UH Marketing QUIZ 2 – Flashcards
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Which of the following is NOT an important condition for a market-skimming pricing strategy to be effective? a. the must be demand for the product at the higher price b. competitors should not be able to enter the market easily c. the costs of producing a small volume cannot be prohibitively high d. the product must be well established in the market when the highest price is charged e. the product's quality and image must support its high price
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D
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What is the goal of market-penetrating pricing? a. to generate buzz about a product that is not widely available b. to reward customers for product and brand loyalty c. to attract a small but profitable segment of the market d. to attract a large number of buyers quickly and win a large market share e. to offer products at different value levels to attract different types of customers
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D
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Keith's startup company is launching its first product and he wants it to be a bug hit. Which pricing strategy should he implement? a. by-product pricing b. captive product pricing c. product bundle pricing d. market-penetration pricing e. optional product pricing
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D
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SEAN USED MARKET-PENETRATION PRICING TO LAUNCH HIS COMPANY'S NEW SOLAR-POWERED BLENDER AND GRAB A BIG CHUNK OF MARKET SHARE. But things didn't work out as planned. What could be the cause? a. Distribution costs rose as sales increased b. the blenders low price limited competition c. the initial price point did not change d. production cost decreased as sales volume increased e. the market was highly sensitive to price
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A
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When Gillette sells low-priced razors that require high-priced blades, the company is using ....... pricing? A. product line b. product bundle c. optional product d. captive product e. by-product
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D
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Which of the following is likely to occur when a company finds a market for the by-products of a primary product? a. the production costs of the original product decrease b. the disposal costs of by-products are offset c. demand for the original product decreases d. the production costs of the original product increase e. the price of the original product becomes less competitive
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B
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Helen is taking her car for an oil change. She only wanted the basic $29 oil change, but the manager sold her on a radiator flush for an extra $39. What pricing structure does the store use? a. product bundle pricing b. by-product pricing c. captive product pricing d. product line pricing e. optional product pricing
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E
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Which of the following scenarios is an example of by-product pricing? a. a burger joint sells its usual frying oil to a company that makes soap from it b. a store donates unsold clothes to an organization that gives them to low-income students needing interview outfits c. a metal fabricator collects its shop floor trimmings and melts them down to use in other products d. a restaurant provides overstock items from its pantry for the city's annual food drive e. a garage charges customers a fee to cover appropriate disposal of their used motor oil
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A
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Which of the following most accurately describes a cash discount? a. a price reduction for turning in and old item when buying a new one b. a price reduction for buyers purchasing items in off-peak periods c. a price reduction for buyers who purchase larger volumes d. a price reduction rewarding dealers for participating in sales programs e. a price reduction for buyers who pay bills promptly
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E
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A movie theater charging lower admission for young children and senior citizens is an example of.... a. life-cycle stage pricing b. functional discounting c. time pricing d. product-form pricing e. customer-segment pricing
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E
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Lenny lives in Boston and usually pays $5 for a hotdog on the sidewalk vendor. Visiting Ted in New York, Lenny thinks $7 for a hotdog is expensive. Ted thinks $5 is cheap. What accounts for their disagreement? a. reference prices b. geographical pricing c. dynamic pricing d. by-product pricing e. zone prices
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A
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Eduardo is an Arizona-native attending the atate-run University of Illinois. When he goes to the 10pm movie with his friends, he shows student ID and gets the $6 discount rate. Which of the following determined the price of his ticket? a. time-based pricing b. location-based pricing c. product-form pricing d. geographical pricing e. customer-segment pricing
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E
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Falling demand in the face of strong price competition will most likely lead a company to.... a. maintain prices and cut costs b. drop a fighter brand c. improve product quality and increase prices d. reduce prices e. increase prices
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D
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What is the term for a company that substantially raises prices to increase revenue greatly at consumers' expense? a. time-based pricer b. predatory pricer c. dynamic pricer d. price fixer e. price gouger
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E
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In an attempt to gain market share, Star Lite recently dropped prices on its key product. However. the company's vision did not play out because competitors swiftly dropped their prices, the Star Lite's market share stayed the same. What is likely the reason for it's competitors response? a. there are few competitors making the product b. there are many variations of the product on the market c. the marker is saturated with producers of the product d. buyers have little knowledge about the product e. buyers have little awareness of pricing for this type of product
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A
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A company that owns a chain of designer fashion discount stores launches a chain of stores selling off-brand discount clothes in the urban market. Which of the following best describes the company's strategy for the new store chain? a. fighter brand b. back-to-basics c. base-point pricing d. retail price maintenance e. bottom-of-the-pyramid
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A
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According to federal law, sellers must not talk to competitors when setting prices to avoid charges of... a. price fixing b. retail price maintenance c. predatory pricing d. price gouging e. price discrimination
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A
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Sellers cannot use ...... by selling below cost with the intention of punishing a competitor. a. price discrimination b. predatory pricing c. retail price maintenance d. price fixing e. deceptive pricing
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B
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Jake's so-lo Furniture chain ran a commercial for a leather sofa priced at $159. When customers came in to by it, the salespeople said the $159 was only available if they bought a matching love seat and coffee table. Bought separately, the sofa cost $359. Jake is now under investigation for..... a. predatory pricing b. deceptive pricing c. discriminatory pricing d. retail price maintenance e. price fixing
