IBM 301 final

question

Manufacturers of computer diskettes such as 3M or Sony sell their products to software developers, such as Microsoft, to be used to store software programs. Microsoft would be considered a customer in a(n): a. accessory equipment market b. OEM (Original Equipment Manufacturer) market c. processed materials market d. supplies market e. replacement part market
answer

b. OEM (Original Equipment Manufacturer) market
question

A product was introduced. Since then its sales has gone through growth and maturity stages, after which its sales start to decline. How can marketers effectively revert this declining trend? Choose the most viable option. a. Find new uses for the product b. Cut the price deeper c. Increase advertising frequency d. Make more stylistic modification e. Make more functional modification.
answer

a. Find new uses for the product
question

” The series of stages a product goes through over its sales history, a similar to the stages that a living organism goes through” is called ___________. a. the diffusion process b. product life cycle c. fashion cycle d. the adoption process e. family life cycle
answer

b. product life cycle
question

About 13.5 % of adopters tend to rely much on group norms and values, and they are oriented towards local community. They are likely to be highly respected opinion leaders. Thus, they are more important influencers than innovators in the diffusion process. What is this group called? a. innovators b. laggards c. early majority d. early adopters e. late majority
answer

d. early adopters
question

An intangible product in the form of an activity or benefit provided to customers is known as: a. a brand b. a service c. a good d. an idea e. a brandmark
answer

b. a service
question

A manufacturer of car batteries has added a handle and an emergency reserve switch to its batteries. The manufacturer has not changed its prices or quality. This is an example of a(n) __________ modification. a. Repositioning b. style c. quality d. Upward extention e. functional
answer

e. functional
question

Evaluation of a new-product idea before any prototype is created in order to measure consumer attitudes and perceptions of the idea is known as a. development b. research and development c. concept testing d. screening e. brainstorming
answer

c. concept testing
question

A specific and distinct version of a product offered by an organization is defined as a a. product line b. product mix c. product category d. product item
answer

d. product item
question

Business partners Buey, Cheatem, and Howe wish to make a 40% markup on the sale of an item that cost $7. At what price should it be sold? (Hint: the markup % should be based on intended price, not the cost.) a. $9.80 b. $17.50 c. $3.00 d. $10.00 e. $11.67
answer

e. $11.67
question

When new computers were introduced, prices were initially high to recover R&D costs quickly. Over time, prices came down gradually. This illustrates the use of a ________ pricing strategy. a. prestige b. skimming c. recovery of costs d. penetration e. value-added
answer

b. skimming
question

A product is priced to sell for $12 with average variable costs of $8. The company expects to earn a profit of $400,000 with its total fixed costs of $120,000. The minimum number of units that must be sold in order to reach this target return is (hints: you need to add profit to total fixed costs). a. 200,000 b. 130,000 c. 30,000 d. 100,000
answer

b. 130,000
question

Tickets to the combined amusement park and water slide were $49 for the day. Then the company gave customers the option to purchase tickets for either the amusement park or the water slide for $18. To help keep costs in line, the park management also began charging its customers a small parking fee. Initially, the cost of parking was figured into the $49 price. The amusement park is using: a. professional services pricing b. unbundling c. price maintenance d. potential (or base) pricing e. price lining
answer

b. unbundling
question

Pricing and selling a product at a point at which the additional revenue gained by the sale of a product equals the increase in total cost associated with making and selling that product is referred to as a. PIMS b. target return objectives c. market share d. profit maximization e. sales maximization
answer

d. profit maximization
question

Choose a statement that is correct about the relationship between price and value. a. All of the above are correct b. Price is what you pay and value is what you get in return. c. Price alone cannot determine the value of a product or service. d. Value = quality / price e. People have their own perception of quality and price.
answer

a. All of the above are correct
question

Which of the following is correct about ‘meeting competition objective?’ a. companies want customers to be persuaded by low price b. companies want consumer to consider an array of benefits offered by a product rather than just the price. c. companies focus on a price as a way to differentiate it from competitors d. companies want customers to be persuaded by low price e. it is a pricing objective that lowers price below the prices charged by competitors
answer

b. companies want consumer to consider an array of benefits offered by a product rather than just the price.
question

