to

A) minimize the zone of tolerance. B) increase empowerment zones. C) avoid negative word of mouth from upset customers. D) avoid a situational ethics conflict. E) keep management from finding out what happened.

135)

Which of the following are recommended strategies for service recovery?

A) attending mediation B) finding a solution beneficial to the company at any cost C) resolving problems quickly D) silencing an irate customer before the individual makes any angry outbursts E) providing alternate scenarios for why this is not the company’s problem

136) One afternoon, the clerk at the customer service desk of a large retail store got bored and started stating different return policies to each customer. Customers waiting in line and overhearing the different policies would probably feel that the store’s handling of returns lacked

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A) procedural fairness. B) variability. C) organizational fairness. D) intangibility. E) explanatory fairness.

137) Firms that primarily sell products view service as a method to maintain a sustainable competitive advantage. ⊚ ⊚

138)

true false

All products and services are intangible. ⊚ ⊚

true false

139) The marketing of services differs from the marketing of products because services are tangible and separable from the service provider. ⊚ ⊚

true false

140) The Service Gaps Model encourages the systematic examination of all aspects of the product creation process. ⊚ ⊚

Version 1

true false

141) A delivery gap is the difference between the firm’s service standards and the actual service it provides to customers. ⊚ ⊚

true false

142) The knowledge gap is where “the rubber meets the road,” where the customer directly interacts with the service provider. ⊚ ⊚

true false

143) In the service context, empowerment means allowing employees to make decisions about how service is provided to customers. ⊚ ⊚

144)

true false

The communication gap can be reduced by managing customer expectations. ⊚ ⊚

true false

145) Marriott Hotels trains its front desk employees to dress neatly and conservatively to project a professional image. This relates to the service dimension of tangibles. ⊚ ⊚

true false

146) Renatta was employee of the month at Sonic Subs, primarily because she provided excellent customer service by serving food quickly. This relates to the reliability service dimension. Version 1

⊚ ⊚

true false

147) The zone of tolerance refers to the area between customers’ expectations regarding their desired service and the minimum level of acceptable service. ⊚ ⊚

true false

148) In training service providers, service quality goals should be general to allow for the various needs of consumers. ⊚ ⊚

true false

149) Procedural fairness pertains to a customer’s perception of the benefits he or she received compared with the costs (inconvenience or loss). ⊚ ⊚

true false

150) Distributive fairness pertains to a customer’s perception of the benefits received compared to the costs of the inconvenience or loss. ⊚ ⊚

Version 1

true false

Answer Key Test name: Chapter 13 Test Bank 29) A 30) B 31) C 32) A 33) E 34) E 35) C 36) B 37) D 38) B 39) A 40) C 41) A 42) B 43) E 44) D 45) E 46) C 47) C 48) B 49) E 50) E 51) D 52) E 53) A 54) A Version 1

55) A 56) A 57) E 58) A 59) C 60) B 61) E 62) C 63) D 64) E 65) C 66) A 67) B 68) B 69) C 70) B 71) B 72) D 73) D 74) E 75) A 76) A 77) B 78) C 79) C 80) C 81) D 82) E 83) D 84) E Version 1

85) A 86) A 87) B 88) C 89) A 90) B 91) C 92) C 93) C 94) B 95) D 96) A 97) D 98) A 99) B 100) A 101) C 102) C 103) E 104) E 105) E 106) D 107) A 108) A 109) A 110) A 111) E 112) D 113) D 114) A Version 1

115) B 116) D 117) D 118) A 119) A 120) D 121) D 122) A 123) B 124) B 125) D 126) A 127) B 128) A 129) B 130) B 131) B 132) A 133) C 134) C 135) C 136) A 137) TRUE 138) FALSE 139) FALSE 140) FALSE 141) TRUE 142) FALSE 143) TRUE 144) TRUE Version 1

145) TRUE 146) FALSE 147) TRUE 148) FALSE 149) FALSE 150) TRUE

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Student name:__________ 1) Developing a good pricing strategy is essential to the financial well-being of a firm. Even though a firm has an excellent strategy, what are continuing threats to the strategy?

2) Suppose that a friend asks you to drive him to the airport this weekend so he can catch a flight. He pays you for the gas used driving to the airport, and for the cost of parking the car at the airport while you help him in with his bags. He then declares that you are now “even,” since he has fully compensated you for any costs you incurred in helping him get to his flight. From your perspective, what aspects of the “price” of taking your friend to the airport has he omitted?

3) Most public colleges charge less than half the price of similar private colleges. How can each type of college be delivering value?

4) What five components should be taken into consideration when a company is developing its pricing objectives?

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5) What methods might a firm use when pricing based on a profit orientation and how do they differ?

6) Oscar’s Food Shoppe is trying to compete with the local Subway store. When Subway offers lower prices on certain sandwiches during its “customer appreciation month,” Oscar’s reduces the price of its similar subs in order to compete. What pricing orientation is being utilized by Oscar’s Food Shoppe?

7) If upscale manufacturers of prestige products like BMW autos, Tiffany glass, or Rolex watches offered lower-priced products, what might happen to the demand for their products? Why?

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Explain how the demand curve works, and how it benefits a firm.

9) David-Michael is conducting an experiment, charging different prices for the same products at different stores and measuring sales. With this information, he will construct a demand curve. How can David-Michael use this information?

10) Yana initially charged $80 for an hour-long massage and averaged 20 clients per week. When she raised her price to $100, the number of massages decreased to 15 per week. What is the price elasticity of demand for her service?

11) How is the price elasticity for Colgate toothpaste likely to be different from the price elasticity for all toothpastes (a product category)? Why are they likely to be different?

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12) When the major league baseball season opens in April, teams that are located in the Midwest and Northeast are still experiencing colder and frequent rainy weather. This often results in fewer fans attending these April games. What can these ball clubs do to maximize their revenue during this time period?

13)

How is consumer behavior affected by the “income effect”?

14)

Explain the difference between fixed and variable costs and provide examples of each.

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15) Quentin estimates the fixed costs associated with opening a new bank branch are $500,000. He estimates the branch will attract 1,000 new customers who will cost $50/year to service each of their accounts. He also expects to generate $100,000 in fees annually from these accounts. What will be the total cost of opening the new branch and remaining open for one year?

16) Small-business consultants are constantly admonishing would-be entrepreneurs, “Beware of the overhead.” Using an overhead (fixed costs) of $100,000 and then an overhead of $200,000, with a contribution per unit of $50, determine the break-even points.

17) Harold has always used standard markups to determine the prices for his clothing products. You are advising him to change his pricing strategy. What advice would you give Harold?

18) Why might it be considered more fun and challenging for a marketer to be part of a market characterized by monopolistic competition than be part of one characterized by pure competition?

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19)

Differentiate between the four levels of competition and offer examples of each type.

20)

Why are price wars more common in oligopolies than in pure competition markets?

21) When CarMax promises a “no-haggle” pricing structure, it exhibits ________ because it provides additional value to potential used car buyers by making the process simple and easy.

A) a customer orientation B) a status-quo pricing structure C) competitive parity D) a competitor orientation E) consumer parity

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22) Raoul was known for driving 20 miles just to save a dollar on the price of his favorite beverage. Raoul perceived price as ________ for a good or service, while most consumers recognize price as the ________ made to acquire a good or service.

A) the money paid; overall sacrifice B) a variable cost; fixed cost C) a fixed cost; variable payment D) the overall sacrifice; monetary payment E) the break-even amount; total cost

23)

________ are included in the full price of a product or service.

A) Delivery costs B) Extended warranties C) Travel costs D) The prices of alternative products and services E) Market perceptions

24) Consumers generally believe that ________ is one of the most important factors in their purchase decisions.

A) promotion B) place C) product D) perception E) price

25) ________ is the cash expenditure plus taxes that consumers have to pay for a good or service.

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A) A warranty B) A trade C) Competitive value D) Price E) Consumer perception

26)

Unlike product, promotion, or place, price is the only part of the marketing mix

A) that offers the opportunity for an oligopoly. B) that is subject to gray market manipulation. C) that leads to competition. D) that generates revenue. E) that is determined by the consumer.

27) In developing marketing strategies, why is price often the most challenging of the four Ps to manage?

A) because most managers feel it is the least important element of the marketing mix B) because it is the least understood element of the marketing mix C) because it has to be based on the promotion budget for the product D) because it is difficult to calculate markups for products E) because managers don’t understand the relationship between benefits and costs

28)

Historically, prices were

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A) the center of attention in almost all marketing strategies. B) analyzed and changed constantly. C) calculated to minimize contribution per unit. D) allowed to vary seasonally as cross-shopping tendencies fluctuated. E) rarely changed except in response to radical shifts in market conditions.

29) Firms using a ________ to set prices believe that increasing sales will help the firm more than will increasing profits.

A) sales orientation B) customer orientation C) competitive parity D) demand curve E) competitor orientation

30)

________ is/are one of the five Cs of pricing.

A) Customers B) Communication C) Correlation D) Collaboration E) Contribution per unit

31) Hayla is the marketing manager for a fast-food restaurant chain. She uses a target return pricing strategy because her firm’s primary objective is to

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A) increase profits. B) increase sales. C) decrease competition. D) build customer satisfaction. E) broaden the product line.

32) Ozzie is the marketing manager for an automobile dealership. His boss tells him the firm’s primary goal is to increase its local market share from 15 to 30 percent. His firm is using a ________ orientation.

A) profit B) sales C) competitive D) customer satisfaction E) product development

33) When Delta increases its average fares, American Airlines and United often follow with similar increases. This is an example of

A) competitor orientation. B) customer orientation. C) status-quo pricing. D) customer orientation. E) adding value.

34) Abdul’s firm has set corporate direction to become one of the leaders in each of its significant market segments. It was Abdul’s job to examine the firm’s pricing strategy to determine how to maximize market share, even at the expense of profits in the short run. What kind of company objective would guide Abdul’s effort?

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A) industry-oriented B) sales-oriented C) competitor-oriented D) innovation-oriented E) customer-oriented

35) Naomi tells her sales representatives the goal is to generate at least a 15 percent return on investment for all of the industrial building supplies they sell. Naomi is using a ________ pricing strategy.

A) sales orientation B) target profit C) target return D) status-quo E) competitive parity

36) A ________ strategy involves accurately measuring all the factors needed to predict sales and profits at various price levels, so that the price level that produces the highest return can be chosen.

A) sales orientation B) target profit C) target return D) status-quo E) maximizing profits

37) Health clubs often use a low introductory offer price to get people to join their club. These low prices represent a ________ pricing strategy.

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A) maximizing profits B) target profit C) target return D) status-quo E) sales orientation

38) Many years ago Honda’s Accord and Ford’s Taurus were the two top-selling cars in the United States. As the year was coming to an end, Ford cut the price of the Taurus, hoping to outsell the Accord and allow Ford to claim that “Taurus is the best-selling car in America.” Ford was using a ________ pricing strategy.

A) maximizing profits B) target profit C) sales orientation D) status-quo E) target return

39) Juliannna wants her firm’s gourmet snacks to be the leading brand in the U.S. market. When adopting a pricing strategy designed to gain market share, she should remember that

A) rarely is the lowest-price offering the dominant brand in a market. B) prestige products need to be competitively priced. C) companies can gain market share by offering low-quality products at a high price. D) total value equals total cost minus variable costs leading to price escalation. E) price wars are the way to become the dominant brand.

40) Rita knew that her established customers liked her product much better than her competitor’s. She was planning to expand into new markets, and she was considering pricing. She was leaning toward charging a higher price than competitors to help demonstrate that hers was a high-quality product. Rita was considering

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A) a top of market strategy. B) the value of quality. C) advantageous pricing. D) premium pricing. E) differential pricing.

41) When Ursula decides how to price new products in her gift store, she measures the value of her product offerings against those of the other stores in her area. Ursula uses a ________ pricing strategy.

A) maximizing profits B) target profit C) target return D) competitor-oriented E) sales-oriented

42) Byron gave the manager of his convenience store a set of binoculars so she could see the gasoline prices charged by the other convenience store at that intersection. Byron told the manager to always match the gasoline prices of the other store. Byron is using a ________ pricing strategy.

A) maximizing profits B) target profit C) target return D) status-quo E) sales

43)

When firms set prices similar to those of competitors, they are following a strategy of

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A) me-too pricing. B) copycat pricing. C) competitive parity. D) market-broadening pricing. E) industry-standard pricing.

44) In many high-end resort markets, Westin hotels compete directly with Crown Plaza hotels. When it comes to pricing, Westin tends to charge its guests similar rates to what the Crown Plaza hotels charge. Westin is using a ________ pricing strategy.

A) maximizing profits B) target profit C) target return D) competitive parity E) sales-oriented

45) Dana owns a bakery where she sells cupcakes. Two blocks down there is another bakery, Sweet’s Bakery, that sells cupcakes for $1 less than Dana. Dana decides to lower her price and match Sweet’s Bakery prices. What type of pricing strategy is Dana implementing?

A) internal pricing B) profit-oriented pricing C) competitor-oriented pricing D) customer-oriented pricing E) sales-oriented pricing

46)

A customer orientation toward pricing implicitly invokes the concept of

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A) knowing the dimensions of the target market. B) positioning. C) the income effect. D) value. E) profit.

47)

A “no-haggle” pricing policy is a type of _____ pricing strategy.

A) maximizing profits B) sales orientation C) target return D) status-quo E) customer-oriented

48) Imelda’s is an upscale women’s clothing store. Prices are based on customers’ beliefs about the value of the clothing. The store focuses on a limited target market and provides excellent customer service. Imelda’s is using a ________ pricing strategy.

A) customer-oriented B) target profit C) target return D) status-quo E) maximizing profits

49) A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy, especially if the strategy

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A) leads the marketer to being the low-cost seller. B) is supported by consistent advertising and distribution strategies. C) challenges consumers to discard their perceptions of value. D) is consistent with a competitive target return strategy. E) is measured against the competition.

50) Traditional demand curve economic theory is used by marketers to understand ________ in the five Cs of pricing.

A) competitors B) channel members C) cost D) customers E) company objectives

51) Customers must see value in a product or service before they are willing to exchange time or money to obtain it, but not all customers see the same value in a product. To analyze how many units will be sold at any given price point, marketers draw on

A) a demand curve. B) the law of averages. C) multiple regression analyses. D) target return strategies. E) a sales orientation.

52) A demand curve shows the relationship between ________ during a specific period of time.

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A) income and demand B) price and costs C) price and elasticity D) profit and price E) price and demand

53)

A demand curve is built on the assumption that

A) income is derived from demand. B) price remains the same, and fixed costs change. C) everything but price and demand remains the same. D) fixed costs change with quantity demanded. E) the firm does not advertise.

54)

According to a typical demand curve, the higher the price,

A) the greater the income effect. B) the lower the quantity consumers will buy. C) the lower the output of producers. D) the greater the production costs. E) the lower the cross-price elasticity.

55) French luxury goods manufacturer and retailer Hermès is known for making expensive leather goods. But paying $300,168 for a handbag at auction, which is over the standard retail price of $280,000, is extraordinary, and not for the casual shopper. The handbag is considered a

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A) product in demand. B) inelastic product. C) elastic product. D) custom product. E) prestige product.

56)

______ shows the relationship between income and demand.

A) Target return B) Parity pricing C) Prestige pricing D) A demand curve E) A supply curve

57) There is an old saying “If you have to ask the price of a yacht, you cannot afford it.” Products like yachts are most likely to be associated with

A) cross-shopping. B) competitive parity pricing. C) target return value. D) prestige pricing. E) break-even point pricing.

58) The price elasticity of demand for a teeth-whitening kit is −1.5. The market for this product is considered

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A) inelastic. B) elastic. C) dynamic. D) saturated. E) a prestige market.

59) The price elasticity of demand for a specific brand of deodorant is −.9. The market for this product is considered

A) inelastic. B) elastic. C) saturated. D) dynamic. E) a prestige market.

60) When it comes to measuring consumers’ price sensitivity, product prices are viewed as either

A) elastic or inelastic. B) fixed or variable. C) complementary or substitutable. D) necessary or optional. E) dynamic or rigid.

61)

For which of the following is demand likely to be least sensitive to price increases?

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A) spring break vacations B) a specific brand of cereal C) prescription drugs D) theater tickets E) restaurant meals

62)

For which of the following is demand likely to be most sensitive to price increases?

A) prescription drugs B) college tuition for last-semester seniors C) electricity D) hospital care E) a specific brand of soft drink

63) A study found that, among addicted smokers, a 10 percent increase in the price of cigarettes resulted in a 2 percent decrease in quantity demanded. For these consumers, cigarettes have a(n) ________ price elasticity demand.

A) elastic B) inelastic C) cross-price D) income effect E) substitution effect

64) What situation is occurring if a 1 percent decrease in price results in more than a 1 percent increase in quantity demand?

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A) Demand is cross-price elastic. B) Demand is price inelastic. C) Demand is price elastic. D) Demand maintains the status quo. E) Demand results in the income effect.

65) Assume the demand for electricity, a necessity with few substitutes, is −0.2. If the electric company raised its rates by 10 percent, we would expect

A) a 10 percent decrease in quantity demanded. B) a 2 percent increase in quantity demanded. C) a 10 percent increase in quantity demanded. D) a 2 percent decrease in quantity demanded. E) a 5 percent decrease in quantity demanded.

66) If a 1 percent decrease in price results in less than a 1 percent increase in the quantity demanded, demand is

A) cross-price elastic. B) price inelastic. C) price elastic. D) status-quo elastic. E) derived demand inelastic.

67) Samar customizes Harley-Davidson motorcycles. No two cycles are alike. He notices that very few customers even ask the price of his motorcycles before they decide to purchase them. Demand for his motorcycles is probably

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A) price sensitive. B) price elastic. C) price inelastic. D) income elastic. E) cross-price elastic.

68) The observation that consumers are generally more sensitive to price increases than to price decreases suggests that

A) most consumers cannot remember what price they paid the last time they bought a particular product. B) it is easier to lose customers with a price increase than to gain customers with a price decrease. C) most consumers would rather skip buying a product than pay a higher price. D) most consumers are emotionally attached to their favorite products and are unlikely to change, even if the price changes. E) firms gain more customers with price decreases than they lose with price increases.

69) The Curtain’s Coffee company is located in a business district with few customers on the weekend. To attract customers on Saturday and Sundays, it reduces its prices on these two days. This is an example of

A) dynamic pricing. B) the substitution effect. C) the income effect. D) the target return effect. E) cross-price elasticity.

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70) Annika operates on a pretty tight budget. She is a price-conscious shopper and usually buys store or generic brands to save money. Recently, however, Annika was given a pretty substantial raise. As such, she has altered her shopping patterns and now regularly buys more expensive, name-brand goods. This is an example of

A) the substitution effect. B) the price inelasticity coefficient. C) the income effect. D) the target return effect. E) cross-price elasticity.

71) Sales of national brands of orange juice tend to increase when the economy is doing well, while sales of generic orange juice increase when the economy is not doing well. This is an example of how ________ impacts demand for products.

A) dynamic pricing B) the price inelasticity coefficient C) the income effect D) the target return effect E) cross-price elasticity

72) Wilhelm owns Do-It-Right Auto Repair Service. He has observed over the years that customers keep their high-mileage cars longer when the economy is doing poorly, creating demand for his maintenance and repair service. Wilhelm has observed the impact of ________ on demand for his service.

A) break-even points B) the price inelasticity ratio C) the income effect D) the target return effect E) cross-price elasticity

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73) There are many options available to consumers when it comes to breakfast cereals. So, if Kellogg’s significantly increases the price of Rice Krispies, consumers are more apt to buy alternate cereals instead. This illustrates which concept?

A) the income effect B) the substitution effect C) the break-even point D) the target return effect E) cross-price elasticity

74)

The more substitutes that exist in a market,

A) the lower the price elasticity for each product. B) the greater the income elasticity for each product. C) the easier it will be to utilize a target profit pricing strategy. D) the more sensitive consumers will be to changes in the price of a particular product. E) the more likely the market will be characterized as an oligopoly.

75)

Dynamic pricing is also referred to as ________ pricing.

A) monopoly B) market C) profit D) individualized E) premium

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76) Dante always buys and uses Bridgestone brand golf balls. If he finds a Titleist or Callaway ball in the rough, he gives it away. Brand-loyal golfers like Dante allow Bridgestone to charge a higher price and not lose many sales. By building a strong brand, Bridgestone has effectively

A) increased the income effect for its products. B) increased the cross-price elasticity for its products. C) focused on the competitive parity point for its products. D) shifted the golf ball market from a monopoly to pure competition. E) reduced the price elasticity of demand for its products.

77) Marketers spend millions of dollars annually trying to create or reinforce brand loyalty. Brand loyalty changes the demand curve for the firm’s products by

A) decreasing the price elasticity of demand. B) making demand more oligopolistic and less monopolistic. C) increasing the income effect. D) reducing fixed costs and increasing the gray marketing effect. E) shifting the market from a monopoly to pure competition.

78)

Cross-price elasticity is the

A) percentage change in quantity of a product demanded divided by the percentage change in its price. B) percentage change in quantity demanded of Product A compared to the percentage change in price of Product B. C) change in price of Product A divided by change in quantity demanded for Product B. D) change in quantity of a product demanded divided by the change in its price. E) change in quantity of a product demanded divided by the change in its elasticity.

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79) ________ products are products whose demands are positively related and as such, they rise or fall together.

A) Substitute B) Premium C) Elastic D) Inelastic E) Complementary

80)

Which of the following is the most logical example of complementary products?

A) hot dogs and hamburgers B) VCRs and DVD players C) hot dogs and hot dog buns D) Honda cars and Toyota cars E) a university and a corporation

81) Evan is a yacht broker in the southeastern United States. For years he has had difficulty selling large yachts locally because there were few places to dock these boats. Yachts and spaces to dock them are an example of

A) substitute products. B) purely competitive products. C) status-quo pricing products. D) complementary products. E) competitive parity products.

82)

If the price for a product increases, the demand for the complementary product will

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A) decrease. B) increase. C) stay the same. D) become more elastic. E) become more inelastic.

83) Star Heating and Air Conditioning Company specializes in electric heat pumps. Francis keeps track of the price of natural gas, knowing that

A) natural gas creates more environmental greenhouse effects than coal. B) an increase in the price of natural gas will increase demand for his electrical heating systems. C) gas heating systems and electrical heating systems are complementary goods. D) when the price of natural gas goes up, the quantity demanded also rises. E) the demand for natural gas is price elastic.

84) Managers of Wendy’s fast-food restaurants keep track of prices at competitors such as McDonald’s, Burger King, and Arby’s, knowing that a decrease in the prices at these other fastfood restaurants will

A) increase the income effect for Wendy’s products. B) increase demand for Wendy’s products. C) decrease the income effect for Wendy’s products. D) increase the complementary effect for Wendy’s products. E) decrease demand for Wendy’s products.

85)

One problem in relying on price elasticity and demand curves when setting prices is

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A) the way a product or service is marketed can have a profound impact on price elasticity. B) the underlying ideas of the demand curve and elasticity are less relevant in the modern economy. C) only economists can properly analyze demand curves and set prices using this tool. D) competitors can construct the same demand curves, so there is no advantage in using them. E) marketing split from economics over the ideas of demand and elasticity.

86)

In general, prices should not be based on costs because

A) consumers are cost-conscious. B) producers rarely know what their costs are. C) consumers make their purchase decisions based on perceived value. D) producers need to avoid creating a cost competitive parity debate. E) customers are always right.

87) Consider a bakery like Entenmann’s: The majority of the ________ costs are the cost of the ingredients, primarily flour.

A) fixed B) incidental C) prestige D) inelastic E) variable

88) Ike manages a Shoney’s restaurant. He is considering staying open later in the evening. For Ike, the variable costs associated with staying open longer hours will include

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A) property taxes. B) hours worked by cooks. C) rent on the restaurant building. D) advertising costs. E) routine maintenance.

89)

Variable costs change with

A) changes in fixed costs. B) changes in cross-price elasticity. C) changes in target return pricing. D) changes in the quantity being produced. E) competitive parity.

90) Kyle estimates that the fixed costs associated with opening a new bank branch are $500,000. He expects the branch to attract 1,000 new customer accounts in the first year, each of which will cost $50 per year to service. He also expects to generate $100,000 per year in revenue. For Kyle, the total cost of opening the new branch and remaining open for one year will be

A) $500,000. B) $550,000. C) $650,000. D) $450,000. E) $605,000.

91) In one year, the Sunrise Hotel incurred $100,000 in fixed costs. Because the hotel booked 10,000 room nights, its total variable cost is $100,000 (10,000 room nights × $10 per room). Thus, its total cost is

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A) $10,000. B) $200,000. C) $20,000 D) $100,000. E) $120,000.

92) When the price for Blu-ray players dropped, the demand for DVD players went down, so DVD players and Blu-ray players are

A) complementary products. B) outsourced products. C) substitute products. D) interchangeable products. E) superior products.

93)

At the break-even point,

A) costs are zero. B) price is maximized. C) profits are zero. D) fixed costs are zero. E) contribution per unit is zero.

94)

The break-even point is estimated by

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A) multiplying revenue per unit times the quantity sold. B) dividing fixed contribution per unit by variable costs. C) multiplying fixed costs by contribution per unit. D) dividing fixed costs by contribution per unit. E) dividing variable costs by fixed costs.

95) If the fixed costs of manufacturing a new cell phone are $10,000, the sales price is $60, and variable cost per unit is $20, the break-even point is

A) 100 units. B) 4,000 units. C) 20 units. D) 1,000 units. E) 250 units.

96) The point at which the number of units sold generates enough revenue to equal the total costs of running an operation is known as the

A) contribution per unit. B) fixed cost margin. C) break-even point. D) unit cost. E) marginal revenue.

97) Samson rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $20, to cover maid service and utilities. His fixed costs are $100,000 and his profit last year was $20,000. For Samson, the contribution per unit is

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A) $100. B) $80. C) $800. D) $1,000. E) It cannot be determined from the information provided.

98)

The contribution per unit is

A) price minus total costs. B) price minus total variable cost. C) price minus variable cost per unit. D) total revenue minus total cost. E) break-even quantity divided by total fixed costs.

99) Timor rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $20. His fixed costs are $100,000 and his target profit is $20,000. For Timor, to earn his target profit, he will need to rent out ________ rooms.

A) 100 B) 1,500 C) 20,000 D) 1,000 E) It cannot be determined from the information provided.

100) A useful technique that enables managers to examine the relationships among cost, price, revenue, and profit over different levels of production and sales is called

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A) competitive parity. B) break-even analysis. C) contribution per unit. D) dynamic pricing. E) cross-price elasticity.

101)

Break-even analysis is useful because it allows managers to

A) quantify the relationship between price elasticity and product elasticity. B) reposition products based on their break-even positioning revenue. C) estimate the quantity they will need to sell at a given price to break even. D) determine the relationship between price and quantity demanded. E) analyze the different elements contributing to their variable costs.

