Principles of Marketing III – Flashcards
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A public service campaign to use recyclable shopping bags is an example of what marketing philosophy? a. Societal marketing b. Marketing c. Sustainable d. Relationship marketing e. Nonprofit marketing
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The correct answer is A. Societal marketing, choice A, is a philosophy of marketing that incorporates concerns about the greater good of society. A public service campaign is an example of societal marketing, so choice A is the correct answer. Choice B is incorrect because the marketing concept emphasizes the role of the buyer in product development and uses market research extensively to determine what the market wants. Choice C is incorrect; it is a distractor that may be confused with societal marketing. Choices D and E are incorrect because a public service campaign, though nonprofit marketing as a type, is an example of the societal marketing concept.
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To break down resistance to an unsought product, a company might do all of the following EXCEPT a. offer an extended warranty b. limit promotion to one or two media for saturation c. place the product in many sales outlets d. highlight the benefits of the product e. keep the price competitive
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The correct answer is B. To break down resistance to a product that consumers don't know they can buy or that they don't want to buy, a company would use the full range of promotional tools, so choice B is not true, but the correct answer to this EXCEPT question. Choices A, C, D, and E are ways to break down consumer resistance, so they are incorrect answers to the question.
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The three levels of a product are core, augmented, and a. benefit b. actual c. feature d. real-world e. tangible
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The correct answer is B. The three levels of a product are core, actual, and augmented, so choice B, actual, is the missing level. Choice A is incorrect because the benefit of a product is the core of the product; it's not another level. Choices C, D, and E are incorrect because the missing level is actual, choice A.
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The U.S. company Ajax enters into a joint venture with Tokyo Electronics Company to produce and sell e-readers in Japan. The joint venture establishes a new company TA Unlimited to manufacture and sell the e-readers. The joint venture is a a. franchise b. licensing agreement c. strategic alliance d. joint ownership e. full ownership
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The correct answer is D. Ajax has joined with TEC, a local business in another country to set up, own, and control the manufacturing and marketing of a new business in the local company's country; this describes a joint ownership arrangement, choice D. Choice A is incorrect because in a franchise, the grantor of the franchise (franchiser) gives an independent entity (franchisee) the right to do business in exchange for a fee as long as the franchisee operates according to the rules set down by the franchiser. Choice B is incorrect because a licensing agreement involves one company allowing another to use its patents, trademarks, or some other rights in exchange for a fee or royalty. Choice C is incorrect because a strategic alliance combines the capabilities of two or more companies to achieve certain common objectives, but does not include setting up a new business. Choice E is incorrect because full ownership involves a single company setting up and owning a business.
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The acronym SEO stands for a. Systems Engineering Operations b. Sales, Engineering, and Operations c. Search, Engineering, and Operations d. Search Engine Optimization e. Systems Engineering Optimization
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The correct answer is D. SEO stands for search engine optimization, choice D, an important factor in online marketing. Choices A, B, C, and E are incorrect because they misstate what SEO stands for, search engine optimization.
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Chris wants to buy a new truck for his business. He decides to buy truck Y for its good gas mileage and storage capacity, but he has to sacrifice cabin roominess. Chris has made what kind of decision? a. Variable b. Compensatory c. Characteristic d. Nonimpulse e. Educated
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The correct answer is B. A decision that involves trade-offs is called a compensatory decision, choice B. Choices A and C are incorrect because a buying decision based on trade-offs is a compensatory decision. Chris' decision may be nonimpulsive, choice D, and educated, choice E, but neither are recognized terms and so are incorrect.
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Which of the following is an important economic factor that a company wishing to expand abroad should consider? a. Operations of competitors b. Consumer attitudes c. Import quotas d. Nominal and real interest rates e. Distribution channels
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The correct answer is D. The only answer choice that is economic is choice D, nominal and real interest rates. These affect how much a company will pay to borrow money in order to do business in another country. Choices A, B, C, and E are all factors that a company should consider, but none are economic.
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All of the following are categories in the promotional mix EXCEPT a. sales promotion b. advertising c. market research d. personal selling e. publicity/public relations
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The correct answer is C. Market research, choice C, is not part of the promotional mix and is, therefore, the correct answer to the question. Choices A, B, D, and E are all categories in the promotional mix, so they are incorrect answers to the question.
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Making a sales visit to a potential customer is known as a. the call to action b. prospecting c. the approach d. the opener e. targeting
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The correct answer is C. Making a sales call on a potential customer—or a repeat customer—is called the approach, choice C, in personal selling. Choice A, the call to action, is part of the close of a sales call, so it is incorrect. Choice B is incorrect because prospecting is identifying customers. Choice D is incorrect because the opener is not a step in personal selling. Choice E is incorrect because targeting is part of the direct mail process, not the direct selling process.
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Sullivan Works is launching a new product and has decided that it wants to build market share quickly. Which kind of pricing strategy should it adopt? a. Value-in-use pricing b. Penetration pricing c. Skimming d. Perceived-value pricing e. Captive pricing
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The correct answer is B. Penetration pricing, choice B, is setting a low price in order to build market share quickly. Choice A, value-in-use pricing, and choice D, perceived-value pricing, are identical to one another: a company sets prices at levels where it thinks buyers place the value of the products, and as a result, will be willing to pay the prices. The price may be high, moderate, or low. Choice C, skimming, is incorrect because it is a strategy used to recoup development costs quickly during the introduction stage of a product's life cycle before competitors enter the market; the goal is different from that of penetration pricing. Choice E is incorrect because captive pricing involves a main product and an ancillary product for it; the main product's price is relatively low, whereas the ancillary, which is used with it, is set relatively high. (A manufacturer produces color printers and the cartridges for them; the printer is relatively inexpensive at $199, but the cartridges are relatively high at $89.)
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An ad that describes the harm that bacteria can cause in a person's mouth and then extols the bacteria-fighting powers of a company's mouthwash is using what kind of appeal? a. Humor b. Fear c. Comparative advertising d. Wish fulfillment e. Empathy
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The correct answer is B. The ad is playing on consumers' fear of the damage that oral bacteria can cause, so choice B is the best answer. Choice A is incorrect because while a company may use humor to appeal to consumers, this scenario doesn't suggest that the advertiser is using humor. Choice C is incorrect because there is no suggestion of a competing product in the scenario. Choice D is incorrect because while a bacteria-free mouth may be a consumer's wish, there is nothing in the scenario to suggest this; an ad for a tooth-whitener would be a good candidate for a wish fulfillment appeal. There is no indication that empathy is part of the ad message, so eliminate choice E.
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A company's macroenvironment includes all of the following EXCEPT a. technology b. competitors c. government fiscal policies d. sales forecasts e. economic conditions
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The correct answer is D. Sales forecasts are not part of a company's macroenvironment, which is external, so choice D is the correct answer to the question. Technology, competitors, government fiscal policies, and economic conditions, along with laws and social factors, are elements of the macroenvironment, so choices A, B, C, and E, are incorrect answers to the question.
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The measure of a for-profit's success is profitability. What is the measure of a nonprofit's success? a. The amount of private funding it raises b. The number of funders it has c. The amount of government funding it receives as well as the amount of private funding d. The satisfaction level of its users e. The quality of its services
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The correct answer is D. How well a nonprofit is doing is measured by the level of satisfaction of its users, that is, its customers. Choice E, the quality of a nonprofit's services, is a factor in customer satisfaction, but is not the measure of a nonprofit's success, so it is incorrect. Choices A, B, and C are important for a nonprofit's survival, but are not the measure of its success.
