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Basic Marketing A Strategic Marketing Planning Approach 19th Edition by Perreault – Test Bank

 

Chapter 01

Marketing’s Value to Consumers, Firms, and Society

 

 

True / False Questions

1. Marketing is basically selling and advertising.

True    False

 

2. Marketing, in the literal sense, means “selling” or “advertising.”

True    False

 

3. Marketing means “promotion and selling.”

True    False

 

4. Actually making goods or performing services is called marketing.

True    False

 

5. Estimating what price consumers are willing to pay for a product and if the firm can make a profit selling at that price, is an example of a production activity.

True    False

 

6. Marketing can provide needed direction for production and help make sure that the right goods and services find their way to interested consumers.

True    False

 

7. Marketing plays an essential role in creating customer satisfaction.

True    False

 

8. Customer satisfaction is the extent to which a firm fulfills a consumer’s needs, desires, and expectations.

True    False

 

9. If a firm produces the right goods or services, marketing has little role to play in creating customer satisfaction.

True    False

 

10. It is estimated that marketing costs about 50 percent of each consumer’s dollar.

True    False

 

11. In advanced economies, marketing costs only about 10 percent of each consumer’s dollar.

True    False

 

12. Marketing encourages the development and spread of new ideas, goods, and services.

True    False

 

13. According to the text, marketing means “selling” or “advertising.”

True    False

 

14. Marketing discourages the development and spread of new ideas, goods, and services.

True    False

 

15. Marketing is both a set of activities performed by organizations and a social process.

True    False

 

16. Marketing can be viewed as a set of activities performed by organizations, but not as a social process.

True    False

 

17. Marketing can be viewed as a social process, but not as a set of activities performed by organizations.

True    False

 

18. The micro view of marketing sees it as the performance of activities that seek to accomplish an organization’s objectives by anticipating customer or client needs and directing a flow of need-satisfying goods and services from producer to customer or client.

True    False

 

19. Marketing is the performance of activities that seek to accomplish an organization’s objectives by anticipating customer or client needs and directing a flow of need-satisfying goods and services from producer to customer or client.

True    False

 

20. The micro view of marketing is mainly concerned with the activities performed by organizations.

True    False

 

21. From a micro view, marketing activities are performed only by profit-oriented organizations.

True    False

 

22. Marketing only applies to profit organizations.

True    False

 

23. Marketing only applies to for-profit organizations.

True    False

 

24. Marketing activities should be of no interest to a nonprofit organization.

True    False

 

25. Marketing activities should begin with potential customer needs, not with the production process.

True    False

 

26. Production, not marketing, should determine what products are to be made.

True    False

 

27. Marketing should begin with the production process.

True    False

 

28. Marketing does not occur unless there are two or more parties who want to exchange something for something else.

True    False

 

29. Marketing does not occur unless two or more parties are willing to exchange something for something else.

True    False

 

30. Marketing doesn’t occur unless two or more parties are willing to exchange one item for another.

True    False

 

31. In a pure subsistence economy—when each family unit produces everything it consumes—no marketing is involved.

True    False

 

32. A marketing exchange is a single transaction between a firm and a customer, nothing more.

True    False

 

33. Marketing is concerned with individual transactions rather than with building ongoing relationships with customers because that is the job of people in the public relations department.

True    False

 

34. Macro-marketing emphasizes how the whole marketing system works.

True    False

 

35. Micro-marketing is a social process that directs an economy’s flow of goods and services from producers to consumers in a way that effectively matches supply and demand and accomplishes society’s objectives.

True    False

 

36. Macro-marketing is a set of activities that direct an economy’s flow of goods and services from producers to consumers in a way which effectively matches supply and demand and accomplishes the objectives of society.

True    False

 

37. Macro-marketing emphasizes how the whole system works, rather than the activities of individual organizations.

True    False

 

38. Macro-marketing emphasizes the activities of individual organizations.

True    False

 

39. Macro-marketing is concerned with examining the relationship of the entire production and distribution system.

True    False

 

40. An effective macro-marketing system matches heterogeneous supply with heterogeneous demand.

True    False

 

41. Effective marketing in an advanced economy is difficult because producers and consumers are often separated in several levels.

True    False

 

42. Achieving effective marketing in an advanced economy is simplified by the fact that producers are separated from consumers in only two ways: time and space.

True    False

 

43. “Economies of scale” means that as a company produces larger numbers of a particular product, the cost for each unit of the product goes down.

True    False

 

44. “Economies of scale” prevent a company from taking advantage of mass production.

True    False

 

45. “Economies of scale” means that as a company produces more of a product, the total cost of production goes up.

True    False

 

46. “Economies of scale” means that as a company produces more of a product, the cost of each unit produced goes down.

True    False

 

47. In advanced societies, all goods and services can be produced with mass production and its economies of scale.

True    False

 

48. Both mass production and effective marketing are needed to satisfy the economic needs of an advanced economy.

True    False

 

49. An effective macro-marketing system overcomes discrepancies of quantity and discrepancies of assortment by using the universal functions of marketing.

True    False

 

50. The universal functions of marketing include buying, selling, transporting, storing, standardization and grading, financing, risk taking, and market information.

True    False

 

51. The “universal functions of marketing” consist only of buying, selling, transporting, and storing.

True    False

 

52. Buying, selling, transporting and storing are all universal marketing functions.

True    False

 

53. The universal functions of marketing are performed in the same way in all nations and economic systems.

True    False

 

54. Marketing functions are performed by producers, consumers, and a variety of marketing specialists.

True    False

 

55. Intermediaries specialize in trade and production.

True    False

 

56. The advantages of working with intermediaries increase as the number of producers and customers, their distance apart, and the number and variety of competing products increase.

True    False

 

57. While intermediaries facilitate exchange, their cost makes the whole macro-marketing system less efficient.

True    False

 

58. Marketing collaborators are any firms that provide the marketing functions of buying and selling.

True    False

 

59. Marketing specialists such as intermediaries and collaborators hinder the exchange process between producers and consumers.

True    False

 

60. E-commerce refers to exchanges between individuals and organizations—and the activities that facilitate those exchanges—based on applications of information technology.

True    False

 

61. E-commerce refers to exchanges between organizations (not individuals) and the activities that facilitate those exchanges.

True    False

 

62. E-commerce refers to exchanges between organizations, but not exchanges between individuals.

True    False

 

63. E-commerce refers to exchanges between individuals, but not exchanges between organizations.

True    False

 

64. Compared to other innovations, firms have been relatively slow to adopt e-commerce.

True    False

 

65. Marketing costs go down and customer satisfaction goes up in all exchanges handled by e-commerce.

True    False

 

66. Responsibility for performing the marketing functions can be shifted and shared in a variety of ways, but no function can be completely eliminated.

True    False

 

67. Not all societies need an economic system.

True    False

 

68. An economic system is the way an economy organizes to use scarce resources to produce goods and services and distribute them for consumption among various people and groups in the society.

True    False

 

69. Only industrial nations need an economic system to decide what and how much is to be produced and distributed by whom, when, to whom, and why.

True    False

 

70. In a command economy, producers generally have little choice about what goods and services to produce.

True    False

 

71. In a command economy, the individual decisions of many producers and consumers make the macro-level decisions for the whole economy.

True    False

 

72. A market-directed economy is one in which government officials decide what and how much is to be produced and distributed by whom, when, to whom, and why.

True    False

 

73. In a market-directed economy, government officials decide what and how much is to be produced and distributed by whom, when, to whom, and why.

True    False

 

74. In a market-directed economy, price is a rough measure of how society values particular goods and services.

True    False

 

75. Market-directed economies tend to provide consumers with greater freedom of choice than command economies.

True    False

 

76. In a market-directed economy, consumers enjoy complete freedom of choice.

True    False

 

77. In a market-directed economy, profit is guaranteed.

True    False

 

78. Most Western economies are completely market-directed.

True    False

 

79. The American economy is entirely market-directed.

True    False

 

80. The American economy and most other Western economies are completely market-directed.

True    False

 

81. Whether a particular macro-marketing system is judged fair and effective depends on the objectives of the society.

True    False

 

82. The simple trade era was a time when families traded or sold their “surplus” output to local distributors who resold these goods to other consumers or distant distributors.