102)

One of the limitations associated with break-even analysis is that

A) it assumes fixed costs are zero. B) it cannot adjust for high variable costs. C) it tells marketers only what price is needed to break even. D) it assumes that there is only one price. E) it assumes that demand is extremely inelastic.

103) Which of the following markets is most likely to be characterized by oligopolistic competition in the United States?

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A) soybeans B) pens and pencils C) smartphone service providers D) men’s clothing E) electrical service to the home

104)

Because there are only a few firms in markets with oligopolistic competition,

A) everyone is a price taker. B) producers do not have to consider the reactions of rival firms. C) government often encourages consolidation to reduce the number of competitors. D) price wars may occur. E) the many competitors will focus on product differentiation.

105)

In a market with ________ there are many firms providing differentiated products.

A) pure competition B) oligopolistic competition C) monopolistic competition D) a monopoly E) a duopoly

106)

Because there are many firms in monopolistic competition markets,

A) everyone is a price taker. B) producers do not have to consider the reactions of rival firms. C) government often encourages consolidation to reduce the number of competitors. D) price controls may be implemented. E) the many competitors will focus on product differentiation.

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107) In ________ many firms provide similar products that are considered substitutes for each other.

A) pure competition B) oligopolistic competition C) monopolistic competition D) a monopoly E) a duopoly

108) Which of the following is most likely to be characterized by pure competition in the United States?

A) soybeans B) cereal C) soft drinks D) computer operating systems E) fast-food restaurants

109) What type of competition occurs when there are many firms competing for customers in a given market, but their products are differentiated?

A) monopolistic competition B) monopoly competition C) pure competition D) predatory competition E) oligopolistic competition

110) What price competitive level would be indicated when the price is usually set according to the laws of supply and demand? Version 1

A) oligopolistic competition B) monopolistic competition C) pure competition D) channel competition E) monopoly competition

111)

If a firm is engaged in ________ competition, it should seek a way to differentiate itself.

A) oligopolistic B) pure C) monopoly D) standardized E) monopolistic

112)

Because there are many firms with similar products in purely competitive markets,

A) price is determined by the laws of supply and demand. B) consumers develop personal preferences. C) firms find it easy to build strong, distinct brands. D) advertising is heavily used. E) the many competitors will focus on variable cost pricing.

113) If a firm in a purely competitive market can differentiate its product or service, it becomes part of a(n) ________ market.

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A) pure competition B) oligopolistic competition C) monopolistic competition D) monopoly E) duopoly

114)

How can a company find its way out of a market characterized by pure competition?

A) consistently offer the lowest price until other competitors leave the market B) increase prices and attract different, quality-oriented customers C) decrease the amount of available product until the market reacts D) increase the amount of available product to flood the market E) differentiate the product in some way, even by packaging, so customers will see it as distinct

115) There is often only one provider of cable television services in each region of the country: Time Warner is in New York, Comcast is in most of New England, and so forth. When Comcast recently proposed a plan to buy Time Warner, the purchase ultimately could not be completed, mostly due to concerns that it would have caused Comcast to become an overly large ________ with too much power.

A) monopolist B) oligopolist C) pure competitor D) predator E) icon

116)

Predatory pricing

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A) is legal in the United States. B) occurs when a firm sets a very high price for one or more of its products. C) is illegal in the United States under both the Sherman Antitrust Act and the Federal Trade Commission Act. D) is legal in the United States when a company wants to set a very low price to drive its competition out of business. E) occurs when there are many firms competing for customers in a given market, but their products are differentiated.

117)

The commercial airline industry is considered what type of market?

A) duopoly B) monopoly C) monopolistic competition D) pure competition E) oligopolistic competition

118)

Price is the only part of the marketing mix that does not generate costs. ⊚ ⊚

119)

true false

Pricing strategies should be aligned with a firm’s overall goals and objectives. ⊚ ⊚

true false

120) When a firm has a particular profit goal as its overriding concern, it will use target return pricing to meet the profit objective.

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⊚ ⊚

121)

true false

Rarely is the lowest-price product offering the dominant brand in a given market. ⊚ ⊚

true false

122) American Airlines just reduced its fares for summer flights by $100. Delta Airlines changes its pricing structure and reduces its flights by $100 as well. Delta is employing statusquo pricing. ⊚ ⊚

123)

true false

The demand curve for prestige products generally slopes downward due to higher prices. ⊚ ⊚

true false

124) Because consumers are generally more sensitive to price increases than to price decreases, it is easier to lose current customers with a price increase than it is to gain new customers with a price decrease. ⊚ ⊚

true false

125) When the price of milk goes up, demand does not fall significantly, because people still need to buy milk. However, if the price of T-bone steaks rises beyond a certain point, people will buy fewer of them because they can turn to the many substitutes for this cut of meat. This refers to price elasticity of demand.

Version 1

⊚ ⊚

true false

126) The key to successful pricing is to match the product with the consumer’s perception of value. ⊚ ⊚

127)

true false

Brands that have developed loyal customers have a higher price elasticity of demand. ⊚ ⊚

true false

128) In U.S. markets, there are many substitute products for Lucky Charms cereal, suggesting the price elasticity of demand for Fruit Loops is high. ⊚ ⊚

129)

Costs related to supply and costs related to demand are the two primary cost categories. ⊚ ⊚

130)

true false

At the break-even point, profits are maximized. ⊚ ⊚

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true false

Answer Key Test name: Chapter 14 Test Bank 21) A 22) A 23) C 24) E 25) D 26) D 27) B 28) E 29) A 30) A 31) A 32) B 33) C 34) B 35) C 36) C 37) E 38) C 39) A 40) D 41) D 42) D 43) C 44) D 45) C 46) D Version 1

47) E 48) A 49) B 50) D 51) A 52) E 53) C 54) B 55) E 56) D 57) D 58) B 59) A 60) A 61) C 62) E 63) B 64) C 65) D 66) B 67) C 68) B 69) A 70) C 71) C 72) C 73) B 74) D 75) D 76) E Version 1

77) A 78) B 79) E 80) C 81) D 82) A 83) B 84) E 85) A 86) C 87) E 88) B 89) D 90) B 91) B 92) C 93) C 94) D 95) E 96) C 97) B 98) C 99) B 100) B 101) C 102) D 103) C 104) D 105) C 106) E Version 1

107) A 108) A 109) A 110) C 111) E 112) A 113) C 114) E 115) A 116) C 117) E 118) TRUE 119) TRUE 120) FALSE 121) TRUE 122) TRUE 123) FALSE 124) TRUE 125) TRUE 126) TRUE 127) FALSE 128) TRUE 129) FALSE 130) FALSE

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Student name:__________ 1) John Deere farming equipment has been around for over a century and is known for its durability. Its equipment is usually priced higher than competitors’ offerings, but over the long run it will eventually cost less to own than the competition. What type of value-based pricing method would be appropriate for John Deere, and why?

2) Explain the key difference among the three different pricing methods a firm might choose.

Explain the difference between the two approaches to value-based pricing methods.

4) Belton’s Furniture Company has always used cost-based pricing. The owner’s son-in-law is joining the business and recommends they change. The owner enumerates the advantages of cost-based pricing, while his son-in-law points out the disadvantages. What will each of them say?

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5) Belton’s Furniture Company has always used cost-based pricing. The owner’s son-in-law is joining the business and recommends they change to value-based pricing. The owner enumerates the disadvantages of value-based pricing, while his son-in-law points out the advantages. What will each of them say?

What does an everyday low pricing strategy convey to consumers?

7) Explain the concept of the high/low strategy. Why is this an attractive strategy to marketers?

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8) Almost every time a new-to-the-world electronic device (iPods, flat-screen TVs, digital cameras, PlayStation, etc.) has been introduced, the marketer has used a price skimming strategy. Why?

9) Why do marketers of new and innovative products often start out with a price skimming strategy rather than a penetration strategy?

10) Juanita is the only retailer in her market selling a new, ergonomically designed pen. What are the objectives of using a penetration pricing strategy? Why would Juanita consider using a market penetration pricing strategy?

11) Why would the manufacturer of custom-made yachts not use a penetration pricing strategy?

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12) Why would a price skimming strategy probably not work for a “me-too” product, something very similar to a new-to-the-world product?

13)

What is the experience curve effect? What pricing strategy is it associated with?

14) Most automobile manufacturers appear to use price lining. What is price lining and how does it relate to value-based pricing for automobile manufacturers?

15) Marketers know that coupons might not result in a net increase in sales, yet they continue to issue them. Why do marketers continue to use coupons? Version 1

16)

What is the added benefit to a manufacturer of using rebates rather than coupons?

17) Sanjit sells homemade gyros from his stand next to campus. Students flock to his stand to buy his gyros, but rarely anything else. What type of pricing strategy could Sanjit use to improve his sales? Create an example.

18) What is the advantage to a business of price bundling? What is the advantage to a consumer?

19)

What are slotting allowances? Why do some marketers consider them unfair?

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20)

Explain the meaning of “2/10, n/30.”

21) Describe when each of the following five business-to-business pricing tactics would be most appropriate: ● seasonal discounts ● cash discounts ● allowances ● quantity discounts ● uniform delivered versus zone pricing

22)

How does a loss-leader strategy work? What is the danger of using this strategy?

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23) At Donny’s university, the local coffee shop gives a 10 percent discount to students. Is this price discrimination? Why or why not?

24) Why do manufacturers set manufacturer’s suggested retail prices (MSRP)? How do they enforce this practice? Is it legal?

25) What is predatory pricing? What federal acts make it illegal? How are consumers hurt by predatory pricing?

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26)

Because market and operating conditions are different in each target market

A) all consumers will react similarly to the firm’s pricing strategy. B) the choice of a pricing strategy should be specific to the target market. C) prices need to be held constant because everything else is changing. D) only horizontal price fixing should be used. E) external reference prices will always be the best strategy.

27)

A weakness associated with cost-based pricing methods is that they

A) are too difficult to calculate. B) do not consider profit when calculating. C) do not recognize the role consumers or competitors’ prices play in the marketplace. D) do not consider fixed or variable costs. E) are structurally inflexible and ignore vertical price-fixing alternatives.

28)

Compared with other methods used to set prices, ________ pricing is relatively simple.

A) cost-based B) value-based C) improvement value D) reference-based E) cost of ownership

29)

Cost-based pricing assumes that costs

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A) will vary with the level of prices. B) are used to estimate value. C) are calculated based on historical consumer perceptions of what things should cost. D) will continue to decrease as production increases. E) will not vary much for different levels of production.

30) Renata estimates the average cost of her floral arrangements is $12 regardless of whether she is making 5 or 25 arrangements that day. She adds a standard markup to the $12 estimate to determine her price. Renata is using a(n) ________ pricing method.

A) improvement value B) value-based C) cost-based D) EDLP E) reference-based

31) Firms using a(n) ________ pricing method set their prices relative to what other firms are charging.

A) improvement value B) value-based C) cost-based D) competition-based E) reference-based

32) In determining the price for his company’s new photo printer, Antonio is assessing the total cost of owning his printer as compared to alternative products available in the market. Antonio is using ________ pricing.

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A) improvement value B) EDLP C) reference-based D) cost of ownership E) premium

33) When Dream Home Solutions began building custom houses in a large subdivision with other builders, the company priced its homes slightly higher than its competitors and promoted the added quality features found in Dream Home’s houses. Dream Home was using a(n) ________ pricing strategy.

A) competition-based B) value-based C) improvement-based D) premium E) reference-based

34) Value-based pricing methods include approaches to setting prices that focus on the overall value of the product offering

A) as recognized by competitors. B) as perceived by the consumer. C) relative to production costs. D) in relationship to fixed and variable costs. E) in order to minimize bundling charges.

35) The improvement value method and the cost of ownership method are two approaches for setting prices that are ________ methods.

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A) cost-based B) competitor-based C) production-based D) value-based E) market-based

36) In determining the price of his company’s new financial planning software, Ricardo is assessing how much better his company’s software is as compared to alternative products available in the market. Ricardo is using ________ pricing.

A) cost-based B) improvement value C) reference-based D) cost of ownership E) market-based

37) Each generation of cell phones has provided greater clarity, range, security, and multifunctionality. If marketers of cell phones use these features as a basis for pricing, they would be using ________ pricing.

A) cost-based B) EDLP C) reference-based D) improvement value E) market-based

38) The pricing method that considers what consumers may be willing to pay for a particular product based on the value received over the product’s entire lifetime is the ________ pricing method.

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A) cost-based B) cost of ownership C) reference-based D) improvement value E) market-based

39) Kaelin owns a lawn maintenance business. From experience, Kaelin has found that Kubota equipment lasts almost twice as long as competitors’ machines. For Kubota, Kaelin’s perception about its products makes ________ pricing a logical choice.

A) cost of ownership B) cost-based C) reference-based D) improvement value E) market-based

40)

One of the difficulties associated with value-based pricing is that

A) costs used in this method are difficult to compute. B) only the creator of a new product can fully understand its value to consumers. C) value depends on variable costs and not fixed costs. D) everyday low pricing has neutralized the impact of price on consumers’ purchase decisions. E) it necessitates a great deal of consumer research to be implemented successfully.

41) Every firm needs different strategies to develop pricing models for its products. The strategies include that can help cost-based, competition-based, and

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A) improvement-value-based. B) price-lining-based. C) loss-leader-based. D) profit-based. E) value-based.

42)

Value-based pricing can be difficult to implement because

A) the way consumers perceive value changes often. B) this method requires all costs be identified and calculated on a per-unit basis. C) value depends on variable costs and not fixed costs. D) everyday low pricing has neutralized the impact of price on consumers’ purchase decisions. E) it is difficult to determine how competitors will price their products.

43)

An everyday low pricing strategy stresses the continuity of retail prices

A) at a level above regular retail prices. B) at a level between the regular price and the deep-discount sale prices of competitors. C) based on variable production costs. D) at a price skimming level. E) at a level below the deep-discount sales prices of competitors.

44)

Everyday low pricing (EDLP) provides value to consumers by

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A) continually offering items on sale. B) minimizing the number of options a consumer can evaluate. C) offering noncumulative quantity discounts. D) reducing their search costs. E) creative use of reference pricing.

45) Jamal is especially price-sensitive. He has been known to line up on “Black Friday” (the day after Thanksgiving) at 4 a.m. to be among the first to buy sale items. Jamal would likely respond to a ________ pricing strategy.

A) high/low B) premium C) price skimming D) slotting E) uniform

46) A(n) ________ pricing strategy relies on the promotion of sales, during which prices are temporarily reduced to encourage purchases.

A) premium B) high/low C) EDLP D) slotting E) uniform

47) When Deena’s Discount communicates to consumers that, for any given group of oftenpurchased items, its prices will tend to be lower than that of any other competitor, Deena’s Discount is exhibiting what type of pricing strategy?

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A) high/low B) EDLP C) price skimming D) uniform delivered pricing E) bait and switch

48) In a(n) ________ pricing strategy, marketers rely on the promotion of sales, during which prices are temporarily reduced to encourage purchases.

A) high/low B) EDLP C) price skimming D) uniform delivered E) bait-and-switch

49) It is important to Elias to get value for his money, but he does not want to spend time comparison shopping. Elias will likely respond to ________ pricing, but not to ________ pricing.

A) high/low; EDLP B) premium; high/low C) high/low; premium D) price skimming; high/low E) EDLP; high/low

50)

What makes a high/low pricing strategy appealing to sellers?

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A) It attracts two distinct market segments. B) It allows the seller to market itself as an “everyday low price leader.” C) It doesn’t require the seller to continually offer sales or deep discounts. D) It allows sellers to capture the most profit from a new product or service. E) It reduces the need for slotting and advertising allowances.

51)

A reference price is

A) the total price including tax. B) the price against which buyers compare the actual selling price. C) the manufacturer’s cost. D) a cumulative quantity discount price. E) the external horizontal fixed price.

52) In determining the price for his company’s new digital activity tracker, Matthias determines what consumers consider the regular or original price for similar activity trackers available in the market. Matthias is assessing the influence of ________ on pricing strategy.

A) improvement value B) odd-even prices C) everyday low pricing D) reference prices E) cost of ownership

53) Developing pricing strategies for ________ is one of the most challenging tasks a manager can undertake.

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A) cost-based pricing B) seasonal rebate items C) new products D) zone pricing products E) quantity discounts

54) Pricing ________ products is especially challenging because little or nothing is known about consumers’ perceptions of its value.

A) cost-based B) seasonal C) service-related D) bundled E) new-to-the-world

55) Charging a relatively high price for new and innovative products to those consumers most willing and able to pay the high price is called price

A) penetration. B) bundling. C) fixing. D) referencing. E) skimming.

56) Price skimming focuses on selling products to ________ and ________ in the consumer adoption process model.

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A) innovators; early adopters B) early adopters; the early majority C) the early majority; the late majority D) the late majority; laggards E) laggards; innovators

57) When Burroughs Wellcome introduced the first anti-AIDS drugs, it initially set the price at $10,000 for a year’s supply. Burroughs Wellcome was probably pursuing a(n) ________ pricing strategy.

A) skimming B) introductory C) slotting allowance D) market penetration E) cost-based

58) For marketers using a price skimming strategy, once the initial demand is met for new and innovative products, they will likely

A) leave the market. B) discontinue the product and create a new one. C) offer deep discounts to create a loss-leader pricing strategy. D) lower the price to capture the next most sensitive market segment. E) use zone pricing to maximize differences.

59) When Apple introduced the iPhone—a combination phone, MP3 player, and Internet access device—in 2007, it was priced at $499, considerably higher than either the iPod or competing cell phones. Hoping to attract innovators and early adopters, Apple was most likely pursuing a ________ pricing strategy.

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A) market penetration B) slotting allowance C) price fixing D) reference price E) price skimming

60)

For a price skimming strategy to work, the product or service must

A) be bundled with products or services already available on the market. B) be similar to what consumers are already comfortable with. C) have wide market appeal. D) have low production costs. E) offer consumers some new benefit currently unavailable in alternative products.

61) One reason marketers of new, innovative products often start out with a price skimming strategy rather than a market penetration strategy is that

A) few consumers understand a penetration strategy. B) a price skimming strategy lowers the value for consumers. C) a price skimming strategy targets all product adopters equally. D) it is easier to lower prices than to raise them. E) price skimming is legal while price penetration is not.

62)

What is one of the drawbacks of using a price skimming strategy?

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A) It is difficult to lower prices on an introductory product. B) Price skimming allows competitors to easily enter the market. C) Firms must consider the high costs associated with producing a small volume of product. D) Price skimming does not work well with new-to-the-market, innovative products. E) Price skimming is often challenged as being illegal.

63) With a ________ pricing strategy, marketers set a low initial price for the introduction of a new product or service.

A) penetration B) bundling C) price fixing D) reference E) skimming

64) Mario is the first retailer in town to sell games for Sony’s latest version of its PlayStation gaming console. Mario wants to quickly capture as much of the market for the new games as possible. Mario will likely use a ________ pricing strategy.

A) penetration B) bundling C) price fixing D) reference E) skimming

65)

The major objectives associated with a penetration pricing strategy are to

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A) capture the high end of the market demand curve and lower introduction costs. B) quickly build sales and market share. C) minimize customer dissatisfaction and maximize reference price value. D) provide an incentive to purchase a less desirable product to obtain a more desirable product. E) match competitors’ prices and communicate high quality.

66)

The ________ occurs when unit cost drops as the quantity sold increases.

A) slotting allowance benefit B) price-fixing return C) improvement value effect D) experience curve effect E) cumulative bundling benefit

67) Production of the DeLorean car, made famous in the film Back to the Future, never got above 25,000 units during its lifetime. Automobile industry analysts estimate that production of this car needed to reach around 300,000 units to achieve the ________, which refers to a decrease in unit cost as product volume increases.

A) slotting allowance benefit B) price-fixing return C) improvement value effect D) experience curve effect E) cumulative bundling benefit

68) If a penetration pricing strategy results in lower per-unit cost, competitors might be discouraged from entering the market because

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A) selective consumer demand will increase gross profit margins. B) a high/low cost-based pricing strategy will not work. C) they would likely need to produce a large volume quickly in order to compete. D) profits would increase too rapidly. E) they would be able to advertise only to the same target market as the firm that introduced the original product.

69) Dylan designs and manufactures custom Murphy bed units. He has a number of unique products but can only produce in limited quantities. Dylan will probably not use a penetration pricing strategy because

A) there are few barriers to competitive entry in the market. B) she could not meet a rapid rise in demand. C) a low price would indicate low quality. D) she would have to determine zone pricing discounts. E) the experience curve effect would drop unit costs too rapidly.

70) Yury is opening a financial consulting service for high-income retirees in his area. This target market is used to paying for quality and associates high quality with high prices. In this instance, Yury should probably not use a penetration pricing strategy because

A) he might be missing out on customers who would only pay less for his products. B) there are moderate barriers to competitive entry in the market. C) a low price might signal low quality. D) he would have to determine zone pricing discounts. E) the experience curve effect would drop unit costs too rapidly.

71)

The saying “leaving money on the table” is associated with

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A) a price skimming strategy that forces consumers to choose between products. B) a penetration pricing strategy when there is an opportunity for price skimming. C) vertical price fixing in markets where horizontal price fixing would be more appropriate. D) a predatory pricing strategy that results in excessive seasonal discounts. E) loss-leader pricing that drives consumers to competitors’ products.

72)

A pricing strategy is

A) a long-term approach to setting prices in a companywide integrated effort. B) the use of one-time seasonal discounts to reduce inventory. C) the use of slotting allowances to gain access to distribution channels. D) a short-term approach to setting prices. E) associated with competitive threats in the marketplace.

73)

Price lining is

A) the reduction retailers take on the initial selling price of the product or service. B) the most common implementation of a quantity discount at the consumer level. C) a price reduction offered on products and services to stimulate demand during offpeak seasons. D) a discount on the price of specific items when they’re purchased. E) setting a price floor and a price ceiling for a line of products and then setting price points in between to represent differences in quality.

74)

A pricing tactic is

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A) a long-term and broad-based approach to pricing. B) an integrative pricing approach based on the five Cs. C) an approach that can be used only with consumers. D) a short-term approach that is often in response to a competitive threat. E) an approach that can be used only in a business-to-business setting.

75) Generally, a ________ represents either a short-term response to a competitive threat or a broadly accepted method of calculating a final price for the customer that is short-term in nature.

A) pricing strategy B) reference price C) high/low strategy D) loss-leader price E) pricing tactic

76)

Retailers use ________ to get rid of slow-moving or obsolete merchandise.

A) markdowns B) slotting allowances C) price lining D) rebates E) seasonal allowances

77)

The most common form of a quantity discount for consumers is a

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A) cash discount. B) markdown. C) size discount. D) coupon. E) rebate

78) One of the benefits of offering a size discount to consumers is they will purchase more of a marketer’s product and

A) earn a cash discount. B) capitalize on the experience curve effect. C) will not fall prey to predatory pricing. D) will be less likely to switch brands. E) will be able to take advantage of zone-pricing benefits.

79) Price reductions offered on products and services to stimulate demand during off-peak seasons are referred to as

A) markdowns. B) seasonal discounts. C) price lining. D) predatory pricing. E) zone pricing.

80) Some consumers make it a point to go shopping the day after Christmas to stock up on discounted wrapping paper and bows for the following year. These consumers are

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A) enjoying the benefits of size discounts. B) taking advantage of everyday low pricing strategies. C) avoiding bait-and-switch strategies. D) taking advantage of zone pricing discounts. E) taking advantage of seasonal discounts.

81) Retailers use ________ because they believe their use will induce customers to try new products, convert first-time users to regular users, increase purchases, and protect market share.

A) seasonal discounts B) coupons C) rebates D) cumulative quantity discounts E) noncumulative quantity discounts

82) Mario decided to purchase an electronic toothbrush priced at $100 because of a special offer from the manufacturer. By sending proof of purchase and the receipt to the manufacturer, he could receive a $40 check in return, making the final price $60. This pricing tactic is known as a

A) markdown. B) rebate. C) coupon. D) cash discount. E) price line.

83) When a new product is not being sold at the rate originally forecasted, the retailer may reduce the price in order to reduce the inventory of the product. This reduction is known as a

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A) markdown. B) rebate. C) coupon. D) cash discount. E) quantity discount.

84) Many stores now e-mail codes to their customers that can be used on their websites or printed and brought into the store to receive discounts for products purchased. In this instance, the customer is using a ________ to receive the discount.

A) size discount B) rebate C) coupon D) markdown E) seasonal discount

85)

What is the difference between a coupon and a rebate?

A) The retailer handles coupons while manufacturers handle most rebates. B) Coupons are issued for products and rebates are issued for services. C) Coupons are for “cents/dollars off” while rebates are for “percentages off” the listed price. D) There is no difference between coupons and rebates. E) The manufacturer handles coupons while retailers handle rebates.

86)

One important reason manufacturers like rebates is that

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A) the transaction costs are the responsibility of the retailer. B) their redemption rates are low. C) rebates expire faster than coupons do. D) there are fewer price discrimination issues. E) they build strong brand recognition.

87) In which of the following tactics does a consumer pay a fee to purchase the right to use a product for a specific amount of time?

A) lay-away B) bait and switch C) lease D) bundling E) rebate

88) Cosmetic manufacturers that sell shampoo and conditioner together as one package at a lower price rather than selling each item separately are using

A) price lining. B) slotting allowances. C) cumulative quantity discounts. D) loss leaders. E) price bundling.

89) Supermarkets often offer great deals on milk or eggs to get customers into their stores, knowing that many customers will also purchase items that have higher markups for the store. These supermarkets are using a ________ pricing tactic.

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A) leader B) bundling C) price lining D) cumulative quantity discount E) slotting

90) When Toyota introduced its Scion line of cars, the lowest-price model was listed for $15,000 while the highest-priced model was listed for $21,000, with two other list prices in between. Each price point represented distinct differences in the features and quality of the cars. Toyota used a ________ pricing approach.

A) market penetration B) zone C) price lining D) loss-leader E) slotting

91) General Mills offers three sizes of its popular cereal Cheerios: 10-, 14-, and 18-ounce boxes, and they are priced at approximately $2.99, $3.99, and $4.49, respectively. The company employs this tactic to

A) get rid of a slow-moving product. B) encourage consumers to purchase larger quantities each time they buy. C) match competitors’ prices on specific cereal. D) offer a discount on the price of the cereal when purchased. E) encourage customers to purchase competing brands.

92) When marketers establish a price floor and a price ceiling for an entire line of similar products and then set price points in between for differences in quality among the products, they are using a ________ pricing approach.

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A) loss-leader B) zone C) price bundling D) price skimming E) price lining

93)

Which of the following is a common business-to-business pricing tactics?

A) seasonal discounts B) bait-and-switch C) predatory pricing D) price fixing

94) The local sports store may purchase outswim-related products only during the winter months because the manufacturer offers a better price to the sports store. This type of pricing tactic is known as a

A) seasonal discount. B) cash discount. C) slotting allowance. D) customary discount. E) flexible price.