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Which of the following is a strategy that might appear in a marketing plan for a home furnishings store launching seasonal merchandise? a. Buying ad space in the major metropolitan newspapers every Sunday in May and June. b. Providing trade salespeople with store displays. c. Including flyers in customers' bills from May through July. d. Having checkout clerks stuff flyers in customers' bags from May through June. e. Blanketing media in the Northeast and Southeast with direct marketing information from May through July.
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The correct answer is E. A strategy sets broad policy that will assist an organization or individual in achieving long-term goals. Only choice E is broad in its description of what the organization should do, so it is the correct answer. Choices A, B, C, and D are specific actions, or tactics, to implement the strategy of blanketing two regions with information about seasonal products.
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Which of the following is an example of a product that must appeal typically to both the purchaser and to the final user? a. Face cream b. Work shoes c. Cereal d. Wrench e. Sandwich
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The correct answer is C. Typically, cereal is a food that is bought by one person (parent) for consumption by others (household), so choice C is the correct answer. Choice A is incorrect because a woman usually buys face cream for her own use. Choices B, D, and E are typically bought by the user for his or her own consumption, so they, too, are incorrect answers to the question.
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In identifying a market for a $4 cup of coffee, a company would probably select which socioeconomic classes to consider? a. Upper middle class and middle class b. Middle class and lower middle class c. Middle class and skilled working class d. Skilled working class and working class e. Middle class and working class
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The correct answer is A. The amount of discretionary income of the upper middle class and middle class would be a factor that would cause a company to identify these two classes as a potential market for a $4 cup of coffee, so choice A is correct. Choice B is not the best answer because of the presence of the lower middle class segment, which has less discretionary income. The same is true for choice C, which includes the skilled working class, and for choice E, which includes the working class. Choice D is not the best answer because the skilled working class and the working class have less discretionary income than the upper middle class and middle class.
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NAICS stands for a. National Agency for Internet Commerce Standards b. National Agency for Information and Commerce Standards c. National Administration for Information Classification System d. North American Industry Classification System e. North American Industry and Commerce System
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The correct answer is D. NAICS stands for North American Industry Classification System, which was developed by the federal Department of Commerce and classifies businesses by categories "for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. economy. Choices A, B, C, and E are incorrect because NAICS stands for North American Industry Classification System.
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Where people buy goods, the frequency with which they buy, and what they buy are examples of a. customer belief systems b. customer behavior c. lifestyle choices d. social status e. personality types
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The correct answer is B. Where people buy, the frequency of purchase, and the products purchased are examples of what marketers look at when they analyze customer behavior, so choice B is correct. Customer belief systems, lifestyle choices, social status, and personality types are characteristics that are analyzed if psychographic criteria are being used to identify market segments, so choices A, C, D, and E are incorrect.
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An effective advertising appeal must be a. interesting, believable, and expensive b. thematic, expensive, and interesting c. complete, thematic, and systematic d. interesting, systematic, and believable e. interesting, thematic, and complete
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E. An effective advertising appeal is interesting, thematic, and complete in itself, it also communicates the message and is believable. Choices A and B are incorrect because an ad doesn't have to be expensive to be effective. Choices C and D are incorrect because systematic isn't one of the characteristics of an effective advertising appeal.
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The Fox Company sells brake parts to an automaker. If sales of the automaker's cars decrease, Fox will be able to sell fewer brake parts to the automaker. This is an example of a. differentiated demand b. derived demand c. inelastic demand d. concentrated demand e. reciprocal demand
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Choice B is correct because the demand for brake parts depends on demand for cars, and the definition of "derived demand" is demand that depends on, or derives from, demand for consumer goods. Choice C is incorrect because inelastic demand refers to the negotiating process for price between distributor and manufacturer. Choice D is incorrect because concentrated demand refers to the geographic concentration of suppliers in a particular industry near manufacturers in that industry.
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A pricing "war" between two retailers that keep lowering the price of e-books by a few cents under one another is an example of a. product line pricing b. bundle pricing c. competition pricing d. psychological pricing e. comparison pricing
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The correct answer is C. Competition pricing, choice C, is setting prices in relation to the prices set by competitors. Choice A is incorrect because product line pricing is setting different prices for different products within the same type, for example, different MP3 players from the same company with different features have different prices. Choice B is incorrect because bundle pricing is grouping products as a package and selling the bundle at a discounted price. Choice D is incorrect because psychological pricing sets the price based on the psychology of consumers, for example, odd/even pricing. Choice E is a distractor and incorrect.
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By accurately identifying market segments, a company is able to more accurately do all of the following EXCEPT a. identify market share b. measure the company's growth c. target its customers d. identify competitors e. manage its personnel
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The correct answer is E. Identifying market share, measuring growth, targeting customers, and identifying competitors more accurately are all outgrowths of accurately identifying market segments, so choices A, B, C, and D are incorrect. Choice E, managing a company's personnel more accurately, is not an outcome of accurately identifying market segments, so choice E is incorrect.
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Sally works for a catalog call center helping customers place orders. She is a(n) a. service tech b. sales specialist c. missionary sales representative d. order taker e. order getter
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The correct answer is D. An order taker receives orders from customers, but does not generate them, so choice D is correct. Choice A is incorrect because a service person interacts with a customer after the sale. Choice B is incorrect; "sales specialist" may be a name that a company gives to its sales representatives, but it's not a recognized title. Choice C is incorrect because a missionary salesperson shows new products to potential customers, but does not ask for the sale. Choice E is incorrect because an order getter generates sales.
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If Sally suggests that the customer add a particular shirt to her pants' purchase, Sally is a. cross selling b. bounce back selling c. direct response selling d. complementary selling e. downselling
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The correct answer is A. Cross selling, choice A, is suggesting to a customer that he/she buy a complementary product once the customer has shown a willingness to buy. Choice B is incorrect because bounce back refers to a coupon given to an existing customer to use for a future purchase. Choice C is incorrect because Sally's suggestion is called cross selling. Choice D is a distractor and incorrect. Choice E is also a distractor and incorrect; it plays off upselling, which is another name for cross selling.
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Because of the risk involved in entering a foreign market, the smart way to enter is to a. advertise heavily and see how many orders come in before making the product b. lease manufacturing space c. introduce products with long life cycles d. introduce a product that the company already makes e. introduce a completely new product to see how it sells before making and selling it at home
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The correct answer is D. Introducing a product that the company already sells is a smart way to enter a new foreign market; the company is already familiar with the product, its features, its manufacturing processes, etc., so choice D is the correct answer. Choices A, B, and C are incorrect answers to the question because entering a new foreign market with a familiar product is the correct answer. Choice E, entering a new foreign market with a product new to the company, is the riskier way to enter a market and, therefore, incorrect.
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Profit margins in the maturity stage of the product life cycle are typically a. low b. stable c. increasing d. decreasing e. lagging
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The correct answer is D. Profit margins in the maturity stage of the product life cycle are typically decreasing, choice D. Choice A is incorrect; low profit margins typically occur in the introduction stage. Choice B is incorrect because sales, not profit margins, are typically stable in the maturity stage. Choice C is incorrect because increasing profit margins are a characteristic of the growth stage. Choice E is incorrect because lagging doesn't make sense in the context of the question.