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B
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Tuan is meeting with reps from retail chains to introduce his company's new premium espresso machines for the home. To ensure that he can maximize revenue, Tuan draws up contracts stating that stores must sell the machines for $275. No stores agree to sell the machines. Why? a. Tuan is engaged in resale price maintenance b. Tuan is engaged in predatory pricing c. Tuan is engaged in discriminatory pricing d. Tuan is engaged in deceptive pricing e. Tuan is engaged in market skimming
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A
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A technology company that develops cutting edge electronics decides to develop a new smartphone that has similar software compared to its competitor. The competitor files a lawsuit against the company because they feel that this is a violation of public policy concerning which of the following? A. Product safety B. Warranty C. Dropped product D. Product acquisition E. Patent protection
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E
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Which of the following statements about standardization vs. adaptation of products in the international market is true? A. Standardization is de terminal to companies because it causes brand confusion, whereas adaptation allows for product differentiation across the globe B. Standardization is unfavorable for companies because of high costs, so companies often adapt their products to keep costs low and to make global consumers happy C. Standardization is beneficial to keep a consistent worldwide image and to lower manufacturing costs; however, companies often have to adapt to varying tastes and styles in an international market by appealing to specific consumer needs D. Adaptation is the most favorable for companies because of low costs and customer value; however, companies often have to standardize their products to avoid brand confusion across the globe E. Adaptation is unfavorable because it may be difficult for consumers to recognize the brand, so companies often use standardization to help create a standard product image, though this comes at a high cost
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C
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Which of the following statements about legal issues in the US regarding products is most likely false? A. If a consumer is injured by a defective product design, then the consumer may sue the manufacturer B. Companies dropping a product have a legal obligation to inform their suppliers and dealers C. A company has a legal obligation to obey US patent laws when developing new products D. Through legislation, the government regulates product quality and safety E. A company can legally make its product similar to another company's established product if it is unaware of the other company's patent
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E
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What is the LEAST likely cause of new-product failure? a. a company significantly marks up the price of a new product in comparison to similar products on the market b. the marketing department advertises the product without positioning it in the company's brand c. a company spends too much effort researching customers and competitors before making decisions about market strategy d. a company overestimates the size of the market when introducing the new product e. a company rushes the new product's release, so the design is of poor quality
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C
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Through its own research and development efforts, a company plans and produces original products in response to replacing aging products in the product life cycle. This definition is associated with which of the following concepts? a. new-product development b. concept testing c. marketing strategy d. idea generation e. idea screening
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a.
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A company that sells school supplies decides to develop a new product line by buying a license to use Disney characters. This company is most likely obtaining a new product through which of the following means? a. concept testing b. acquisition c. test marketing d. product development e. marketing strategy
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B.
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Which of the following describes Samsung's motivation for developing new products? a. Samsung's profits were contingent on replicating its competitor's products b. Samsung's marketing research indicated that customers wanted inexpensive, generic products c. Samsung aimed to stop spending money on developing innovative products, so the company started developing knock-offs of it's competitor, Sony. d. Samsung's original products were passing marketing tests with a "wow" response e. Samsung's marketing research indicated that its products should improve the customer's experience and provide cutting-edge technology that would change people's lives
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E
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Which if the following steps in the new-product development process is defined by a review of sales, costs, and profit projections to assess whether these factors satisfy the company's goals? a. idea generation b. crowdsourcing c. concept testing d. business analysis e. market strategy development
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D
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Which of the following information is NOT included on the marketing strategy statement? a. planned value proposition b. distribution c. profit goals d. controlled test markets e. target market
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D
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A start up company in Silicon valley hired employees from various backgrounds to take an interdisciplinary approach to innovation. Every Friday, the company hosts a brainstorming session with employees for new product ideas, and the company encourages all levels of employees to post suggestions on its internal social network. This type of idea generation comes from what type of source? a. suppliers b. customers c. competitors d. internal e. distributors
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D
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P&G condicts a program called "Living it" in which case researchers live with shoppers for several days in order to think of product ideas based on this experience. This program is based on the assumption that which of the following is the most important aspect of successful new-product development? a. customers b. inventors c. competitors d. suppliers e. distributors
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A
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When sales are at zero, which stage of the product cycle is the most likely product in? a. introduction b. growth c. decline d. production development e. maturity
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D
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All of the following are best practice marketing strategies that can be used during the maturity stage of the product life cycle EXCEPT which? a. modifying the market b. updating the product c. increasing usage for current customers d. defending the quality of the product e. modifying the marketing mix
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D
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A fast food company notices that frozen yogurt is becoming popular among customers, so it decides to invest in a frozen yogurt machine. Initially, the fast food company sees a spike in sales of frozen yogurt, and then briefly afterward, the company experiences a rapid decline. The company is most likely experiencing which concept associated with the product life cycle? a. a fad b. a fashion c. a style d. an introduction stage e. a product development
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A.