95) When Amana offers its air conditioner dealers an additional discount if they place their orders and receive delivery before April 1, prior to the summer season, Amana is offering a

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A) seasonal discount. B) cash discount. C) slotting allowance. D) zone-price discount. E) price line discount.

96) The primary reasons manufacturers offer seasonal discounts to retailers are to more easily plan production schedules and to

A) reduce advertising allowances. B) increase price skimming. C) control vertical pricing. D) lessen inventories of finished goods. E) alter consumers’ perceived reference price.

97)

Manufacturers use cash discounts primarily because it allows them to benefit from

A) uniformed delivered pricing. B) seasonal slotting allowances. C) price skimming. D) the time value of money. E) high/low pricing.

98) Fees paid to retailers simply to get new products into stores or to gain more or better shelf space for their products are called ________ allowances.

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A) space B) shelf C) slotting D) placement E) location

99)

A noncumulative B2B quantity discount is

A) used to encourage consumers to purchase larger quantities each time they buy. B) based only on the amount purchased in a single order. C) considered illegal under the Robinson-Patman Act. D) used primarily to attract new retail customers. E) offered only to one-time purchasers.

100) Karson Manufactured Homes charges $500 for deliveries within 50 miles and $800 for deliveries 51 to 100 miles away from their factory. The company is using a ________ pricing tactic.

A) uniformed delivered B) zone C) cumulative D) noncumulative E) horizontal

101)

The advantage of zone pricing to the seller is the shipping charges typically

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A) are not marked down during the off season. B) complement the advertising allowances. C) reflect more closely the cost of delivery. D) result in a cumulative quantity discount. E) are the same for all shipments, making it easy to calculate total price.

102)

A(n) ________ discount is based on the amount purchased in a single order.

A) uniform delivered B) zone pricing C) advertising allowance D) cumulative quantity E) noncumulative quantity

103)

Price advertisements should never A) include “puffery.” B) deceive customers to the point of doing harm. C) include the MSRP. D) use advertising allowances to increase sales promotion. E) use price skimming after using price penetration.

104) For marketers to advertise a price as their ________ price, the Better Business Bureau recommends that at least 50 percent of the sales of a product occur at that price.

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A) fixed B) zone C) regular D) leader E) cost-based

105) Marketers advertising an artificially high “regular price” are unethically attempting to influence consumers’ ________ perceptions.

A) fixed price B) reference price C) seasonal price D) leader price E) cost-based price

106)

A reference price might be considered deceptive if

A) the internal reference point is different from the external reference point. B) the reference price is more than two times the cost of the item. C) the reference price has been inflated or is fictitious. D) the reference price has changed more than once in the past 12 months. E) it reflects actual manufacturing costs plus 50 percent.

107)

________ pricing tactics lower the price of a product below the store’s cost.

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A) Fixed B) Zone C) Regular D) Loss-leader E) Cost-based

108) In a ________ pricing tactic, sellers advertise very low prices and then aggressively pressure customers to purchase higher-priced versions of the product advertised with the low price.

A) fixed offer B) reference C) seasonal D) bait-and-switch E) cost-based

109) Darryl desperately needed tires for his car, and he found an ad with an incredibly low price. When he got there, he found out that those tires had supposedly sold out, and he was pressured into buying tires that were more expensive than he wanted. Darryl found out later that Marcus had the same experience at the store a few weeks earlier. It’s quite possible that both Darryl and Marcus had become the victim of a deceptive pricing tactic known as

A) loss-leader pricing. B) desperation selling. C) bait and switch. D) off-season deceptions. E) inventory reduction pricing.

110) If a telecommunications company drastically cuts the price for cellular phone service in order to eliminate local competitors, the company could be charged with

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A) loss-leader pricing. B) bait-and-switch pricing. C) price fixing. D) unfair slotting. E) predatory pricing.

111) Frannie’s Housewares has set very low prices for its products in an attempt to drive its competitor, George’s Housewares, out of business. This is known as

A) monopolistic pricing. B) bait and switch. C) predatory pricing. D) price discrimination. E) price fixing.

112)

Proving that a company has engaged in the deceptive ________ practice is not easy.

A) bait and switch B) reference pricing C) zone pricing D) cumulative quantity discount E) price discrimination

113) The ________ does not apply to end consumers, at which point many forms of price discrimination occur.

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A) Sherman Antitrust Act B) Federal Trade Commission Act C) MSRP D) Clayton Act E) Robinson-Patman Act

114) A major airline sells an aggressively low-priced ticket compared to a new low-fare airline which is trying to enter the market. The major airline may be accused of engaging in the unethical practice of

A) leader pricing. B) price skimming. C) price fixing. D) predatory pricing. E) deceptive reference prices.

115)

B2B quantity discounts are legal if

A) the discounts are available to all customers. B) they do not exceed 25 percent of the regular price. C) they are not short-term. D) new customers can “buy up” to reach the minimum quantity. E) cumulative discounts do not run for more than a calendar year.

116)

The Clayton Act and the Robinson-Patman Act forbid certain types of

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A) price discrimination. B) bait-and-switch pricing. C) predatory pricing. D) everyday low pricing strategies. E) loss-leader pricing.

117)

When a firm colludes with other firms to control prices, it is engaging in

A) competitive favoritism. B) industry tightening. C) monopolistic competition. D) price fixing. E) regressive pricing.

118) ________ price fixing occurs when competitors collude to control prices, and ________ price fixing occurs within a marketing channel to control prices passed on to consumers.

A) Industry; supply chain B) General; specific C) Widespread; integrated D) Strategic; tactical E) Horizontal; vertical

119) When members of the marketing channel collude to control the prices passed on to consumers, they are engaging in

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A) loss-leader price fixing. B) bait-and-switch price fixing. C) horizontal price fixing. D) vertical price fixing. E) predatory pricing.

120) Several airlines have agreed to charge the same fare for a single route. The airlines are using

A) horizontal price fixing. B) vertical price fixing. C) horizontal price discrimination. D) vertical price discrimination. E) loss-leader pricing.

121) It is the responsibility of ________ to determine the ethical approach to setting prices so consumers find value and the firm can make a profit.

A) the Better Business Bureau B) federal regulators C) the American Marketing Association D) marketers themselves E) industry standards boards

122) If all three grocery stores in town decide to charge the same price for a gallon of milk, what type of pricing tactic is being used?

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A) horizontal price fixing B) vertical price fixing C) horizontal price discrimination D) vertical price discrimination E) loss-leader pricing

123) It is best if firms choose one pricing strategy to use for all its products rather than use different methods for pricing. ⊚ ⊚

true false

124) Cost-based methods do not recognize the role that consumers’ or competitors’ prices play in the marketplace. ⊚ ⊚

true false

125) The improvement value method and the cost of ownership method are both cost-based pricing methods. ⊚ ⊚

true false

126) When a retail store rarely sells deeply discounted or sale products, it is known as “everyday low pricing.” ⊚ ⊚

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true false

127) Sellers using an EDLP pricing strategy often communicate their strategy through the creative use of a reference price. ⊚ ⊚

true false

128) When Sony released its PlayStation 4 game console, it charged a high price, attracting the most avid game players. This was a market penetration pricing strategy. ⊚ ⊚

true false

129) Sarita wants to quickly establish a dominant market share for her new line of organic candles. To do this, she will likely use a penetration pricing strategy. ⊚ ⊚

true false

130) For market penetration pricing to work, the product or service must be perceived as breaking new ground in some way. ⊚ ⊚

131)

true false

A pricing strategy and a pricing tactic are essentially the same thing. ⊚ ⊚

true false

132) Coupons may annoy, alienate, and confuse consumers and therefore do little to increase store loyalty.

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⊚ ⊚

true false

133) Van sells sports equipment and wants to get customers into his store. He knows from past experience that sales generate customer traffic, particularly when he puts children’s baseball equipment on sale. Van may consider a leader pricing strategy. ⊚ ⊚

true false

134) Slotting allowances are used to get retailers to feature a manufacturer’s product in their advertising and promotional efforts. ⊚ ⊚

true false

135) The expression “3/10, n/30” means that a business must pay 3 percent of the total invoice amount in 10 days, with the remainder due in 30 days. ⊚ ⊚

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true false

Answer Key Test name: Chapter 15 Test Bank 26) B 27) C 28) A 29) E 30) C 31) D 32) D 33) A 34) B 35) D 36) B 37) D 38) B 39) A 40) E 41) E 42) A 43) B 44) D 45) A 46) B 47) B 48) A 49) E 50) A 51) B Version 1

52) D 53) C 54) E 55) E 56) A 57) A 58) D 59) E 60) E 61) D 62) C 63) A 64) A 65) B 66) D 67) D 68) C 69) B 70) C 71) B 72) A 73) E 74) D 75) E 76) A 77) C 78) D 79) B 80) E 81) B Version 1

82) B 83) A 84) C 85) A 86) B 87) C 88) E 89) A 90) C 91) B 92) E 93) A 94) A 95) A 96) D 97) D 98) C 99) B 100) B 101) C 102) E 103) B 104) C 105) B 106) C 107) D 108) D 109) C 110) E 111) C Version 1

112) A 113) E 114) D 115) A 116) A 117) D 118) E 119) D 120) A 121) D 122) A 123) FALSE 124) TRUE 125) FALSE 126) TRUE 127) FALSE 128) FALSE 129) TRUE 130) FALSE 131) FALSE 132) TRUE 133) TRUE 134) FALSE 135) FALSE

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Student name:__________ 1) Supply chain management expert Bernard LaLonde once said, “American management’s philosophy has been: If you’re smart enough to make it, and aggressive enough to sell it—then any dummy can get it there. Now we’re paying for [that philosophy].” What supply chain problems will managers with this philosophy likely encounter?

2) As the text states, “Students of marketing often overlook or underestimate the importance of place in the marketing mix.” Why? Create an example to describe how place is important to consumers.

Where does the value for the consumer lie in the supply chain?

What is the difference between a distribution center and a fulfillment center?

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5) Firms such as Forever 21 and H&M have adopted a just-in-time (JIT) or quick response (QR) inventory system. Why is this type of inventory especially valuable in a market like fashion clothing?

What types of firms typically operate distribution centers?

Explain the difference between an indirect and a direct marketing channel.

What are the main challenges in managing a supply chain?

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9) A small manufacturer was once quoted as saying, “The best day and the worst day of my business life was the day we got a contract from Walmart.” What type of vertical supply chain is the manufacturer entering? Why would the manufacturer say this?

10)

Why is mutual trust important in managing a supply chain?

11)

Explain how a firm like Walmart would exert referent power over another firm.

12)

Compare an independent supply chain with a vertical marketing system.

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13) Why does conflict arise in the supply chain? How do partnering relationships help reduce conflict?

14) Western Glass Inc. provides bottles to the major beverage companies in the United States. Western knows it needs to build partnering relationships with each of the beverage companies, and the beverage companies know that Western is important to them. What will both sides need to do to build and maintain a partnering relationship?

15)

Describe a scenario that represents the first phase of a vertical marketing system.

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16)

Define the six types of power that occur in a marketing channel.

17)

Name three benefits of a strategic relationship between channel members.

18)

Describe the three types of vertical marketing systems.

19)

What elements, outlined in your text, contribute to the success of strategic relationships?

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20) Explain the flow of information through marketing channels. Use a specific example, such as a customer who is buying a new computer.

21) What are radio frequency identification tags and what purpose do they serve at the store level?

22) Timor is adapting the new routing software his company bought for its distribution center. What factors will he likely include in the software program in order to maximize distribution efficiency?

23)

Describe the general steps that merchandise follows through the marketing channel.

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24)

Describe the differences between using a distribution center and direct delivery.

25) Give examples of the kinds of information flows that take place between a store and its consumers, a distribution center, and a manufacturer.

26) How are companies, such as Amazon, automating their supply chain—for example, in their warehouses.?

27) In what ways can customers take possession of their merchandise? How does each method address the challenges inherent in that activity? Version 1

28) You see an advertisement for an internship with Best Buy to work with a corporate buyer. The advertisement describes the types of activities associated with working in conjunction with the stores and the manufacturers. What sorts of activities would you expect the ad to list?

29) Years ago, a hardware store had a sign that said, “If we don’t have it, you don’t need it.” How is the implementation of a quick response system the complete opposite of this marketing philosophy?

30) What are RFID tags, where have they typically been used, and why are they becoming more prevalent in retail supply chain applications?

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31) Stimulation Market Inc. manufactures educational toys. The company recently started buying paint for its toys from a Brazilian firm. This Brazilian company is part of Stimulations Markets’

A) supply chain. B) corporate vertical marketing system. C) distribution center. D) CFPR. E) voluntary chain.

32)

Which element of the marketing mix specifically deals with supply chain management?

A) product B) price C) place D) promotion E) production

33) Students of marketing often overlook or underestimate the importance of place in the marketing mix simply because

A) it happens behind the scenes. B) it conflicts with promotion. C) it occurs after making pricing decisions. D) no one is directly in charge of place decisions. E) the product itself is so much more important.

34)

What differentiates a distribution center and a fulfillment center?

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A) A fulfillment center sends goods to company stores. B) A distribution center sends goods to company stores. C) A fulfillment center ships goods in bulk to one address. D) A distribution center packs single orders to multiple addresses. E) A fulfillment center redistributes the goods that it stores.

35) In the four Ps of marketing, ________ refers to all the activities required to get the right product to the right customer when that customer wants it.

A) product B) place C) promotion D) packaging E) partnership

36)

In marketing’s four Ps, place refers to all activities required to get

A) the design of the terminal location for products accomplished. B) the right product to the right customer when that customer wants it. C) access to the physical space within a retail establishment. D) consumers to the destination. E) demand chain management functionally operable.

37) H&M has adopted the inventory management system that delivers less merchandise on a more frequent basis than in traditional inventory systems. The firm gets the merchandise just in time for it to be used in the manufacture of another product or for sale when the customer wants it. This is an example of a ________ inventory system.

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A) cross-docking B) quick response (QR) C) UPC D) EDI E) lead time

38) Forever 21 has adopted an inventory system that reduces the amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise at the seller’s store, available for sale. This practice increases product availability and lowers inventory investment. These benefits are attributed to the ________ system.

A) cross-docking B) UPC C) just-in-time (JIT) D) EDI E) vendor-managed inventory

39) At the BMW plant in Spartanburg, South Carolina, rather than use a typical order-todelivery process, it has suppliers deliver parts every four hours when the plant is in operation. BMW uses a ________ inventory control system.

A) cross-docking B) lead time C) just-in-time (JIT) D) pick ticket E) UPC

40) Because manufacturers with JIT systems produce merchandise closer to the time of sale, they can

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A) organize cooperative agreements among competing manufacturers to reduce oversupply. B) reduce inventories needed to satisfy retailers’ demand. C) use exclusive geographic territories to centralize production. D) effectively eliminate the need for a dispatcher. E) replace independent supply chains with corporate supply chains.

41) Especially in the fashion industry where styles and trends change rapidly, a quick response system can

A) allow retailers to better forecast long-term demand. B) reduce logistical overlay. C) increase cross-docking promotional effectiveness. D) align deliveries more closely with actual sales. E) allow manufacturers to introduce unpopular styles and still be successful.

42)

With more frequent shipments associated with quick response (QR) systems, a retailer is

A) likely to have lower shipping costs. B) more likely to add extra floor-ready merchandise. C) less likely to use radio frequency identification tags. D) more likely to engage in predatory pricing behavior. E) more likely to have what customers want.

43)

While JIT systems have many benefits, they

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A) make the logistics function more complicated. B) interfere with new product development functions. C) confuse customers. D) work only in vertical marketing systems. E) decrease the accuracy of demand forecasts.

44) Leona is the logistics manager for the Barnes & Noble bookstore chain. She is weighing the many benefits of the company’s JIT system but will need to consider that just-in-time inventory management systems increase ________ costs.

A) sales force labor B) transportation C) promotional D) advertising E) new product development

45) Rashid works for a firm that buys products directly from the manufacturer and resells them to retailers, who then sell the products to consumers. Rashid works for a

A) retail distribution center. B) retail jobber. C) store representative. D) wholesaler. E) manufacturer’s representative.

46)

Stores like Home Depot and Costco act as wholesalers when they

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A) take delivery in whole-lot quantities. B) sell directly to consumers. C) sell products for distributors. D) sell to contractors or restaurant owners. E) compete with each other.

47) When Costco sells to consumers directly, it acts as a ________; when it sells to other businesses, such as a restaurant owner, it acts as a ________.

A) wholesaler; retailer B) retailer; manufacturer C) retailer; wholesaler D) manufacturer; wholesaler E) marketing channel; supply channel

48)

A(n) ________ is used in the shipment of products directly to customers.

A) fulfillment center B) distribution center C) administration center D) data warehouse E) vendor warehouse

49) LeeAnna knows she has to order her store’s Christmas holiday merchandise in April to ensure delivery before the holiday season. LeeAnna is concerned with the supply chain management goal of

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A) providing products at the right time. B) providing products at the right locations. C) providing the right quantities. D) satisfying the service levels supply chain participants expect. E) minimizing systemwide costs.

50) When Lenovo sells computers to Brownston College, it engages in a ________ transaction, but when it sells to students individually, it is a ________ operation.

A) fulfillment; distribution B) B2C; B2B C) B2B; B2C D) retail; B2B E) B2C; fulfillment

51) ________ is an inventory management system that delivers less merchandise on a more frequent basis than in traditional inventory systems.

A) Quick response B) Checking C) Combination warehousing D) Cross-docking E) Horizontal merchandising

52) A ________ is a facility for the receipt, storage, and redistribution of goods to company stores.

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A) circulation center B) distribution center C) supply chain hub D) collaborative replenishment office E) floor-ready franchising center

53)

A distribution center is typically operated by

A) the marketing department. B) vertically integrated consumer networks. C) retailers, manufacturers, or distribution specialists. D) wholesalers. E) horizontal interchange services.

54) Having no intermediaries between the buyer and seller is a defining characteristic of a(n) ________ marketing channel.

A) indirect B) vertical C) horizontal D) simple E) direct

55) Gianni made pies and sold them from her food truck to local businesses. This is an example of a(n)

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A) direct marketing channel. B) distribution center. C) simplified transaction. D) wholesale operation. E) indirect marketing channel.

56) In a(n) ________ marketing channel, one or more intermediaries work with manufacturers to provide goods and services to customers.

A) indirect B) vertical C) horizontal D) simple E) direct

57) Elena makes purses out of old blue jeans and sells them to customers at local craft fairs. What type of marketing channel does this represent?

A) indirect B) vertical C) horizontal D) direct E) simple

58) A local furniture store buys furniture from various manufacturers and resells the furniture to its customers. What type of marketing channel does this represent?

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A) horizontal B) vertical C) indirect D) direct E) simple

59)

When a firm is just starting out or entering a new market, it often

A) can choose from whom it buys, but not to whom it sells. B) cannot choose from whom it buys or to whom it sells. C) is able to choose from whom it buys and to whom it sells. D) can choose to whom it sells, but not from whom it buys. E) Can choose to whom it sells, but not how it distributes the products.

60) Walmart’s customers have come to expect to find P&G products in stores, and P&G depends on Walmart to purchase a good portion of its output to sell to its own customers. This scenario represents the first phase of a

A) quick-response system. B) virtual marketing system. C) horizontal marketing system. D) vertical marketing system. E) reward marketing system.

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61) A recent innovation by Amazon, the Vendor Flex program, seeks to lower overall transportation costs but also creates new forms of channel conflict with competitors. As a partner in the Vendor Flex program, P&G agreed to allow Amazon to build fulfillment centers within P&G’s own warehouses, thus helping to eliminate some of the costs of transporting P&G’s products to Amazon’s fulfillment centers. Believing that the program was giving its competitor Amazon an unfair advantage, Target reacted vigorously, moving all P&G products from prominent end-cap positions in its stores to less prestigious and less visible locations. Target also stopped using P&G as its primary source of advice for planning merchandising strategies within each category. The conflict between Amazon and Target is an example of ________ channel conflict.

A) horizontal B) independent C) conventional D) coercive E) vertical

62) The Stanley company wants Home Depot to carry all its tools but not the tools of its competitors so that Stanley can maximize its sales. But Home Depot carries a mix of tool brands so it can maximize the sales in its tool category. This misalignment of goals will likely lead to a ________ channel conflict.

A) horizontal B) Independent C) conventional D) coercive E) vertical

63) Marketing channels and supply chains comprise various buying entities that form relationships with one another. The basic motivating factor in these interactions is

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A) collaboration creates transactional relationships. B) the most powerful member of the supply chain always wins. C) each party wants something from the others. D) the participants must create the best possible EDI system. E) retail floor salespeople need emotional support from management.

64) Although conflict is likely to occur in any marketing channel, it is generally more pronounced when

A) the supply chain members are geographically too close to each other. B) manufacturers pressure retailers. C) retailers pressure manufacturers. D) the channel members are independent entities. E) the economy is booming.

65) Yesterday, Marya overheard a surprisingly unpleasant encounter between the manager of the hardware store where she works and a sales rep who sells a well-known line of tools. The sales rep insisted that his tools should be more prominently displayed and that a better assortment would mean more sales. The manager had other plans and told him so, and the conversation turned into a loud argument. What Marya observed was an example of

A) sales tactics. B) channel conflict. C) retail strategy tension. D) passive aggressive behavior. E) a failure of EDI processes.

66) In a(n) ________ marketing channel, none of the participants have any control over the others.

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A) cooperative B) corporate C) contractual D) administered E) conventional

67) Because of its size and relative power, Walmart can easily impose controls on small manufacturers, such as Brown Betty Dessert Boutique, but with large, powerful suppliers such as P&G, the control is more balanced between parties. Walmart’s various marketing channel relationships offer examples of different forms of a(n) ________ marketing system.

A) cooperative B) corporate C) independent D) administered vertical E) conventional horizontal

68) Tesla Motors, manufacturer of luxury electric automobiles, represents a(n) ________ because it manufactures its own cars in Fremont, California, and it operates its own retail stores in high-foot-traffic locations such as malls and shopping streets.

A) independent marketing channel B) corporate vertical market system C) indirect marketing channel D) horizontal channel E) conventional marketing channel

69) In a(n) ________ marketing channel, several independent members each attempt to satisfy their own objectives and maximize their profits, often at the expense of the other members.

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A) cooperative B) independent C) contractual D) administered E) corporate

70)

In a vertical marketing system, if the system is ________, conflict is less likely to occur.

A) less formal B) more independent C) less independent D) more conventional E) more formal

71)

In an administered vertical marketing system,

A) no individual participant has control over the others, since a third-party administrator oversees the entire supply chain. B) independent firms at different levels of the marketing channel join through contracts to obtain economies of scale and coordination to reduce conflict. C) there is no common ownership, and the dominant member has significant power to impose its ideas and objectives. D) independent firms join together formally to decide as a group how the marketing channel will operate. E) participants—such as warehouses, transportation companies, and retail outlets—are typically owned by a parent company to ensure harmonious relations throughout the supply chain.

72)

Franchising is the most common type of contractual ________ marketing system.

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A) cooperative B) corporate C) vertical D) administered E) conventional

73)

In a corporate vertical marketing system,

A) conflict tends to be a major problem. B) independent firms at different levels of the marketing channel join through contracts to obtain economies of scale and coordination to reduce conflict. C) there is no common ownership, and the dominant member has significant power to impose its ideas and objectives. D) independent firms join together formally to decide how the marketing channel will operate. E) participants—such as warehouses, manufacturing plants , and retail outlets—are typically owned by a parent company to lessen potential conflict among segments of the channel.

74) Ilya had just taken over his family’s business after spending ten years in the marketing department of a large corporation. He met with a representative from one of his firm’s biggest customers, who told him, “We should think about how we can make the pie bigger rather than fighting over the size of the slices.” He had expected a more cutthroat approach rather than this call for a

A) partnering relationship. B) shared mission statement. C) common marketing system. D) corporate vertical marketing system. E) linked supply chain.

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75) The vertical marketing system that exhibits the most formalization and control is the ________ vertical marketing system.

A) corporate B) contractual C) administered D) franchise E) partnership

76)

Which of the following is required to build a successful strategic relationship?

A) autonomous respect B) closed communications C) creation of a joint venture D) individual goals E) credible commitments

77) ________ in a marketing channel exists when one firm has the means or ability to dictate the actions of another member at a different level of distribution.

A) Capacity B) Authority C) Power D) Efficiency E) Ability

78) If a firm declared that it wanted to develop a strategic relationship, but was unwilling to commit funds or any effort to make it succeed, there would be an obvious lack of

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A) mutual trust. B) common goals. C) a contractual arrangement. D) credible commitments. E) open communication.

79) ________ between supply chain members that is based on mutual benefits is key to developing and sustaining the relationship.

A) Cross-checking B) Interdependence C) Vendor-managed inventory D) Vertical conflict reduction E) Independence

80) ________ give both members of the relationship an incentive to pool their strengths and abilities and exploit potential opportunities together.

A) Cross-checking B) Shared goals C) Vendor-managed inventory systems D) Vertical conflict reduction systems E) Horizontal channel conflicts

81) Walmart needs P&G to satisfy its customers, and P&G recognizes that if it can keep Walmart happy, it will have more than enough business for years to come. Walmart and P&G recognize that it is in their common interest to be

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A) separate identities. B) strategic partners. C) supply chain intermediaries. D) in a corporate vertical marketing system. E) in an administered vertical marketing system.

82) A(n) ________ marketing system is a supply chain whose members act like a unified system.

A) vertical B) independent C) concentrated D) conventional E) strategic

83) When Pete’s Pizza wants tomatoes delivered in smaller batches more frequently, it offers its distributors an incentive in the form of special bonuses to change their schedules. Pete’s demonstrates which kind of power?

A) coercive B) reward C) referent D) expertise E) information

84) Because Walmart has vast information about the consumer goods market, it might exert ________ power over P&G by providing or withholding important market information.

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A) coercive B) reward C) referent D) legitimate E) information

85) When her company’s dry goods deliveries were late for the third time, Pilar withheld payment from her supplier until it was back on schedule. This is an example of ________ power.

A) coercive B) reward C) referent D) expertise E) legitimate

86) Walmart may have ________ power if a supplier desperately wants to be associated with Walmart, because being known as an important Walmart supplier enables that supplier to attract other retailers’ business.

A) referent B) legitimate C) licensing arrangement. D) information E) coercive

87) When supply chain members view their goals and ultimate success as intricately linked, or ________, they develop deeper long-term relationships.

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A) conventional B) vertical C) horizontal D) administered E) interdependent

88) In a retail supply chain, the ________ records the purchase information and electronically sends it to the corporate office.

A) UPC B) POS terminal C) VMI D) ASN E) data warehouse

89) When Walmart promises to purchase larger quantities if a manufacturer will lower its wholesale price, it is exhibiting ________ power.

A) reward B) coercive C) knowledge D) legitimate E) referent

90) When Walmart threatens to punish or punishes the other channel member for not undertaking certain tasks, such as if it were to delay payment for a late delivery, this is an example of

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A) reward power. B) coercive power. C) information power. D) expertise power. E) referent power.