True    False

 

83. The marketing concept applies to nonprofit organizations as well as to businesses.

True    False

 

84. Because they don’t try to earn a profit, the marketing concept is not very useful for nonprofit organizations.

True    False

 

85. The marketing concept cannot be applied to nonprofit organizations because they are not profit-oriented.

True    False

 

86. In nonprofit organizations, support may not come directly from satisfied customers.

True    False

 

87. As with any business, a nonprofit organization must take in as much money as it spends or it won’t survive.

True    False

 

88. A nonprofit organization does not measure profit in the same way as a firm.

True    False

 

89. During the “production era” a company focuses on production—because few products are available in the market.

True    False

 

90. From the Industrial Revolution until the 1920s, most companies were in the production era.

True    False

 

91. During the “sales era,” the firm tries to improve short-run marketing policy planning to tie together its activities.

True    False

 

92. Marketing departments are usually formed when firms go from the “production era” to the “sales era.”

True    False

 

93. The “marketing department era” is a time when all marketing activities are brought under the control of one department.

True    False

 

94. During the “marketing company era,” the total company effort is guided by the idea that customers exist to buy the firm’s output.

True    False

 

95. A company has moved into the “marketing company era” when, in addition to short-run marketing planning, the total company effort is guided by the marketing concept.

True    False

 

96. The marketing concept means that an organization aims all its efforts at satisfying its customers—at a profit.

True    False

 

97. The marketing concept says that a firm should aim all its efforts at satisfying customers, even if this proves to be unprofitable.

True    False

 

98. The “marketing concept” means that a firm emphasizes attracting new customers above all other objectives.

True    False

 

99. A firm that adopts the “marketing concept” will aim all its efforts at satisfying customers, while trying to make a profit.

True    False

 

100. A firm that makes products which are easy to produce and then tries to sell them has a production orientation.

True    False

 

101. The term “marketing orientation” means making products that are easy to produce and then trying to sell them.

True    False

 

102. A marketing-oriented firm would try to produce what customers want, while a production-oriented firm would try to get customers to buy what the firm has produced.

True    False

 

103. The three basic ideas in the marketing concept are 1) putting the marketing manager in charge of the whole firm, 2) a competitive orientation, and 3) an emphasis on profit.

True    False

 

104. When a firm makes a total company effort to satisfy its customers, and profit—not just sales—is an objective of the firm, the company is practicing the “marketing concept.”

True    False

 

105. The three basic ideas included in the definition of the marketing concept are: customer satisfaction, a total company effort, and sales as an objective.

True    False

 

106. The three basic ideas in the marketing concept are: 1) customer satisfaction; 2) confining marketing activities to marketing professionals; and 3) having profit as an objective.

True    False

 

107. Adopting the marketing concept rarely requires any change in a firm’s attitudes, organization structure, or management methods and procedures.

True    False

 

108. Adopting the marketing concept requires that a business firm eliminate all functional departments.

True    False

 

109. Companies that consider the triple bottom line measure economic, social, and political outcomes.

True    False

 

110. Organizations guided by a triple bottom line consider economic, social, and environmental outcomes as measures of long-term success.

True    False

 

111. The marketing concept was very quickly accepted, especially among producers of industrial commodities like steel and glass.

True    False

 

112. Producers who operate in a competitive environment are more likely to adopt the marketing concept.

True    False

 

113. Adoption of the marketing concept is now universal.

True    False

 

114. A manager who follows a production concept views customer satisfaction as the path to profit.

True    False

 

115. Customer value is the difference that a customer sees between the benefits of a firm’s offering and the costs of obtaining those benefits.

True    False

 

116. Customer value is the difference between the benefits a customer sees from a market offering and the costs of obtaining those benefits.

True    False

 

117. Customer value is just another term for customer satisfaction.

True    False

 

118. A good or service that doesn’t meet a consumer’s needs results in low customer value.

True    False

 

119. Setting a low price for a firm’s offering is a sure way of creating high customer value.

True    False

 

120. Low price and high customer value is one and the same thing.

True    False

 

121. When it comes to customer value, it is the customer’s view that matters, not the view of the marketing manager.

True    False

 

122. In marketing, it is the manager’s viewpoint that matters, not the customer’s.

True    False

 

123. Offering superior customer value is especially important when competition is intense.

True    False

 

124. Often the best way for a firm to beat the competition is to be first to satisfy a need that others have not even considered.

True    False

 

125. Firms that embrace the marketing concept seek ways to build a profitable long-term relationship with each customer.

True    False

 

126. It is more costly for firms to try and attract new customers than it is to build a strong relationship with existing customers.

True    False

 

127. To develop lasting relationships with customers, marketing-oriented firms need to focus on customer satisfaction both before and after each sale.

True    False

 

128. When trying to build relationships with customers, salespeople must be particularly well-trained because they are usually the only employees whose actions influence customers directly.

True    False

 

129. The text credits L.L. Bean’s success to its focus on customer satisfaction and good customer value.

True    False

 

130. The text credits L.L. Bean’s marketing success to its great location.

True    False

 

131. L.L. Bean has achieved success because its customers typically view the benefits of buying its products as greater than the costs.

True    False

 

132. The text credits Chipotle’s marketing success to its great price.

True    False

 

133. Chipotle has achieved success because its customers typically view the benefits of buying its products as greater than the costs.

True    False

 

134. The text credits Chipotle’s success to its offering good customer value.

True    False

 

135. Sometimes micro-macro dilemmas arise because what is “good” for some producers and consumers may not be “good” for society as a whole.

True    False

 

136. Gun control is an example of a micro-macro dilemma.

True    False

 

137. The micro-macro dilemma occurs when a firm focuses its efforts on satisfying some consumers to achieve its objectives, possibly causing negative societal outcomes.

True    False

 

138. A firm’s obligation to improve its positive effects on society and reduce its negative effects is called fiscal responsibility.

True    False

 

139. The marketing concept says that it is a firm’s obligation to improve its positive effects on society and reduce its negative effects.

True    False

 

140. Organizations that adopt the marketing concept should be concerned about marketing ethics as well as broader issues of social responsibility.

True    False

 

141. Marketing ethics are the moral standards that guide marketing decisions and actions.

True    False

 

142. The moral standards that guide marketing decisions and actions are called marketing ethics.

True    False

 

143. Moral standards often vary from one person to another, from one society to another, and among different groups within a society, so there is likely to be disagreement about what opinion is correct when it comes to marketing ethics.

True    False

 

144. A manager shouldn’t be criticized for making an unethical marketing decision unless the ethical breach was intentional.

True    False

 

145. The American Marketing Association has adopted a statement of ethics that sets specific ethical standards for many aspects of the management job in marketing.

True    False

 

146. The American Marketing Association’s statement of ethics sets specific ethical standards for many aspects of marketing.

True    False

 

 

Multiple Choice Questions

147. According to the text, marketing means:

A. much more than selling and advertising.

 

B. selling.

 

C. producing and selling.

 

D. advertising.

 

E. selling and advertising.

 

148. The following activities are rightly considered marketing except:

A. advertising the grand opening of a new furniture store.

 

B. researching which furniture designs are popular with consumers.

 

C. determining how many pieces of furniture can be sold at different price points.

 

D. building a facility to make furniture.

 

E. selling furniture to customers in a furniture showroom.

 

149. A marketing manager planning to launch a successful new product should begin by:

A. obtaining financing for the venture.

 

B. designing products that interest him or her.

 

C. identifying a product or service that customers need.

 

D. choosing a business partner.

 

E. establishing a legal corporation.

 

150. Which of the following would not engage in the process of marketing?

A. The United Way

 

B. United States Postal Service

 

C. Outback Steakhouse

 

D. JFK International Airport

 

E. Sam’s Club members

 

151. According to the text, marketing means:

A. Distribution.

 

B. Making good products.

 

C. More than selling and advertising.

 

D. Promotion.

 

E. Performing services.

 

152. According to the text, marketing means:

A. much more than just selling and advertising.

 

B. advertising.

 

C. producing a product that fills a need.

 

D. selling.

 

E. making a good product that sells itself.

 

153. According to the text, marketing means:

A. making a good product that sells itself.

 

B. much more than selling and advertising.

 

C. selling and advertising.

 

D. producing goods and/or services.

 

E. doing whatever it takes to be able to offer consumers a “better mousetrap.”

 

154. The production of a new mountain bike model includes which of the following activities?

A. Determining how to get the new model to likely bike purchasers.

 

B. Actually making the new mountain bikes.

 

C. Estimating how many competing companies will be making bikes.

 

D. Predicting what types of bikes different types of bike riders will want.

 

155. Predicting what types of bicycles different customers will want and deciding which of these customers the business will try to satisfy are activities a firm should do as part of

A. production.

 

B. a command economy.

 

C. marketing.

 

D. making goods or performing services.

 

E. a production orientation.

 

156. For Tesla, a new firm that makes an electric sports car, estimating how many competitors will make electric vehicles and what kinds they will make, is:

A. one of the universal functions of innovation.

 

B. a production activity.

 

C. an example of the micro-macro dilemma.

 

D. best left to intermediaries.

 

E. a part of marketing.

 

157. Marketing

A. means “selling” or “advertising.”

 

B. provides direction for production.

 

C. involves actually making goods or performing services.

 

D. does not impact consumers’ standard of living.

 

E. is the development and spread new ideas, goods, and services.

 

158. ____________________ is the extent to which a firm fulfills a customer’s needs, desires, and expectations.