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A new smartphone enters the market, and after an initial slow climb in sales, the product sees a jump in sales and profits. Customers have mentioned that they have heard about the new product through word of mouth and wanted to purchase the latest technology. Competitors are trying to keep up with this new product, which ultimately expends the market and decreases distribution costs. The company decides to lower the price of its product at the right time to attract more buyers and then experiences its highest profit rate. Based on this description, the product is most likely in which stage of the product life cycle? a. growth stage b. introduction c. maturity stage d. decline e. product development stage
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A
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How do most savvy marketers approach price? a. they use it to retain employees b. the use it to create customer value c. they downplay it and focus on discounts instead d. they create the illusion that the product is free e. they avoid talking about it in print advertisements
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B
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Which of the following is NOT a cost? a. internet marketing b. radio time c. organizational structure d. marketers' salaries e. T.V. advertisements
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C
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Bases in customer feedback, a clothing company has adjusted its prices for sweaters down from $50 to $45. What will LEAST likely occur? a. the company will see a large increase in profitability b. the company will experience increased sweater demand c. the company will retain customers d. the company will see a decrease in sales e. the company will sell more sweaters
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D
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What is the definition of good-value pricing? a. it focuses on attaining the right combination of quality and service at a fair price b. it uses employees' attitudes about value as a basis for pricing c. it involves setting all prices to be lower than the competition d. it focuses on adding features to differentiate a product from others in the market e. it uses buyers' perceptions of value as the key to pricing
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A
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What is the definition of fixed costs? a. costs that vary directly with the level of production b. the sum of all company expenses c. costs that can never be recuperated by the company d. costs associated with charging sales tax e. costs that do not vary with production or sales
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E
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Hair Creations, a beauty salon, has slightly higher prices than other salons in the area, but the company justifies this by the fact that it gives aromatherapy hand massages with every haircut. Which major pricing strategy is Hair Creations using? a. markup pricing b. cost-based pricing c. competition-based pricing d. break even pricing e. value-added pricing
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E
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A firm's accountant is analyzing how much money the company spends on its lease, equipment, rentals, and executive salaries. The accountant is reviewing the firm's .... costs. a. total b. fixed c. variable d. avoidable e. customer
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B
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What must a company do before determining price? a. survey employees about the advertised price b. decide how much of a discount it wants to give c. determine the sales tax it will charge d. determine the overall marketing strategy e. develop marketing materials
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D
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Under ..... the market consists of many buyers and sellers trading in a uniform commodity. a. monopolistic competition b. impure competition c. pure competition d. oligopolistic competition e. demand competition
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C
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There are 200 oats suppliers in a tri-state area. Among them, there is a very little variation in price. This is an example of a ....... . a. oligopolistic competition b. pure monopoly c. monopolistic competiton d. demand curve e. pure competition
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E
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3 months ago, a company raised its prices by 15%. The company's marketing team is discussing the decrease in demand for the company's products since that time. What are they analyzing? a. social concerns b. reseller's reactions c. price elasticity d. target costing e. cost-plus pricing
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C.