91) When Walmart relies on its experience and knowledge to decide how to market a product without giving the supplier much of a say in the matter, this is an example of

A) reward power. B) coercive power. C) information power. D) expertise power. E) referent power.

92)

The ________ tag is the black-and-white 13-digit bar code found on most merchandise.

A) electronic data interchange (EDI) B) advanced shipping notice (ASN) C) universal product code (UPC) D) point-of-sale (POS) E) vendor-managed inventory (VMI)

93)

________ centers deliver directly to customers rather than to stores.

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A) Distribution B) Direct store C) Fulfillment D) Merchandise E) Retail

94) The role of the buyer in dealing with the manufacturer includes getting information, negotiating prices, arranging shipping dates, and

A) identifying transportation options. B) changing the marketing structure. C) determining promotional events. D) establishing a franchise. E) changing the product development timeline.

95)

Manufacturers trying to implement a just-in-time delivery system need to start with

A) routing software. B) shipping schedules. C) distribution center design. D) knowledge of customer demand. E) intensive distribution.

96) Who usually makes the final decision regarding the use of distribution center versus direct store delivery?

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A) the wholesaler B) the marketing director C) the retailer D) the manufacturer E) the customer

97) Which is a wireless network and mobile device that receives demand notices and allows sales associates to pull inventory from the shelves for customers?

A) mobile task management technology B) advanced shipping notices C) point-of-sale terminals D) universal product codes E) quick response inventory systems

98) The purchase information from each individual store is typically aggregated by the retailer as a whole, which creates an order for new merchandise and sends it to the manufacturer. This is an example of information flowing from the

A) store to the distribution center. B) store to the manufacturer. C) customer to the buyer. D) store to the buyer. E) buyer to the manufacturer.

99) The ________ terminal records the purchase information and electronically sends it to the buyer at corporate office.

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A) point-of-sale (POS) B) universal product code (UPC) C) radio frequency identification device (RFID) D) certificate of origin E) advanced shipping notice (ASN)

100)

A(n) ________ is a 13-digit code that retailers can use to track inventory.

A) UPC B) CFPR C) pick ticket D) ASN E) EDI

101) Best Buy is shipping computers to its distribution center. It uses ________ as notification mechanisms.

A) advanced shipping notices B) radio frequency identification tags C) universal product codes D) just-in-time inventory E) quick response inventory systems

102)

Which of the following statements is true regarding distribution centers?

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A) They enable retailers to carry less merchandise in individual stores. B) They are more expensive than retail space. C) They are appropriate for all retailers. D) They are the quickest way to get all products to retailers. E) They complicate the process of predicting accurate sales forecasts.

103)

More accurate sales forecasts are possible when retailers ________ rather than ________.

A) create one forecast for a distribution center; forecasting for each store B) forecast for each store; create one forecast for a distribution center C) survey every current customer; create one forecast for a distribution center D) create one forecast for a distribution center; survey every current customer E) survey all current customers; forecast for every store

104)

________ enable the retailer to lower inventory investments systemwide.

A) Distribution centers B) Additional local factories C) Warehouses D) Additional retail outlets E) Local storage units

105) Marcie’s Mats creates custom mats for homes. She operates out of two stores in the New York City metropolitan area. These are used to display sample mats and show the selection of available materials. Marcie is wondering where to store the basic mats that have been manufactured in advance and are customized on request. She is considering using a distribution center. Would this be a good decision?

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A) Yes, because it will be easier for Marcie to forecast sales from one central distribution center. B) No, the expense of a distribution center is not warranted for this amount of inventory. C) Yes, because the cost of retail space would be more than the cost of the distribution center. D) Yes, because Marcie wouldn’t run out of stock. E) No, because Marcie wouldn’t be able to get her products onto shelves fast enough.

106)

Which of the following is true regarding getting merchandise to customers?

A) Most distribution centers ship products by rail. B) Many retailers now offer free expedited service. C) Distribution centers provide a window of two weeks for deliveries to stores but cannot get more specific. D) To use the buy-online-and-pick-up-in-store option successfully, stores need to hire twice considerably more sales associates. E) In most cases, consumers have to come to the store multiple times to see if their online order is available.

107)

What problem has developed as a result of increased package delivery?

A) more uncertainty on delivery dates B) additional spoiled perishable products C) consumers spending too much D) delivery of incorrect merchandise E) package/“porch” thieves

108) When a customer purchases a television at Best Buy, which of the following information flows in the supply chain are started?

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A) The sales associate records the UPC in the sales ledger. B) The sale is transmitted to Best Buy’s distribution center to adjust inventory data. C) The purchase is added to the customer’s purchasing habit records. D) Best Buy’s buyer aggregates sales at all stores and uses the information to alert the advertising company. E) The point-of-sale terminal records the sale and sends it to the manufacturer.

109) Steve managed an auto parts store in the 1990s. At that time, stockouts—failure to have the parts auto mechanics needed to do their work that day—increased the likelihood of the mechanics becoming customers of competing auto supply stores. To avoid this problem and keep his business customers, Steve most likely

A) canceled orders and shifted the business to competitors. B) increased promotional outlays to overcome customer dissatisfaction. C) used exclusive geographic territories to reduce supply chain inefficiencies. D) stockpiled inventory, adding to the cost of providing auto parts. E) returned to traditional distribution center logistics.

110) In addition to merchandise and payments, information flows throughout a supply chain. Which of the following statements are a good characterization of the flow of information in a supply chain?

A) A manufacturer will send and receive information from buyers, stores, and distribution centers. B) Stores will send and receive information only from manufacturers. C) Distribution centers will send and receive information directly from customers. D) Customers will send and receive information from stores and manufacturers. E) Manufacturers will send and receive information only from fulfillment centers.

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111) Today, when a customer orders merchandise from an online vendor, the vendor usually sends an immediate order confirmation message by e-mail. Usually within a day or two, a second message arrives stating that the order is in the mail. This second message is a type of

A) vertical contractual notice. B) VMI requirement. C) advanced shipping notice. D) universal product code report. E) RFID tag.

112) Ron has just received notification from a vendor that his clothing merchandise order has been processed and dispatched. Ron has just received a(n)

A) horizontal contractual notice. B) vendor-managed inventory alert. C) advanced shipping notice. D) universal product code report. E) EDI tag.

113)

In order to anticipate demand, advertising and promotions must be coordinated with the

A) customers. B) fulfillment centers. C) store managers. D) human resource departments. E) departments that control inventory.

114)

Which is an advantage of using a distribution center?

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A) inaccurate sales forecasts B) retailers need to keep more merchandise in the store as inventory C) more difficult to avoid running out of stock or having too much stock D) saves money since the storage space at a distribution center is generally less expensive than that of a store E) customers know they are dealing with a more sophisticated operation

115)

Which of the following are activities carried on in a distribution center?

A) sending promotional material to customers B) receiving, checking, and storing merchandise C) distributing paychecks and paystubs for retail employees D) setting up in-store displays E) arranging expedited shipping direct to customers

116) Nathan is glad his company finally converted to an RFID system. Now, he can be sure that can be sure that

A) he is aware of special promotions. B) customer information is entered into the database. C) fulfillment centers are stocking appropriate inventories. D) the mobile task management system is operating properly. E) strategic partners are informed of special sales.

117)

Radio frequency identification tags are

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A) selective distribution designs used to maximize geographic efficiency. B) electronic discount information tags used to provide reduced prices to select customers. C) VMI demand scheduling data tags. D) tiny computer chips that transmit information about a container’s contents. E) information tags used for floor-ready merchandising.

118) Marketing channel management adds value because it gets products to customers efficiently, quickly, and at low cost. ⊚ ⊚

119)

true false

Marketing channel management and supply chain management are virtually the same. ⊚ ⊚

true false

120) When manufacturers such as Avon sell directly to consumers, they perform both production and retailing activities. ⊚ ⊚

121)

Distribution centers are always operated by distribution specialists. ⊚ ⊚

122)

true false

Wholesalers are often used in an indirect marketing channel.

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⊚ ⊚

true false

123) In a direct marketing channel, there are no intermediaries between the buyer and the seller. ⊚ ⊚

true false

124) When two competing retailers have a disagreement, it is an example of a horizontal channel conflict. ⊚ ⊚

125)

true false

Marketing channel relationships evolve when the parties have common goals. ⊚ ⊚

true false

126) Conflicts within a supply chain tend to be more pronounced when the members are part of a corporate vertical marketing system. ⊚ ⊚

true false

127) Universal product codes (UPCs) are used to describe products for inventory taxation purposes. ⊚ ⊚

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true false

128) Retailers generally have no prior knowledge of the merchandise they will be receiving from suppliers in any particular shipment. ⊚ ⊚

true false

129) Radio frequency identification (RFID) tags automatically transmit information about a container’s contents or individual products. ⊚ ⊚

true false

130) Quick response (QR) inventory systems allow retailers to maximize their inventory holdings. ⊚ ⊚

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true false

Answer Key Test name: Chapter 16 Test Bank 31) A 32) C 33) A 34) B 35) B 36) B 37) B 38) C 39) C 40) B 41) D 42) E 43) A 44) B 45) D 46) D 47) C 48) A 49) A 50) C 51) A 52) B 53) C 54) E 55) A 56) A Version 1

57) D 58) C 59) B 60) D 61) A 62) E 63) C 64) D 65) B 66) E 67) D 68) B 69) B 70) E 71) C 72) C 73) E 74) A 75) A 76) E 77) C 78) D 79) B 80) B 81) B 82) A 83) B 84) E 85) A 86) A Version 1

87) E 88) B 89) A 90) B 91) D 92) C 93) C 94) C 95) D 96) C 97) A 98) E 99) A 100) A 101) A 102) A 103) D 104) A 105) B 106) B 107) E 108) B 109) D 110) A 111) C 112) C 113) E 114) D 115) B 116) A Version 1

117) D 118) TRUE 119) TRUE 120) TRUE 121) FALSE 122) TRUE 123) TRUE 124) TRUE 125) TRUE 126) FALSE 127) FALSE 128) FALSE 129) TRUE 130) FALSE

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Student name:__________ 1) When writing news stories, journalists are taught to answer the questions of who, what, when, where, and why. How is the job of retailers similar to that of journalists?

How has the relationship between manufacturers and retailers changed?

3) Trisha has developed a line of clothing accessories and has lined up the production and financing. Next, she is preparing to reach out to the ultimate customer. She has spoken to several stores that have agreed to carry these products, and she has narrowed her options to specialty and department stores. What factors must Trisha now address?

How can the size of a company affect the choice of marketing channels?

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What is the difference between exclusive distribution and selective distribution?

Name three kinds of food retailers and five kind of general merchandise retailers.

7) Conventional supermarkets still sell a majority of food merchandise, but they are under substantial competitive pressures. Who are the emerging competitors and what can they offer customers that conventional supermarkets do not?

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8) Convenience stores are said to be the modern version of the mom-and-pop grocery or general stores. Those mom-and-pop stores are no longer around. If convenience stores want to thrive, what must they do to provide value to customers?

9) Imagine you are shopping for a specific item (such as a sweater, a toaster, etc.). What type of general merchandise retailer will you first seek? Using a specific item, select one type of general retailer, and in broad terms, describe the breadth and depth of its merchandise, the level of anticipated customer service, and general pricing.

10) If you were a marketer who wanted to sell your product to very specific segments, what kind of general merchandise retailer would you select? Why would this be an advantage?

11) What is unique about drugstores as a general merchandise retailer? What competitive pressures could limit growth in sales and profits?

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12) Describe an extreme-value retailer. Who is their target customer and what does this customer seek?

13) From the consumer’s perspective, what is the major drawback associated with off-price retailers?

14) What is the difference between warehouse clubs, extreme-value retailers, off-price retailers, full-line discount retailers, and category specialists.

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15) Linda is opening an upscale outdoor cooking equipment store. No other store in her market area carries similar items. Linda is counting on her product line differentiation to distinguish her business from the competition. What problem might Linda encounter?

16) Martin is opening an upscale outdoor cooking equipment store. If he wants to differentiate his store from competitors based on product offerings, what will he likely need to do?

17) What is the goal of newspaper, magazine, and television advertising for brick-and-mortar retailers?

18) Sanscita is converting an empty warehouse into an upscale designer clothing store. What recommendations regarding promotion and the overall retail environment would you make to Sanscita?

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19) How do retailers accumulate knowledge that can be used in customer relationship management (CRM)?

20) Igor manages a cell phone store and is debating how much personal selling and customer service he should utilize as part of his promotion strategy. What would you recommend and why?

21) The regional manager for your home goods store announces a goal of increasing the company’s share of wallet by 10 percent. What does the manager mean?

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22)

In what type of retail situation would the old cliché “location, location, location” be true?

23) You are a marketer working for a firm that manufactures a wide range of products. Many of your traditional retail outlets are cutting back on the number of products they stock in a store, and you are receiving complaints from customers who cannot find their favorite products. Your firm has developed an efficient operation that makes it possible to continue to expand the number of items you can offer customers. Which channel should be your focus, and why?

24) Omnichannel retailing has many potential advantages, but it also has challenges. What are they?

25) Although customers expect across-the-board pricing consistency, why might a retailer use a variety of pricing strategies?

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26) Explain what happens to the organizational structure of an omnichannel retailing operation, such as Walmart, that is maturing.

27)

A company that buys products from manufacturersand resells them to retailers is a

A) wholesaler. B) specialist. C) supercenter. D) warehouse. E) cooperative.

28)

Where does retailing fall in the supply chain?

A) at the end B) in the center C) first D) second E) no where

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29) Caruso’s Office Supplies has decided to branch out from its existing stores. It plans to start sending out a catalog and to sell its products online. Caruso’s is adopting

A) an omnichannel strategy. B) exclusive distribution. C) selective distribution. D) an extreme value strategy. E) a service retailing philosophy.

30) ________ is the term used to describe the situation when retailers use some combination of stores, catalogs, and the Internet to sell merchandise.

A) Vertical channel integration B) Cross-channel leverage C) Horizontal channel integration D) Omnichannel retailing E) Opportunistic retailing

31)

Retailing is the primary activity in which of the following situations?

A) shipping electrical components to a factory B) transporting pallets of Daisy brand dairy products C) restocking a big-box store with paper towels from multiple suppliers D) upgrading an airline ticket at the airport E) going to a lab for blood tests

32) Yvonne represents a manufacturer who makes unique, high-end handbags. When making a recommendation about potential retail partners, what should be Natalie’s first consideration?

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A) What is the appropriate advertising strategy? B) When will customers want this product? C) What prices will customers be willing to pay? D) What assortment of products will customers want? E) How likely is it for certain retailers to carry this product?

33)

Retailing is defined as the set of business activities that

A) focuses on a firm’s core values. B) focuses on transactions, but not relationships. C) adds value to products and services sold to consumers for their personal or family use. D) separates wholesaling from manufacturing. E) occurs only in brick-and-mortar space.

34)

Which of the following are typical outlets used by retailers?

A) catalogs B) manufacturers C) business-to-business requests for proposals (RFPs) D) wholesalers E) distribution centers

35)

The key factor distinguishing retailers from other members of the supply chain is that

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A) they sell to consumers, businesses, and government. B) they utilize marketing to reach consumers. C) they use advertising to generate demand. D) they rarely engage in personal selling. E) they sell to customers for their personal use.

36)

Wholesalers sell to

A) other distributors. B) manufacturers. C) retailers. D) consumers. E) jobbers.

37) Which of the following is included in the broad factors that manufacturers must consider when establishing a strategy for getting their products into the hands of the ultimate customer?

A) choosing retail partners B) increasing transportation costs C) retail advertising programs D) creating a JIT manufacturing system E) lowering production costs

38)

In the past, ________ controlled supply chains.

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A) retailers B) manufacturers C) government agencies D) wholesalers E) distributors

39)

Today, ________ dominate supply chains.

A) large retailers B) manufacturers C) government agencies D) wholesalers E) distributors

40)

Today, retailers like Walmart, Home Depot, and Kroger dictate to their suppliers

A) which competitors they should collaborate with. B) what should be made. C) how products should be advertised. D) that they must have local manufacturing plants. E) who they can buy their components from.

41) Rhys has designed innovative accessories for hard-core bicycling enthusiasts. He knows where and how he will make them, and he needs to turn his attention to getting the products to the customers. As he chooses retail partners, which of the following is least important in this process?

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A) looking at the channel structure B) determining where target customers will expect to find this product C) considering characteristics of channel members D) encouraging new bicycling enthusiasts E) considering distribution intensity

42) The level of difficulty a manufacturer experiences in getting retailers to purchase its products is determined by the degree to which the channel is

A) exclusive. B) vertically integrated. C) known nationally. D) recognized. E) horizontally integrated.

43) Knowing what customers expect is essential. Retailers need to know which manufacturers their customers prefer, while manufacturers need to know

A) if customers are using credit cards or cash to make purchases. B) how many employees the retailers have. C) where their target customers expect to find their products. D) whether the products will fill a customer’s self-actualization needs. E) whether customers will find the store atmospherics appropriate to the location.

44) will

Generally, the larger and more sophisticated the channel member, the less likely that it

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A) use supply chain intermediaries. B) rely on marketing research. C) use omnichannel marketing. D) use intensive distribution. E) be concerned about competitive actions.

45) Otto used to work for a large, well-known retailer. He left that company to work for a much smaller company, and in doing so, he discovered that the channel functions were handled very differently in the smaller firm. Looking back at his experience, he noticed that larger firms

A) perform many different channel functions themselves. B) have less control in the channel. C) are generally less efficient. D) spend more money wastefully. E) use more independent salespeople.

46)

When choosing a retail partner, manufacturers consider

A) convenience for the customer. B) channel structure. C) distribution intensity. D) horizontal channels. E) who they can buy components from.

47)

Distribution intensity is commonly divided into three levels:

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A) intensive, exclusive, and selective. B) primary, secondary, and tertiary. C) administered, vertical, and independent. D) global, national, and local. E) corporate, contractual, and independent.

48) Some companies want to get their products into as many outlets as possible, understanding that the more exposure a product gets, the more it will sell. If this belief is consistent with the company’s overall strategy, it will choose ________ distribution.

A) primary B) independent C) intensive D) exclusive E) selective

49) When Creative Pen Company designed a new pen that was particularly comfortable to use, it wanted to literally get the pen in the hands of as many consumers as possible. Creative Pen will probably choose ________ distribution for its new product.

A) intensive B) exclusive C) selective D) collective E) variable

50) Coca-Cola wants its product available everywhere—grocery stores, convenience stores, restaurants, and vending machines. The more exposure the products get, the more they sell. The company is employing a (an) ________ strategy.

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A) intensive distribution B) exclusive distribution C) selective distribution D) surplus distribution E) contractual distribution

51) Manufacturers might use ________ distribution by allowing only a few selected retail customers in a territory to sell its products.

A) luxury B) selective C) monopolistic D) intensive E) exclusive

52) Ambyah Fashions is launching a new line of one-of-a-kind designer jewelry. Each piece is handcrafted, and production volumes will be very low. To emphasize the unique nature of this jewelry, Ambyah Fashions will most likely choose ________ distribution.

A) luxury B) selective C) monopolistic D) intensive E) exclusive

53) Windsor Locks produces organic food products like stone-ground grits and wild rice. The company has limited production capacity and wants to carefully control where its products are sold. Windsor Locks will likely choose ________ distribution intensity.

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A) luxury B) variable C) monopolistic D) intensive E) exclusive

54) A(n) ________ distribution intensity helps a seller maintain a particular image and control the flow of merchandise into an area.

A) intensive B) widespread C) selective D) collective E) variable

55) If a manufacturer isn’t happy with either intensive or exclusive distribution, a logical choice, which incorporates some features from both, would be ________ distribution.

A) moderate B) compromise C) luxury D) evolutionary E) selective

56) Full-line discount, category specialist, and specialty stores are all types of ________ retailers.

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A) food B) general merchandise C) price sensitive D) limited demand E) special appeal

57) If a manufacturer wanted to sell a full range of products in a number of different container sizes, which kind of store would the company be least likely to choose as a retailing partner?

A) conventional supermarket B) supercenter C) warehouse club D) convenience stores E) full-line discount stores

58) Juan’s family has owned and operated a small chain of conventional supermarkets for many years. Competition from a variety of other kinds of retailers has adversely affected the business. To address the new competitive reality, Juan wants to apply what he recently learned as a marketing major and he has recommended that his family’s business should

A) emphasize fresh, locally sourced perishables. B) target the broadest possible customer base. C) eliminate customer frills and extras. D) offer fewer private-label brands. E) offer more national brand packaged goods and few perishables.

59) Supercenters are large stores that combine a supermarket with a full-line discount store. ________ dominates this category with the vast majority of supercenters in the United States.

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A) Target B) Meijer C) Kmart D) Kroger E) Walmart

60)

Compared to conventional supermarkets, warehouse clubs have

A) a broader assortment of food items. B) a lower level of service. C) slightly higher prices. D) no products appealing to small businesses. E) lower annual fees.

61) Which of the following represents the best reason a manufacturer of high-end products might consider selling products in a warehouse club?

A) There are no high-end shopping centers within a 100-mile radius of the warehouse club. B) The warehouse club has a good reputation. C) The manufacturer is trying to increase market share. D) The manufacturer overestimated demand or has a great deal of returned merchandise from other retailers. E) The warehouse club wants to upgrade its image.

62) ________ are combating competitive pressures by offering fresh food and healthy fast food, tailoring assortments to local markets, opening locations closer to where consumers work and shop, and adding new services.

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A) Warehouse clubs B) Supercenters C) Convenience stores D) Department stores E) Extreme value retailers

63) Caruso’s Office Supplies has large stores resembling warehouse environments, with racks stocked from floor to ceiling with different types of office supplies. Its assortment of office supplies is the largest in town, and its prices are low. Caruso’s is a(n)

A) warehouse club. B) extreme-value retailer. C) off-price retailer. D) full-line discount retailer. E) category specialist.

64) Latifa’s Studio, located in a shopping mall, offers Zumba dance classes for all ages. Latifa’s Studio is known as a(n)

A) service retailer. B) category specialist. C) specialty store. D) outlet studio. E) small-box specialist.

65) Which type of store is small and offers a limited merchandise assortment at very low prices?

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A) specialty stores B) extreme-value retailers C) outlet stores D) limited assortment supermarkets E) convenience stores

66) Eloise, a medical equipment sales rep, purchases a quick snack to eat on the way to work. She buys lunch while on the road visiting customers, and grabs bread and milk on the way home when she stops to buy gas. Eloise probably does the majority of this shopping at a

A) convenience store. B) warehouse club. C) conventional supermarket. D) drugstore. E) category specialist.

67) If you walk into a(n) ________, you will likely find a broad variety of merchandise, deep assortment, and customer service, with everything organized into distinct departments for displaying merchandise.

A) department store B) off-price retailer C) discount store D) specialty store E) category specialist

68)

Macy’s, Kohl’s, JCPenney, and Nordstrom are examples of

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A) department stores. B) off-price retailers. C) discount stores. D) extreme value stores. E) category specialist stores.

69) ________ are combating competitive pressures by providing better value with privatelabel merchandise; adding new value-added services such as online ordering and delivery options; and providing a better shopping experience.

A) Convenience stores B) Department stores C) Full-line discount stores D) Extreme value stores E) Conventional supermarkets

70) Retailers that offer a broad variety of merchandise, limited services, and low prices are known as

A) full-line discount stores. B) convenience stores. C) home improvement stores. D) category specialists. E) department stores.

71) If you’re a manufacturer, and you want to showcase your product in a store that has a narrow but deep selection of merchandise and where expert sales associates can assist customers with their selections, you’d most likely choose

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A) a category specialist. B) a specialty store. C) a department store. D) an extreme value retailer. E) a warehouse club.

72) If you are a marketer for a manufacturer, and the marketing mix for your product focuses on very specific market segments, you’d like to sell your product through

A) department stores. B) category specialist stores. C) extreme value retailers. D) specialty stores. E) convenience stores.

73)

Of the following retailers, the best example of a category killer is

A) Dollar General. B) Staples. C) Kohl’s. D) Target. E) Costco.

74)

As a type of retailer, category specialists offer

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A) a broad assortment of merchandise. B) highly trained personnel throughout the stores. C) a narrow but deep assortment of merchandise. D) highly attractive loyalty programs. E) a limited, but complementary merchandise assortment.

75) ________ offer a limited assortment of general merchandise at very low prices and are often found in lower-rent locations.

A) Department stores B) Off-price retailers C) Discount stores D) Extreme value retailers E) Category specialists

76) ________ reduce costs and maintain low prices by buying opportunistically from manufacturers with excess inventory, offering limited assortments of household goods and groceries, as well as health and beauty aids.

A) Category killers B) Specialty stores C) Factory outlets D) Extreme-value retailers E) Convenience stores

77) ________ are likely to target low-income consumers who demand national brands but cannot afford to buy large-sized packages.

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A) Category killers B) Department stores C) Extreme-value retailers D) Specialty stores E) Warehouse club stores

78) ________ can purchase merchandise at substantial discounts from the original wholesale prices because they do not ask the suppliers for advertising allowances or markdown adjustments.

A) Department stores B) Specialty stores C) Category specialists D) Drugstores E) Off-price retailers

79)

________ offer an inconsistent assortment of brand-name merchandise at low prices.

A) Department stores B) Specialty stores C) Category killers D) Off-price retailers E) Full-line discount stores

80) Because of the way ________ buy merchandise, customers can never be confident that the same merchandise will be in stock each time they visit the store or website.

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A) department stores B) off-price retailers C) discount stores D) services retailers E) category specialist stores

81) Ike owns an oil-change business called For Oil Only. He changes oil in cars—and that is all he does. What kind of retail business is this?

A) services retailer B) specialty store C) category specialist D) extreme value retailer E) off-price retailer

82) Janette has a large family and likes to stock up on large packs of basics like toilet paper, paper towels, and large bottles of condiments like ketchup. Janette would most likely prefer to shop for these items at a(n)

A) convenience store. B) off-price retailer. C) specialty store. D) warehouse club. E) category killer.

83) Higher-income consumers visiting ________ feel like they are on a treasure hunt, searching for a bargain.

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A) department stores B) extreme-value retailers C) big-box retailers D) services retailers E) category specialist stores

84) If you were a marketer for a clothing manufacturer and you wanted to improve revenues from irregulars, production overruns, and returns, you would be attracted to using

A) department stores. B) specialty stores. C) category specialists. D) off-price retailers. E) supercenters.

85) Considering what you know about their target markets and merchandise, which of the following retailers is least likely to have an online presence?

A) department stores B) convenience stores C) category specialists D) off-price retailers E) full-line discount stores

86)

In which of the following categories would a dry cleaning business be placed?

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A) services retailer B) specialty store C) category killer D) superstore E) discount store

87) A customer who is shopping for fashionable but relatively low-cost merchandise in a pleasant environment is shopping at a(n)

A) specialty store. B) extreme value retailer. C) full-line discount store. D) department store. E) convenience store.