A. Customer forecast

 

B. Customer satisfaction

 

C. Customer service

 

D. Customer support

 

159. Customer satisfaction is the extent to which a firm fulfills a consumer’s:

A. needs.

 

B. desires.

 

C. expectations.

 

D. needs and desires.

 

E. All of these are correct.

 

160. In an advanced economy, marketing costs account for about ___ cents of every consumer dollar.

A. 10

 

B. 20

 

C. 30

 

D. 40

 

E. 50

 

161. Which of the following statements about marketing is FALSE?

A. Marketing concepts and techniques apply for nonprofit organizations—as well as for profit-seeking organizations.

 

B. Marketing offers many rewarding career opportunities.

 

C. The cost of marketing is about 15 percent of the consumer’s dollar.

 

D. Marketing affects almost every part of your daily life.

 

E. Marketing is vital for economic growth and development.

 

162. Marketing

A. affects almost every aspect of our daily lives.

 

B. offers few exciting or rewarding career opportunities.

 

C. limits our choices of goods and services every day.

 

D. focuses an organization on being the first to market a new product.

 

163. Which of the following is NOT a reason for you to study marketing?

A. Marketing affects almost every aspect of daily life.

 

B. Marketing will be important to your job.

 

C. Marketing involves actually making the goods that people need.

 

D. Marketing affects innovation and consumers’ standard of living.

 

E. Marketing plays a big part in economic growth and development.

 

164. Marketing encourages research and ______________, the development and spread of new ideas, goods and services.

A. analysis

 

B. assessment

 

C. evaluation

 

D. innovation

 

E. introspection

 

165. The development and spread of new ideas, goods, and services for the marketplace is called:

A. marketing.

 

B. the micro-macro dilemma.

 

C. collaboration.

 

D. innovation.

 

E. production.

 

166. Marketing can be viewed as:

A. a set of activities performed by individual organizations.

 

B. relevant to for-profit organizations only.

 

C. just selling and advertising.

 

D. beginning with the production process.

 

167. Macro-marketing examines all the following challenging scenarios except:

A. Producers prefer to manufacture goods in large quantities, but consumers buy in small quantities.

 

B. Consumers require a wide assortment of food items, but individual producers can offer only a narrow assortment of food products.

 

C. Producers set prices to cover costs and make a profit, but consumers choose goods based on their ability to pay.

 

D. Cedar Point Amusement Park would like to attract customers all year long, but its marketing strategy is currently limited to discount season pass offers during winter months while the park is closed.

 

E. Producers tend to locate where it is economical to produce, but consumers are located in many scattered places.

 

168. The text stresses that:

A. advertising and selling are not really part of marketing.

 

B. marketing is nothing more than a set of business activities performed by individual firms.

 

C. marketing techniques have no application for nonprofit organizations.

 

D. marketing is a social process and a set of activities performed by organizations.

 

E. a good product usually sells itself.

 

169. Looking at marketing as a set of activities focuses on

A. macro-marketing.

 

B. for-profit marketing.

 

C. micro-marketing.

 

D. nonprofit marketing.

 

E. personalized marketing.

 

170. Micro-marketing:

A. tries to accomplish a company’s objectives by anticipating customers’ needs and trying to satisfy them.

 

B. begins with the production process.

 

C. involves persuading customers to buy your product.

 

D. is a social process involving all producers, intermediaries, and consumers.

 

E. tries to make the whole economic system fair and effective.

 

171. Micro-marketing:

A. is concerned with whether the whole economic system is fair and effective.

 

B. applies only to profit organizations.

 

C. consists only of personal selling and advertising.

 

D. is a social process only.

 

E. tries to anticipate and satisfy customer needs and accomplish an organization’s objectives.

 

172. _______ is defined as the performance of activities that seek to accomplish an organization’s objectives by anticipating customer needs and directing a flow of need-satisfying goods and services from producer to customer.

A. Innovation

 

B. Advertising

 

C. Selling

 

D. Marketing (from a micro view)

 

E. Sales promotion

 

173. From a micro view, marketing

A. applies to large corporations but not to a new venture started by one person.

 

B. is an important social process.

 

C. emphasizes how the whole marketing system works.

 

D. is a set of activities performed by an individual organization to satisfy its customers.

 

E. directs an economy’s flow of goods and services from producers to consumers.

 

174. Which of the following statements best describes the modern view of marketing?

A. The job of marketing is to get rid of whatever the company is producing.

 

B. Marketing should take over production, accounting, and financial services within a firm.

 

C. Marketing is concerned with generating a single exchange between a firm and a customer.

 

D. Marketing begins with anticipating potential customer needs.

 

E. Production, not marketing, should determine what goods and services are to be developed.

 

175. Which of the following statements best describes the modern view of marketing?

A. Marketing is only necessary for profit-oriented firms.

 

B. Marketing consists mainly of advertising and personal selling.

 

C. Marketing anticipates customer needs.

 

D. Marketing begins as soon as products are produced.

 

E. Firms that don’t rely on e-commerce should put more emphasis on marketing.

 

176. From a micro view, which of the following is the best example of marketing?

A. North Korea unveils a new five-year production plan.

 

B. China and the U.S. agree on a new trade agreement.

 

C. The American Red Cross seeks more blood donors.

 

D. The Internet makes it possible for firms to reach customers in other countries.

 

E. None of these is a good example.

 

177. Which of the following statements by a U.S. president best reflects a MICRO view of marketing?

A. “A tax cut will give consumers more spending money.”

 

B. “With interest rates low, many young people can now afford to buy a new home.”

 

C. “In the United States we have a better choice of products than in any other country.”

 

D. “My administration will spend 75 percent more on purchases related to domestic security during the next year.”

 

E. “Tourism firms should advertise more to attract more international visitors.”

 

178. Marketing:

A. applies to both profit and nonprofit organizations.

 

B. says that marketing should take over all production, accounting, and financial activities.

 

C. should begin as soon as goods are produced.

 

D. does away with the need for advertising.

 

179. Marketing:

A. emphasizes mass selling over personal selling.

 

B. allows production, rather than marketing, to determine what products to make.

 

C. applies to both profit and nonprofit organizations.

 

D. concentrates on production, rather than advertising.

 

E. None of these is a true statement about marketing.

 

180. Marketing

A. applies to both profit and nonprofit organizations.

 

B. is another name for selling and advertising.

 

C. should pick up where the production process ends.

 

D. people should expect that the production department will determine what goods and services are to be developed.

 

181. Which of the following organizations would be least likely to need marketing skills?

A. An accountant

 

B. An electronics retailer

 

C. A toy manufacturer

 

D. A financial advisor

 

E. All of these organizations would be likely to need marketing skills.

 

182. The aim of marketing is to

A. help create a pure subsistence economy.

 

B. eliminate the need for exchanges.

 

C. persuade customers to buy the firm’s product.

 

D. identify customers’ needs and meet those needs so well that the product almost “sells itself.”

 

E. facilitate a single transaction.

 

183. Effective marketing should begin with

A. an effort to persuade unwilling customers to buy the firm’s products.

 