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Which of the following is an example of VALS? a. Health and fitness b. Gender c. ZIP code d. Educational level e. Job title
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The correct answer is A. VALS stands for values and lifestyle and represents a segmentation system. Health and fitness is the only value listed, so choice A is the correct answer. Gender, educational level, and job title relate to demographic characteristics, so choices B, D, and E are incorrect. Choice C, ZIP code, refers to geographic characteristics, so it is incorrect.
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Joanna buys a particular type of top because several of her friends have it. In marketing terms, Joanna is being influenced by a. her peers b. her reference group c. her social group d. outside influencers e. a brand
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The correct answer is B. In marketing, a reference group is one that influences an individual's behaviors; it is the point of reference by which a person evaluates his/her beliefs and attitudes, so choice B is correct. Choices A, C, and D are incorrect; her friends may be peers, her social group, and outside influences on her buying habits, but the correct term is reference group. Choice E is incorrect; brand is not the focus of the question.
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Place is the most important factor in the marketing mix for which type of product? a. Shopping b. Unsought c. Components d. Convenience e. Supplies
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The correct answer is D. Placement of convenience goods, some of which are often impulse purchases, require locating them where they are accessible and visible to consumers, so choice D is the correct answer. Products in the shopping, unsought, components, and supplies categories are not so dependent on place for their sale, so choices A, B, C, and E are incorrect.
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Which of the following is NOT a mobile channel used for marketing? a. Cable b. Multimedia messaging c. Text messaging d. Internet e. E-mail
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The correct answer is A. Mobile channels are increasingly popular as ways to market product. These channels include multimedia messaging, text messaging, the Internet, and e-mail—all of which are regulated to some degree by federal law—so choices B, C, D, and E are incorrect answers to the question. Choice A, cable, is not a mobile medium, so it is the correct answer to the question.
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A brand personality is made up of what kinds of appeal? a. Rational, humorous, and sensual b. Emotional, humorous, and rational c. Sensual, performance, and humorous d. Rational, emotional, and sensual e. Emotional, sensual, and performance
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The correct answer is D. A brand personality is a combination of three types of appeal to potential buyers: rational, emotional, and sensual; therefore, choice D is correct. Choices A and B are incorrect because they include humorous, which is an appeal used in creating ads, but is not part of brand personality. Choices C and E are incorrect because they include humorous and performance; performance is only one factor in rational appeal.
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The best way to determine the effectiveness of pop-up ads is to measure a. cost-per-click b. the number of complaints that a company gets for its pop-up ads c. the click-through rate d. the conversion rate e. site stickiness
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The correct answer is D. The best way to determine the effectiveness of pop-up ads is to measure the conversion rate (the percentage of viewers who take action), choice D. Cost-per-click, click-through rate, and site stickiness are not the most accurate way to determine the effectiveness of pop-up ads, so choices A, C, and E are incorrect. Choice B is incorrect; complaints would determine the ineffectiveness of pop-up ads.
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A major problem in gathering market intelligence by survey format is the a. lack of people's interest in participating b. cost of phone surveys c. lack of trained people to administer phone surveys d. difficulty in writing unbiased and unambiguous questions e. difficulty in generalizing from the data
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The correct answer is D. The design of questionnaires is the crucial factor in using surveys to gather market intelligence, so choice D is correct. Without a well-designed questionnaire, finding willing participants is a moot point, so choice A is not the best answer. Choice B is incorrect because phone surveys are relatively inexpensive to administer. Choice C is incorrect because the training to conduct surveys is not difficult to administer or undergo. Choice E is incorrect because surveys result in quantifiable data, and quantifiable data can be used as the basis for generalizations.
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Companies typically have four objectives in marketing products: minimizing costs and maximizing profits, return on investment, and a. revenue b. product quality c. standardization of production d. customer satisfaction e. brand acceptance
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The correct answer is A. Revenue is not the same as profits, and companies typically include maximizing revenue as one of their objectives, so choice A is correct. Choice B is incorrect because increasing and maintaining product quality is a strategy for achieving profit, return on investment (ROI), and revenue. Choice C is incorrect, but standardizing production is a strategy that may reduce costs. Choice D is incorrect, but customer satisfaction is a component in achieving brand acceptance, choice E, which is also incorrect but can lead to maximization of profits, ROI, and revenue.
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New products fail in the first stage of the product life cycle for all of the following reasons EXCEPT a. poor timing into the market b. lack of differentiation from competitor's products c. lack of product quality d. too small a target market segment e. lack of inventory
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The correct answer is E. While lack of inventory can curtail product sales, it doesn't necessarily spell the failure of the product, so choice E is the correct answer. (Apple's inability to produce enough iPads to satisfy initial demand didn't doom the iPad to failure.) Poor timing into the market, lack of competitive edge, poor product quality, and targeting too small a market are more likely to result in the failure of a new product, so choices A, B, C, and D are incorrect answers to the question.
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A marketing message for oatmeal that promotes it as no longer just a hearty breakfast for a cold day, but also as a way to lower cholesterol is an example of a. product line extension b. product positioning c. product repositioning d. product differentiation e. value-added
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The correct answer is C. Adapting a marketing message to reflect changes in the marketing environment is product repositioning, choice C. Choice A is incorrect because product line extension is adding product to a product line. Choice B is incorrect because product positioning is the initial message for a product at its introduction. Choice D is incorrect because differentiating a product involves comparing its features to another product. Choice E is incorrect because value-added refers to the value added to a product during each stage of its production and distribution.
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Reverse logistics is a. recovering penalties for late deliveries of goods b. analyzing the distribution channel to improve the flow of goods c. buying salvaged construction materials for use in new construction d. returning goods e. using postconsumer waste in manufacturing new clothing
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The correct answer is D. Reverse logistics is the return of goods, choice D. Choices A and B are incorrect because reverse logistics is the return of goods. Choices C and E are the recycling and reuse of materials, but they don't involve returning product to the seller.
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John has decided to set up his own direct-mail agency to work with pharmaceutical companies. John's business is what kind of an intermediary? a. Financial services b. Physical distribution c. Marketing services d. Selling e. Production
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The correct answer is C. Providing direct mail pieces for companies is the function of a marketing services intermediary, choice C. Choice A, financial services, refers to banks, insurance companies, and similar institutions, so it is incorrect. Choice B is incorrect because distribution intermediaries are the companies that warehouse and transport goods. Choice D is incorrect because selling intermediaries are agents, wholesalers, retailers, and brokers who sell products to customers. Choice E is a distractor and incorrect.
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A small regional family-owned supermarket chain decides to move out of the region and open stores in another region. This is an example of a. demographic development b. market development c. institutional development d. geographic development e. promotional development
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The correct answer is B. Expanding the market for a business by expanding geographically is market development, choice B. Choices A, C, D, and E are not recognized terms in this context and are incorrect.
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The price per unit of specialty items is typically a. low b. moderate c. high d. varies from low to moderate e. varies from medium to high
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The correct answer is C. A specialty product is one that is considered unique by buyers, and because of this, buyers are willing to pay a high price for specialty products, choice C. Choice A is incorrect; low prices are typically charged for convenience items because they are high-volume goods. Choices B, D, and E are incorrect because the per unit price of specialty goods is high.