Why are marketers hesitant to apply price theory in determining price? a. None of the above is true b. because marketers hate numbers c. because estimating demand curve is difficult d. because it is difficult for marketers to know facts about factors determining supply e. because marketers do not understand the theory
answer

c. because estimating demand curve is difficult
question

Volume objectives-based pricing a. will not help companies obtain desirable profits b. is not likely to help companies achieve high return on investment c. tends to reduce operating costs d. is not desirable e. usually entails higher price
answer

c. tends to reduce operating costs
question

The price of cough suppressant ranges from $5.00 to $7.00. A pharmaceutical company recently have made a discovery of an element that is sure to increase the effectiveness by 50%, but it came with $5.00 increase in cost. However, the company had a difficulty persuading consumers with its price of $12.00 for the new cough suppressant. What pricing would explain the company’s pricing dilemma the best? a. loss-leader pricing b. competitive pricing c. customary pricing d. product-line pricing e. odd pricing
answer

c. customary pricing
question

_____________ refers to a channel in which foreign distributors import products from unauthorized channels and distribute the products in that country. This channel often leads to lower price than regular price set by the exporting company and no customer service (e.g., no warranties honored) a. consumer products channels b. non-traditional channels c. direct channels d. adaptive channels e. gray marketing channel
answer

e. gray marketing channel
question

Rolls Royce has a restrictive policy of establishing only one dealer within a given geographic area. Buyers of this type of expensive car will travel to acquire the product. This kind of distribution is called __________ distribution. a. Selective b. Exclusive c. dual d. Intermediary e. Intensive
answer

b. Exclusive
question

_____________ is a distribution arrangement in which producers, wholesalers, and retailers operate as an integrated system with unified objectives and in which coordination is achieved through either administration, contractual agreement, or ownership. a. channel captain b. channel leadership c. multiple channel d. vertical marketing system (VMS) e. channel control
answer

d. vertical marketing system (VMS)
question

The strategy of ___________ attempts to saturate every viable retail outlet with usually ________ goods, thus obtaining maximum product exposure at the retail level. a. intensive distribution / convenience b. intensive distribution / specialty c. intensive distribution / shopping d. exclusive distribution / specialty e. selective distribution / shopping
answer

a. intensive distribution / convenience
question

A manufacturer told a distributor that they could buy products from the manufacturer only if they agreed not to carry products of the manufacturer’s competitors. What is legal term for this situation? a. horizontal restriction b. full line forcing c. vertical restriction d. a tying contract e. exclusive dealing contract
answer

e. exclusive dealing contract
question

Whereas consumers like to buy a little bit of a lot of things, producers generally like to make a lot of a few things. This is known as: a. None of the above b. incompatibility of goals and objectives c. the exchange paradox d. discrepancy of assortment and discrepancy of quantity e. incongruency of goals
answer

d. discrepancy of assortment and discrepancy of quantity
question

Which of the following is the most certain distinctive characteristic of agent intermediaries compared with retailers and wholesalers? a. they produce the goods that they sell b. they do not own the goods they (re)sell c. they take physical possession of the goods they sell d. they sell to consumers directly e. they transport the goods that they sell
answer

b. they do not own the goods they (re)sell
question

Which of the following types of channels would most likely be used when small manufacturers lack the resources to find downstream members such as wholesalers, retailers, or end-customers? a. all of the above b. wholesaler channel c. direct channel d. agent/broker channel e. retailer channel
answer

d. agent/broker channel
question

Which of the following is NOT one of the retail marketing mix? a. product assortment b. planning c. personnel d. pricing e. visual merchandising and store atmospherics
answer

b. planning
question

A retailer that has only single product line but that has a moderate to deep assortment within that line and that sell merchandise at medium to high price with extensive service is: a. off-price discount retailers b. category killer c. specialty store d. mass merchandiser e. warehouse clubs
answer

c. specialty store
question

Retail institutions can be classified by: a. location b. product assortment c. ownership structure d. service level e. All of the other options
answer

e. All of the other options
question

Classifying retail institutions into independent retailers, chain stores, and franchises is as a result of using a. product assortment b. ownership structure c. service level d. location
answer

b. ownership structure
question

What is correct about scrambled merchandising? a. None of the options here is correct. b. It tends to increase intra-format competition than inter-format competition. c. Consumers usually negatively respond to it. d. Retailers are less likely to see their sales increase with this strategy. e. Less popular product tend to be sold under this strategy.
answer

a. None of the options here is correct.
question

Which of the following is an example of non-store retailing? a. a mail order catalog (e.g., Land’s End catalog) b. The home shopping channel c. All of the other choices d. a vending machine e. Party plan (e.g., a Tupperware party)
answer

c. All of the other choices
question

The retail marketing mix includes which of the following elements? a. processes b. projection c. presentation d. profit
answer