88) When a company offers consumers the ability to make purchases via a smartphone, this is known as

A) M-commerce. B) smart retailing. C) cell selling. D) P-commerce. E) channel expansion.

89) Ursula owns a pet sitting service. She recently paid a web developer to build a special version of her company website for use on smartphones. Customers will now be able to easily place orders for pet sitting on their cell phones. This is an example of

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A) M-commerce. B) smart retailing. C) cell selling. D) P-commerce. E) channel expansion.

90) One of the most fundamental activities of retailers is to provide ________, satisfying the needs of their target market.

A) wholesaling opportunities B) persuasive advertising C) the right mix of merchandise and services D) corrective price controls E) category killing profitability

91) Retailers address the conflict between consumers wanting or needing only one item and manufacturers wanting to produce and ship in quantity by providing

A) reciprocity. B) simplicity. C) discounting. D) storage. E) extreme value labeling.

92) It is often difficult for retailers to distinguish themselves from their competitors through the merchandise they carry because

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A) they do not carry enough merchandise. B) consumers no longer recognize brand equity. C) big-box food retailers are shifting into specialty store product lines. D) there is not enough merchandise to go around. E) competitors can purchase and sell many of the same popular brands.

93)

One product strategy used by retailers to differentiate themselves from competitors is

A) the use of private-label brands. B) discount pricing. C) removing brand labels from their merchandise offerings. D) JIT product delivery. E) offering brand-name merchandise.

94) ________ must always be aligned with other elements of a retailer’s strategy in order to accurately define the value of the product and a retailer’s image.

A) Mobile commerce B) Transportation C) Distribution D) Price E) Labeling

95)

For retailers, promotion refers to

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A) supply chain communication. B) the relationship between price and product. C) the image a store attempts to maintain through its pricing strategy. D) both their in-store environment and their media communications. E) the seasonal discounts offered to move end-of-season items.

96) Retailers use ________ to communicate with or sell to consumers through wireless handheld devices.

A) virtual media B) mobile commerce C) cooperative advertising D) share of wallet tactics E) social media advertising

97) Gina wants to maximize sales to the customers who walk into her store. Of the following, Gina will most likely focus on

A) in-store promotions. B) billboard and other outdoor advertising. C) supply chain relationships. D) off-price wholesaling. E) mass media advertising.

98)

Increasingly, ________ are being used for promotions.

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A) television advertisements B) electronic communications C) newspapers D) magazines E) catalogs

99)

Companies offer real-time promotions on their

A) mobile devices. B) personal computers. C) websites. D) catalogs. E) competitive offers.

100) Unusual and exciting displays like Bass Pro Shops’ climbing wall and stocked aquarium are examples of

A) promotional discounts. B) mass media gimmicks. C) mobile marketing. D) atmospherics. E) co-op advertising.

101)

As the old cliché claims, the three most important things in retailing are

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A) presentation, presentation, presentation. B) promotion, promotion, promotion. C) product, product, product. D) price, price, price. E) location, location, location.

102) Roberto wants customers in his specialty tobacco store to feel at home, as if they were in their personal smoking den. He uses lighting, music, and soft chairs to create a “look and feel” that will get customers to relax and return. Roberto is focusing on which aspect of the marketing mix?

A) price B) place C) policy D) promotion E) product

103) The knowledge retailers gain from their store personnel, the Internet browsing and buying activities of customers, and the data they collect on customer shopping habits can be used in

A) POP. B) MSRP. C) CRM. D) JIT. E) SKU.

104)

Personal selling is particularly important for retailers selling

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A) online services. B) discount items. C) products that are complicated or expensive. D) low-cost services. E) trend or fashion items.

105) Which of the following retail stores would emphasize personal selling the most as part of the firm’s promotional efforts?

A) jewelry store B) convenience store C) liquor store D) secondhand clothing store E) bakery

106) The knowledge retailers can gain from their store personnel and customer relationship management databases is valuable for developing

A) supply chain relationships. B) extreme value retailing efforts. C) increased customer loyalty. D) global private-label brands. E) omnichannel retailing.

107) Retailers can gain valuable knowledge about their customers from the transaction process and from

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A) trade industry profiles. B) store brand/private-label brand ratios. C) omnichannel flow process. D) the insights of store personnel. E) end-of-aisle positioning studies.

108) Traditionally, retailers treated all their customers ________, but today, successful retailers

A) based on demographics; treat customers based on share of wallet. B) based on share of wallet; treat all customers identically. C) identically; base customer attention on demographics. D) based on demographics; provide more value to mobile commerce customers. E) the same; provide more value to their best customers.

109)

The percentage of a customer’s purchases made from a particular retailer is referred to as

A) share of wallet. B) share of market. C) customer loyalty. D) customer relationship management. E) customer value ratio.

110) Leonard manages a building supply company. He wants to invite 15 of his most valuable building-contractor customers to a golf outing and party. Leonard will likely use the firm’s ________ to identify these customers.

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A) website B) CRM database C) specialty store sales D) annual sales report E) inventory management system

111) Internet buyers are sometimes surprised to see online retailers using information about their past purchases to customize promotions targeted to them the next time they visit the retailer’s website. The retailer is using the information to

A) comply with Homeland Security requirements. B) shift from a general merchandise retailer to a private-label retailer. C) increase the share of wallet from their best customers. D) create traffic in their brick-and-mortar stores. E) reward customer loyalty.

112) Omnichannel retailers use consumer information collected from the customers’ Internet browsing and buying behavior to send dedicated emails to customers promoting specific products or services in an effort to

A) slay the category killers. B) compete with off-price retailers. C) drive their supply chain. D) increase their share of wallet. E) combat the inroads made by big-box specialty retailers.

113) McKenna directs her salespeople to increase the company’s share of wallet. McKenna is directing her salespeople to

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A) focus on increasing sales to their best customers. B) focus on male consumers, and not female consumers. C) sell more store brands and fewer private-label products. D) become omnichannel salespeople. E) retailing elasticity.

114)

For retailers, when making decisions regarding place, a key ingredient to success is

A) product placement promotion. B) convenient locations. C) private-label merchandise. D) off-price placement. E) customer relationship management.

115)

The six Ps include product, price, promotion, place, presentation, and

A) profit. B) private-label. C) personnel. D) presence. E) purchase.

116) Because many consumers choose stores based on proximity to their workplaces or homes, great locations are

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A) difficult to define. B) more important than great products. C) always situated near supply chain members. D) a competitive advantage that few rivals can duplicate. E) almost always locations next to big-box discounters.

117) While it is relatively easy to offer customers Internet options like a FAQ page and an email address to answer questions, some companies are using an interactive approach to address customers’ questions while they are visiting the websites. These firms are using ________ to provide the customer with enhanced customer service.

A) vendor-managed inventory B) web videos C) online chats D) EDI E) online games

118) Anders purchased a number of books from Amazon.com, and he learned to trust the recommendations made to him. More than once he was pleasantly surprised at the books and authors that he discovered this way. In this case, Amazon.com was creating value for Anders through

A) repeat business. B) rapid delivery. C) expanded market presence. D) personalized offerings. E) interactive offerings.

119) Effective ________operations require an integrated CRM (customer relationship management) system.

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A) cross-channel B) horizontal channel C) manufacturing D) omnichannel E) distributing

120) Kylie purchased some eyeliner from an Internet-based beauty supply house, and now she often receives online recommendations for other products from the same cosmetics line. These recommendations were probably the result of

A) the purchases she had made. B) purchases other customers had made that day. C) manufacturer clearances and overruns. D) products she may have returned to the company. E) items the retailer no longer carries.

121) When retailers extend their services to the Internet and become ________ retailers, they are able to satisfy a broader range of customers’ needs and wants.

A) general merchandise B) service C) omnichannel D) extreme-value E) discount

122)

Retailers need to provide a consistent ________ across all channels.

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A) availability of merchandise B) selling technique C) assortment of merchandise D) brand image E) shopping experience

123) One of the greatest constraints faced by store-based retailers—and one that the Internet channel can address—is

A) price competition. B) the amount of merchandise that can be carried in a physical store. C) competition from other retailers. D) common zoning restrictions limiting the kinds of merchandise that can be offered for sale. E) interactive customer service.

124) Katrina could not afford expensive furnishings but wanted a stylish home. After researching many options, she went to a local Target to purchase the trendy lamps, pillows, and art featured on its ads and website. As a consumer, which retailing challenge was Katrina likely responding to?

A) integrated CRM B) brand image consistency C) pricing consistency D) integrated supply chain E) efficient distribution

125) As an omnichannel retailing operation matures, as in the case of Walmart, what tends to happen to its organizational structure?

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A) separation of all operations B) escalation of costs across all channels C) growth of retail channel and diminishment of Internet channel D) operational integration of all channels E) growth of Internet channel and diminishment of retail channel

126) In omnichannel retailing, what visible element must often be adjusted because of competition faced in different channels?

A) supply chain B) return policies C) pricing D) distribution E) place

127) How does a retail distribution center supporting a store channel most obviously differ from one supporting an Internet channel?

A) in use of SKU identification B) in quantity of items shipped C) in speed of order fulfillment D) in quality of tracking mechanisms E) in use of CRM technology

128)

Customers interacting with omnichannel retailers most desire a(n) ________ experience.

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A) unique B) speedy C) distinctive D) inexpensive E) seamless

129) It is primarily the retailer’s responsibility to make sure customers’ expectations are fulfilled. ⊚ ⊚

130)

true false

Today, large retailers dictate to their suppliers what should be made. ⊚ ⊚

true false

131) Many retailers and some manufacturers use an omnichannel or multichannel strategy in which they sell in more than one channel (e.g., store, catalog, Internet). ⊚ ⊚

true false

132) The larger and more sophisticated the channel member, the more likely that it will use supply chain intermediaries. ⊚ ⊚

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true false

133) Consumer packaged-goods companies, such as Procter & Gamble, Pepsi, and Kraft, typically seek an exclusive distribution strategy. ⊚ ⊚

true false

134) Supercenters are large stores (185,000 square feet) that combine a supermarket with a full-line discount store. ⊚ ⊚

135)

Category specialists are also known as category killers. ⊚ ⊚

136)

true false

Dollar General and Dollar Tree are examples of full-price discount retailers. ⊚ ⊚

true false

137) Off-price retailers specialize in having a consistent line of merchandise available at discount prices. ⊚ ⊚

true false

138) One of retailers’ most fundamental activities is providing the right mix of merchandise and services that satisfies the needs of the target market.

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⊚ ⊚

true false

139) One significant potential benefit of the Internet channel is its ability to enable retailers to provide personalized offerings and services for each customer. ⊚ ⊚

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true false

Answer Key Test name: Chapter 17 Test Bank 27) A 28) A 29) A 30) D 31) D 32) E 33) C 34) C 35) E 36) C 37) A 38) B 39) A 40) B 41) D 42) B 43) C 44) A 45) A 46) A 47) A 48) C 49) A 50) A 51) B 52) E Version 1

53) E 54) C 55) E 56) B 57) D 58) A 59) E 60) B 61) D 62) C 63) E 64) A 65) B 66) A 67) A 68) A 69) E 70) A 71) B 72) D 73) B 74) C 75) D 76) D 77) C 78) E 79) D 80) B 81) A 82) D Version 1

83) B 84) D 85) B 86) A 87) C 88) A 89) A 90) C 91) D 92) E 93) A 94) D 95) D 96) B 97) A 98) B 99) C 100) D 101) E 102) D 103) C 104) C 105) A 106) C 107) D 108) E 109) A 110) B 111) C 112) D Version 1

113) A 114) B 115) C 116) D 117) C 118) D 119) D 120) A 121) C 122) D 123) B 124) B 125) D 126) C 127) B 128) E 129) TRUE 130) TRUE 131) TRUE 132) FALSE 133) FALSE 134) TRUE 135) TRUE 136) FALSE 137) FALSE 138) TRUE 139) TRUE

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Student name:__________ 1) What is noise in the communication process? What are the three typical sources of noise? Provide an example of noise you have experienced or observed.

2) There is an old advertising adage “I know I’m wasting half of my advertising budget. I just don’t know which half.” What is the lagged effect? How does it contribute to the dilemma of attempting to determine which advertising has an impact and which doesn’t?

What are the four mental stages in the AIDA model?

What is another name for the AIDA model? Correlate this term to the AIDA steps.

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5) Pietra saw a review of the new Love CD produced in collaboration with Cirque du Soleil, and she has decided she has to have it. At what stage in the AIDA model is Pietra?

List the steps in the AIDA model and explain why each step is important to marketers.

7) Provide an example of how the lagged effect might impact the sales of a newly manufactured vehicle that is advertised in January, but not available until July of the same year.

Compare and contrast mobile marketing with online marketing.

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9) How are social media used to help facilitate the consumer decision process? What are the three most popular sites?

10)

How is advertising different from publicity?

11) What types of sales promotions would a marketer consider if the goal is to build shortterm sales?

12)

What is the major advantage of direct marketing over advertising?

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13) Provide an example of a firm delivering the right message to the right audience through the right media.

14) Nathan and Nadine’s Canoe Tours offers a variety of coastal kayaking trips. When they started their business, they experimented with advertising but were disappointed with the results. A friend has suggested using sales promotions instead. What are their sales promotion options? Which would have the best potential for success, and why?

15) What are the individual elements of integrated marketing communications, and how does each contribute to an IMC campaign?

16) How have changes in the way consumers purchase goods and services contributed to the growth in the use of direct marketing IMC efforts?

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17)

How can direct marketing create a win-win situation for customers and the firm?

18) One of the newest IMC efforts is the use of corporate blogs. Why do businesses use them?

19) A media rep from the local radio station comes into your retail store and suggests running a series of advertisements. She says, “Let’s do it and see what happens.” What problems can you anticipate with this as the suggested goal?

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20) Wei is developing a budget for her firm’s IMC program. First, she decides what she wants to accomplish. Then she chooses media, and finally she determines the cost for each product to be promoted. What type of IMC budgeting process is Wei using?

21) Alejandro asks you how to measure gross rating points and how to compare results from various media. How would you respond?

22)

Explain how Google Analytics helped Nike develop its marketing strategy.

23) If you were advertising your company’s watches in Vogue and you had five ads in the magazine, how would you calculate your gross rating points (GRP)?

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24)

Explain how a company can use search engine marketing.

25)

Why should a marketer try to measure the success of a communications effort?

26) Ps.

Integrated marketing communications (IMC) represents the ________ element of the six

A) product B) promotion C) place D) period E) price

27)

The basic goal of integrated marketing communications is to

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A) communicate the value proposition to the target market. B) create desire. C) manipulate consumers. D) outspend competitors. E) tell the world about your company.

28)

Especially for marketers with new products or services, IMC is needed because

A) consumers need to know all about the features of new products before making a purchase decision. B) consumers are unlikely to buy products they are not aware of. C) it is impossible for products to sell themselves through word-of-mouth communication. D) pricing decisions cannot be made without IMC. E) new products and services need to be integrated into the supply chain value proposition.

29) Integrated marketing communications represents the ________ element in the six Ps of a firm’s marketing mix.

A) pricing B) product C) promotion D) place E) partnering

30)

Integrated marketing communications includes

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A) personal selling. B) distribution. C) atmospherics. D) supply chain management. E) transmission.

31) Bart owns a chain of retail electronic stores. He is evaluating how he allocates his firm’s IMC budget. He receives offers from a variety of advertising media, spends money on his firm’s public relations efforts, and is considering electronic media alternatives. Bart must recognize that each IMC alternative

A) will stand on its own. B) is part of the whole. C) is part of noncommercial free speech. D) doesn’t help communicate value to the consumer. E) is dictated by the nature of the supply chain.

32)

The three elements of any IMC strategy are the consumer, the channels, and

A) the receiver. B) the product. C) evaluation of the results. D) the company. E) event sponsorship.

33) As the number of communication media has increased, the task of understanding how best to reach target customers has

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A) shifted from creating a value proposition to revising a value proposition. B) increased the use of rule-of-thumb targeting. C) become easier. D) focused on reducing communication noise. E) become more complex.

34)

The IMC communication process includes a(n)

A) evaluation. B) proposal. C) the transmitter. D) distribution. E) promotion.

35) The IMC communication process begins with ________, who (which) must be clearly identified.

A) the integrator B) the sender C) the transmitter D) the communication channel E) the receiver

36) In the IMC communication process, the ________ encodes the marketing communication message.

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A) instructor B) sender C) transmitter D) communication channel E) receiver

37) ________ means converting the sender’s ideas into a message, which could be verbal, visual, or both.

A) Decoding B) Integrated marketing communications C) Precoding D) Encoding E) Tracking

38)

In integrated marketing communications, encoding involves

A) converting consumers’ ideas into value propositions. B) differentiating noncommercial speech from commercial speech. C) converting the decoder into the receiver. D) interpreting click-through rates. E) converting the sender’s ideas into a message.

39)

Though a picture can be worth a thousand words, the most important facet of encoding is

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A) who draws the picture. B) the self-visualization process. C) not what is received, but rather what is sent. D) the sponsor rather than the receiver. E) not what is sent, but rather what is received.

40) In the IMC communication process, the ________ is the medium that carries the message.

A) feedback loop B) sender C) transmitter D) communication channel E) receiver

41)

Which of the following are communication channels used in the IMC process?

A) warehouse B) distributor C) retailer D) Internet E) supply chain

42)

The right communication channel to use in IMC is

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A) the traditional channel used in that particular retail sector. B) network advertising, local newspapers, and regional radio stations. C) the one that will connect to the desired recipients. D) the one with the best encoding capabilities. E) the one that maximizes decoding difficulty.

43) In the IMC communication process, the ________ is the person who reads, hears, or sees and processes the message being communicated.

A) medium B) sender C) transmitter D) communication channel E) receiver

44)

The sender of an IMC message hopes the receivers are

A) the people for whom the message was originally intended. B) the people with the most buying power. C) consumers who are capable of discerning value. D) consumers who have purchased the firm’s products in the past. E) the market segment with the most gross rating points.

45) The ________ loop allows the receiver to communicate with the sender in the IMC process and thereby informs the sender whether the message was received and decoded properly.

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A) decoding B) pretesting C) precoding D) encoding E) feedback

46) Most manufacturing and retailing marketers worry constantly about whether or not their IMC efforts are paying off. They assess various forms of ________ to determine what is working and what is not.

A) noise B) pretesting C) precoding D) encoding E) feedback

47) Sales data, complaints, compliments, and redemption rates for coupons and rebates are types of ________ marketers use to assess the effectiveness of their IMC efforts.

A) decoding B) pretesting C) feedback D) simulations E) encoding

48) Nazira would like to know which, if any, of her firm’s IMC efforts are working. She could use ________ to provide feedback from her efforts.

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A) product placement B) distribution tracking C) transport notices D) coupon redemption rates E) the channel

49)

A firm’s marketing communication strategy is formulated specifically to

A) increase its frequency ratio. B) control its public image. C) increase its social media presence. D) communicate the value of its product(s). E) increase its return on investment.

50) In a television commercial for Chobani Greek yogurt, the manufacturer Chobani plays which role in the communication process?

A) sender B) transmitter C) encoder D) channel E) receiver

51) The manufacturer of Beats by Dr. Dre headphones decides to advertise in the “lifestyles” sections of big-city newspapers. However, this generates a limited response in sales. Which of the following represents a likely breakdown in the communication process here?

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A) The message was decoded incorrectly. B) The message was not transmitted. C) The message was not received by its intended audience. D) The message was encoded incorrectly. E) The sender was not clearly identified.

52) Marketers often use focus groups to learn how consumers interpret their IMC messages. Experience has shown that

A) effective branding requires marketers to encode messages identically for each market. B) each receiver decodes IMC messages in his or her own way. C) action is taken before desire and interest are determined. D) marketers can almost always use the same message for all audiences. E) messages are decoded in the manner intended by the encoder.

53)

The sender of an integrated marketing communication

A) must work with the advertising specialists to ensure all recipients interpret the message accurately. B) can assess the manner in which receivers interpret the message through gross rating points. C) has little control over what meaning any individual receiver will take from the message. D) controls the meaning all receivers take from the message. E) should attempt to control how the message is received.

54)

________ refers to the process by which the receiver interprets the sender’s message.

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A) Decoding B) Feedback C) Precoding D) Encoding E) Tracking

55) If you ever watched a television commercial and at the end of the message wondered what they were promoting, you may have had trouble ________ the IMC message.

A) decoding B) transmitting C) precoding D) encoding E) tracking

56)

________ is any interference in the IMC process.

A) Translation B) Looping C) Excessive reach D) Noise E) Feedback

57) In the IMC process, noise can occur as a result of lack of message clarity, a flaw in the medium, or

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A) competing messages. B) an extended feedback loop. C) indirect encoding. D) inhibited decoding. E) excessive reach.

58) Advertising agencies often provide the IMC function of comparing their customer’s target audience with the viewer, listener, or reader profile of the communication channel being considered. The agency is most likely trying to avoid noise problems associated with

A) competing messages. B) lack of clarity in the message. C) a poor choice of medium. D) an extended feedback loop. E) a flaw in the medium.

59) National manufacturers and retailers often pay a service provider to monitor television ads around the country, to ensure that their ads are shown in their entirety during the time frames that were purchased. This service provider is monitoring for IMC noise problems associated with

A) competing messages. B) lack of clarity in the message. C) a poor choice of medium. D) a flaw in the medium. E) an extended feedback loop.

60) Though advertising experts wish it were true, there is not always a direct link between a particular form of marketing communications and

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A) supply chain effectiveness. B) enhanced decoding processes. C) a consumer’s purchase. D) the level of noise in the IMC channel. E) the reach/frequency ratio.

61) Marissa is driving down Interstate 95 on her way from New England to Florida and sees a billboard saying, “South of the Border Restaurant and Motel is just 100 miles away.” Marissa has never heard of South of the Border before. After seeing the sign, she will most likely need additional exposure to the product before deciding whether to stop at South of the Border. This is an example of

A) rejection of advertising. B) subliminal advertising. C) product underwhelm. D) IMC strategy. E) the lagged effect.

62)

Which of the following are steps in the AIDA model?

A) awareness B) intention C) promotion D) placement E) strategy

63)

In simple terms, the AIDA model is also known as the ________ model.

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A) intention, action, interest B) stop, look, listen C) want, need, desire D) inform, persuade, act E) think, feel, do

64)

In the AIDA model, awareness leads to

A) intention, which hopefully leads to desire and then action. B) integration, which hopefully leads to desire and then action. C) interest, which hopefully leads to desire and then action. D) intention, which hopefully leads to desire and then attention. E) interest, which hopefully leads to determination and then action.

65)

In the AIDA model, the think stage is the ________ stage.

A) awareness B) action C) interest D) desire E) intention

66) If the marketing communication has piqued the interest of its target market, the goal of subsequent IMC messages should be to move the consumer from

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A) “I want it” to “I like it.” B) “I like it” to “I want it.” C) “I’m thinking about it” to “I like it.” D) “I like it” to “I’m thinking about it.” E) “I want it” to “Can I afford it?”

67) ________ refers to a potential customer’s ability to recognize or recall that the brand name is a particular type of retailer or product/ service.

A) Product familiarity B) Brand association C) Brand awareness D) Marketing recall E) Cognitive association

68)

Even the best marketing communication can be wasted if the sender does not first

A) generate consumer action. B) offer testimonials from past consumers. C) determine the level of desire needed to sustain action. D) gain the attention of the consumer. E) stimulate interest among stealth marketing consumers.

69) Marina asked Selma to help her buy some aftershave for her boyfriend. Selma was going through a list of different brand names, when Marina stopped her and said, “I recognize that one.” Marketers call this

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A) selective recall. B) free association. C) aided recall. D) recall mapping. E) top-of-mind awareness.

70)

In the AIDA model, the do stage is the ________ stage.

A) awareness B) action C) interest D) desire E) intentions

71) The highest level of awareness occurs when customers mention a specific brand name when asked about a product or service. Marketers call this

A) the primacy effect. B) aided recall. C) top-of-mind awareness. D) category dominance. E) elevated awareness.

72) After creating awareness of the firm’s products or services, the next goal of integrated marketing communications is to

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A) generate consumer action. B) increase the level of interest among consumers. C) determine the level of desire needed to sustain action. D) gain the attention of the consumer. E) create intentions to purchase the product.

73) In the movie Field of Dreams, one of the memorable phrases is, “If you build it, he will come.” The AIDA model would suggest that after marketers “build” a product or service and create awareness among consumers, they need to

A) determine the level of desire needed to sustain action. B) promote sufficiently to gain global attention. C) create interest among consumers, persuading them to investigate further. D) offer discounts to increase purchase intentions. E) take steps to encourage immediate purchase.

74) Several years ago, changes in advertising restrictions allowed pharmaceutical companies to begin promoting their products through traditional media. Today, it is common to see ads on television ending with, “Ask your doctor about [our medicine].” In addition to creating awareness about their drugs, the companies are most likely hoping to

A) reduce deceptive advertising. B) signal encoding symbols to simplify the feedback loop. C) offer objective-and-task marketing communications. D) stimulate interest, persuading consumers to investigate further. E) promote public interest social responsibility communications.

75) Melinda could recall the brand of toothpaste she used only when a marketing researcher mentioned the brand. This is known as

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A) aided recall. B) unaided recall. C) top-of-mind awareness. D) brand preference. E) brand indifference.

76) Once the marketing communication has captured the interest of its target market, the goal of subsequent IMC messages should be to move the consumer from A) “I want it” to “I like it.” B) action to desire. C) “I like it” to “I want it.” D) interest to awareness. E) feeling to thinking.

77) Shannon is assessing the effectiveness of her firm’s marketing communications. She knows the ultimate goal is to

A) maximize rating points. B) minimize marketing communication expenditures. C) shift encoding into decoding. D) use personal selling to augment public relations. E) drive the receiver to action.

78)

If marketing communications are effective, they will

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A) result in purchases by some of the consumers receiving the communications. B) offset any negative publicity the firm may have received. C) minimize the number of communication channels used by the firm. D) generate interest in the product in over half the consumers reached. E) include all steps of the AIDA model with equal weighting to each step.

79) One of the difficulties in measuring the effectiveness of IMC efforts is the ________, where consumers do not act immediately after receiving a marketing communication.

A) decoding decomposition effect B) lagged effect C) noncommittal effect D) viral effect E) click-through delay

80) Inga wants to purchase a gift for a colleague whose home she will be visiting. She decides to bring luxury chocolates, as she knows most people enjoy them. Although she is not sure about specific products, Inga heads directly for a store selling Godiva Chocolates, because she knows this is a high-end brand. Inga can be said to have

A) brand recall. B) aided recall. C) brand preference. D) brand image. E) brand awareness.

81) From the consumer’s perspective the individual elements of an IMC strategy can be viewed on two axes: ________ and

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A) passive and interactive; tangible and intangible. B) mobile marketing and direct marketing; tangible and intangible. C) offline and online; low cost and high cost. D) passive and interactive; offline and online. E) static and changing; offline and online.