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Price discrimination occurs when a. a person refuses to buy a product because of the price b. a product is discounted in order to clear out inventory c. products are priced differently based on features d. different customers pay different prices for the same product e. customers perceive price to be an indicator of prestige
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The correct answer is D. Price discrimination occurs when different customers pay different prices for the same product, choice D. Choices A, C, and E are incorrect because price discrimination occurs when different customers pay different prices for the same product. Choice B is incorrect because discounting in terms of price discrimination refers to quantity purchases of a product.
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A TV/cable ad uses a voiceover and shows workers laying a carpet and a delighted homeowner after it's finished. The ad uses what kind of execution style? a. Straight sell b. Testimonial c. Demonstration d. Slice of life e. Humor
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The correct answer is D. An ad showing a staged "slice of life" uses choice D, a dramatization execution style, or creative format. Choice A is incorrect because a straight sell would be an announcer talking directly to the camera about the features and benefits of a product. Choice B is incorrect because a "homeowner" would look into the camera and talk about his/her experience with the carpet store. Choice C is incorrect because a demonstration would show the features of a product, for example, how smoothly a certain brand of paint goes in a wall. Choice E is incorrect because the scenario doesn't indicate the use of humor in the commercial.
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Which of the following describes social influence marketing? a. It focuses on personal selling to important customers in a community. b. It focuses on developing long-term relationships with customers so they buy product. c. It emphasizes product features and benefits. d. It focuses on using customers to market product in online communities. e. It focuses on the content of products and the processes to produce them that do not harm the environment.
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The correct answer is D. Social influence marketing (SIM) focuses on using customers to market a company's products in online communities, choice D. Choice A is incorrect because social influence marketing is not personal selling, which is face-to-face selling. Choice B is incorrect because it describes relationship marketing. Choice C is incorrect because SIM uses customers to market product online through their contacts in online communities. Choice E is incorrect because it describes part of a message that a company using societal marketing might use.
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The four elements of a direct response marketing piece include all of the following EXCEPT a. an offer b. a call to action c. information about the product d. a vehicle for reply e. an incentive
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The correct answer is E. Direct response marketing includes an offer, information about the product, a call to action, and a way to respond, so choices A, B, C, and D are incorrect answers to the question. Choice E, an incentive, is the correct answer to the question because an incentive is not necessarily included in a direct response piece. The piece could offer a discount, free shipping, a chance to enter a contest, or some other incentive to buy, but it could also have no incentive, but simply state information about a product and ask the consumer to buy.
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Tony and Bill want to get the message about their new app out quickly, so they decide to a. set up a Web site for the app b. buy banner advertising on relevant Web sites c. use viral marketing d. buy pop-under ads on relevant Web sites e. make it available for as many platforms as possible
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The correct answer is C. Viral marketing, choice C, is a strategy that facilitates and encourages social networks to pass along a marketing message through electronic media; it's similar to traditional word-of-mouth advertising, but using electronic media. Choices A, B, and D are all methods of advertising product, but they will not necessarily get the message out quickly. Choice E is incorrect because employing as many outlets as possible is not a promotional strategy; it's a place strategy.
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The Saturday Electronics Company is deciding whether to enter the e-reader business. To determine the market attractiveness of this business, the company is analyzing a. its capital resources b. the strength of its research and development teams c. the power of suppliers in negotiating contracts d. the functionality and power of its Web site e. the strengths of its in-house marketing department
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The correct answer is C. Market attractiveness measures the potential of the marketplace to generate sales and profits. It is a measure of factors external to the organization. Only choice C satisfies this characteristic. Capital resources, R & D, a company's Website, and its marketing department are factors internal to the organization, so choices A, B, D, and E are incorrect.
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Which is a unique factor that an exporter must consider in setting prices for foreign markets? a. Tariffs b. Fixed costs c. Demand patterns d. Competitive conditions e. Legal regulations
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The correct answer is A. Choice A, tariffs, taxes on imports, is a unique cost factor that an exporter must consider in setting prices for foreign markets. Fixed costs, demand patterns, competitive conditions, and legal regulations are all factors that both domestic and export companies must consider in setting prices, so choices B, C, D, and E are incorrect.
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Jocelyn is recommending that her company, which makes cleaning products, sponsor the national spring clean-up campaign of a nonprofit. Her major business objective is to a. provide monetary support for the campaign b. increase sales of the company's product c. increase product awareness d. increase brand awareness e. get company employees to work in the campaign
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The correct answer is D. Choice B, increase sales, may seem like the appropriate business objective, but being able to track a causal relationship between a sponsorship and sales is very difficult. Increasing brand awareness, choice D, is a realistic objective. Choice A, funding for the campaign, is a business objective for the nonprofit in requesting sponsorships, but not a business objective for the company, so choice A is incorrect. Choice C is incorrect because product awareness is too narrow an objective; choice D is a better answer. Choice E, employee support, may be a by-product of the sponsorship, but is not the main business objective.
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A trade-in allowance on copy machines is an example of a. a service guarantee b. sales promotion c. indirect selling d. delayed invoicing e. premium offer
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The correct answer is B. A trade-in allowance is a type of sales promotion, so choice B is correct. Service guarantees, delayed invoicing, and premium offers are types of sales promotion, so choices A, D, and E are incorrect. Choice C is incorrect because indirect selling occurs when a manufacturer uses another entity such as a retailer to sell its products.
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Deciding whether a business is a prospect is called a. determining feasibility b. analyzing a customer c. quantifying a customer d. qualifying a customer e. establishing credibility
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The correct answer is D. Analyzing various factors to determine whether a business is a prospect is known as qualifying a customer, choice D. Choices A, B, C, and E are incorrect because deciding whether a business is a viable potential customer, a prospect, is known as qualifying the customer.
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The Wood Company is analyzing its product lines and finds that it has three products that are in high growth areas, generating a large amount of cash, but also draining a lot of cash. These three products are known as a. cash cows b. dogs c. stars d. question marks e. a combination: cash cows and dogs
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The correct answer is C. The scenario describes choice C, "stars," a designation in the Boston Consulting Group's (BCG) matrix. A star is a market leader in a high growth market; it generates a large amount of cash, but also uses a large amount to maintain its position and grow its sales. Choice A is incorrect because a cash cow is a market leader in a market with little additional growth potential; it generates large amounts of cash for the company while using little. Choice B is incorrect because a dog generates little cash, may use up cash, and has little potential. Choice D is incorrect because a question mark has potential to become a market leader, but has not reached that level yet; it uses up cash and generates little cash in return. Choice E is incorrect because neither a cash cow nor a dog is a market leader in a high growth market, generating a large amount of cash, but also using a lot to maintain its position and grow its sales.
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A department store chain markets itself as offering great service to its customers. This is an example of a. targeting a market segment b. branding c. product evolution d. effective advertising e. trademark
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The correct answer is B. Branding, choice B, is creating a perception in the minds of consumers about a product, in this case, a department store chain. Choice A is incorrect because there is no indication of market segmentation in the scenario. Choice C is incorrect because product evolution is the change in a product over time as its manufacturer attempts to modify it to meet changing market needs or to enter new markets. Choice D is incorrect because the scenario doesn't describe a specific advertising campaign. Choice E is incorrect because a trademark is a letter, symbol, word, design, etc., that distinguishes one product from another and is registered with the government and protected by law.