B. potential customer needs.

 

C. a decision about what the firm can produce efficiently.

 

D. evaluation of the effect of the firm’s decisions on the MACRO-marketing system.

 

E. the marketing manager making important production, accounting, and financial decisions for the firm.

 

184. Marketing should

A. begin with the production process.

 

B. make decisions about product design and packaging, prices or fees.

 

C. not need to coordinate with production, accounting, and financial activities.

 

D. provide input, but let production determine what goods and services are to be developed.

 

E. focus on getting customers to make a final purchase.

 

185. All of the following should be determined by the marketing department of a firm EXCEPT:

A. storing the product.

 

B. actually making the product.

 

C. advertising the product.

 

D. designing the packaging for the product.

 

E. setting the price of the product.

 

186. Marketing could NOT take place without:

A. intermediaries.

 

B. collaborators.

 

C. two or more parties who are willing to exchange something for something else.

 

D. a high standard of living.

 

187. Marketing will not happen unless:

A. e-commerce is flourishing.

 

B. collaborators are present to simplify exchange.

 

C. intermediaries are present to facilitate exchange.

 

D. two or more parties each have something they want to exchange for something else.

 

E. an economy is market-directed rather than command.

 

188. Which of the following must occur for marketing to happen?

A. Product

 

B. Place

 

C. Advertising

 

D. Price

 

E. Two or more parties exchange something of value for something else of value.

 

189. Marketing is NOT needed in a ______________ economy.

A. consumer-oriented

 

B. command

 

C. pure subsistence

 

D. market-directed

 

E. None of these is correct.

 

190. In a pure subsistence economy,

A. each family unit is self-sufficient.

 

B. exchanges are very important.

 

C. the standard of living must be relatively high.

 

D. there is a great need for intermediaries.

 

191. If the family units on a South Pacific-island nation made all the products they consume, it would be a good example of:

A. a pure subsistence economy.

 

B. a market-directed economy.

 

C. a micro-marketing system.

 

D. a command economy.

 

E. None of these is a correct answer.

 

192. Which of the following statements is FALSE?

A. Marketing is most important in a pure subsistence economy.

 

B. Marketing should provide direction for production, accounting, and financial activities.

 

C. Marketing builds long-lasting relationships that benefit the selling firm.

 

D. Marketing doesn’t occur unless two or more parties are willing to exchange something for something else.

 

E. Marketing anticipates customer needs.

 

193. Which of the following statements about marketing is FALSE?

A. Marketing affects the products you buy.

 

B. Marketing applies to nonprofit organizations too.

 

C. Marketing affects the advertising you see and hear.

 

D. Marketing offers many good job opportunities.

 

E. Marketing can help with individual transactions but not in building relationships with customers.

 

194. Viewing marketing as a social process focuses on

A. marketing by nonprofit organizations.

 

B. command economies.

 

C. macro-marketing.

 

D. micro-marketing.

 

E. None of these is correct.

 

195. Looking at marketing as a social process focuses on

A. macro-marketing.

 

B. for-profit marketing.

 

C. micro-marketing.

 

D. nonprofit marketing.

 

E. personalized marketing.

 

196. Societies need a macro-marketing system

A. to help match supply and demand.

 

B. to create a gap between producers and consumers.

 

C. to accomplish an organization’s objectives only.

 

D. to identify collaborators.

 

E. to reduce the need for intermediaries.

 

197. Macro-marketing:

A. Emphasizes how the whole marketing system works.

 

B. Considers how marketing affects society, but not how society affects marketing.

 

C. Matches homogeneous supply and demand.

 

D. Is mainly concerned with the activities of individual organizations.

 

198. Macro-marketing:

A. tries to produce discrepancies of quantity and discrepancies of assortment.

 

B. focuses on the activities of individual organizations.

 

C. tries to effectively match supply and demand.

 

D. is a set of activities performed by individual firms.

 

199. Macro-marketing:

A. is concerned with the activities performed by individual business organizations.

 

B. tries to match heterogeneous supply capabilities with heterogeneous demands for goods and services.

 

C. is concerned with how effectively and fairly an individual business organization performs.

 

D. assumes that the effectiveness and fairness of all macro-marketing systems must be evaluated in terms of the same social objectives.

 

200. Macro-marketing

A. is a social process.

 

B. concerns the activities of individual managers.

 

C. is what people have in mind when they talk about marketing in everyday use.

 

D. helps consumers that need a narrow assortment of products.

 

E. applies only to nonprofit organizations.

 

201. _________ directs an economy’s flow of goods and services from producers to consumers in a way that effectively matches supply and demand and accomplishes the society’s objectives.

A. Macro-marketing

 

B. The transporting function

 

C. Micro-marketing

 

D. Standardization and grading

 

E. Social responsibility

 

202. Macro-marketing

A. emphasizes building a long-term relationship that benefits both the firm and the customer.

 

B. considers the marketing activities of corporations rather than individuals.

 

C. emphasizes how the whole marketing system works.

 

D. systems are only relevant to advanced economies.

 

E. addresses discrepancies that emerge from homogeneous consumer demand.

 

203. Macro-marketing:

A. is a social process.

 

B. tries to encourage “discrepancies of quantity” and “discrepancies of assortment.”

 

C. tries to disrupt supply and demand.

 

D. tries to foster the many separations between producers and consumers.

 

204. The following headlines are from Business Week magazine. Which article is most likely to be reporting on a macro-marketing topic?

A. “Two-Person Engineering Firm Offers Unique Service.”

 

B. “Russia Increases Output of Consumer Goods.”

 

C. “Pepsi Sells in Japan.”

 

D. “Bank of America Offers New Internet Banking Services.”

 

E. “Donations to Tsunami Victims Fund Increase after TV Broadcast.”

 

205. The following headlines are for articles from the WALL STREET JOURNAL. Which article is most likely to be reporting a macro-marketing topic?

A. “Mercedes Goes after Luxury Sport Utility Buyers.”

 

B. “Adidas Jumps as Footwear Competition Heats Up.”

 

C. “Drugstore Chain Aims at Seniors.”

 

D. “Hardee’s Fried Chicken Takes on KFC.”

 

E. “DVD Popularity Leads to More DVD Retailers.”

 

206. Of the following headlines from the WALL STREET JOURNAL, which is most likely to be about a MACRO-marketing topic?

A. “Tupperware Has a New Strategy.”

 

B. “Thailand Has Unusually Large Number of Wholesalers.”

 

C. “Military Supplier Shifts to Selling Gas Masks to Private Citizens.”

 

D. “Coke Plans Beverage Line to Compete with Lipton’s.”

 

E. “Dow Chemical Adds Shipping Safeguards.”

 

207. Of the following headlines from a business magazine, which is most likely to be about a macro-marketing topic?

A. “Chinese Women Demand More Luxury Goods.”

 

B. “Girl Scouts Organize Nationwide Cookie Sale.”

 

C. “L’eggs Sells Direct in Brazil and Argentina.”

 

D. “Frito-Lay Offers New Low-Fat Products.”

 

E. “Coke Losing Beverage Sales in India to local brands.”

 

208. In advanced economies:

A. both supply and demand tend to be homogeneous.

 

B. producers and consumers are often separated in several ways.

 

C. most firms specialize in producing and selling small amounts of a huge assortment of goods and services.

 

D. exchange is aided by discrepancies of quantity and assortment.

 

209. In advanced economies:

A. mass production with its economies of scale makes the cost of each product higher.

 

B. exchange is simplified by discrepancies of quantity and assortment.

 

C. there is little need for marketing specialists.

 

D. both supply and demand tend to be homogeneous in nature.

 

E. producers and consumers experience a separation of values.

 

210. Exchanges between producers and consumers are more difficult in an advanced economy because of:

A. separation in time.

 

B. separation in values.

 

C. spatial separation.

 

D. separation of information.

 

E. All of these are correct.

 

211. The primary purpose of the transporting and storing functions of marketing is to overcome:

A. the need for marketing specialists.

 

B. separation of information.

 

C. spatial separation.

 

D. discrepancies of assortment.

 

E. separation of values.

 

212. American supermarket chain, FoodMart, purchases cheese from five different manufacturers from around the world to assure its customers can choose among different types of cheeses at different prices. FoodMart facilitates the macro-marketing system by helping to address:

A. spatial separation.

 

B. discrepancies of assortment.

 

C. separation of values.

 

D. all of these are correct.

 

213. The fact that US car companies are located in the upper Midwest while their customers are located throughout the U.S. is an example of:

A. separation in values.

 

B. discrepancies of assortment.

 

C. separation of information.

 

D. spatial separation.

 

E. separation in time.

 

214. When consumers do not know where to buy a product or what it costs and the product’s producer does not know where its target market is located, this is an example of:

A. separation of information.

 

B. discrepancy of quantity.

 

C. separation of ownership.

 

D. discrepancy of assortment.

 

E. separation in time.

 

215. When an individual producer sets a price for its product to earn a certain profit while consumers search for the product at the lowest price available from any producer, this is an example of:

A. separation in time.

 

B. discrepancy of quantity.

 

C. separation in values.

 

D. discrepancy of assortment.

 

E. spatial separation.

 

216. The fact that producers usually prefer to produce products in large quantities, while most consumers prefer to buy in small quantities, results in:

A. discrepancies of quantity.

 

B. separation of ownership.

 

C. discrepancies of assortment.

 

D. spatial separation.

 

E. temporal separation.

 

217. In a simple economy, one family may produce only cooking pots, but many of them. Others may specialize in farming, making clothing, and building shelters. This

A. shows why “discrepancies of assortment” occur.

 

B. is so simple that the universal functions of marketing don’t have to be done.

 

C. cannot work without an intermediary.

 

D. is an example of “separation in values” since the different families choose to produce different things.

 

218. Discrepancies of assortment happen when

A. producers prefer to produce and sell in large numbers, but consumers prefer to buy and consume in smaller numbers.

 

B. consumers may not want to consume goods and services at the time producers would prefer to produce them.

 

C. consumers value goods and services in terms of costs and competitive prices whereas producers value them in terms of satisfying needs and ability to pay.

 

D. producers specialize in producing a narrow range of goods and services but consumers need a wide variety.

 

E. producers hold title to goods and services that they themselves do not want to consume.

 

219. _______ refers to producers holding title to goods and services that they themselves do not want to consume and consumers wanting goods and services that they do not have.

A. Discrepancies of assortment

 

B. Separation of ownership

 

C. Discrepancies of quantity

 

D. Spatial separation

 

E. Separation in time

 

220. “Economies of scale” means that:

A. as a company produces larger numbers of a particular product, the cost of each unit of the product goes down.

 

B. the more producers there are in an economy the greater the need for intermediaries.

 

C. larger countries enjoy more economic growth than smaller countries.

 

D. as a company produces larger numbers of a particular product, the total cost of producing these products goes down.

 

173. When Herbal Essences tries to get shelf space in Target and Walmart because young women frequently shop there for hair care products, this is an example of which of the 4Ps?

A. Price

 

B. Product

 

C. Promotion

 

D. Place

 

174. A detailed plan for handling transportation and storage of a new product that is now being distributed to wholesalers nationwide is an aspect of which part of the 4Ps?

A. Place

 

B. Product

 

C. Promotion

 

D. Price

 

175. An office supplies producer sells a variety of office supplies to final consumers and businesses using its own mail order catalog. Here,

A. there is no channel of distribution.

 

B. there is no opportunity to apply target marketing.

 

C. no promotion is involved.

 

D. a production orientation is just as effective as a marketing orientation.

 

E. None of these is true.

 

176. The _____ area of the marketing mix includes decisions related to telling the target market or others in the channel of distribution about the “right” product.

A. product

 

B. place

 

C. promotion

 

D. price

 

E. communication

 

177. “Promotion” may include:

A. personal selling to channel members.

 

B. point-of-purchase materials.

 

C. mail-order selling.

 

D. advertising on the Internet.

 

E. all of these may be included in Promotion.

 

178. “Promotion” includes:

A. advertising.

 

B. personal selling.

 

C. sales promotion.

 

D. publicity.

 

E. All of these may be included in Promotion.

 

179. Marketing strategy decisions concerning Promotion include decisions about

A. packaging and branding.

 

B. the kinds of intermediaries to use.

 

C. training for salespeople.

 

D. transporting and storing.

 

E. discounts and allowances.

 

180. “Promotion” is NOT concerned with:

A. creating billboard ads.

 

B. designing new products.

 

C. publicity.

 

D. television commercials.

 

E. personal selling.

 

181. Personal selling lets the salesperson adapt the firm’s marketing mix to a specific customer. This is an aspect of which marketing mix variable?

A. Price

 

B. Place

 

C. Promotion

 

D. Product

 

182. ______________ is direct spoken communication between sellers and potential customers.

A. Personal selling

 

B. Sales promotion

 

C. Advertising

 

D. Publicity

 

E. Mass selling

 

183. From the perspective of the four Ps, personal selling is to advertising as

A. mass selling is to branding.

 

B. Place is to Product.

 

C. sales promotion is to pricing.

 

D. warranties are to channel type.

 

E. geographic terms are to price allowances.

 

184. ______ refers to personal communication between a seller and a customer who wants the seller to resolve a problem with a purchase.

A. Advertising

 

B. Sales promotion

 

C. Publicity

 

D. Personal selling

 

E. Customer service

 

185. Advertising is:

A. the designing and distribution of novelties, point-of-purchase materials, store signs, contests, catalogs, and circulars.

 

B. direct communication between sellers and potential customers.

 

C. any paid form of nonpersonal presentation of ideas, goods, or services by an identified sponsor.

 

D. the main form of publicity.

 

E. All of these are included in Advertising.

 

186. A popular television show, The Unexpected, achieved skyrocketing ratings after moralist Tom Bowman attempted to have it removed from the air. This is an example of mass selling through

A. advertising.

 

B. publicity.

 

C. unethical means.

 

D. personal selling.

 

E. media hype.

 

187. Sales promotion:

A. lets the salesperson adapt the firm’s marketing mix to each potential customer.

 

B. is the main form of advertising.

 

C. tries to help the personal selling and mass selling people.

 

D. is free.

 

E. consists of both advertising and personal selling.

 

188. Catalogs, point-of-purchase materials, and free samples are all examples of:

A. publicity.

 

B. personal selling.

 

C. sales promotion.

 

D. advertising.

 

189. Coupons, samples, and point-of-purchase materials are examples of

A. advertising.

 

B. publicity.

 

C. specialty service.

 

D. personal selling.

 

E. sales promotion.

 

190. When Herbal Essences offers “dollar-off coupons” to adult women to try to get them to try its shampoos and conditioners, this is an example of:

A. publicity.

 

B. sales promotion.

 

C. product development.

 

D. market penetration.

 

E. distribution.

 

191. Ford Motor Co. “loaned” new Fiestas to social trendsetters who drove the cars as part of their Meals on Wheels responsibilities. When Ford asked them to write about their driving experiences on Facebook and Twitter, it was emphasizing which aspect of the 4Ps?

A. Product

 

B. Place

 

C. Price

 

D. Promotion

 

192. The owner of the new Sharp Scissors hair salon gave coupons to potential customers walking by her store to stimulate interest and trial of her new hair salon. The coupons are an example of

A. advertising.

 

B. publicity.

 

C. sales promotion.

 

D. a channel of distribution.

 

E. media.

 

193. To help cosmetic company, RedRain Inc., launch a new line of lipstick, tickets that can be redeemed for prizes are enclosed in some of the lipstick packages. This activity can be best classified as

A. advertising.

 

B. publicity.

 

C. sales promotion.

 

D. personal selling.

 

E. mass marketing.

 

194. When 3M sent samples of Breathe Right Nasal Strips to the NFL trainers, this was an example of a ___________________ strategy.