82) Reaching the right audience with marketing communications is becoming more difficult because

A) consumers are bored. B) government regulations are constraining free speech. C) personal selling is becoming less expensive, making it more competitive with advertising. D) the media environment has become more complicated. E) the AIDA model no longer represents how marketing communication works.

83) When comparing the various communication channels available to marketing professionals, it becomes apparent that

A) consumers prefer advertising over other channels. B) no single channel is better than another channel. C) public relations is the least expensive, but the most successful. D) personal selling is the most expensive and the least successful. E) online marketing is taking the place of advertising and public relations.

84) ________ is the two-way flow of communication between buyer and a seller that is designed to influence the buyer’s purchase decision.

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A) Personal selling B) Sales promotion C) Advertising D) Direct marketing E) Public relations

85) Twitter is a form of ________ and is increasingly used to reach current or potential customers.

A) print advertising B) blogging C) distribution D) supply channel E) formal critique

86) ________ involves marketing to customers through wireless handheld devices such as cellular telephones.

A) Print advertising B) Mobile marketing C) Distribution D) The supply channel E) A formal critique

87)

The goal of any marketing communication is to

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A) maximize personal selling. B) increase public relations click-through rates. C) overwhelm negative publicity with commercial speech. D) replace cause-related marketing with non-cause-related marketing. E) get the right message to the right audience through the right media.

88)

Which of the following is an interactive element of an IMC strategy?

A) distribution B) consumer contests C) encoding D) public relations E) supply channel

89) The proliferation of new media alternatives has led many firms to shift their promotional budgets from

A) publicity to public relations. B) personal selling to advertising. C) integrated marketing communications to disintegrated marketing communications. D) indirect marketing to viral marketing. E) advertising to direct marketing and website development.

90)

Compared to other IMC alternatives, advertising is extremely effective for

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A) closing a sale. B) decoding messages efficiently. C) reducing the potential for noise. D) creating awareness and generating interest in a product. E) repositioning consumers in the AIDA model.

91)

One difficulty associated with using advertising as part of a marketer’s IMC efforts is

A) it is hard to break through the clutter of other messages targeted for the same audience. B) it is more expensive than personal selling. C) it works only when communicating to the most uninformed consumers. D) government regulations have significantly decreased allowable advertising frequencies. E) it is considered old-fashioned by many younger consumers.

92)

Integrated marketing communications include

A) distribution. B) supply chain management. C) direct marketing. D) encoding. E) public relations.

93)

Which statement best describes personal selling?

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A) It involves a larger audience than advertising. B) It is primarily indirect communication. C) It is primarily informational communication, not persuasive communication. D) It is the two-way flow of communication between a buyer and a seller. E) It involves encoding while advertising involves only decoding.

94)

Personal selling is an especially important part of IMC in

A) business-to-business settings. B) cause-related marketing. C) event sponsorships. D) stealth marketing. E) web tracking.

95) Ellis is debating how to allocate the IMC budget for his new ski equipment store. He knows having knowledgeable salespeople in his store can simplify buyers’ purchase decisions. He should also consider that, compared to other IMC alternatives, personal selling is

A) easy. B) expensive. C) ineffective. D) overrated. E) simple.

96) Which of the following is being used by a store owner who sends out a text message to all of her preferred customers announcing the arrival of this season’s new clothing?

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A) mobile marketing B) social marketing C) personal selling D) sales promotions E) advertising

97) The Salvation Army runs a campaign over the Christmas holidays called the Mobile Bell Ringer. Volunteers send text messages to their friends’ cell phones asking them to donate. Which type of marketing communication does this represent?

A) mobile marketing B) public relations C) personal selling D) sales promotions E) advertising

98) Red Bull sends out student brand managers to distribute free samples to their peers. Which form of marketing communication is this?

A) sales promotion B) direct marketing C) public relations D) mobile marketing E) advertising

99) Pretty Practical, a fashion accessories retailer, encourages visitors to its stores to “check in” using a smartphone app. In return, customers receive an instant coupon toward that day’s purchase. This is an example of

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A) personal selling. B) mobile marketing. C) online marketing. D) social media. E) advertising.

100)

Which of the following is the least interactive IMC strategy?

A) personal selling B) mobile marketing C) online marketing via social media D) direct marketing via catalog E) direct marketing via telemarketing

101) A firm that places an emphasis on developing and maintaining positive relationships with the media is focusing on a(n) ________ strategy.

A) personal selling B) mobile marketing C) advertising D) direct marketing E) public relations

102) As firms become more sophisticated in their communication efforts, the trend is toward company blogs becoming more

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A) interactive. B) expensive. C) company-controlled. D) consumer-controlled. E) entertainment-oriented.

103)

Sales promotions include

A) mobile marketing. B) rebates. C) online ads. D) print ads. E) public relations.

104)

An advantage of Internet-based technologies is they

A) can be directed to a specific consumer. B) reach a larger audience. C) involve face-to-face contact. D) use the rule-of-thumb budgeting method. E) are used almost exclusively for B2B marketing.

105) In recent years, the component of IMC that has received the greatest increase in aggregate spending is

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A) media advertising. B) direct marketing. C) public relations. D) sales promotions. E) publicity.

106) Sophia wants to reduce mass media IMC and to increase the use of personalized marketing communication messages. To achieve this goal, Sophia will likely increase her use of

A) sales promotions. B) advertising. C) public relations. D) price reductions. E) direct marketing.

107) Leena will be a bridesmaid next summer, and she purchased her dress online. The next time she turned on her computer, Leena was surprised to see special offers for matching accessories. This is an example of which marketing strategy?

A) sales promotions B) media advertising C) direct marketing D) personal selling E) public relations

108) The increased use of customer databases has enabled marketers to identify and track consumers over time and across purchase situations, and has contributed to the rapid growth in

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A) media advertising. B) publicity. C) public relations. D) sales promotions. E) direct marketing.

109)

A major factor contributing to the growth in the use of direct marketing IMC efforts is

A) reduced government regulation of deceptive advertising practices. B) expanded use of personal selling. C) a shift from objective-and-task to rule-of-thumb budgeting. D) increased use of credit and debit cards, and online shopping by consumers. E) the reduction in IMC noise, allowing for a decreased lagged effect.

110) When purchasing books on Amazon.com, customers are shown other books and a message saying “Customers who purchased [your book] also purchased . . .” This is an example of

A) mass media advertising. B) publicity. C) public relations. D) sales promotions. E) direct marketing.

111)

Public relations is the component of IMC that

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A) supports other promotional efforts by generating free-media attention. B) has received the greatest increase in spending. C) converts mass media advertising into direct marketing. D) most effectively uses IMC encoding. E) generates the most gross rating points.

112) Which of the following is most effective in building brand image, listing details about retail locations, and educating customers about products and services?

A) corporate blog B) faxed newsletter C) Super Bowl ad D) corporate website E) Twitter

113) A ________ can be used to create positive word of mouth, help customers form a community, and develop long-term relationships between customers and the company.

A) corporate blog B) faxed newsletter C) Super Bowl ad D) full-page ad in selected newspapers E) public relations campaign

114) Firms can use ________ to bring customers together to share experiences around the products.

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A) surveys B) social media C) consumer outlets D) brand associations E) public relations

115)

The goals of IMC need to

A) expand as the advertising budget expands. B) be explicit and measurable. C) be encoded before they can be decoded. D) include both the noise effect and the transmitter effect. E) be separate from budget.

116) Nonni is the IMC manager for a chain of regional income tax service providers. Franchisees pay a percentage of their revenue to an IMC account allocated to her. As she establishes the short-term goals for her firm’s IMC efforts, her goals are likely to include

A) expanding customer loyalty by closing the feedback loop. B) increasing market share, sales, and customer loyalty. C) increasing inquiries, awareness, and trial of her firm’s services. D) shifting customers to rule-of-thumb budgeting. E) increasing the lagged effect.

117) Lamar is assessing the long-term effectiveness of his firm’s IMC efforts. He will probably analyze the firm’s success in

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118) Julius is developing a budget for his firm’s IMC program. First he sets objectives. Then he chooses media, and finally he determines the cost for each product to be promoted. Julius is using the ________ method of establishing an IMC budget.

A) reach and frequency B) track and decode C) objective-and-task D) rule-of-thumb E) sender-receiver

119)

Which of the following is true of competitive parity?

A) It assumes the same percentage used in the past, or by competitors, is still appropriate for the firm. B) It does not take into account new plans (e.g., to introduce a new line of products in the current year). C) It does not allow firms to exploit the unique opportunities or problems they confront in a market. D) It assumes communication expenses do not stimulate sales and profit. E) If all competitors use this method to set communication budgets, their market shares will stay increase over time.

120) Using prior sales and communication activities to determine the present communication budget describes which method of IMC budgeting?

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A) reach and frequency B) track and decode C) objective-and-task D) rule-of-thumb E) sender-receiver

121) When using the objective-and-task method of IMC budgeting for multiple products and services, how often must the process be repeated?

A) never, after the first product/service B) once, for each individual product and service C) once, by each management team member D) only when a product is removed from the line E) when the prior year’s budget is exceeded

122) Marketing communications managers usually state their media objectives in terms of ________, which represents reach multiplied by frequency.

A) IMC B) CTR C) ROMI D) GRP E) CRM

123) ________ describes how often the audience is exposed to a specific marketing communication, such as an advertisement, within a specified period of time.

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A) Reach B) Gross rating C) Relevance D) Web tracking E) Frequency

124) Yolanda asked her firm’s advertising agency to estimate how often consumers saw her firm’s IMC message and what percentage of the target audience was exposed to the message. Yolanda is asking for ________ data.

A) parity and affordability B) sales and promotion C) attitude change D) rule-of-thumb E) frequency and reach

125) When Yolanda asked her firm’s advertising agency to estimate how often consumers saw her firm’s IMC message and what percentage of the target audience was exposed to the message, she was told the reach was 40, the frequency was 4, and the competitive parity was 10. The gross rating points for her firm’s campaign were

A) 160. B) 1,600. C) 400. D) 40. E) The answer cannot be determined from this information.

126) To estimate reach in terms of electronic media, marketers can use the click-through rate (CTR). To do so, they need to know the number of clicks and

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A) the number of destinations. B) the number of impressions. C) the cost per click. D) how much time consumers spend viewing the ad or page. E) the total number of clicks recorded by the industry.

127) An ad for Bud Light ran six times during a recently televised football game. When measuring IMC results for this ad, six would be the ________ for this telecast.

A) frequency B) reach C) gross rating points D) ROI E) click-through rate

128) If you send an email and include a link, you can track how many people took the desired action of clicking on the link. This is known as

A) the click-through rate. B) impressions. C) frequency. D) gross rating points. E) reach.

129) Harold wants to increase the number of visits to his insurance firm’s website, which specializes in rental insurance for college students. Harold decides to target Internet users who search for the terms “apartment,” “insurance,” and “student.” Which of the following will be most helpful to Harold?

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A) Twitter B) corporate blog C) Google AdWords D) Google Chrome E) Google Analytical Thinking

130) When Apple’s famous 1984 “Big Brother” ad aired during the Super Bowl, it reached an estimated 500 million viewers. It aired only once on commercial television, but was seen in later years in at least 10 television programs recalling great commercials. For its target audience, the frequency of this ad is measured as

A) 1. B) 10. C) 500 million. D) one-tenth. E) 5 billion (10 times 500 million).

131) A measure termed ________ describes how useful an ad message is to the consumer doing the search.

A) reliability B) relevance C) impression D) awareness E) return on investment

132) Integrated marketing communications (IMC) represents the promotion dimension of the six Ps. It encompasses a variety of communication disciplines—advertising, personal selling, sales promotion, public relations, direct marketing, and online marketing including social media.

Version 1

⊚ ⊚

true false

133) Each element of an integrated marketing communication (IMC) strategy must have a well-defined purpose and support, and extend the message delivered by all the other elements. ⊚ ⊚

true false

134) As the number of communication media has increased, the task of understanding how best to reach target customers has become easier. ⊚ ⊚

true false

135) Encoding means converting the sender’s ideas into a message, which could be verbal, visual, or both. ⊚ ⊚

true false

136) Though a picture may be worth a thousand words, the most important facet of encoding is not what is received but what is sent. ⊚ ⊚

true false

137) In the communication process of marketing communications, the marketing department often functions in the role of transmitter. ⊚ ⊚ Version 1

true false 43

138) If there is a difference between the message that is sent and the message that is received, it is probably due to noise. ⊚ ⊚

true false

139) The sender of an integrated marketing communication controls the meaning individual receivers take from the message. ⊚ ⊚

true false

140) Though advertising experts wish it were true, there is not always a direct link between a particular marketing communication and a consumer’s purchase. ⊚ ⊚

true false

141) Even the best marketing communication can be wasted if the sender does not gain the attention of the consumer. ⊚ ⊚

true false

142) Top-of-mind awareness is when consumers indicate that they know the brand when the name is presented to them. ⊚ ⊚

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true false

143) Ilana is assessing the effect of her firm’s marketing communications. She should remember that the ultimate goal is to drive the receiver to action. ⊚ ⊚

true false

144) After seeing advertisements for the Toyota Prius, Hannah becomes interested and does some Internet research. However, after seeing the price for a new model, she decides to purchase a Ford Fusion instead. This is an example of the lagged effect. ⊚ ⊚

true false

145) Public relations is the component of IMC that has received the greatest increase in aggregate spending. ⊚ ⊚

true false

146) The cost of communicating directly with a potential customer is low compared with other forms of promotion. ⊚ ⊚

true false

147) The message originates from the transmitter, who must be clearly identified to the intended audience. ⊚ ⊚

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true false

148) Because the goals of IMC are only part of the overall promotional plan, they do not need to be explicit or measurable. ⊚ ⊚

true false

149) When using a rule-of-thumb method for IMC budgeting, prior sales and communication activities are used for guidance. ⊚ ⊚

true false

150) It may take several exposures to marketing communications before consumers are moved to buy. ⊚ ⊚

Version 1

true false

Answer Key Test name: Chapter 18 Test Bank 26) B 27) A 28) B 29) C 30) A 31) B 32) C 33) E 34) C 35) B 36) C 37) D 38) E 39) E 40) D 41) D 42) C 43) E 44) A 45) E 46) E 47) C 48) D 49) D 50) A 51) C Version 1

52) B 53) C 54) A 55) A 56) D 57) A 58) C 59) D 60) C 61) E 62) A 63) E 64) C 65) A 66) B 67) C 68) D 69) C 70) B 71) C 72) B 73) C 74) D 75) A 76) C 77) E 78) A 79) B 80) E 81) D Version 1

82) D 83) B 84) A 85) B 86) B 87) E 88) B 89) E 90) D 91) A 92) C 93) D 94) A 95) B 96) A 97) A 98) A 99) B 100) D 101) E 102) A 103) B 104) A 105) B 106) E 107) C 108) E 109) D 110) E 111) A Version 1

112) D 113) A 114) B 115) B 116) C 117) B 118) C 119) C 120) D 121) B 122) D 123) E 124) E 125) A 126) B 127) A 128) A 129) C 130) A 131) B 132) TRUE 133) TRUE 134) FALSE 135) TRUE 136) FALSE 137) TRUE 138) TRUE 139) FALSE 140) TRUE 141) TRUE Version 1

142) FALSE 143) TRUE 144) FALSE 145) FALSE 146) FALSE 147) FALSE 148) FALSE 149) TRUE 150) TRUE

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Student name:__________ 1)

Why do many people think advertising and marketing are synonymous?

2) Marketers know perception is a highly selective process. What does this mean for advertisers?

3) The first step in developing an ad campaign for Chloe’s Classical Quartet is to identify her target audience. Why is this a starting point for effective advertising? What does identifying his target audience involve?

4) You are assigned the task of developing an advertising plan for the marketing program at your university. What will you include in your plan?

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5) Jamal is reviewing the proposed assessment measures for an upcoming travel magazine campaign encouraging last-minute travel to his region. Jamal knows he can measure the number of inquiries on the website in response to the ad, but he wants to monitor external factors that could influence consumers’ responsiveness to the campaign. What factors should he monitor?

6) Create three one-sentence advertising messages for the nearest fast-food restaurant: one that is informative, one that is persuasive, and one that is a reminder ad.

What are PSAs? Why do television and radio stations run them?

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Why do marketers need to create an advertising plan before they initiate a campaign?

9) What type of advertising appeal is most appropriate for a marketer introducing hydrogenpowered automobiles to consumers?

10) To be effective, what three qualities does a selling proposition in an advertising campaign need to have?

11)

Which of the two types of appeals does each of these ads represent?

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12)

What is a unique selling proposition (USP)? Propose one for your university.

13) Mei-Lan opened a new financial services office about two years ago. Now she is established and known in her local market. How will her advertising message change?

14) Create two appeals for a nonprofit organization whose cause you support—one informational appeal, and one emotional appeal.

15) Assume you are the owner of a nationally franchised subway restaurant in a large city like New York, Chicago, or Los Angeles. Which types of media would you use, and why?

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16) The author/self-publisher of a new book, The Gullah Bible (a translation of the Bible into the Gullah language), wants to advertise her book. Which media outlets would be most appropriate?

17) Which type of advertising scheduling would you recommend for your university, and why?

18) Every day we can see local car dealerships advertising on television. What are the advantages and disadvantages of television advertising for local car dealerships?

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19) Luther runs an ice cream shop on the pier in Ocean City, Maryland. Luther closes his business in winter, when the weather turns cold. What type of advertising schedule should Luther use?

20) Almost everyone in advertising agencies wants to be part of the creative team, coming up with potential award-winning ads. What admonition needs to be considered when creating advertisements and why?

21)

Why is tracking the impact of an advertising campaign challenging?

22) What is puffery? Why is puffery not illegal in the United States? Give an example of an advertising message containing puffery.

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23) Briefly define public relations. Why is public relations an important part of a marketing campaign?

24) Many small “main street” retailers find advertising either too expensive or ineffective. In this situation, these business owners turn to sales promotion to complement or augment their advertising efforts. Describe three kinds of sales promotion a small, main street retailer might use, including the advantages and disadvantages of each sales promotion method.

25)

Create a sales promotion to promote your university bookstore.

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26) Describe an example of a product placement you have recently seen, and if it was effective.

27)

The difference between advertising and publicity is that advertising is

A) more effective in reaching consumers. B) almost always used in conjunction with consumer satisfaction surveys. C) a paid form of marketing communication. D) designed to remind consumers, while publicity is used to persuade consumers. E) designed for very targeted audiences, while publicity reaches mass audiences.

28) Kalani is the head of marketing for a nonprofit agency that supports the arts. She just received the go-ahead from her board of directors to conduct the agency’s first-ever advertising campaign. Her first step will be to

A) identify the target audience. B) set the advertising objectives. C) determine the advertising budget. D) evaluate and select the media. E) create the advertisements.

29)

For an advertiser, the target audience can be understood as

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A) consumers who currently use or like the product. B) consumers who do not use the product. C) consumers designated by research as its focal market. D) consumers who prefer the competitor’s product. E) consumers who are unaware of the product.

30)

In very simple words, advertising is really about

A) improving brand image. B) personal selling. C) linking emotions with products. D) getting consumers’ attention. E) being creative.

31)

Because advertising is the most visible form of marketing,

A) many people think of marketing and advertising as synonymous. B) it is the most important part of a marketing mix. C) everyone prefers to be in advertising. D) marketing budgets always emphasize advertising over other forms of communication. E) it is the largest source of employment opportunities for marketing graduates.

32)

To get us to remember their ad and the product or brand in the ad, advertisers must first

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A) use persuasion. B) offer incentives. C) create effective PSAs. D) get our attention. E) vary between flighting and pulsing scheduling.

33) Marta is working on an advertisement to promote consumer awareness of the danger of solar radiation causing skin cancer. Marta’s first concern will be to

A) get consumers’ attention. B) enlist creative advertising designers. C) make sure firms producing sunscreen lotions approve. D) collect a petition in support of controls against global warming. E) use public relations to buy advertising space.

34) Anthony is working on an advertising campaign to promote downtown businesses. He knows the increasing number of advertising communication channels available and changes in consumers’ media usage

A) will force him to use PSAs. B) increase consumers’ preference for high-pressure persuasive advertising. C) make his job more difficult. D) make it easier to select media. E) make budget more important, and creativity less important.

35) The ________ stage of the advertising campaign planning process can be described by the question, “To whom are we trying to talk?”

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A) identifying target audience B) setting advertising objectives C) conveying the message D) assessing the impact E) determining the advertising budget

36) Lyle is planning an advertising campaign to promote his canoe tour company. The success of his ad campaign depends on

A) the quality of his canoes. B) how much money he spends. C) how well he can identify his target audience. D) how much consumers like him. E) whether he can gain commitments from manufacturers for complementary products.

37) After using market research to identify the target audience for her advertising campaign, Nya will next use this information to

A) develop creative advertising copy. B) assess the potential effectiveness of her ad campaign. C) buy advertising time. D) set explicit and measurable objectives for the campaign. E) develop PSAs for distribution in lieu of advertising.

38) Maruska has identified the target audience for her line of Russian jewelry. For optimum success, she is creating an advertising plan that will

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A) allow her to skip the assessment stage at the end of the campaign. B) offer discounts to media as an incentive to carry out her plan. C) clarify the specific goals that the advertising is designed to accomplish. D) encapsulate her unique selling proposition. E) maximize puffery.

39)

An advertising plan is crucial to an ad campaign because it

A) is the basis for sales commissions. B) is required by the accounting department. C) offers insights into the creative leadership of mass media buyers. D) will later be used to measure the success or failure of the campaign. E) stimulates demand for a product category.

40)

Generally, when advertising to consumers, the objective of an advertising campaign is

A) a pull strategy—to get the product into stores by having consumers demand it. B) a push strategy—to stimulate interest among members of the supply chain. C) to win advertising awards. D) to offset sales promotion costs. E) to maximize media planning.

41) After the advertiser has decided on the message, type of ad, and appeal, its attention now shifts to

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A) logistical support. B) new product development. C) advertising assessment. D) determining why they should advertise. E) creation of the advertisement.

42) Whenever the major beverage companies develop a new product, they advertise it heavily using television and print media. These efforts are designed to

A) generate goodwill for the company. B) pull the product into retail stores through consumer demand. C) signal strategy changes to market competitors. D) make it easier to do post-testing. E) push the product into retail stores so customers can purchase it.

43) Georgia Heat Pump Manufacturing Company is offering a free, all-expenses-paid trip to Las Vegas for HVAC dealers that sell at least 25 units this year. Georgia Heat Pump is using a ________ promotional strategy.

A) pull B) puffery C) publicity D) push E) post-testing

44) Achmed’s Pita Bread Chips offers free POP (point-of-purchase) displays to retailers ordering its product. Achmed’s is using a ________ strategy.

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A) pull B) puffery C) publicity D) push E) post-testing

45) After identifying the target audience for the university’s new advertising campaign, the advertising team needs to decide whether the advertising objective is to ________, ________, or ________ potential and/or existing students.

A) create; stimulate; ignore B) beg; borrow; steal C) pay; buy; entertain D) inform; persuade; remind E) push; pull; sell

46)

Generally speaking, all advertising messages are designed to

A) meet the needs of society. B) inform, persuade, or remind customers. C) comply with FCC rules combined with FTC antitrust regulations. D) entertain or apprise. E) match production scheduling with consumer demand.

47)

Informative advertising is used to

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A) prompt repurchase of a product. B) create and build brand awareness. C) trigger an emotional response. D) gather information about consumers. E) convince consumers to take action.

48) “Now available—the latest fall fashions” is an example of a(n) ________ advertising message.

A) persuasive B) reminder C) socially responsible D) informative E) institutional

49) When a product has gained a certain level of brand awareness, firms use ________ advertising to motivate consumers to take action.

A) informative B) persuasive C) institutional D) discussive E) reminder

50)

Which of the following is the best example of a persuasive advertising message?

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A) “Buy now, pay later.” B) “Doing business in Peoria since 1848.” C) “This is good.” D) “Now available—the latest fall fashions.” E) “Serving the public since last Tuesday.”

51) P&G’s Tide laundry detergent has been around since 1948 and is still a market leader. P&G has used ________ advertising to reposition Tide several times over the product’s life, trying to motivate new consumer segments to use the product.

A) informative B) persuasive C) social marketing D) emotional E) institutional

52)

Persuasive advertising is often used when competition

A) is nonexistent. B) is cooperating. C) is most intense. D) is declining. E) is ineffective.

53)

Reminder advertising is primarily used to

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A) prompt repurchase of a product. B) create and build brand awareness. C) accelerate market acceptance. D) gather information about consumers. E) persuade consumers to change existing perceptions.

54)

Which of the following is the best example of a reminder advertising message? A) “Buy now, pay later.” B) “Doing business in Peoria since 1848.” C) “Buy one, get one free.” D) “Now available—the latest fall fashions.” E) “New and improved!”

55) Each year in December, Anheuser-Busch runs television ads featuring the Clydesdale horses pulling a stagecoach with an Anheuser-Busch logo. The message is low-key, wishing everyone well during the holiday season. This is an example of ________ advertising.

A) informative B) persuasive C) reminder D) discussive E) institutional

56) Campbell’s Soup Company ran a series of radio ads tied to local weather forecasts. Before an impending storm the ads said, “Time to stock up on Campbell’s Soup.” During the storm the ads said, “Stay home and stay warm with Campbell’s Soup.” The first ad was ________ advertising, while the second ad was ________ advertising.

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A) informative; persuasive B) persuasive; reminder C) reminder; persuasive D) discussive; informative E) institutional; persuasive

57)

The three general objectives of advertising are to select, target, and

A) remind. B) promote. C) discuss. D) deceive. E) survey.

58) Advertising slogans such as “Don’t text and drive” and “Buy flood insurance before it is too late” are examples of ads designed to

A) provide information. B) remind consumers. C) recruit employees. D) persuade consumers to take action. E) generate goodwill.

59) The California Raisin Advisory Board used to run ads featuring “The California Raisins,” a fictitious R&B musical group composed of dancing raisins that boogied to the song “I Heard It Through the Grapevine.” The ads, which were hugely popular and which gave rise to a line of raisin-themed merchandise, were designed to encourage raisin consumption. This campaign was an example of

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A) product-focused advertising. B) consumer-generated advertising. C) public service announcements. D) institutional advertising. E) push strategies.

60)

A ________ is an advertisement that focuses on public welfare issues.

A) product-focused advertisement B) consumer-generated advertisement C) public service announcement D) reminder advertisement E) push strategy

61) First Lady Michelle Obama recorded an ad encouraging parents to teach their children good nutrition habits to stem the increase in child obesity. This message is an example of

A) product-focused advertising. B) consumer-generated advertising. C) a public service announcement. D) reminder advertising. E) a flighting campaign.

62)

Because PSAs are a special class of advertising,

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A) consumers to listen to them. B) court approval before they are aired. C) all advertisers to contribute to them. D) broadcasters to devote a specific amount of free airtime to them. E) that they use only the informative or reminder advertising appeals.