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Which of the following is a legal factor that companies must deal with in entering foreign markets? a. Lack of transportation infrastructure b. Social class structure c. Standard of living d. Cultural values e. Import quotas
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The correct answer is E. Import quotas are established and regulated by governments, so choice E is a legal factor that may also be a political issue for companies entering foreign markets. Choice A is incorrect because a lack of infrastructure is a technological factor. Choices B and D are incorrect because social class structure and cultural values are social and cultural factors. Choice C is incorrect because standard of living is an economic factor.
question
The market leader in MP3 players grosses five times more than its closest rival. This indicates that the market leader has a. a competitive advantage b. lower production costs c. a higher quality product d. more attractive stores e. a more effective marketing mix
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The correct answer is A. A competitive advantage, choice A, gives a company the ability to outperform its rivals. A measure of that advantage is revenue, so choice A is correct. Choice B is incorrect for two reasons. First, lower production costs would result in higher profitability, but it wouldn't affect revenue and, second, there is nothing in the scenario that indicates that the market leader's production costs are lower than that of rivals. Choices C, D, and E are incorrect; they are qualitative factors that may contribute to a company having a competitive advantage.
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Which of the following is NOT a benefit that a U.S. company may gain by entering a foreign market? a. Certain tax advantages at home b. Extension of the life of products and product lines c. Increase in the company's profitability d. Reduction in expenses e. Increase in sales
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The correct answer is D. While there may be some economies of scale, entering foreign markets doesn't cut costs, but typically raises them, as is true with entering any new market, so choice D is the correct answer to the question. Tax advantages, extending product life, and increasing sales and profitability are four benefits that a company may gain from entering a foreign market, so choices A, B, C, and E are incorrect answers to the question.
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The Dayton Appliance Company is switching from making white appliances to making stainless steel ones. This may be an indication of a shift in a. technology b. consumer tastes c. foreign competition d. poor national economic conditions e. advertising
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The correct answer is B. The most likely cause of the shift in appliance models is a shift in consumer tastes, choice B. Choice A, a shift in technology, doesn't make sense; making an appliance with a stainless steel skin is much the same as making one with enamel, so eliminate choice A. If foreign competitors are making stainless steel appliances and being successful, it would be because customers are buying them, so choice B is a better answer than choice C. Choice D is incorrect because stainless steel costs more than enamel. Choice E is incorrect because advertising shifts when a product message shifts, not before the product changes.
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A bottler of apple juice combines the original fruit juice with a variety of other fruit juices in order to a. extend the product line b. differentiate the product line c. harvest the product line d. target a new market e. test a new product concept
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The correct answer is A. Adding new product to a product line is known as extending the product line, choice A; it is a strategy for improving a company's position in an existing target market. Choice B, product differentiation, isn't correct because there is no information about the products of a competitor in the scenario. Choice C is incorrect because harvesting a product maximizes short-term profits and cash flow from a product line when a company anticipates getting out of a market. Adding product is the opposite of this strategy. Choice D is incorrect because the bottler is looking for additional customers in the apple juice market, not targeting a new market. Choice E, market testing, is not indicated in the scenario and so is incorrect.
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Marketing information systems (MIS) are built from data from a. internal records, market research, and suppliers b. market intelligence, market research, and customers c. cash flow, market research, and customers d. inventory, internal records, and market research e. market research, internal records, and market intelligence
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The correct answer is E. You are looking for the best answer and choice E is the best answer because it has the broadest categories: market research, internal records, and marketing intelligence. Choice A is incorrect because it includes suppliers, which is one source for market intelligence. Choice B is incorrect because it includes customers, which is one source for market intelligence. Choice C is incorrect because it includes cash flow, which is an internal record and customers, which is one source for market intelligence. Choice D is incorrect because it contains inventory, which is an internal record.
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In designing a questionnaire, a market researcher who wanted to find out how passionately consumers feel about a need would use a. open-ended questions b. scaled-response questions c. close-ended questions d. check-off questions e. yes/no questions
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The correct answer is B. Whereas choice A, open-ended questions, might be able to get respondents to describe how they feel, choice B, scaled-response questions are designed to measure intensity of responses, so choice B is a better answer. Choice C is incorrect because although closed-end questions ask a respondent to choose from a list of responses, those responses aren't necessarily designed to measure intensity. Choices D and E are incorrect because the correct term is scaled-response questions.
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A nonprofit can market itself in all of the following ways EXCEPT a. developing a Web site b. submitting grant proposals c. having a staff member available to the press for comments on appropriate news stories d. developing a brand e. using social media
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The correct answer is B. Submitting grant proposals will help a nonprofit financially, but it is not something a nonprofit can rely on for promoting itself, so choice B is the correct answer to the question. Developing a Web site, having a staff member who is viewed as an expert and thereby gaining publicity for the organization, developing a brand, and using social media to get the word out about themselves are all ways that nonprofits can market themselves, so choices A, C, D, and E are incorrect answers to the question.
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Which of the following products would be best sold through selective distribution? a. Refrigerators b. Candy bars c. A couture line of women's clothing d. Beer e. Light bulbs
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The correct answer is A. The most appropriate goods for selective distribution are those that people shop for in the marketing sense of the word: people doing research and comparing features and prices. A refrigerator is a relatively expensive item that people shop for, so choice A is the best answer. Candy bars, beer, and light bulbs typically receive intensive distribution because they are relatively inexpensive and people have a number of brands to choose from, so choices B, D, and E are incorrect. Choice C is incorrect because a couture line of women's clothing is sold through exclusive distribution.
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Manufacturing product so that there is little excess supply in relation to demand is a. quality control b. just-in-time manufacturing c. inventory control d. profit maximization e. inventory minimization
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The correct answer is B. The question asks for what the process of manufacturing is called that results in little excess supply in relation to demand, and the answer is choice B, just-in-time manufacturing. Choice D is a goal of the process, but not the process. Choice A is incorrect because the process is not quality control. Choices C and D are incorrect because controlling the level of inventory and minimizing the amount of inventory are results of the process, but not the process.
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The best description of marketing is that a. it involves development, production, and sale of products b. it affects pricing more than any other element in the marketing mix c. its major role is in market research d. it is responsible for sales force development e. it is the total process of promoting and selling a product.
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The correct answer is A. The marketing mix includes product, price, place, and promotion, so only choice A is the most complete answer. Choice B is incorrect because pricing is not singled out for special attention in marketing. Choice C is incorrect because a marketing department, which is not the same as marketing, does more than conduct market research. Choice D is incorrect because the sales department is responsible for sales force development. Choice E is incorrect because it omits development and distribution.
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A cell phone maker's market research shows that many people in South Asia like bright-colored cases—reds, greens, golds, and blues—for cell phones. This is an example of what kind of influence? a. Demographic b. Cultural c. Societal d. Nationality e. Behavioral
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The correct answer is B. Preference for certain colors fits into the category of cultural influences, so choice B is correct. Choice A is incorrect because demographic influences include age, gender, occupation, and similar characteristics. Choice C is incorrect because societal influence refers to the structure and functioning of a society. Choice D is incorrect because nationality is a subcategory under demographic. Choice E is incorrect because a behavioral influence refers to information such as user status, usage rate, and product loyalty.