c. presentation
question

Which of the following would not be an example of retail atmospheric cues? a. assortment b. lighting c. music d. store front e. smells
answer

a. assortment
question

According to an old adage, there are three keys to successful retailing. They are a. people, products, prices b. location, location, location c. sale, sale, sale d. volume, volume, volume e. attract, convert, retain
answer

b. location, location, location
question

According to the wheel of retailing hypothesis, which of the following is true about new entrant’s strategy? a. They enter the market as a low-price alternative to existing stores. b. Targeted at the segments that are less sensitive to price. c. They enter the market with a high level of service. d. They enter the market at the “high end.”
answer

a. They enter the market as a low-price alternative to existing stores.
question

Which of the following is the least viable strategies for locally owned small independent retailers in order for it to be successful against big corporate chain store? a. position the store uniquely. b. provide better service c. sell unique products d. lower the price e. build emotional attachment through personalization
answer

d. lower the price
question

Select a statement that is NOT accurate about Song Airline’s advertising campaign: a. Song used emotional branding by branding not only their products but also their own employees. b. Song is a subsidiary of Southwest airline. c. Advertising played an important role in developing a brand. d. Song discovered an underserved segment by doing a research mainly using a focus group.
answer

b. Song is a subsidiary of Southwest airline.
question

Which of the following communication mix that companies can control is excellent in increasing awareness and interest, but is not so good in changing consumer action? a. personal selling b. advertising c. P. R. d. sales promotion e. All of the above
answer

b. advertising
question

What might have been a problem(s) with Song’s product development? a. There was not sufficient financial support from the parent company. b. Brand awareness was so low. c. Song’s ad didn’t clearly articulate connection between the ads and the airline. d. Timing was not good for starting new airline. e. All of the other options were the problems with its product development
answer

e. All of the other options were the problems with its product development
question

Badoit, a brand of mineral water, is very popular in France. The firm is considering exporting this product to the United States to compete with Perrier. They surveyed a representative sample of the potential target market and found that 81% were aware of the brand, 44% had some accurate knowledge of the brand and 41% expressed a positive liking for the product. What should be Badoit’s promotional goal? a. To increase awareness. b. It depends – What is the level of preference among those that have achieved a product knowledge. c. To give away free samples to acquaint the new market with their product. d. To increase knowledge. e. To increase liking.
answer

d. To increase knowledge.
question

Firm X promotes its product directly to the end user market (consumers) and their competitor, firm Y, promotes its product to wholesaler distributors. Assume that both X and Y are manufacturers. Whereas X is using a ________ strategy, Y is using a ________ strategy. a. penetration / skimming b. skimming / penetration c. None of the above d. push / pull e. pull / push
answer

e. pull / push
question

Which of the following descriptions about marketing communications is correct? a. Advertising is more effective in influencing consumer behavior than other integrative marketing communication elements. b. Effective marketing communication program should be able to differentiate the company’s product from competitor’s products. c. The main goal is to increase product awareness. d. Marketing communication decisions should be made independent of other marketing mix elements to be effective. e. In building brand equity, the role of marketing communication is least important compared with that of other marketing mix elements.
answer

b. Effective marketing communication program should be able to differentiate the company’s product from competitor’s products.
question

Which of the following is the least plausible reason why marketing communication might break down: a. Benefit of the product was not appropriately converted into an advertising appeal, which is the message marketers want to convey. b. Marketers were simply out of luck. c. The message failed to evoke consumers’ attention. d. Lack of common field of experience between the marketers and consumers. e. Selection of inappropriate channel (medium) for the encoded message.
answer

b. Marketers were simply out of luck.
question

Heavily used during the maturity stage of the product life cycle, comparative advertising offers consumers reasons why your brand is better than competitors’ brands by comparing your brand with a competitor’s brand on performance or mentioning competitor’s name directly or indirectly. True False
answer

true
question

Please answer the question based on the following information only. Once Pizza Hut identified Big New Yorker’s benefits, and turned these benefits into the advertising appeals, they linked the appeals into a testimonial executional style using a TV mainly. They aired their ads once a day before and after the Super Bowl day consistently throughout promotion period. However, on the Super Bowl day, the ads were shown every 20 minutes before the start of the Super Bowl. Which media schedule best represent their approach? a. Pulsing media schedule b. Seasonal media schedule c. Flighted media schedule d. None of the others represent their approach. e. Continuous media schedule
answer