63) An advertisement featuring a cartoon Smokey the Bear saying “Only you can prevent wildfires” is an example of a successful

A) push-and-pull advertisement. B) puffery campaign. C) sales promotion. D) product-focused advertisement. E) public service announcement.

64) be

Regardless of the objective of an advertising campaign, each campaign’s objectives must

A) sincere and emotional. B) consistent with those of the available media. C) either informative or persuasive but not both. D) specific and measurable. E) designed for use in both a pull and a push strategy.

65) Generally, less money is spent on advertising in B2B markets than in B2C markets because

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A) B2B marketing usually involves more personal selling. B) B2B marketing is too expensive to use advertising. C) business customers prefer coupons. D) B2B markets are too homogeneous to use advertising. E) publicity is the most effective advertising in B2B markets.

66)

Public service advertising (PSA) represents

A) a form of sales promotion. B) an appeal to personal desires. C) tax benefits for businesses. D) attention to the target audience. E) a form of niche media.

67) Which of the following is considered a major consideration in determining an advertising budget?

A) the role of advertising in overall promotional objectives B) if the marketing metrics include only post-testing C) if the appeal is emotional or informational D) the budgeting method used E) the message of the product

68) Franco is working on the message to convey in his firm’s advertising campaign. As a starting point, Franco should first consider

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A) the due date for his contribution to the campaign. B) touting the key benefits of his firm’s services. C) what competitors are doing. D) which media he wants to use. E) whether or not he uses the product being advertised.

69)

When developing an advertising message, the message should focus on

A) the producer. B) the advertising environment. C) solving problems for consumers. D) creating investment opportunities. E) niche media balance.

70) The advertising message “People are not looking for quarter-inch drill bits; they are looking for quarter-inch holes” suggests that advertising messages need to

A) emphasize technology. B) focus on quality. C) inform consumers about opportunities. D) focus on solving problems. E) engage in mild puffery.

71) Neville is trying to create an advertising message that tells consumers how his company’s cable and Internet services differ from other alternatives in the market. Neville is trying to create a(n)

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A) unique selling proposition. B) proportional benefit communication. C) institutional advertising message. D) PSA. E) flighting ad strategy.

72)

Walmart’s “Everyday low prices” selling proposition is effective primarily because it is

A) unique to the industry. B) meaningful to the consumer. C) variable over time. D) a one-time message. E) generally unsustainable.

73) An ________ appeal aims to satisfy consumers’ demonstrative desires rather than their utilitarian needs.

A) informational B) emotional C) functional D) practical E) responsive

74) ________ appeals help consumers make purchase decisions by offering facts in advertising messages and strong arguments built around relevant issues, explaining key benefits of the firm’s products and services.

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A) Emotional B) Niche marketing C) Informational D) Institutional E) Reminder

75) Emelia is trying to create an advertising message that communicates the tangible features of her company’s laptop computers, telling consumers about the relative advantages of her products as compared to other offerings in the market. Emelia is trying to create a(n) ________ appeal.

A) emotional B) niche marketing C) informational D) institutional E) reminder

76) Jerome knows that his spring break travel packages are the best deal on campus. He also knows his competitor is sloppy, often waiting until the last minute to provide the needed tickets and documents to students buying his island packages. Jerome wants to develop an advertising message that emphasizes the key benefits he provides. He will develop a(n) ________ appeal.

A) emotional B) niche marketing C) informational D) institutional E) reminder

77) Quinn is creating an advertising message designed to appeal to consumers’ fears of having their home broken into. Quinn’s message will focus on a(n) ________ appeal.

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A) emotional B) niche marketing C) informational D) institutional E) reminder

78)

The key to a successful emotional advertising appeal is to use the emotion to

A) make consumers cry. B) create a bond between the consumer and the brand. C) get consumers to think about the benefits of the product. D) balance social marketing with product-focused advertising. E) deliver a logical message.

79) An emotional appeal aims to satisfy consumers’ ________, while an informational appeal speaks to consumers’ ________.

A) needs; desires B) institutional focus; personal focus C) emotional desires; utilitarian needs D) top-of-the-mind awareness; bottom-of-the-mind reactions E) cost-consciousness; imaginations

80) Automobile manufacturers often use television advertising showing an attractive man or woman driving the manufacturer’s stylish new car on a winding road along an ocean vista. These types of ads have ________ appeal.

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A) emotional B) ethical C) informational D) institutional E) reminder

81)

Which of the following is the least likely common emotional appeal for advertisers?

A) fear B) anger C) humor D) love E) nostalgia

82)

The content of an advertising message is closely tied to

A) the size of the advertising team. B) the characteristics of the media selected to carry the message. C) the opportunity for post-testing. D) the sales promotion opportunities. E) the coupon redemption rate.

83) The ________ is the combination of media used and the frequency of advertising in each medium.

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A) media plan B) media buy C) media mix D) communications tactical plan E) communications operational plan

84) Rory was nervous about making the ________. He knew it was likely to be the largest expense in the advertising budget.

A) publicity plan B) media flight plan decision C) media mix choice D) media buy E) monitoring and evaluation plan decision

85) When Microsoft introduces a new version of its Windows operating system, it typically uses selected magazine, Internet, and direct mail advertising. This combination of advertising outlets represents Microsoft’s

A) niche buy. B) advertising plan. C) media mix. D) product placement. E) supply chain messaging.

86) Generally, which of the following media outlets relies on a mix of visual and auditory techniques and is typically very expensive?

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A) the Internet B) newspaper C) radio D) television E) billboards

87) An advertisement for LG kitchen appliances that airs on the cable television HGTV is an example of what type of media channel?

A) niche B) mass C) select D) product placement E) institutional

88)

Which of the following is the best example of a mass media advertising channel?

A) Popstar! Magazine B) Crochet World magazine C) Home and Garden TV (HGTV) D) USA Today E) TransWorld Skateboarding

89)

One of the advantages of niche media is it often allows marketers to

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A) reach a larger audience than mass media. B) use major events like the Super Bowl. C) target a specific audience. D) sell cooperative advertising space to cosponsors. E) spend fewer advertising dollars.

90)

________ is a particularly good advertising medium for groceries and fast food.

A) Television B) Internet C) Direct mail D) Radio E) Newspaper

91)

________ refers to the process of evaluating and selecting the ________.

A) Advertising; media buy B) Media planning; media mix C) Promotion planning; advertising mix D) Media buying; media mix E) Media mixing; media buy

92) ________ channels are used to reach a broad audience; ________ channels are used to reach a narrower segment of consumers.

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A) Niche media; mass media B) Media mix; media buy C) Media buy; media mix D) Mass media; niche media E) Promotion; institutional

93)

Advertising in which medium relies on a mix of visual and auditory techniques?

A) radio B) magazines C) newspapers D) television E) direct marketing

94) A ________ advertising schedule uses heavy advertising during some periods followed by periods of no advertising.

A) continuous B) flighting C) pulsing D) penetrating E) purposeful

95) A ________ advertising schedule uses a base level of advertising during some periods followed by periods of increased advertising.

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A) continuous B) flighting C) pulsing D) penetrating E) purposeful

96) For consumer products like toothpaste and groceries, things consumers purchase throughout the year, most advertisers would use a ________ advertising schedule.

A) continuous B) flighting C) pulsing D) penetrating E) purposeful

97) Tilly runs a parasailing business on Hilton Head Island, South Carolina. Tilly closes her business in winter when the water gets too cold. She should use a ________ advertising schedule.

A) continuous B) flighting C) pulsing D) penetrating E) purposeful

98) Whitney just bought a gift and jewelry store on Main Street. She knows from the previous owner that almost 60 percent of her sales take place during the Christmas holiday season, with the other 40 percent of sales evenly distributed over the rest of the year. Whitney will probably use a ________ advertising schedule.

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A) continuous B) flighting C) pulsing D) penetrating E) purposeful

99) In the “create advertisements” step when planning and executing an ad campaign, often the execution style for the ad will

A) determine the pretesting pulse of the ad. B) dictate the type of medium used to deliver the message. C) determine which push-pull strategy will accompany the ad. D) dictate how advertising will be flighted. E) deliver integrated marketing.

100) Often, advertisers will employ a variety of media to deliver their message. When using different media, advertisers need to deliver

A) value-based post-testing. B) niche media emotional appeals to the mass market. C) a consistent and compelling message. D) selective, continuous pulsing. E) mild puffery.

101) Chrissy just bought a gourmet bagel store. She is working with a freelance graphic artist who is designing her logo and print advertisements. Chrissy is spending days looking over the various designs and color options. She needs to remember that the creative aspect of advertising design

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A) is everything. B) will determine pretesting and post-testing options. C) dictates tracking alternatives. D) should not overshadow the message. E) should always include coupons.

102)

The execution style of an advertising message must

A) match the medium and the objectives. B) correspond with globally accepted norms. C) include a minimum of puffery and maximum media buy. D) selectively pull retailers into the marketing channel. E) cover new creative ground to be effective.

103) Brett is working on the creative design for his company’s new ad campaign. This is his first major assignment. His boss reminds him that when writing a headline, it should

A) represent the main text of the ad. B) identify the sponsor of the ad. C) use jargon and complex terminology. D) overshadow the visual message. E) be short and use simple words.

104) Jeremy has worked for many years reviewing and approving print ads for his firm. He has memorized a checklist of key points to review. Which of the following would be on her checklist?

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A) name of advertising agency B) body copy C) creator of ad content D) photo credits E) schedule

105) The major text portion of a print advertisement that should arouse a desire for the product and move the consumer to action is contained in the

A) headline. B) body copy. C) brand elements. D) photo credits. E) subheads.

106)

The effectiveness of an advertising campaign is assessed during the campaign by

A) pull strategies. B) push strategies. C) tracking. D) flighting. E) pretesting.

107) Marketers ________ an advertising campaign to ensure that various elements of the campaign will work in an integrated fashion and do what they are intended to do.

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A) pretest B) posttest C) monitor D) flight E) pulse

108) Ivan is managing an extended advertising campaign for a local convenience store chain. The campaign includes a series of television, radio, and print messages. As part of monitoring the campaign, which of the following offers a good indicator of advertising effectiveness?

A) the cost of the media buy B) past economic conditions C) planned store expansions in similar markets D) new advertising concepts E) the daily and weekly sales volume

109) Procter & Gamble advertises its Tide brand of laundry detergent regularly throughout the year. This is an example of a(n) ________ schedule.

A) impact B) lifting C) tracking D) continuous advertising E) pulse advertising

110) Tamara had conducted a thorough pretest before the new ad campaign, so she was fairly sure the elements would work together. A lot was riding on the success of the ad campaign, so she couldn’t wait until the campaign was over to see how well it did. During the campaign, she will be monitoring the sales volumes on a daily basis as part of her

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A) cause-related marketing. B) pulsing. C) tracking. D) flighting. E) lifting.

111) In the early stages of an ad campaign, the objectives are established. To determine if those objectives have been met, the marketer will

A) posttest. B) conduct feedback analysis. C) initiate content analysis. D) pretest. E) arrange for peer analysis.

112)

The additional sales that can be attributed to an advertising campaign are known as

A) payload. B) impact. C) lift. D) the campaign increment. E) ROI.

113) In the United States, the regulation of advertising involves a complex mix of laws and informal restrictions designed to

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A) protect consumers from deceptive practices. B) stimulate domestic demand. C) reduce international competition. D) promote social marketing. E) institutionalize pull strategies.

114)

Which of the following is a federal agency that regulates advertising activities?

A) FBI B) FCCC C) FRS D) IRS E) OSHA

115)

The ________ is the primary enforcement agency for mass media advertising.

A) FDA B) FCC C) FTC D) BATF E) USPS

116) Elias has developed a vitamin-enriched crouton in crazy colors that can be added to children’s salads to make them more nutritious and fun. He’d like to ethically advertise the product directly to the children, so he is examining

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A) the complete FCC regulations. B) the provisions of the Children’s Television Act of 1990. C) the Better Business Bureau’s Children’s Advertising Review Unit guidelines. D) the federal GAO regulations on advertising. E) the Food and Drug Administration guidelines.

117) The head of the marketing area told Alisha to find the most stringent federal regulations on advertising to create the toughest standards. “If we can pass those, we should be able to get by all regulations.” One real problem is

A) state regulations are not always consistent with federal standards. B) FCC regulations create a uniform standard that preempt all other regulations. C) European countries have agreed to follow the U.S. standards, so it’s a matter of working with the U.S. federal regulations. D) as long as the advertising does not contain sexually explicit content, there are no regulations. E) in most cases, standards are changing almost daily.

118)

U.S.-based global marketers have often found that

A) anything goes when advertising outside the United States. B) European advertising regulations are more restrictive than those in the United States. C) children in other countries are less influenced by advertising. D) self-regulatory groups are especially demanding of U.S. advertisers. E) outside the United States, standards are subject to UN approval.

119)

Which of the following is the best example of puffery?

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A) “Take two and call us in the morning.” B) “Happy hour every Friday.” C) “You have tried the rest, now try the best.” D) “All natural ingredients.” E) “Northwestern, the quiet company.”

120)

Unlike advertising, public relations

A) supports promotional efforts by generating free media attention and goodwill. B) accounts for a greater increase in marketing spending. C) converts mass media advertising into direct marketing. D) is considered a human resource function. E) should not be considered part of the marketing area.

121) Carlina has just started as a fashion marketing intern for an up-and-coming design firm. She expected to immediately begin implementing the four Ps she had learned about in class. Instead, she was asked to work on a project identifying important events where celebrities might wear the fashions. Carlina soon realized that this activity was part of ________, directly related to marketing.

A) sales promotions B) cause-related marketing C) public relations D) press release development E) a push-pull strategy

122)

Which of the following statements about public relations is true?

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A) PR has become less important as costs of other forms of marketing communications continue to increase. B) Consumers have become increasing confident of marketing claims made in conventional media. C) Media coverage generated by PR is seen as more credible than paid advertising. D) Because of its high cost, the use of PR has waned in recent years. E) Public relations activities do not support other promotional efforts.

123) Garland is recognized by his friends as an activist on many fronts. He prefers to buy products from firms that will donate part of the total purchase price to organizations he supports. Marketers recognize that this approach can be an important competitive tool; it is called

A) social activist marketing. B) voluntary premium pricing. C) cause-related marketing. D) business/social responsibility. E) the do-gooder syndrome.

124)

Which of the following is a public relations tool?

A) donating a portion of profits to a charitable cause B) coupons and rebates C) sweepstakes D) deals E) contests

125) ________ are special incentives or excitement-building programs that encourage consumers to purchase a particular product, typically used in conjunction with advertising or personal selling programs.

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A) B2B programs B) Trade incentives C) Sales promotions D) Push programs E) Targeted leader items

126) Sarita goes through the newspaper looking for coupons to help reduce her living expenses. Her roommate Pilar doesn’t read newspapers, let alone look through them for coupons. But Pilar filled out a form from inside a cereal box entering her in a drawing for free exercise equipment. What kind of sales promotion reached Pilar?

A) loyalty program B) contest C) deal D) premium E) sweepstakes

127)

“Buy one, get one free” is a ________ sales promotion.

A) deal B) coupon C) sample D) sweepstake E) rebate

128) Elias was struggling selling his golf photography outside a PGA event. When he offered a T-shirt with a golf photograph on it with any framed golf photo, sales picked up. Elias discovered the value of sales promotions—specifically ________—in encouraging customers to buy.

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A) deals B) premiums C) samples D) sweepstakes E) rebates

129)

Firms are willing to offer generous rebates because

A) the retailer and manufacturer always split the cost. B) rebates increase sales, but firms may not have to pay off all the rebates offered. C) they are easier for the consumer to use than are coupons. D) rebates are the only type of sales promotion proven to impact sales. E) they tend to generate repeat customers.

130) Actor Sissy Spacek once objected to a series of movie scenes that included her smoking a certain brand of cigarettes. She was probably objecting to a ________ arrangement the film company had made with an advertiser.

A) promotional deal B) mass media buy C) product placement D) loyalty program E) sampling

131) Special in-store displays for magazines and chewing gum are most likely to be effective if located

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A) near the entrance to the store. B) near the restrooms. C) along the aisle or wall to the far right of the customer as he or she enters the store. D) near the checkout counter. E) in the window at the front of the store.

132)

Starbucks provides tastes of new products to customers. This is called

A) cobranding. B) sampling. C) a rebate. D) multitarget promoting. E) convenience promoting.

133) Traditionally, marketers have seen the role of ________ as generating short-term results, whereas the goal of ________ was to lead to long-term results.

A) public relations; institutional advertising B) advertising; personal selling C) sales promotion; advertising D) advertising; public relations E) corporate blogs; public relations

134) Traditionally, the role of sales promotion has been to ________, whereas the goal of advertising was to ________.

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A) increase product exposure; decrease product exposure B) generate increased revenues; generate better marketing metrics C) generate long-term results; generate short-term results D) generate better marketing metrics; generate increased revenues E) generate short-term results; generate long-term results

135) A form of sales promotion that offers prizes based on a chance drawing of entrants’ names, ________ do not require the entrant to complete a task other than buying a ticket or filling out a form.

A) contests B) deals C) sweepstakes D) premiums E) loyalty programs

136) Beverage companies often pay movie producers to have their products used and shown in movies. This is an example of product

A) placement. B) loyalty. C) deals. D) sampling. E) premiums.

137) ________ are specifically designed to retain customers by offering premiums or other incentives to customers who make multiple purchases over time.

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A) Coupons B) Rebates C) Contests D) Sweepstakes E) Loyalty programs

138) One problem facing advertisers is that consumers screen out messages that are not relevant to them. ⊚ ⊚

139)

true false

The target audience for advertisers is not always the same as current users of the product. ⊚ ⊚

true false

140) Bennett is trying to promote his new, self-published financial guidebook. By directly promoting it to readers in Wall Street Journal, he is using a push strategy. ⊚ ⊚

true false

141) Consumer goods firms such as Lancôme often use reminder advertising to convince consumers to take action—switch brands, try a new product, or even continue to buy the advertised product. ⊚ ⊚

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true false

142) A television ad showing a crowd holding candles and singing “I’d like to teach the world to sing,” followed by the words “Happy Holidays from your Coca-Cola bottler,” is an example of reminder advertising. ⊚ ⊚

143)

An advertisement stating “Buy now: no money down” is a persuasive-type ad. ⊚ ⊚

144)

true false

Public service advertising typically focuses on social marketing objectives. ⊚ ⊚

145)

true false

An advertising campaign’s objectives should be specific and measurable. ⊚ ⊚

true false

146) A pulsing advertising schedule uses periods of heavy advertising followed by periods of no advertising. ⊚ ⊚

true false

147) An iPad mini advertisement appearing in the New York Times is an example of using a niche media channel.

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⊚ ⊚

true false

148) The primary federal agencies that regulate advertising activities in the United States are the Fed, FEMA, and the FCC. ⊚ ⊚

149)

true false

Puffery is not always illegal in the United States under state and federal law. ⊚ ⊚

true false

150) When businesses support cultural or sporting events, such as the St. Jude Walk/Run to End Childhood Cancer, this is known as cause-related marketing. ⊚ ⊚

Version 1

true false

Answer Key Test name: Chapter 19 Test Bank 27) C 28) A 29) C 30) D 31) A 32) D 33) A 34) C 35) A 36) C 37) D 38) C 39) D 40) A 41) E 42) B 43) D 44) D 45) D 46) B 47) B 48) D 49) B 50) A 51) B 52) C Version 1

53) A 54) B 55) C 56) B 57) B 58) D 59) D 60) C 61) C 62) D 63) E 64) D 65) A 66) A 67) A 68) B 69) C 70) D 71) A 72) B 73) B 74) C 75) C 76) C 77) A 78) B 79) C 80) A 81) B 82) B Version 1

83) C 84) D 85) C 86) D 87) A 88) D 89) C 90) D 91) B 92) D 93) D 94) B 95) C 96) A 97) B 98) C 99) B 100) C 101) D 102) A 103) E 104) B 105) B 106) C 107) A 108) E 109) D 110) C 111) A 112) C Version 1

113) A 114) B 115) C 116) C 117) A 118) B 119) C 120) A 121) C 122) C 123) C 124) A 125) C 126) E 127) A 128) B 129) B 130) C 131) D 132) B 133) C 134) E 135) C 136) A 137) E 138) TRUE 139) TRUE 140) FALSE 141) FALSE 142) TRUE Version 1

143) TRUE 144) TRUE 145) TRUE 146) FALSE 147) FALSE 148) FALSE 149) TRUE 150) FALSE

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Student name:__________ 1) Your best friend is considering a career in sales. What benefits of a sales career would you explain to your friend?

2) Warren is debating between spending the money needed to hire a sales force and using advertising and promotion to sell his products. What benefits of hiring a sales force will Warren weigh in his decision?

How can sales representatives save time for customers?

What is relationship selling?

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5) Gerard is a sales rep for a line of golf equipment. He has been trying to get his sales manager to allow him to rent a booth at the upcoming PGA (Professional Golfers’ Association) Show held every February in San Diego. Gerard is putting together a list of the benefits of displaying his company’s products at the show. What benefits should his list include?

6) Tatiana sells office networking systems. She is putting together a sales presentation for a new customer. What advice would you give Tatiana about making her sales presentation?

7) Alexis has trouble closing sales with new customers but not with existing customers. What advice would you give Alexis?

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8) Renard, a sales manager for a Best Buy electronics store, is putting together a training seminar for his sales force. He wants to use the five dimensions of service quality to emphasize the importance of follow-up in the selling process. Provide an example of each of the five service quality dimensions that Renard could use in training his Best Buy sales staff.

For a car salesperson, what are good ways of generating leads?

10) Yusef has just finished his sales presentation. He knows that half the battle is asking questions. What is the other half?

11) Jarel, an architect, made his presentation to the potential customer and handled objections. What does Jarel need to do next, and why is this stage so stressful?

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12) After installing a new HVAC system, what should Foster’s Heating & Air Conditioning do, according to the personal selling process?

13) Effective sales demand in-depth, extensive knowledge about customers, which suggests the need for customer relationship marketing (CRM). In turn, CRM demands data because these systems cannot work without information being put into them, for salespeople to take out later, as they need it. But convincing salespeople to take time out of their schedules to file CRM reports (rather than engaging in more lucrative sales efforts) has long been a challenge for managers and companies. Explain how sales companies have addressed these issues.

14)

What is the difference between an order getter and an order taker?

15) On weekends, Rudy often finds himself thinking about his customers and their problems. Sometimes Rudy will figure out a potential solution and email or call his customer. What personal trait does Rudy have that is important to sales success? Version 1

16)

What basic rule should be used in creating sales evaluation criteria?

17)

What is the advantage to the firm of paying salespeople based on straight commission?

18) Sales experts have identified five key personal traits that are often found in successful salespeople. List and define these five traits.

19) Describe the objective and subjective measures that can be used to evaluate a salesperson’s performance. When should each be used?

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20) Quentin is creating a sales force for his new hydrogen-powered vehicles company. What questions will Quentin need to address when creating a sales force?

21)

Why is recruitment such an important part of sales management?

22) You are offered a sales position and given a choice of salary plus a small commission or straight commission. What are the advantages and disadvantages of each?

23)

Why are nonfinancial rewards important?

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24) Imagine that you are a sales manager at IBM. What sales training techniques will you use to train your sales force? Explain the benefits of each of the options presented in the text.

25) A computer salesperson at Staples may spend an hour with a customer educating him or her about the pros and cons of various systems and then make the sale. The next customer might simply need a specific printer cartridge. A third customer might bring in a computer and seek advice about an operating system problem. Why might Staples consider a team selling approach?

26) Describe a company that would be likely to use a company sales force, and a second company that would be likely to use manufacturer’s representatives. Explain why these companies would make these choices.

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27) Fred really wanted the sales position and he was qualified, but the hiring manager didn’t think men could sell hair products, so she decided to hire a less-qualified woman instead. Is this legal?

28) When Edie was hired for the sales position in Austin, she found that the previous rep had laid the foundation for several sales that resulted in half a million dollars in sales, even though Edie never called on those customers. Maureen had only a $200,000 increase, but she took over a territory that had not been called on for two years. How would you handle their evaluations and bonuses at the end of the year?

29) Explain the ethical and legal issues that may arise between a salesperson and the customer.

30)

What kinds of ethical problems can be created by corporate sales policies?

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31)

Personal selling can take place

A) through print catalogs. B) over the Internet. C) through the mail. D) through newspaper ads. E) using distribution centers.

32)

In Arthur Miller’s play Death of a Salesman, Willie Loman portrays

A) a leading example of an ethical salesman. B) the loneliness of a traveling salesman. C) the ruthlessness of a pushy salesman. D) the lifestyle and success of people in sales. E) the value salespeople provide to consumers.

33) Tyler loves the lifestyle associated with being a salesperson, allowing him to take a day off during the week and make it up on the weekend. He most likely values the ________ associated with creating his own schedule.

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A) structure B) rigidity C) flexibility D) selling team approach E) compensation

34) Jonah is starting a career in selling, but he eventually wants to become a senior manager. A selling career may help Jonah achieve that goal by providing

A) structure. B) scheduling flexibility. C) job security. D) income. E) visibility to management.

35) One of the advantages of personal selling over other types of marketing communication is that

A) salespeople can build strong relationships with customers. B) personal selling almost always costs less than other marketing communication alternatives. C) personal selling has greater reach than advertising. D) cold calling is easier than direct mail advertising. E) personal selling requires less training than other types of selling.

36)

One of the disadvantages associated with personal selling is

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A) cold calling is easier than direct mail advertising. B) a salesperson often changes the message based on consumers’ needs. C) it is expensive. D) it can be directed toward those customers with the highest potential. E) it is structured and finite.

37) Jeanette recognizes that one of her roles as a company sales rep is to be the firm’s frontline emissary. As such, she strives to build strong relationships with customers and

A) use whatever means necessary to capture every possible sale. B) focus on the short term. C) take a long-term perspective. D) disparage competitors’ offerings. E) shift organizational control from production to marketing.

38) As marketing manager for a newly created software company, Colette is deciding whether or not to hire a company sales force. To make this decision, Colette needs to consider whether or not

A) her firm should attend trade shows. B) her firm has a “hot” product. C) having a sales force is worth more than it costs. D) she will be able to find an effective supply chain manager. E) online advertising will work.

39)

Sales representatives add value for customers by

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A) educating them about competitive products. B) causing adding complex business problems. C) adding time to the sales process. D) simplifying communication with the firm. E) reducing the firm’s marketing costs.

40)

Experts estimate that the average cost of a single B2B sales call is over

A) $50. B) $190. C) $500. D) $1,000. E) $1,500.

41) Piper made sure that her customers felt comfortable contacting her when they needed something, and she focused on the long term in her dealings with them Piper is a ________oriented salesperson.