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Which of the following is an example of advertising based on a product's attributes? a. A model showing off her shiny hair to advertise shampoo b. A paper towel being used to mop up a spill c. A basketball player wearing a particular brand of sneakers d. A group of happy children eating a brand of breakfast cereal e. A sunset behind a sports car with a couple in it on a mountaintop to advertise the car
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The correct answer is B. The absorbability of the paper towel is one of its attributes, so choice B is the correct answer. Choice A, the model, is incorrect because she is demonstrating a benefit of the product, not one of its attributes, or features. Choice C is incorrect because it relies on a cultural icon, the athlete, to sell the sneakers; he wears them so consumers will want to wear them to emulate him. Choice D is incorrect because the cereal ad is showing users of the product enjoying a benefit of the cereal, happiness. Choice E is incorrect because the sports car ad is selling an image—the "romance" of driving the car—not a tangible attribute of the car.
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A company originally developed a drug for use with lung patients, but then discovered it was better suited to fighting liver cancer. This is an example of a. product derivative b. product discernment c. product transformation d. product use e. product trial
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The correct answer is C. When a product designed for one function or use is used for something else, this is known as product transformation, choice C. Choices A, B, and D are incorrect because the shift of a product from one use or function to another is known as product transformation. A product trial, choice E, is a sales promotion in which consumers receive small sizes of a product to use to see if they like it and will buy it.
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According to Maslow's Hierarchy of Needs, a campaign to advertise an over-55 community will be most successful if it adopts as its central message that living there offers a. companionship b. self-fulfillment at any age c. a safe place to live d. less work e. prestige
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The correct answer is B. The highest need according to Maslow is self-actualization, so choice B is correct. Choice A is incorrect because companionship fits the third level of Maslow's hierarchy, social need. Choice C is incorrect because safety is the second level of Maslow's hierarchy. Choice D is incorrect because rest fits the fifth level, physiological. Choice E is incorrect because prestige is part of the fourth level, esteem or ego.
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Sam's business consultant believes that his small electronics repair business needs to develop its market. He currently advertises only in his small town. Which of the following will help Sam expand his market? a. Selling refurbished computers b. Selling new computers c. Adding a line of products that complement computers d. Adding a service to pick up and deliver repaired computers e. Advertising online through a service that targets the county in which Sam operates
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The correct answer is E. Market development refers to increasing the number of customers for the existing business, so choice E is correct. Selling refurbished or new computers, adding a line of products, or adding a new service are all strategies for adding businesses, not customers, to the current business, so choices A, B, C, and D are incorrect.
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Which of the following sampling types is the least likely to be representative of the population as a whole? a. Systematic sample b. Cluster sample c. Probability sample d. Random sample e. Nonprobability sample
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The correct answer is E. There are two categories of sampling: probability and nonprobability. In probability sampling, choice C, every unit of a known population has a statistical chance, or probability, of being included in a sample. In a nonprobability sample, choice E, a representative sample of the population is not selected; selection is based on some other criterion such as convenience. Choice E is the correct answer. Systematic, cluster, and random sampling are all subcategories of probability sample, so choices A, B, and D are incorrect.
question
Which of the following is the best tool for marketing products online? a. Celebrity endorsements b. Customer reviews c. Comparison charts d. Shared shopping lists e. Banner ads
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The correct answer is B. The best tool for marketing products online is choice B, customer reviews. A user's experience tends to carry the most weight with potential customers, so celebrity endorsement, comparison charts, shared shopping lists, and banner ads, choices A, C, D, and E, are incorrect.
question
All of the following are useful demographics in identifying market segments in the business-to-business market EXCEPT a. number of employees b. social responsibility policies, if any c. management style d. risk tolerance e. facility locations
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The correct answer is E. The location of facilities is a geographic factor in identifying a market segment—individual or business—not a demographic factor, so choice E is correct. Choices A, B, C, and D are four demographic factors that a business might use in identifying segments in business-to-business markets, so they are incorrect answers to the question. These take the place of such consumer demographic factors as age, gender, religion, etc., in the retail market.
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The Allied Company's marketing group is analyzing the market leader's strategy in order to determine how Allied might enter the same market with a new product. The marketing department is engaged in a. gathering market information b. gathering competitive intelligence c. gathering segmentation information d. forecasting e. developing a marketing plan
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The correct answer is B. Focusing on a competitor and gathering information about it is more than gathering market information; it is gathering competitive intelligence, choice B. Marketing information, choice A, is not specific enough; choice B is the better answer. Choice C is incorrect because the marketing department is focusing on a competitor, not the market segment. Choice D is incorrect because forecasting involves sales. Choice E is incorrect because Allied will develop a marketing plan after it looks at the competitive intelligence and other information and determines whether or not to enter the market.
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A saleswoman from the ECON software company is demonstrating its new inventory control package to a potential business customer. Which of the following levels of management will most likely make the purchasing decision? a. Vice president of facilities b. CEO c. CFO d. Director of inventory control e. Human resources manager
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The correct answer is D. The inventory control package is a functional product so a functional manager would make the decision, choice D. Choice A is incorrect because a vice president is at the operational level. If you weren't sure, the word "facilities" would point to eliminating this response; a facilities person wouldn't make inventory control decisions. Choice B is incorrect because the chief executive officer (CEO) makes strategic, not functional decisions. Choice C, the chief financial officer (CFO), is incorrect because the CFO is at a strategic level, not a functional level; however, someone in the finance department would sign off on the purchase. Choice E is incorrect because while the human resources manager is at a functional level, the department is incorrect.
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Purchasing a speedboat requires what kind of problem solving? a. Economic b. Routinized c. Psychological d. Limited e. Extensive
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The correct answer is E. Making a purchase is solving a problem. The problem-solving process can be routinized, choice B, for habitual, low-cost products; can involve some limited problem solving, choice D, for unfamiliar brands for a familiar product; or can be extensive, choice E, for an unfamiliar, high-end, and visible product of deep significance to the purchaser. The latter description fits the purchase of a speedboat, so choice E is correct. Choice A, economic, and choice C, psychological, are risk factors associated with products that involve extensive problem solving, so they are incorrect choices.
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No matter how many coupons Brie receives in the mail or at check-out or how discounted another brand of frozen dinners is, she always buys the same brand at her supermarket. This is known as brand a. recognition b. preference c. insistence d. reputation e. assertion
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The correct answer is B. The clue in this scenario is that Brie always buys the same brand of frozen dinner, not the same dinner, so choice B is correct. Brand preference is demand for the brand rather than a product. Choice A is incorrect because brand recognition is consumer awareness of a brand's existence and Brie is more than aware of the brand. Choice C is incorrect because brand insistence occurs when a buyer will buy only the desired brand and will search for it if it's not available in the usual location; there is nothing in the scenario to indicate that Brie, though loyal, will go to even one other store to find the desired brand. Choice D is incorrect because brand reputation is the position in the marketplace that a brand occupies. Choice E is incorrect because refusal to buy another brand is brand preference.
question
Market intelligence gathered during research for a sports car and then used by a team working on a mid-sized car concept is called a. experimental data b. predictive data c. primary data d. secondary data e. tertiary data
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The correct answer is D. Data—original surveys, interviews, and market intelligence—gathered during market research for one use, and then applied to another project is called secondary data, choice D. Choice A is incorrect because the use of market research data for other than the purpose it was originally intended makes it secondary data. Choice B is incorrect; while market research data can be used to predict the results of a marketing decision, in this scenario, the predictive nature of market research is irrelevant and the correct answer is choice D. Choices C and E are incorrect because the correct term is secondary data. (A clue to eliminating primary and tertiary is that the data is being used twice.)