A. price

 

B. promotion

 

C. personnel

 

D. product

 

E. place

 

195. “Price”:

A. is affected by the kind of competition in the target market.

 

B. includes markups and discounts, but not allowances and freight charges.

 

C. is not affected by customer reactions.

 

D. is the most important part of a marketing mix.

 

196. The Price area of the marketing mix:

A. requires consideration of the cost of the marketing mix and the competition facing the firm when setting prices.

 

B. does not involve estimating consumer reaction to possible prices.

 

C. refers to any paid form of nonpersonal presentation of ideas, goods, or services by an identified sponsor.

 

D. does not include the consideration of geographic terms in price setting.

 

E. None of these is correct.

 

197. When developing a marketing mix, a marketing manager should remember that:

A. “Promotion” includes only personal selling and publicity.

 

B. A channel of distribution includes at least one intermediary.

 

C. “Price” includes markups, discounts, allowances, and geographic terms.

 

D. “Product” includes physical goods but not services.

 

198. When Ford Motor Co. introduced its Escape hybrid SUV, it offered a $1,000 rebate as an incentive to attract new buyers. This was an example of which aspect of the marketing mix?

A. Price

 

B. Promotion

 

C. Place

 

D. Product

 

199. The most important variable in a firm’s marketing mix is:

A. Product.

 

B. Price.

 

C. Promotion.

 

D. Place.

 

E. None of these since all contribute to one whole.

 

200. When ranked in importance from greatest to least, the four Ps line up as follows:

A. Product, price, promotion, place.

 

B. Price, promotion, place, product.

 

C. Promotion, place, product, price.

 

D. Place, product, price, promotion.

 

E. The four Ps are of equal importance.

 

201. The appropriate marketing mix is determined in large part by:

A. the preferences of the marketing managers.

 

B. the length of the product production cycle.

 

C. the needs of the target market.

 

D. the hottest trends in viral marketing.

 

E. the popularity of big box retail stores.

 

202. An appropriate marketing mix should be determined PRIMARILY by

A. what has worked for the company in the past.

 

B. the needs of a target market.

 

C. the budget available to spend.

 

D. the past experiences of the marketing manager.

 

E. what product the firm can produce with economies of scale.

 

203. Ideally, a good marketing mix should:

A. be very similar to the marketing mix typically used by key competitors.

 

B. be determined by which marketing mix costs the least.

 

C. not include much advertising because it’s expensive and usually isn’t very effective.

 

D. flow logically from all the relevant dimensions of a target market.

 

204. The text’s “Toddler University” example shows that:

A. parents are not price sensitive when it comes to assuring that their kids will get a good college education.

 

B. the needs of a target market determine the nature of the appropriate marketing mix.

 

C. a small producer can’t compete effectively against large competitors.

 

D. in the long run, a firm cannot make a profit without its own production facilities.

 

E. All of these are true.

 

205. The text’s “Toddler University” example shows that:

A. no mass market exists for general-purpose baby shoes.

 

B. the needs of a target market determine the nature of the appropriate marketing mix.

 

C. a small producer can’t compete effectively against large competitors.

 

D. no target market exists for high-quality baby shoes.

 

E. All of these are true.

 

206. The text’s Toddler University example shows that TU’s marketing plan included:

A. A detailed description of the marketing mix to be offered.

 

B. A description of the resources required to carry out the plan.

 

C. Expected results of the plan.

 

D. Control procedures.

 

E. All of these.

 

207. The main difference between a “marketing strategy” and a “marketing plan” is that:

A. time-related details are included in a marketing plan.

 

B. a marketing plan includes several marketing strategies.

 

C. a marketing strategy provides more detail.

 

D. a marketing strategy omits pricing plans.

 

E. a marketing plan does not include a target market.

 

208. A “marketing plan” is:

A. a marketing program.

 

B. a marketing strategy.

 

C. a marketing strategy–plus the time-related details for carrying it out.

 

D. a target market and a related marketing mix.

 

E. a plan that contains the necessary operational decisions.

 

209. A “marketing plan”:

A. is just another terms for “marketing strategy.”

 

B. consists of several “marketing programs.”

 

C. includes the time-related details for carrying out a marketing strategy.

 

D. is a strategy without all the operational decisions.

 

E. ignores implementation and control details.

 

210. A “marketing plan” should include:

A. some control procedures.

 

B. what company resources will be needed–at what rate.

 

C. what marketing mix is to be offered to whom–and for how long.

 

D. what sales and profit results are expected.

 

E. all of these are included in a marketing plan.

 

211. Which of the following is part of a complete marketing plan?

A. Competitors’ marketing strategies.

 

B. What company resources (costs) are required and at what rate.

 

C. How different marketing mixes (for different target markets) relate to each other.

 

D. All of these are parts of a complete marketing plan.

 

212. Which of the following would probably NOT be in a proposed marketing plan?

A. A list of what company resources (costs) would be required.

 

B. A statement of how frequently the design of the website will be changed.

 

C. Expected sales and profit results.

 

D. A description of the target market and marketing mix.

 

E. All of these would normally be part of a marketing plan.

 

213. Which of the following is NOT included in a marketing plan?

A. The control procedures to be used

 

B. The costs involved

 

C. The results expected

 

D. What marketing mix is to be offered.

 

E. All of these should be included in a marketing plan.

 

214. _____ refers to putting marketing plans into operation.

A. Delivery

 

B. Implementation

 

C. Operational planning

 

D. Strategy planning

 

E. Control

 

215. Short-run decisions to help implement strategies are best known as

A. actionable items.

 

B. strategic decisions.

 

C. marketing plans.

 

D. operational decisions.

 

E. dependencies.

 

216. Managers should make operational decisions

A. within the guidelines set down during strategy planning.

 

B. with great care as these decisions are the same as strategic decisions.

 

C. for the long-run to help formulate strategic plans.

 

D. keeping in mind that these decisions should always lead to changes in the basic strategy.

 

E. on a month-to-month basis and never daily or weekly.

 

217. Which of the following statements about operational decisions is FALSE?

A. They help to carry out a marketing strategy.

 

B. They are short-run decisions.

 

C. They are part of the implementation process.

 

D. They usually require ongoing changes in the basic strategy to be effective.

 

218. Which of the following statements is a strategy decision, rather than an operational decision?

A. “We will change the colors of our selection of shirts at the end of the season.”

 

B. “We will cut prices as needed to in order to protect our market share.”

 

C. “We will increase the number of training sessions for new sales associates from two to three.”

 

D. “We will hire a merchandising specialist this month to help remodel our older stores.”

 

E. “We will place a special ad in the Sunday newspaper promoting our upcoming sale.”

 

219. Which of the following statements by a marketing manager refers to operational decisions, rather than strategy decisions?

A. “Our target customers view most existing luxury sedans as dull, and they want performance as well as luxury.”

 

B. “Newspaper ads will be more cost effective than 30 second radio ads–given the price increase for radio this month.”

 

C. “We hope to earn a 15 percent return on investment with our plan.”

 

D. All of these statements refer to operational decisions.

 

220. Which of the following is an operational decision–rather than a strategy decision?

A. A decision to seek distribution only through the best retailers.

 

B. Selection of a specific target market.

 

C. A decision to maintain a “one price” policy.

 

D. Selection of a specific cable TV channel on which to advertise.

 

E. All of these are good examples of operational decisions.

 

221. Which of the following is an example of an operational decision?

A. Focus promotion on the economy of the product.

 

B. Make the product available in every possible retail outlet.

 

C. Have a salesperson visit the manager of a new hardware store that will open next week.

 

D. Set a price that is no higher than competitors’ prices.

 

E. None of these is an example of an operational decision.

 

222. Which of the following would NOT require an operational decision for a leading hair color manufacturer?

A. Solicit orders from any new, financially attractive, salons.

 

B. Drop colors that are losing appeal.

 

C. Create a fresh ad for each Sunday newspaper.

 

D. Set a competitive price if a primary competitor offers a special discount.

 

E. Promote the fair price and satisfactory quality of the product.

 

223. Happy Feet shoe company’s strategic policy states “Carry as limited a line of colors, styles, and sizes as will satisfy the target market.” This policy best relates to which decision area of the marketing mix?

A. People

 

B. Place

 

C. Promotion

 

D. Price

 

E. Product

 

224. One of the strategic policies of camera maker, Zoom Cameras, states: “We will communicate the key benefits and value of our camera’s unique zoom lenses and demonstrate how they meet customer needs.” This policy best fits which marketing mix decision area?