a. Pulsing media schedule
question

Widely used during the introduction stage of the product life cycle, ___________ offers consumers reasons why consumers should consider the product category. a. Institutional advertising b. Comparative advertising c. Competitive advertising d. Pioneering advertising
answer

d. Pioneering advertising
question

What is the most effective promotional mix to use with products that are convenience goods and purchased routinely? a. personal selling and advertising b. sales promotion and advertising c. advertising and public relations d. personal selling and sales promotion e. public relations and personal selling
answer

b. sales promotion and advertising
question

Select a statement that is correct about advertising: a. Ads cluttering is not much of a problem for marketers. b. Advertising spending has diminishing returns on sales after a certain point. c. Even the most successful advertising campaign cannot change consumer rank-order of brand attributes. d. All of the others are correct. e. Advertising is good in building brand loyalty, but it is not effective in protecting market share from competitors’ advertising.
answer

b. Advertising spending has diminishing returns on sales after a certain point.
question

The first step in any advertising campaign decision process must be to a. determine campaign objectives b. make media decisions c. evaluate the campaign d. make creative decisions
answer

a. determine campaign objectives
question

In advertising, the term “reach” refers to the number of the target audience that sees an ad at least once. True False
answer

true
question

This commonly used advertising appeals to people’s internal desire to avoid such negative things as social embarrassment, old age, and losing health. a. Romance b. Variety c. Fear d. Fun e. Environmental consciousness
answer

c. Fear
question

Imagine a retailer who is pondering over which media to use and how often to use it. Which of the following statements would NOT be true? a. frequency will be more important than reach if the goal of advertising is to inform consumers of upcoming discount sales. b. In general, it would be easier to reach a certain demographic groups with magazine than with TV. c. Use of billboard may be good to inform consumers of name and location of the store. d. CPM will constrain the number and type of media the retailer can use
answer

a. frequency will be more important than reach if the goal of advertising is to inform consumers of upcoming discount sales.
question

Advertising spending and sales has a positive linear relationship. True False
answer

false
question

Which of the following sales promotion will be the most effective in reinforcing positive behaviors of your loyal customers? a. Loyalty marketing b. free sample c. Cents-off coupons d. Sweepstakes e. rebate
answer

a. Loyalty marketing
question

Which of the following statements about handling objections is true? a. Objections should not be used to close the sale. b. A professional salesperson should not anticipate objections. c. A good salesperson dreads having to handle sales objections. d. None of these statements about handling sales objections is true. e. Salesperson should view objections as requests for more information.e.
answer

e. Salesperson should view objections as requests for more information.
question

Which is a characteristic of relationship personal selling? a. Focus on customers’ bottom line b. Discuss and sell products c. Focusing on closing sales d. Focus on product e. Focus on pricing
answer

a. Focus on customers’ bottom line
question

In which of the following situations, personal selling is better than advertising or sales promotion? a. product is simple to understand b. a product has a low value c. there are many customers d. product needs to be customized e. customers are scattered
answer

d. product needs to be customized
question

What is cash amount paid to intermediaries to secure shelf space? a. trade allowance b. loyalty marketing program c. slotting allowances d. premiums
answer

c. slotting allowances
question

Which is NOT a characteristic of relationship personal selling? a. Do long term sales follow-up b. Focus on customers’ bottom line c. Sell advice, assistance, counsel d. Sales planning is top priority e. Focus on product/pricing
answer

e. Focus on product/pricing
question

Schwinn Cycling and Fitness, Inc., is offering a chain of sporting goods superstores a 20 percent discount on all Schwinn bicycles if the stores will run their own special promotion on the new Schwinn Paramount Titanium bikes. Schwinn is offering retailers a: a. product development deal b. P-O-P discount c. push money deal d. life cycle extension promotion e. trade allowance
answer

e. trade allowanceWhich of the following would be true in personal selling?
question

Which of the following would be true in personal selling? a. Salesperson should leave a customer immediately if he or she is not interested in your product. b. All of the above is correct. c. Understanding the difference between your prospect’s needs and wants will help you translate your product features to the benefits for your prospect. d. You just need to focus on decision maker’s concern and do not worry about the other people in the buying center. e. Salesperson should focus on thinking about what to say next while a prospect is talking.
answer

c. Understanding the difference between your prospect’s needs and wants will help you translate your product features to the benefits for your prospect.
question