question
All of the following are public relations tools EXCEPT a. press releases b. sales training manuals c. company publications/Web site d. events e. sponsorships and donations
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The correct answer is B. Sales training manuals are internal documents, whereas public relations, as its name implies, gets the company's message out to the general public. Choice B is not a public relations tool and is therefore the correct answer to the question. Press releases, company publications, its Web site, events, and sponsorships and donations are all public relations tools, so choices A, C, D, and E are incorrect answers to the question.
question
The decision whether to enter a foreign market often revolves around a. the compatibility of the marketing campaign in the home country to the culture of the new marketplace b. the fees that intermediaries will charge c. the amount of adaptation to the product that may be required d. cost e. customer preferences
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The correct answer is D. Choices A, B, C, and E all come down to the same issue: cost, so choice D, cost, is the best answer. If the marketing campaign, choice A, is not compatible, which it probably isn't, it will cost to revamp it. Choice B notes the fees that intermediaries will charge the company. Choice C, product adaptation, which may be required depending on the product, will also cost the company. Choice E, customer preference, is the determining factor in whether the marketing campaign and product will need to be changed, and hence, cost the company money.
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A two-way stretch is a product line decision to a. save money and use a single marketing campaign for two markets b. target the exact same product to two markets c. add product to a line to appeal to both more- and less-profitable markets d. to sell the same product domestically and internationally e. to use two manufacturers to increase production
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The correct answer is C. Adding product to a line to appeal to both more- and less-profitable markets is called a two-way stretch, choice C. Choices A and B are similar and incorrect because a two-stretch is adding product to a line to appeal to both more- and less-profitable markets. Choice D is incorrect because selling the same product domestically and internationally is expanding the market, not the product line. Choice E is incorrect because adding manufacturers for the same product is not the same as adding product
question
Which of the following typically offers a high level of customer service? a. A supermarket b. A convenience store c. A catalogue sales d. A big box store e. A specialty store
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The correct answer is E. A specialty store, choice E, offers a high level of customer service; it sells limited product to a limited market, so keeping its customers is important. Choice A, a supermarket, typically has a medium level of service, so it is incorrect. Convenience stores, catalogue sales, and big box stores typically offer a low level of customer service, so choices B, C, and D are incorrect.
question
The first step in marketing communications based on the AIDA model is to a. create a desire for the product b. describe the features and benefits of the product c. create an interest in the product d. create an awareness of the product e. generate a buzz about the product
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The correct answer is D. AIDA stands for attention, interest, desire, action. Choice D, creating awareness, is the same as gaining prospective customers' attention, so it is the correct answer. Choice A, creating a desire for the product, is the third step, so it is incorrect. Choice B is incorrect because it is part of step two, creating interest. Choice C, creating interest, is the second step, so it is incorrect. Choice E, generating a buzz about the product, is one way to gain customers' attention, but is too specific an answer. Choice D, creating awareness, is a broader term that includes many ways to gain customers' attention, so it is a better choice.
question
In determining how to segment an industrial market, a company would look at all the following variables EXCEPT a. ways products are purchased b. niche possibilities c. loyalty to sellers d. demographics e. situational factors
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The correct answer is B. A niche isn't a variable used to determine a market segment, so choice B is the correct answer to the question; a niche is a way to position a product. Purchasing, loyalty, (industry) demographics, and situational factors are all variables that can be considered in segmenting industrial markets, so choices A, C, D, and E are incorrect answers to the question.
question
Which of the following is NOT used in a creating an ad based on a rational appeal? a. Product features b. Price c. The pleasure that buyer will get from having the product d. Comparison with other brands e. Popularity of the brand
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The correct answer is C. Choice C, pleasure, is used when an emotional appeal is being created for a product or product line, so it is the correct answer to the question. Features, price, comparison with the competition, and brand popularity are used in creating a rational appeal to advertise a product or product line, so choices A, B, D, and E are incorrect answers to the question.
question
Typically, consumers looking for information about a potential purchase most value information gathered from a. TV/cable advertising b. salespeople c. comparison shopping on Web sites d. examining products e. friends and family
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The correct answer is E. Typically, word-of-mouth information, information gathered from family and personal acquaintances, choice E, is the most valued information gathered in the information search. Choices A, B, C, and D are incorrect because ads on TV/cable, salespeople, Web sites, and product handling are not as respected as the opinions of family and friends.
question
A bathroom cleaner advertised as new and improved is an example of what marketing strategy? a. Product switch b. Product assortment c. Substitute product d. Innovation e. Product repositioning
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The correct answer is E. Product repositioning, choice E, is making some change to an existing product to strengthen and refresh its identity in the marketplace. Selling something as "new and improved" is a typical product repositioning strategy. Choice A is incorrect because a product switch is initiated by a customer, not a manufacturer, and may be for any number of reasons, including product repositioning. Choice B is incorrect because a product assortment is all the products that a manufacturer or retailer sells. Choice C is incorrect because a substitute product is one that the consumer sees as an alternative for another product; in this case the manufacturer is replacing a product with a newer version that it wants the consumer to perceive as better than its predecessor. Choice D is incorrect because innovation would result in a completely new product with new features and benefits for a new market.
question
The response rate to a TV/cable ad with a call-in number is a. not tracked b. easier to measure than a direct mail piece's response rate c. more difficult to measure than a direct mail piece's response rate d. about the same level of difficulty to measure as the response rate to a direct mail piece e. very difficult to measure as opposed to measuring the response rate to a direct mail piece
answer
The correct answer is D. As long as the TV/cable ad has a call-in number for action, it should be no more difficult to measure the response to it than the response to a direct mail piece, choice D. If the TV/cable ad did not have a call-in number, as most don't, then it would be very difficult to measure the response. Choice A is incorrect; it is too broad an answer, so eliminate it. Choice B is incorrect because the ability to track responses to TV/cable ads with call-in numbers and a direct mail piece are similar. Choices C and E are incorrect because as long as the TV/cable ad has a call-in number, it would not be very difficult to track responses to it
question
Which of the following is an example of a product that suffers from brand nonrecognition? a. Margarine b. Paper clips c. Toothpaste d. Pickup trucks e. Paper towels
answer
The correct answer is B. How many brands of paper clips can you name? Choice B, paper clips, is a product that has little marketing attention paid to it either by its manufacturers or its purchasers, so choice B is the best answer. Manufacturers spend millions of dollars marketing different brands of margarine, toothpaste, pickup trucks, and paper towels, so choices A, C, D, and E are not the best choices to answer this question.
question
A company has decided to outsource its employee benefits program, and the human resources department along with representatives from finance, other departments, and unions working at the company, will review proposals. These decision makers are called a a. decision support system b. buying center c. review committee d. analytics committee e. purchasing agents
answer
The correct answer is B. All the people in an organization involved in a buying decision make up a buying center, choice B. Choice A is incorrect because a decision support system (DSS) is an interactive computer system that provides information for decision makers. Choices C and D are distractors and incorrect. Choice E is incorrect because a purchasing agent is someone who makes the actual purchase; the buying center makes the decision to purchase
question
Getting a good haircut one time and a poor haircut the next time from the same stylist is an example of what characteristic of services? a. Variability b. Intangibility c. Inseparability d. Conceptualization e. Perishability
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The correct answer is A. The characteristics of services are variability, intangibility, inseparability, and perishability. The way that services may vary in quality over time is an example of variability, choice A. Choices B, C, and E, while characteristics of service products, are incorrect answers to the question. Choice D is a distractor and incorrect.