A. Product

 

B. Place

 

C. Promotion

 

D. Price

 

E. People

 

225. A retailer’s operational decision to hire new salespeople would best relate to the marketing mix decision area of

A. product.

 

B. place.

 

C. promotion.

 

D. price.

 

E. people.

 

226. When fast food restaurant, Tommy’s Tacos, had poor sales in Central City, marketing managers closed one outlet on the east side of town and opened two new locations on the south side of town. These moves represent

A. operational decisions in the product decision area.

 

B. strategy policies in the place area.

 

C. strategy policies in the product area.

 

D. operational decisions in the place area.

 

E. strategy policies in the promotion area.

 

227. A “marketing program”:

A. blends all of a firm’s marketing plans into one big plan.

 

B. is a description of a firm’s marketing mix.

 

C. is a detailed plan of how to implement a strategy.

 

D. is a marketing strategy plus the time-related details.

 

E. None of these apply to a marketing program.

 

228. Which of the following blends all of the firm’s marketing plans into one big plan?

A. Marketing program.

 

B. Marketing mix.

 

C. Marketing statement.

 

D. Marketing overview.

 

229. ______ is the total stream of purchases that a customer could contribute to the company over the length of the relationship.

A. Customer value

 

B. Return on customer

 

C. Customer equity

 

D. Target return

 

E. Customer lifetime value

 

230. When a restaurant manager offers a dissatisfied customer a discount and a coupon for the customer’s next visit, the manager is thinking about:

A. customer value.

 

B. customer lifetime value.

 

C. cost management.

 

D. marketing plans.

 

E. differentiation.

 

231. A college of business developed online programs to help its alumni learn the latest marketing practices. The college is thinking about:

A. customer value.

 

B. customer satisfaction.

 

C. breakthrough opportunities.

 

D. customer lifetime value.

 

E. market penetration.

 

232. The total stream of purchases that a single customer could contribute to a company over the length of the relationship is called _____.

A. customer equity

 

B. customer lifetime value

 

C. customer service

 

D. customer satisfaction

 

E. customer feedback

 

233. Estimating a customer’s lifetime purchasing potential is important because it helps marketers to:

A. make a quick sale on a product.

 

B. decide whether to place ads online or in magazines.

 

C. recognize that mass marketing is the best way to reach customers.

 

D. select the right channel of distribution.

 

E. devise long-range plans and strategies for building customer relationships.

 

234. ____ is the expected earnings stream (profitability) of a firm’s current and prospective customers over some period of time.

A. Customer equity

 

B. Profit

 

C. Net worth

 

D. Lifetime customer value

 

E. A premium price

 

235. Customer equity

A. focuses on the costs of acquiring new customers rather than on increasing revenues from current customers.

 

B. is basically a historical measure of how profitable a firm has been in the past.

 

C. is a concept that applies to firms that target final consumers but not to firms that target business customers.

 

D. will increase if a firm increases its market share with a particular strategy.

 

E. is the expected earnings stream of a firm’s current and prospective customers over some time period.

 

236. ______ is the expected earnings stream of a firm’s current and prospective customers over some period of time.

A. Profit

 

B. Earnings

 

C. Operating profit

 

D. Customer equity

 

E. Net value

 

237. Customer equity

A. is of concern to top management, but not very relevant in planning a particular marketing strategy.

 

B. takes the perspective of the selling firm.

 

C. always increases over time, at least as long as a firm can stay in business.

 

D. is important to marketing managers but of little interest to customers.

 

E. increases as long as the number of customers that a firm serves increases over time.

 

238. Customer equity is

A. simply the financial result achieved by a single marketing strategy.

 

B. the total difference between the benefits of a firm’s whole marketing program and total costs of obtaining those benefits, as the group of target customers sees it.

 

C. increased when a firm is able to increase the earnings stream expected from current or prospective customers.

 

D. decreased whenever the firm’s costs of offering a marketing mix increase.

 

E. the difference between the benefits of a firm’s marketing mix and the cost of obtaining those benefits–as a particular customer sees it.

 

239. Which of the following is NOT a reason the marketing program should build customer equity?

A. Marketing strategies do not contribute to customer equity.

 

B. Expected profits depend on customer equity.

 

C. Firms expect financial returns.

 

D. Profit growth comes from customers.

 

E. Customers are the source of revenue.

 

240. Which of the following is most likely to increase a firm’s customer equity?

A. The firm offers a more costly marketing mix that attracts more customers.

 

B. The firm offers customer value that is at least as good as what is offered by competitors.

 

C. The lifetime value of the firm’s individual customers increases.

 

D. The competition in the firm’s market increases.

 

E. The firm cuts costs by reducing promotion efforts.

 

241. The customer equity concept

A. encourages a manager to consider both the costs and the revenue from a marketing strategy.

 

B. recognizes that customers are satisfied at a cost–and it is basically an estimate of a firm’s future earnings.

 

C. applies even to firms that pursue several different strategies.

 

D. focuses on earnings as well as sales.

 

E. all of these are part of the customer equity concept.

 

242. Which of the following statements about customer equity is FALSE?

A. Expected losses depend on customer equity.

 

B. If the parts of a firm’s marketing program work well together, it should increase the firm’s customer equity.

 

C. Expected profits depend on customer equity.

 

D. Customer equity benefits customers but not the company.

 

E. None of these statements about customer equity is FALSE.

 

243. The text’s discussion of Ford’s marketing strategy highlights the fact that:

A. it’s not wise for managers to just define a business in terms of the products they currently produce or sell.

 

B. there is little alternative but to stick with the traditional promotion channels for a product.

 

C. most consumers see basic products–like cars–as close substitutes for each other.

 

D. once a firm establishes a position as the market leader, competitors are not likely to be a big problem.

 

244. The text’s discussion of Ford’s marketing strategy highlights the fact that:

A. creative strategy planning is needed for survival.

 

B. there is little alternative but to stick with the traditional promotion channels for a product.

 

C. most consumers want only established products.

 

D. once a firm reaches a position as the market leader, competitors are not likely to be a big problem.

 

245. It’s best to think of “breakthrough opportunities” as opportunities which:

A. appeal to the mass market.

 

B. will quickly create a whole new industry of firms competing with similar marketing mixes.

 

C. help innovators develop hard-to-copy marketing mixes.

 

D. increase sales.

 

E. All of these apply to breakthrough opportunities.

 

246. _____ help(s) innovators develop hard-to-copy marketing strategies that will be very profitable for a long time.

A. Opportunity segments

 

B. Competitive decisions

 

C. Breakthrough opportunities

 

D. Competitive marketing

 

E. Operational decisions

 

247. Which of the following best illustrates a “breakthrough opportunity?”

A. A recording company’s new CD gets unexpected national publicity on MTV and almost every teenager wants a copy for Christmas.

 

B. A drug company develops a patented pill that people can take once a year and safely avoid catching a cold.

 

C. A bank puts its credit card machines in convenient drive-up locations–so they will be more convenient for customers.

 

D. A nurse realizes that the growing number of older people will increase the demand for nursing home services, so she quits her job and opens a quality nursing center for the elderly.

 

E. A wireless phone company introduces a new service that offers more free weekend minutes than any other service in its market area.

 

248. Which of the following would be likely to help you develop a “breakthrough opportunity?”

A. A two-month advantage over competitors in introducing a new product.

 

B. An idea for a new website animation that will attract consumer attention.

 

C. Accurate marketing research information about how much of a planned product the target market is likely to buy.

 

D. None of these would help you develop a breakthrough opportunity.

 

249. Which of the following could be a “breakthrough opportunity?”

A. A unique technical invention that competitors could not legally copy.

 

B. A contract with the best intermediaries to reach your market–ensuring that they will handle your product and no competitors’ offerings.

 

C. A head start in a market so you can win target customers who will be really loyal to your firm and its offering.

 

D. All of these could be breakthrough opportunities.

 

250. A pharmaceutical company spent a significant amount of money developing a new drug to combat high blood pressure. The drug did not cause any of the typical side effects usually associated with blood pressure medications. It was forecasted to be a “blockbuster” medication that would achieve over $1 billion in sales. It would also be difficult for other firms to duplicate, at least in the short-run, because of patent protection and the substantial research and development costs required. The introduction of this new drug would best be described as:

A. Diversification.

 

B. Market development.

 

C. A breakthrough opportunity.

 

D. “Hit-or-miss” marketing.

 

E. Market penetration.

 

251. ______ means that a firm has a marketing mix that the target market sees as better than a competitor’s mix.