A) needs B) relationship C) sales D) profit E) rewards

42)

The Consumer Electronics Show is an example of a(n)

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A) vendor conference. B) product demonstration. C) industry convention. D) trade show. E) consumer meeting.

43)

Telemarketing and cold calls have become less popular as sales tools because

A) their success rate is low. B) they are inexpensive. C) they are protected by state and federal laws. D) the salesperson is able to establish the customer’s needs ahead of time. E) they require appointments, which takes time away from the actual selling of the product.

44) When Parker was talking with his customer about the new accounting system, his customer mentioned that she thought the new system was not going to fit into their budget. Parker explained that once her people were trained on it, it would require less time to process orders, and therefore save her money in payroll. Which part of the sales presentation is demonstrated in this example?

A) generating and qualifying leads B) the presentation C) overcoming reservations D) the preapproach E) follow-up

45)

Which of the following are service quality dimensions related to follow-up?

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A) ethics B) reliability C) foresight D) rigidity E) determination

46) Whether or not a salesperson will go through all five steps of the selling process depends on the sales situation and

A) the use of sales representatives versus independent reps. B) the effectiveness of role-playing. C) the buyer’s readiness to purchase. D) the number of sales support personnel available. E) how the person was trained.

47) Although a sales representative may skip a step in the personal selling process or might sometimes have to go back and repeat steps, there is logic in the sequence. Which of the following describes the personal selling process?

A) no leads are qualified before a salesperson can work through the preapproach B) the customer’s reservations must be addressed before initiating any sales pitch C) closing the sale is the final—and most satisfying—part of the process D) carefully working through the preapproach will make the next step—the sales presentation—more effective and efficient E) follow-up will set up problems for the representative

48) Amaya, who works in sales for her firm, has learned about her customer during the prequalification stage, but now she must conduct additional research and develop plans for meeting her customer. In the past, she would have maintained this information manually, but today she is able to access such information through her company’s

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A) direct marketing system. B) B2B selling system. C) customer relationship management system. D) customer response management system. E) indirect marketing system.

49) Dulcie went to the Gap ready to buy a new sweater but was not sure which color or style she wanted. The sales representative, sensing Dulcie’s buying mode, most likely began with the ________ stage of the selling process.

A) generate leads B) preapproach C) closing the sale D) follow-up E) sales presentation

50) Monique works as a salesperson in a retail clothing store. Of the five stages in the selling process, Monique is least likely to engage in

A) generating and qualifying leads. B) making the preapproach. C) closing the sale. D) following up. E) making a sales presentation.

51) Celine works in the office of a building materials company. One of her jobs is to identify new building projects and to determine who will make the building materials purchase decisions. Celine is involved in the ________ step of the selling process.

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A) generate leads B) preapproach C) closing the sale D) follow-up E) sales presentation

52)

The sales process consists of ________ steps.

A) five B) three C) two D) four E) six

53)

Potential customers are called

A) marks. B) clients. C) leads. D) shoppers. E) patrons.

54) Marie visited an office building and went door to door to hand out business cards and sell office products. Marie was making

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A) leads. B) order calls. C) preapproaches. D) follow ups. E) cold calls.

55) Several months ago, Viola took over the sales territory managed by a very successful salesperson. Viola should use ________ as a first source of leads.

A) current customers B) chamber of commerce gatherings C) trade shows D) census data E) competitor databases

56) Gabina is a new agent for a financial services company. She decides to join the local chamber of commerce, the local association of businesswomen, and the local chapter of the United Way organization. Gabina is attempting to use ________ to generate leads.

A) current customers B) networking C) trade shows D) the Internet E) customer complaints

57)

Trade shows are a particularly good source of B2B sales leads because

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A) they are open to the general public. B) they are almost always sanctioned by the government. C) people who attend are interested in the products and services being offered. D) consumers tell retailers which shows to attend. E) they are an inexpensive way to generate leads.

58) Imagine that a management consulting firm wants to sell a bank a new system for finding checking account errors. The consulting firm’s salesperson has learned about the customer during the qualification stage, and the salesperson should now

A) think about whether it’s worth the effort to try to make the sale. B) determine whether the bank can pay more than the base rate for the product. C) figure out how to immediately close the sale. D) decide whether he should go to work for the bank and run the new system. E) conduct additional research and develop plans for meeting with the customer.

59)

If your company hired you to make sales calls via the telephone, it hired you to perform

A) cold calling. B) telemarketing. C) relationship selling. D) inbound marketing. E) role reversal selling.

60) Peter is in the process of qualifying leads he received from corporate headquarters. Peter will assess

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A) whether or not it is worthwhile to pursue these potential customers. B) how often these customers have bought his products in the past. C) whether he should use role-playing in his sales presentation. D) what objections he is likely to receive from the customers. E) how to preapproach these people.

61) Retail salespeople should not ________ and assume that a person in the store cannot afford to purchase the store’s products based on appearances.

A) assume Murphy’s Law is true B) “run for the roses” C) “judge a book by its cover” D) “let sleeping dogs lie” E) attempt to “keep up with the Joneses”

62) When a plumbing contractor drove up to Woody’s house in a brand-new Mercedes, Woody decided this person would be too high-priced even before the plumbing contractor offered his bid. Woody made the mistake of

A) assuming Murphy’s Law is true. B) anticipating his preapproach. C) not overcoming reservations. D) closing the sale too early. E) making an assumption of cost based on appearances.

63) that

One reason B2B salespeople spend considerable time qualifying potential customers is

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A) they want to have absolutely everything in order before approaching a potential customer. B) it can be costly to prepare and make a presentation to a business customer. C) too many business buyers at trade shows are really people from competing firms trying to obtain competitive information. D) independent agents get the best leads; the company sales representatives need to work harder. E) they want to determine if telemarketing is required.

64) Fredo sells health insurance packages for small businesses. He has been given the names of ten new businesses in his town. During the qualifying leads stage of the selling process, Fredo will likely try to assess which of the ten businesses

A) would respond best to a sales contest. B) are closest to his office. C) need health insurance packages and can afford them. D) have order getters and order takers. E) are willing to meet with him.

65) The ________ stage occurs prior to meeting the customer for the first time and extends the qualification of leads.

A) qualify leads B) preapproach C) closing the sale D) follow-up E) sales presentation

66)

The preapproach stage occurs ________ and extends the qualification of leads procedure.

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A) after the sales presentation B) prior to the sales presentation C) before closing the sale but after follow-up D) after closing the sale but before follow-up E) at the beginning of the sales presentation

67)

Before approaching a potentially major B2B customer, a salesperson will usually

A) conduct an initial sales presentation to lower-level personnel. B) estimate the potential commission associated with making the sale. C) try to find out everything possible about the firm and its needs. D) ask competitors what they know about the prospect. E) assess the corporate climate.

68) During the preapproach stage, a salesperson usually conducts additional research about prospects and

A) assists the prospect through the buying process. B) decides what role to play during the handling reservations stage. C) develops plans for meeting with the customer. D) offers initial concessions to gain the sale. E) determines which of the customer’s buying support team need to be present at the sales presentation.

69) Octavia has identified an attractive potential customer for her biodiesel home power system. She knows the customer is concerned about the environment and has considerable financial resources. The customer is also a respected leader among wealthy environmentalists in the area. Next Octavia will

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A) evaluate alternative systems available from competitors to see which is best for the customer. B) send the customer a list of frequently mentioned objections and responses to each. C) decide if she wants to contact the customer. D) establish goals for meeting with the customer. E) call the customer and offer a first-time discount.

70) Isla has found out everything she can about a newly qualified lead. She has practiced making her sales presentation and has determined what goals she has for the first meeting. Isla has finished the ________ stage of the selling process.

A) qualify leads B) preapproach C) closing the sale D) follow-up E) sales presentation

71) Denman tells a colleague about a major prospect he plans to call on in the next few days and asks the colleague to pretend to be a customer while he makes his sales presentation. Denman and his colleague are engaged in

A) requalifying leads. B) approach dynamics. C) closing the sale. D) role-playing. E) cold calling.

72) Regina has made the same sales presentation twice a day for almost a month. At first, the presentation seemed to flow nicely but lately it has not seemed as effortless as it initially was. Regina might ask another sales rep to participate in ________ and critique her presentation.

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A) requalifying leads B) approach dynamics C) closing the sale D) role-playing E) cold calling

73) After exchanging greetings and getting to know the customer a bit in an initial sales call, the first goal of a sales presentation is to

A) close the sale. B) offer alternatives. C) estimate the total cost to the customer. D) requalify the customer. E) create interest.

74) The beginning of the sales presentation may be the most important part of the selling process, because this is where the salesperson establishes

A) where the customer is in the buying process. B) how much time has been allocated for the presentation. C) which of the alternative products to demonstrate. D) whether to quote a full price or discount price. E) which type of follow-up will be needed.

75) Like any effective salesperson, Franz walks into a customer’s office, shakes hands, looks the customer in the eye, and smiles. After exchanging pleasantries, Franz will immediately try to create interest in his company’s product and establish

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A) which type of follow-up will be needed. B) how much time has been allocated for the presentation. C) which of the alternative products to demonstrate. D) whether to quote a full price or discount price. E) where the customer is in the buying process.

76) Like any effective salesperson, Tiana walks into a customer’s office, shakes hands, looks the customer in the eye, and smiles. After exchanging pleasantries, Tiana will try to create interest in her company’s product. Tiffany will likely ________ to adapt or customize her presentation to match the customer’s needs.

A) use a hypothetical situation B) ask a series of questions C) examine the customer’s office D) make a variety of assumptions E) refer to past sales

77) Brody knows that he needs to ask a series of questions early in his sales presentation, but he also knows that he

A) should take control of the conversation. B) should ask questions only if he already knows the answers. C) needs to first determine whether the customer is an order getter or order taker. D) needs to listen carefully to the answers. E) should follow a strict structure with his questions.

78) Often, inexperienced salespeople mistakenly believe that during the sales call, they should

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A) listen carefully to the customer. B) pay attention to body language. C) note the office environment. D) act positively. E) do all the talking.

79) Karter is preparing for an important sales presentation. He knows that customers are more likely to ________ during his presentation than during other stages of the selling process.

A) be identified as qualified leads B) agree with everything he says C) raise objections D) offer advice E) return unacceptable merchandise

80) Evelyn knows that prospective customers are likely to raise reservations about price and quality. She needs to convince customers that her products represent

A) time savings. B) a good value. C) the least expensive choice available. D) average quality for an average price. E) an environmental achievement.

81)

Effective salespeople anticipate and handle

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A) external environmental changes. B) corporate takeovers. C) buyers’ reservations about the product. D) role-playing conflict. E) supply chain problems.

82)

Often the best way to handle customers’ reservations is to relax, listen, and

A) reassess your preapproach strategy. B) consider outsourcing. C) immediately call your sales support team. D) ask questions to clarify the issues. E) reevaluate your expected order.

83) For salespeople who practice ________, an unsuccessful close one day may lay the groundwork for a successful close during the next meeting.

A) role-playing B) sales support promotion C) relationship selling D) delayed preapproach E) transactional selling

84) Studies have found that customers are typically ready to make a purchase decision well before salespeople attempt to close the sale. Salespeople can learn when to close the sale by

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A) listening to customers and paying attention to their body language. B) keeping accurate records regarding how long it took to close sales in the past. C) asking sales personnel to estimate the average time before customers are ready to close. D) using the same selling process for all customers. E) monitoring and mimicking the closing process used by their sales managers.

85) The follow-up offers a prime opportunity for a salesperson to solidify the customer relationship through great service quality. The five service quality dimensions include

A) reliability. B) determination. C) sympathy. D) loyalty. E) intangibles.

86) The ________ stage of the selling process offers a prime opportunity for salespeople to solidify customer relationships through great service quality.

A) generating and qualifying leads B) follow-up C) sales presentation D) closing the sale E) preapproach

87) In the selling process, the saying “It ain’t over till it’s over” refers to the ________ stage of the process.

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A) generating and qualifying leads B) preapproach C) sales presentation D) closing the sale E) follow-up

88) The attitudes that Bettina’s customers develop after they have purchased her yearly lawn care service will become the basis for determining whether or not they renew each year. She needs to convey ________ by delivering the right services the right way.

A) reliability B) responsiveness C) assurance D) empathy E) tangibles

89) The attitudes that Bettina’s customers develop after they have purchased her yearly lawn care service will become the basis for determining whether they renew each year. She needs to be ________, by quickly addressing any problems that occur.

A) reliable B) responsive C) assuring D) empathic E) tangible

90) Selima has been having a difficult time working with a particular buyer while using the personal selling process, and she has asked her manager, Cezar, for some ideas about how to close the sale effectively. Cezar asks her a number of questions to help sort out the difficulties. Which of the following questions would Cezar be least likely to ask?

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A) “What does the buyer’s body language tell you about her readiness to buy?” B) “Did you skip any steps in the process?” C) “Are there any reservations that have not been addressed to the buyer’s satisfaction?” D) “Have you completed the follow-up to ease the buyer’s mind?” E) “Should you go back to an earlier stage in the process and start the process over from there?”

91) The attitudes that Bettina’s customers develop after they have purchased her yearly lawn care service will become the basis for determining whether they renew each year. She needs to convey ________ by guaranteeing his work in writing.

A) reliability B) responsiveness C) assurance D) empathy E) tangibles

92) Salespeople at Andi’s Cookie Company want to draw the attention of their customers through blogs, Twitter, and LinkedIn, rather than using more traditional activities that require making a sales call. As the marketing manager, you understand this activity to be

A) outbound marketing. B) cold calls. C) preapproaches. D) inbound marketing. E) telemarketing.

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93) Henri sells building materials to local contractors. He wants to build long-term relationships with his contractors through effective follow-up. After delivering the materials ordered, Henri can demonstrate ________ by checking with his contractors right after the delivery and addressing any problems promptly.

A) assurance and profitability B) responsiveness and empathy C) tangibility and competence D) profitability and reliability E) reliability and tangibility

94) The attitudes that Bettina’s customers develop after they have purchased her yearly lawn care service will become the basis for determining whether they renew each year. She needs to demonstrate the ________ dimension of service quality by showing consistently well-maintained yards with neat, professional personnel.

A) reliability B) responsiveness C) assurance D) empathy E) tangibles

95) Since Tobias’ Auto Parts has had trouble with its windshield wiper manufacturer in the past, it is requesting a guarantee from the company before it will place another order. Which of the service quality dimensions is being addressed in this scenario?

A) ethics B) assurance C) tangibles D) responsiveness E) empathy

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96)

Getting a commitment from the customer to purchase your product is also known as

A) asking for the bacon. B) closing the sale. C) wrapping it up. D) preparing for follow-up. E) handling reservations.

97) Liam told the sales rep he wasn’t buying his product because it cost too much. In terms of the personal selling process this is called a(n)

A) excuse. B) ruse. C) reservation. D) rebuttal. E) rebuff.

98) The process of salespeople creating blogs to draw customers in and generate leads is a process known as

A) telemarketing. B) inbound marketing. C) target marketing. D) test marketing. E) team selling.

99) ________ refers to a sales philosophy and process that emphasizes a commitment to maintaining the relationship over the long term and investing in opportunities that are mutually beneficial to all parties. Version 1

A) Relationship selling B) Inbound marketing C) Telemarketing D) Cold calling E) Order taking

100) The internal monthly magazine and blog at the cosmetics firm Mary Kay serve as ________ for employees; the magazine and blog are outlets for not only selling advice but also company-wide recognition of individual salespeople’s accomplishments.

A) nonfinancial rewards B) financial rewards C) bonuses D) commissions E) salary increases

101) Pauley’s firm had grown steadily and the products and systems had become more and more complicated. He had been a star representative and had personally serviced and developed all his accounts. In the past year or so, Pauley and his sales colleagues have been changing their approach due to the sales growth and increasing product complexity. Customer relationships are now being handled more and more by ________—whose primary duties are order getting, order taking, or sales support—which is typical of firms experiencing this kind of growth.

A) selling teams B) manufacturer’s representatives C) retailer representatives. D) customers E) marketing executives

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102) Jason works at an electronics store. In addition to his salary, he receives 1.5 percent of the sales dollars he brings in each month. This extra 1.5 percent is called a

A) commission. B) salary. C) bonus. D) reward. E) rebate.

103) Every Monday during the month of December, salespeople who had the highest sales the previous week participated in a package surprise, where each would receive a package containing either a $50 or a $100 bill. This short-term incentive is known as a

A) sales contest. B) bonus. C) commission. D) salary. E) rebate.

104) Bhakti was recently promoted to a sales management position. She had been an effective representative, but her strengths and educational background were in management. She was about to begin her first salesperson recruitment campaign. The most important thing Bhakti can do to ensure that she recruits the right people is to

A) check references to determine why the job candidate was leaving his or her current position. B) run a credit check to ensure that the recruit does have any hidden problems. C) determine exactly what the salesperson will be doing and what traits and abilities job candidates will need to succeed. D) make sure the application forms are filled out correctly. E) make sure her boss is happy with the number of candidates interviewed.

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105) Managers and sales experts agree that certain personal traits, such as being ________, are necessary to be a successful salesperson.

A) optimistic B) stubborn C) rigid D) inflexible E) unmotivated

106) Which of the following are considered typical financial compensation for sales representatives?

A) commissions B) mentoring assignments. C) award plaques D) extra vacation days E) recognition ceremonies

107) Jaleel is a sales manager at Hewlett Packard. He is responsible for evaluating the sales, profits, orders, and sales ratios of each of the sales representatives in this territory. Jaleel is evaluating ________ measures.

A) subjective B) objective C) uncontrollable D) cooperative E) customer-related

108)

Salespeople should be evaluated and rewarded only for those activities and outcomes that

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A) generate the most income. B) increase the number of customers. C) fall under their control. D) reduce manufacturing costs. E) cut into competitors’ sales.

109)

Which of the following best describes a company sales force?

A) A company sales force is composed of people who are employees of the selling company. B) A company sales force is made up of independent agents making cold calls. C) A company sales force is a team set up to sell products to companies. D) A company sales force is an organization that supplies sales reps to other companies. E) A company sales force is composed of people both inside and outside the organization.

110) A small office supply company may have a person whose primary responsibility is to process routine orders, reorders, or rebuys of products for clients. This employee is known as a(n)

A) order taker. B) order getter. C) sales support rep. D) sales team. E) sales manager.

111) Sales representatives are often compensated, at least in part, on a percentage of the sales revenue. This percentage is known as a

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A) bonus. B) sales increment. C) base salary. D) commission. E) finder’s fee.

112) ________ involves the planning, direction, and control of personal selling activities, including recruitment, selection, training, motivation, compensation, and evaluation of members of the sales force.

A) Human resource management B) Integrated marketing communications management C) Sales management D) Marketing management E) Sales administration

113) By their very nature, ________ measures reflect one person’s opinion about another’s performance.

A) perspective B) objective C) effective D) subjective E) competitive

114)

What financial reward system provides the most incentive for the sales force to sell?

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A) commission B) sales contest C) bonus D) salary E) nonfinancial

115)

What type of sales training has revolutionized the way training happens in many firms?

A) on-the-job training B) one-on-one interaction C) role-playing exercises D) online training E) simulated buying situations

116) When Motorola first entered the Mexican marketplace, the company wanted direct control of salespeople in major urban markets but was not as concerned about control in less populated areas of the country. Motorola probably used ________ in major urban areas and ________ in less populated areas of Mexico.

A) a company sales force; manufacturer’s reps B) manufacturer’s reps; customer relationships C) manufacturer’s reps; a company sales force D) independent agents; manufacturer’s reps E) order takers; selling teams

117) Myles worked selling products to industrial users and spent most of his time working on customers’ new buy and modified new buy situations. Myles was primarily a(n)

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A) new business specialist. B) prospector. C) order getter. D) order taker. E) sales support rep.

118) If you are hired as a sales manager, you will be responsible for recruiting, selecting, training, motivating, and compensating sales staff as well as

A) evaluating the sales force. B) budgeting for marketing activities. C) forecasting for competitive operations. D) managing the production schedule. E) arranging transportation options.

119) When her salespeople bring in five new customers, Denisha gives them a $1,000 payment. This is an example of a

A) commission. B) bonus. C) sales contest. D) nonfinancial reward. E) salary.

120) ________ training is excellent for communicating selling and negotiation skills, because managers can observe the sales trainees in real selling situations and provide instant feedback.

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A) Role-play B) Internet-based C) Simulation D) On-the-job E) Distance learning

121) Harvey enjoys a successful sales career. He is a go-getter, gets up early every morning to check his schedule, and arrives at appointments early so he can get in the right mental frame of mind. Which personal trait does Harvey exhibit?

A) personality B) optimism C) resilience D) self-motivation E) empathy

122) A salesperson’s compensation can be made up of some combination of salary, commission, and ________, which are payments made at a manager’s discretion when the salesperson achieves certain goals.

A) bonuses B) metrics C) awards D) income segments E) rebates

123) When Bella realized she didn’t have all of the technical information she needed to answer the customer’s questions, she made a call to her office. Who would be most likely to provide appropriate assistance?

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A) sales support personnel B) an order taker C) another salesperson D) her sales manager E) an order getter

124) Most beverage distributors have their delivery people act as the firm’s sales representatives. The delivery people primarily function as

A) order getters. B) order takers. C) sales support personnel. D) manufacturer’s reps. E) telemarketers.

125) Martine spends much of her time checking inventories, processing straight rebuys, and making sure that everything is going smoothly. She is primarily a(n)

A) business development specialist. B) caretaker rep. C) order getter. D) order taker. E) sales support rep.

126) The most important activity in recruiting salespeople is determining what the salesperson will be doing and

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A) what personal traits and abilities a salesperson should have to do the job well. B) when they are available to start work. C) whether to pay them on a commission basis, or a salary plus commission. D) how long they are likely to stay. E) their previous level of experience.

127) Moshe sells small-business health insurance programs, working on straight commission. Closing the sale is an extremely stressful point in the selling process for him. If he does not close the sale, the most likely outcome will be

A) his quota will be increased. B) he will generate no income. C) his quota will be lowered. D) his bonus will not exceed his commission. E) he will get a salary reduction.

128) While ethical and legal issues are associated with all aspects of marketing, personal selling presents unique issues because

A) salespeople tend to be unethical. B) sales managers are the only people in most sales organizations who worry about ethics. C) salespeople interact directly with customers and are, therefore, more visible. D) laws regulating personal selling are detailed, complex, and often mistakenly ignored. E) customers tend to expect unethical behavior from salespeople.

129) Cliff is told by his sales manager, “Do whatever you need to do to get the sale,” yet the company has ethical selling standards. Cliff faces the ethical problem of

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A) customer relationship management. B) sales force compensation inequity. C) limited commission reinforcement. D) mixed signals from her sales manager. E) unqualified lead generation.

130)

The best way for sales managers to instill ethical behavior in the sales force is to

A) provide extensive ethical training. B) use only straight salary and no commissions. C) employ a sales ethics forecaster. D) never use telemarketing. E) lead by example.

131) Sonya was selling siding and her boss told her that she could hide an extra charge for trim in the total, even though the customer was told he would not be charged for trim. Sonya was told this was standard practice for the siding company. If the customer takes legal action for this, who is most likely liable?

A) the customer for not checking the order more carefully B) Sonya only, because she wrote the order C) Sonya’s boss only, since he told her to do it D) both Sonya and the siding company, because both intentionally misled the customer E) no one, because this would be considered a victimless crime

132) To maintain trustworthy customer relationships, companies must take care that they respect customer privacy and respect the ________—that is, the amount of information a customer feels comfortable providing.

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A) privacy bubble B) information limit C) communication tolerance level D) privacy zone E) information comfort zone

133)

Almost everyone is engaged in some form of selling. ⊚ ⊚

134)

true false

One of the benefits of careers in sales is flexibility in scheduling. ⊚ ⊚

true false

135) One of the major responsibilities of being a sales rep is being the frontline emissary for one’s firm. ⊚ ⊚

136)

Personal selling is worth less than it costs to firms. ⊚ ⊚

137)

true false

Under a commission system, salespeople have only one objective—make the sale.

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⊚ ⊚

138)

The first step in the personal selling process is the preapproach. ⊚ ⊚

139)

true false

Retail salespeople should never “judge a book by its cover.” ⊚ ⊚

true false

140) Jesse is in NEC’s sales training program. She will probably be taught that all a salesperson needs to do is ask questions. ⊚ ⊚

true false

141) The best way to avoid postsale problems is to contact customers right after they take possession of their products. ⊚ ⊚

142)

true false

Good salespeople know the types of reservations buyers are likely to raise. ⊚ ⊚

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true false

143)

Manufacturer’s representatives are a firm’s senior sales employees. ⊚ ⊚

144)

true false

In business practice, salesperson evaluation measures can be objective or subjective. ⊚ ⊚

true false

145) The four main types of financial rewards for sales representatives are salaries, commissions, bonuses, and sales contests. ⊚ ⊚

true false

146) If you had a small business and needed a sales force but did not wish to hire anyone, you could use the services of an independent agent. ⊚ ⊚

true false

147) If it is a company’s policy to intentionally mislead potential customers about some aspect of a product, a sales rep that carries out this policy by misleading the customer can be held legally accountable. ⊚ ⊚

true false

148) Regarding ethical issues, the most important thing a company can do is to have written formal guidelines for common ethical situations.

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⊚ ⊚

true false

149) Ethical and legal issues are likely to arise between the sales force and corporate policy when the salespeople become conflicted between doing what they believe is ethical and what their company asks them to do in order to make a sale. ⊚ ⊚

true false

150) It is the company’s responsibility, not the salesperson’s, to ensure that all dealings with the customer are ethical and legal. ⊚ ⊚

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true false

Answer Key Test name: Chapter 20 Test Bank 31) B 32) B 33) C 34) E 35) A 36) C 37) C 38) C 39) D 40) A 41) B 42) D 43) A 44) C 45) B 46) C 47) D 48) C 49) E 50) A 51) A 52) A 53) C 54) E 55) A 56) B Version 1

57) C 58) E 59) A 60) A 61) C 62) E 63) B 64) C 65) B 66) B 67) C 68) C 69) D 70) B 71) D 72) D 73) E 74) A 75) E 76) B 77) D 78) E 79) C 80) B 81) C 82) D 83) C 84) A 85) A 86) B Version 1

87) E 88) A 89) B 90) D 91) C 92) A 93) B 94) E 95) B 96) B 97) C 98) B 99) A 100) A 101) A 102) A 103) A 104) C 105) A 106) A 107) B 108) C 109) A 110) A 111) D 112) C 113) D 114) A 115) D 116) A Version 1

117) C 118) A 119) B 120) D 121) D 122) A 123) A 124) B 125) D 126) A 127) B 128) C 129) D 130) E 131) D 132) E 133) TRUE 134) TRUE 135) TRUE 136) FALSE 137) TRUE 138) FALSE 139) TRUE 140) FALSE 141) TRUE 142) TRUE 143) FALSE 144) TRUE 145) TRUE 146) TRUE Version 1

147) TRUE 148) FALSE 149) TRUE 150) FALSE

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