question
Goods sold business-to-business include all of the following EXCEPT a. raw materials b. maintenance equipment c. components d. capital goods e. durable goods
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The correct answer is E. Durable goods, choice E, are consumer goods such as washing machines and refrigerators that last over a long period, so choice E is incorrect. Raw materials, choice A; maintenance equipment, such as window washing equipment, choice B; components, such as parts to assemble autos, choice C; and capital goods, such as robotic machinery for assembling autos, choice D; are all goods that are sold by businesses to businesses, so they are incorrect answers to the question.
question
Whenever a commercial comes on, Megan switches channels. This is known as a. selective perception b. selective exposure c. selective retention d. selective specialization e. selective demand
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The correct answer is B. Consumer behavior that avoids listening to or seeing certain stimuli, such as commercials, is called selective exposure, choice B. Choice A is incorrect because selective perception is the conscious or subconscious increase in attentiveness to information that is congruent with the person's interests or attitudes. Choice C is incorrect because selective retention is retaining information that is congruent with a person's interests or attitudes. Choice D is incorrect because selective specialization is a marketing strategy. Choice E is incorrect because selective demand is demand by a consumer for a specific brand
question
What type of store do people shop in that requires a membership and sells items only in large quantities and at a discount? a. Wholesale store b. Warehouse club c. Discount retailer d. Merchant club e. Superstore
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The correct answer is B. Choice B, warehouse club, is the only answer that satisfies all three parts of the question: membership, items in large quantities, and discounts. Choice A, wholesale store, is incorrect; it is not a recognized term. Choice C is incorrect; discount retailers don't require memberships and don't necessarily sell items only in large quantities. Choice D is incorrect; it is a distractor. Choice E is incorrect because a superstore sells a large variety of goods, but not necessarily in large quantities and doesn't require a membership.
question
A school gets a better deal and orders its paper goods for the year from the ABC Company instead of the XYZ Company. This is known as a. new task buying b. new order c. new buy d. modified rebuy e. straight rebuy
answer
The correct answer is D. A modified rebuy, choice D, is the purchase of the same previously bought goods but from a new supplier; it can also be the purchase of new goods but from the old supplier. Choice A is incorrect because new task buying is buying something that has not been bought before. Choices B and C are incorrect; they seem as though they could be correct, but they're distractors. Choice E is incorrect because a straight rebuy is making the same purchase from the same vendor as been previously done.
question
Which of the following is NOT a package offer? a. Burger, fries, and soda for one price b. Four-pack of printer cartridges c. All-inclusive hotel price d. Hotel, car rental, and airline ticket for one price e. Cell phone and manual
answer
The correct answer is E. The manual for the cell phone is not sold separately from the cell phone, so its inclusion in the box with the cell phone doesn't make choice E a package offer, but it does make it the correct answer to the question. The burger, fries, and soda can be sold separately, so combining them under one price creates a sales package, so choice A is an incorrect answer to the question. Choice B, combining four printer cartridges into one package, is a sales package, so it is an incorrect answer to the question. Choices C and D, the all-inclusive hotel deal and the hotel, car rental, and airline ticket deal, are not tangible products, but they are products and each constitutes a sales package, so they are incorrect answers.
question
"Our shoes are handmade with the greatest care in Italy, the home of the finest leather goods" promotes a. customer service b. the uniqueness of the product c. the expertise of the manufacturing process d. the reliability of the company e. the uniqueness of the company
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The correct answer is C. The slogan promotes the expertise of the manufacturing process, choice C. Choices A, B, D, and E are incorrect because nothing is said or implied about customer service, manufacturing a unique product, the reliability of the company, or the uniqueness of the company.
question
Surveys conducted over the Internet a. are no more effective than telephone surveys in getting people to participate b. take more time than telephone surveys to design, conduct, and tabulate c. are more expensive than telephone surveys to conduct d. enable researchers to personalize questions to the respondent e. do not use sampling methods but are open to anyone
answer
The correct answer is D. Choice D, personalization, is a feature of Internet-conducted market research surveys. Choice A is incorrect because telephone surveys are no more effective in getting people to participate. Choice B is incorrect because telephone surveys are not more time-intensive than telephone surveys, especially when it comes to reporting results. Choice C is incorrect because Internet-based surveys are less expensive than telephone surveys to conduct. Choice E is incorrect because only surveys that use unrestricted samples are open to anyone; both screened and recruited Internet samples can be used that preselect participants.
question
Which of the following is NOT an advantage of primary data gathered through market research? a. The data is specific to the questions that the research project is designed to answer. b. Secrecy of the project can be maintained so that competitors don't become aware of it. c. The information is current. d. The research is short-term. e. The sources of the data are known to the researchers.
answer
The correct answer is D. Depending on the nature of the research project, the research may be short-term or long-term, so choice D is not necessarily an advantage of primary data gathering and is the correct answer to the question. Choices A, B, C, and E are all advantages of using primary data in market research
question
Which of the following is a dealer brand? a. A line of paper sold under a retailer's name b. Ford c. A designer clothing line sold only in the designer's boutiques d. A designer line of bedding sold under the designer's name in retail stores e. A brand that encompasses a number of similar products like hair care products
answer
The correct answer is A. A dealer's brand is a product or product line that is manufactured by one company and sold under another company's name, similar to a private label brand or private brand. Choice B is incorrect; Ford is a manufacturer's brand that is sold by dealers, but this isn't the same as a dealer's brand. A designer clothing line sold in the designer's boutique, choice C, and a designer line sold in a retail store, choice D, may be a private label, a manufacturer's brand, or a licensed brand, depending on who owns the line, but it is not a dealer's brand. Choice E is incorrect because a brand that encompasses a number of similar products is a brand family.
question
After new ideas have been generated and screened, what is the next step in the new product development process? a. Concept development and testing b. Commercialization c. Market testing d. Product and marketing mix development e. Business analysis
answer
The correct answer is A. The seven steps of the new product development process are idea generation, screening, concept development and testing, business analysis, product and marketing mix development, market testing, and commercialization. Choice A, concept development and testing, is step three and the correct answer. Choice B, commercialization, is the last step, so eliminate it. Choice C, market testing, is incorrect because it is the sixth step. Choice D is incorrect because product and marketing mix development is the fifth step. Choice E is incorrect because business analysis is the fourth step.
question
Which of the following is NOT a benefit of relationship marketing in the business-to-business market for sellers? a. Long-term customers are more likely to go along with price increases. b. Long-term customers are more predictable in their purchasing patterns. c. Long-term customers are less likely to be enticed to move their business to another company selling a newer, similar product. d. Long-term customers require less training on new product. e. Long-term customers are more likely to offer referrals to the seller.
answer
The correct answer is D. Long-term customers are no less likely than newer customers to need training on new products, so choice D is incorrect about the benefits of RM, and the correct answer to the question. Choices A, B, C, and E are all benefits of RM for sellers, so they are incorrect answers to the question.