Good sales managers should: a. Be assertive b. All of the above c. Have ego drive d. Be empathetic e. Have ego strength
answer

b. All of the above
question

During the preapproach, the salesperson would: a. create point-of-purchase displays b. do all of these things c. handle pricing objections d. learn as much as possible about the prospect’s organization and its buyers e. ask for referrals
answer

d. learn as much as possible about the prospect’s organization and its buyers
question

In which of the following situations, personal selling is better than advertising or sales promotion? a. customers are scattered b. product is complex c. there are many customers d. customer needs are the same e. a product has a low value
answer

b. product is complex
question

Determining whether a potential customer has the need, the income (buying power), and the authority to buy, and whether or not the customers is accessible is the part of the sales process called a. qualifying. b. verifying. c. closing. d. prospecting. e. testing.
answer

a. qualifying.
question

Which is NOT one of the trends that are occurring in managing sales forces? a. shift from leadership to management b. shift from transaction to relationship c. shift from individuals to teams d. shift from sales volume to sales productivity
answer

a. shift from leadership to management
question

Which of the following is the last step in the selling process? a. Generate leads b. Develop solutions c. Close the sale d. Follow up e. Probe customer needs
answer

d. Follow up
question

which of the following is correct about meeting competition objective?
answer

companies want consumer to consider an array of benefits offered by a product rather than just the price.
question

pricing and selling a product at a point at which the additional revenue gained by the sale of a product equals the increase in total cost associated with making and selling that product is referred to as
answer

profit maximization
question

volume objective based pricing
answer

tends to reduce operating costs
question

a product is priced to sell for $12 with average variable costs of $8. the minimum number of units that must be sold in order to reach this target return is (you need to add profit to total fixed costs.
answer

130,000 units
question

why are marketers hesitant to apply price theory in determining price?
answer

because estimating demand curve is difficult
question

when new computers were introduced, prices were initially high to recover R&D costs quickly. Over time, prices came down gradually. This illustrates the use of a _________ pricing strategy.
answer

skimming
question

choose a statement that is correct about the relationship between price and value.
answer

all of the above are correct
question

tickets to the combined amusement park and water slides were $49 for the day. Then the company gave customers the option to purchase tickets for either the amusement park or the water slide for $18. to help keep costs in line, the park management also began charging its customers a small parking fee. initially, the cost of parking was figured into the $49 price. the amusement park is using
answer

unbundling
question

Rolls Royce has a restrictive policy of establishing only one dealer within a given geographic area. Buyers of this type of expensive car will travel to acquire the product. This kind of distribution is called ______________ distribution.
answer

Exclusive
question

A manufacturer told a distributor that they could buy products from the manufacturer only if they agreed not to carry products of the manufacturer’s competitors. What is legal term for this situation?
answer

Exclusive dealing contract
question

___________ is a distribution arrangement in which producers, wholesalers, and retailers operate as an integrated system with unified objectives and in which coordination is achieved through either administration, contractual agreement, or ownership.
answer

Vertical marketing system.
question

Which of the following types of channels would most likely be used when small manufacturers lack the resources to find downstream members such as wholesalers, retailers, or end customers?
answer

Agent/ broker channel
question

which of the following is the least viable strategies for locally owned small independent retailers in order for it to be successful against big corporate chain store?
answer

Lower the price
question

Firm X promotes its product directly to the end user market (consumers) and their competitor, firm Y, Promotes it product to wholesaler distributors. Assume that both X and Y are manufacturers. Whereas X is using a _________ strategy, Y is using a ________ strategy.
answer

pull/push
question

which of the following descriptions about marketing communications is correct?
answer

Effective marketing communication program should be able to differentiate the company’s product from competitor’s products.
question

Select a statement that is correct about advertising.
answer

Advertising spending has diminishing returns on sales after a certain point.
question

Advertising spending and sales has a positive linear relationship.
answer

false
question

Imagine a retailer who is pondering over which media to use and how often to use it. Which of the following statements would NOT be true?
answer

Frequency will be more important than reach if the goal of advertising is to inform consumers of upcoming discount sales.
question

Selling Price under cost plus pricing: Example: lost=$100, desired markup= 30%. What should be selling price? Price= cost+markup SP= cost/ (1-%MU) =Cost/ %Cost
answer

Price=100+30% SP= = 100/(1-0.3) =100/0.7 =$142.86
question

A buyer bought brand A at $100 per unit and sells at $143. Later he decided to mark down and put them on sale at $114. further he wants to write “?? discount” next to the new price tag. what % should he write? Markdown(%)= Markdown$/SP=(InitialSP-FinalSP)/ InitialSP
answer

%= 143-114/143= .2028=20%

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