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Which term describes the company, suppliers, distributors, and customers who "partner" with each other to improve the performance of a system? a. value delivery network b. contact channel c. marketing channel d. manufacturing channel e. distribution channel
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A
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A layer of marketing intermediaries that performs some work in bringing the product to the buyer is known as a .... a. direct marketing channel b. indirect marketing channel c. advertising channel d. channel level e. marketing channel
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D
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Nathan's company is an intermediary in the marketing channel for an appliance manufacturer. His company helps the manufacturer complete transactions. Which of the following would Nathan;s company NOT perform? a. negotiation b. matching c. promotion d. contact e. distribution
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E
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Hector wants to analyze a direct consumer marketing channel for his business class. Which of the following scenarios should hector use for his report? a. a food company sells pre-made pizzas to concession stands at a sports arena b. an ice cream truck sells Good Humor brand treats to kids c. a landscaping service sells shrubs to an office park d. a woman sets up a table at a craft fair to sell wreaths she made from pine cones she gathered from the forest e. Scouts go door-to-door selling cookies manufactured by the ABC bakery
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D
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Which of the following defines a vertical marketing system? a. independent firms at different levels of production and distribution join together b. a structure in which producers, wholesalers, and retailers act as a unified system c. one or more independent producers, wholesalers, and retailers, each seeking to maximize profits d. a franchiser who owns several stages in the production-distribution process e. a system that combines successive stages of production and distribution under single ownership
answer
B
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Which of the following definitions best fits a multichannel distribution system? a. a system coordinates successive stages of production and distribution through the size and power of one of the parties b. a single firm sets up 2 or more marketing channels to reach one or more customer segments c. 2 or more companies at one level join together to follow a new marketing opportunity d. cutting out marketing channel intermediaries by product or service producers e. independent firms at different levels of production and distribution join together
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B
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A1 Foods supplies small stores like the Little Hen chain, and contracts Big Truk to handle distribution. Big Truk makes deliveries once a week. Little Hen owners wand Big Truk to delver 3 times a week because they don't have, and can;'t afford, extra storage space. Big Truk refuses because making fewer deliveries is cheaper. What dynamic is occurring? a. vertical channel conflict b. horizontal channel conflict c. contractual conflict d. disintermediation e. multichannel conflict
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A
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Zentastic manufactures a line of premium hair products. To control costs, it created a wholesaling company to handle its product line plus others. Zentastic products are only sold in top salons under special contract, to avoid diluting the brand's perceived value. Which of the following describes this marketing dynamic? a. vertical marketing system dominated by the retailer b. conventional marketing channel dominated by the retailer c. horizontal business marketing system dominated by the producer d. vertical marketing system dominated by the producer e. indirect business marketing channel dominated by the wholesaler
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D
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After a company has defined its channel objectives, which of the following is most important when identifying a major channel alternative? a. types of intermediaries b. channel objectives c. customer price preferences d. customer-value delivery network e. marketing channel design
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A
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Which term describes stocking a product in as many outlets as possible? a. exclusive distribution b. selective distribution c. intensive distribution d. all-inclusive distribution e. right to exclude distribution
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C
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Trey's company makes surfboards from sustainable wood. They are costly to produce, so his partner thinks they should be sold onlt to top pro shops. But Trey wants to build awareness about sustainable products, so he thinks they should be sold at a wider range of retailers targeting recreational surfers with high income. Which distribution strategy does Trey recommend? a. intensive distribution b. selective distribution c. segmented distribution d. horizontal distribution e. exclusive distribution
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B
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Ivan runs an organic farm. He just signed a deal to supply a regional grocery chain, and he needs to contract with a distributor. Ivan's been burned before by getting stuck in long-term contracts that didn't address the unpredictability of farming. How can he avoid making this mistake when looking at potential distribution companies? a. he should evaluate them on adaptability criteria b. he should evaluate them on control issues c. he should evaluate them based on economic criteria d. he should evaluate them on prior performance e. he should evaluate them on logistical criteria
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A
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Which of the following is NOT a step in the marketing channel management? a. selecting channel members b. evaluating channel members c. terminating channel members d. motivating channel members e. managing channel members
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C
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When a producer agrees not to sell other dealers in an area, this is called..... a. exclusive dealing b. exclusive territorial agreements c. full-line forcing d. exclusive distribution e. tying agreements
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B
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Munch Factory recently created a new line of whole-grain healthy snacks that are flying off the shelves. Every store wants to carry them. To do so, Munch Factory requires retailers to also carry its older line of trans fat snacks, which has been the losing market share. What type of marketing channel is Munch Factory using? a. exclusive dealing b. cross-brand distribution c. intensive distribution d. full-line forcing e. exclusive territory
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D
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Mya is working to develop the marketing logistics for her company's line of furniture. There are many components and factors to consider, but what should be the ultimate goal of Mya's marketing logistics plan? a. to move product efficiently b. to maximize sales c. to earn a profit d. to meet customer requirements e. to add value to every channel
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C
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Which of the following is NOT a supply chain management activity? a. production planning b. purchasing c. information systems d. hiring additional employees e. forecasting
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D
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Which of the following is a vital part of integrated logistics management? a. cross-functional teamwork b. inventory management c. building logistics partnerships d. intermodal transportation e. third-party logistics
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A
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Juan's boss asked him to do a cost-benefit analysis of various intermodal transportation options to get the company's product to appropriate markets. Which of the following modes should Juan NOT analyze? a. airtruck b. fishyback c. Internet d. piggy back e. trainship
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C