A. Competitive advantage

 

B. Strategic policy

 

C. Customer equity

 

D. Comparative opportunity

 

E. Market development

 

252. “Breakthrough opportunities” are opportunities that:

A. help innovators develop hard-to-copy marketing strategies.

 

B. may be turned into marketing strategies that will be profitable for a long time.

 

C. help the firm develop a “competitive advantage.”

 

D. help a firm satisfy customers better than some competitor.

 

E. All of these apply to breakthrough opportunities.

 

253. Breakthrough opportunities:

A. are so rare that they should be pursued even when they do not match the firm’s resources and objectives.

 

B. seldom occur within or close to a firm’s present markets.

 

C. are especially important in our increasingly competitive markets.

 

D. are those that a firm’s competitors can copy quickly.

 

E. are best achieved by trying to hold onto a firm’s current market share.

 

254. Which of the following statements regarding marketing strategies is FALSE?

A. It is useful to think of the marketing strategy planning process as a narrowing-down process.

 

B. These strategies must meet the needs of target customers, and a firm is likely to get a competitive advantage if it just meets needs in the same way as some other firm.

 

C. Developing successful marketing strategies doesn’t need to be a hit-or-miss proposition.

 

D. These strategies require decisions about the specific customers the firm will target and the marketing mix the firm will develop to appeal to that target market.

 

E. Most companies implement more than one marketing strategy and related marketing plan at the same time.

 

255. Developing a set of specific qualitative and quantitative screening criteria

A. increases the different opportunities–and strategy possibilities–in the market.

 

B. can make it difficult to zero in on the best target market and marketing mix.

 

C. cannot help eliminate potential strategies that are not well suited for the firm.

 

D. can help a manager define what business and markets the firm wants to compete in.

 

E. highlights advantages of a strategy but does not make it clear why you should select that strategy.

 

256. A S.W.O.T. analysis includes:

A. strengths.

 

B. weaknesses.

 

C. opportunities.

 

D. threats.

 

E. all of these are included in a S.W.O.T analysis.

 

257. Which of the following statements about S.W.O.T. analysis is true?

A. It is a useful aid for identifying relevant screening criteria and for zeroing in on a feasible strategy.

 

B. S.W.O.T. is simply an abbreviation for the first letters of the words: strengths, weaknesses, opportunities, and threats.

 

C. It identifies and lists the firm’s strengths and weaknesses and its opportunities and threats.

 

D. It helps managers focus on a strategy that takes advantage of the firm’s strengths and opportunities while avoiding its weaknesses and threats to its success.

 

E. All of these statements about S.W.O.T. analysis are true.

 

258. A S.W.O.T. analysis

A. seeks to improve strategy planning by “Scanning for Warnings, Omens, and Tips” about competitors’ plans.

 

B. is not necessary if competitors have already entered the market.

 

C. defends against potential competitive threats by planning specific “safeguards, weapons, or tactics.”

 

D. should help a manager develop a strategy that leads to a competitive advantage.

 

E. None of these apply to a S.W.O.T. analysis.

 

259. A S.W.O.T. analysis can help a marketing manager:

A. define what business and markets the firm wants to compete in.

 

B. narrow down to a specific target market and marketing mix from the many alternatives available.

 

C. see the pros and cons of different possible strategies.

 

D. develop a competitive advantage.

 

E. all of these can help a marketing manager who is using a S.W.O.T. analysis.

 

260. A S.W.O.T. analysis

A. focuses on what a firm plans to do to “Satisfy Wishes Of a Target” customer.

 

B. summarizes a firm’s “strategy, wishes (of its customers), outlook, and tactics.”

 

C. helps defend against potential competitors by developing a set of competitive “safeguards, weapons, offensives, and tactics.”

 

D. identifies a firm’s “strengths, weaknesses, opportunities, and threats.”

 

E. seeks to reduce the risk of competitive surprises by scanning the market for “signals, warnings, omens, and tips.”

 

261. In which quadrant of the SWOT analysis tool does the following fit? A firm has adequate resources.

A. Strengths.

 

B. Weaknesses.

 

C. Opportunities.

 

D. Threats.

 

262. In which quadrant of the SWOT analysis tool does the following fit? A firm is in a fast-growing industry.

A. Strengths.

 

B. Weaknesses.

 

C. Opportunities.

 

D. Threats.

 

263. In which quadrant of the SWOT analysis tool does the following fit? A firm is vulnerable to recession.

A. Strengths.

 

B. Weaknesses.

 

C. Opportunities.

 

D. Threats.

 

264. In which quadrant of the SWOT analysis tool does the following fit? A firm is falling behind in research and development.

A. Strengths.

 

B. Weaknesses.

 

C. Opportunities.

 

D. Threats.

 

265. _______ means that the marketing mix is distinct from and better than what is available from a competitor.

A. Operational

 

B. Visible

 

C. Differentiation

 

D. Competitive

 

E. None of these is correct

 

266. Differentiation of a firm’s marketing mix:

A. Means the firm’s marketing mix is hard to distinguish from a competitor.

 

B. May provide the firm with a competitive advantage in the marketplace.

 

C. Makes it harder for consumers to notice if there is a consistent theme across all elements of the marketing mix.

 

D. Is usually not necessary in order for the firm to succeed.

 

267. Differentiation refers to the ______________ of the firm’s marketing mix to meet the needs of the target market.

A. similarity

 

B. uniqueness

 

C. unsuitability

 

D. willingness

 

268. Differentiation

A. helps a firm get a competitive advantage if it just meets needs in the same way as other firms.

 

B. means that the marketing mix is similar to what is available from a competitor.

 

C. often requires that the firm fine-tune all of the elements of its marketing mix to the specific needs of a distinctive target market.

 

D. is less obvious to target customers when there is a consistent theme integrated across the four Ps decision areas.

 

E. can only be based on one important element of the marketing mix.

 

269. ______________ means trying to increase sales of a firm’s present products in its present markets.

A. Product development

 

B. Market penetration

 

C. Market development

 

D. Mass marketing

 

E. Diversification

 

270. _____ means trying to increase sales of a firm’s present products in its present markets.

A. Differentiation

 

B. Product development

 

C. Market development

 

D. Diversification

 

E. Market penetration

 

271. When Colgate encourages its current customers to brush more often by taking their toothbrush and toothpaste to work with them, which market opportunity is Colgate pursuing?

A. Market development

 

B. Product development

 

C. Diversification

 

D. Market penetration

 

272. Lipton has increased sales by developing ads that encourage it current customers to drink Lipton tea instead of coffee at morning “coffee breaks.” This effort focuses on

A. diversification.

 

B. market penetration.

 

C. product development.

 

D. mass marketing.

 

E. market development.

 

273. Tropicana is trying to get its customers to drink orange juice more often with ads that say “It’s not just for breakfast anymore.” What type of opportunity is the company pursuing?

A. Market penetration

 

B. Diversification

 

C. Market development

 

D. Product development

 

E. Mass marketing

 

274. Kraft Foods recently increased its advertising and couponing to its present cheese customers. It appears that Kraft is pursuing what kind of opportunity?

A. Market penetration

 

B. Product development

 

C. Market development

 

D. Mass marketing

 

E. Diversification

 

275. If Frito-Lay (which has products in almost all the submarkets for snack foods) were to try to increase its share of one of these markets, it would be pursuing a ______________ opportunity.

A. diversification

 

B. market penetration

 

C. product development

 

D. mass marketing

 

E. market development

 

276. Coca-Cola runs an advertising campaign on morning radio shows encouraging current customers to “have a Coke in the morning” instead of their morning coffee. This is an example of:

A. Market development.

 

B. Product development.

 

C. Diversification.

 

D. Market penetration.

 

E. Mass marketing.

 

277. Pop Soda Co. wants to increase sales of its existing carbonated drinks by making them more convenient, so it’s making the drinks available at more stores in its present areas. This is an example of:

A. Market penetration.

 

B. Differentiation.

 

C. Product development.

 

D. Diversification.

 

E. Market development.

 

278. When a customer goes online to register Adobe’s Acrobat Reader, the Web page promotes other related products, including its popular Photoshop software. This is an example of:

A. Product development.

 

B. Screening opportunities.

 

C. Mass marketing.

 

D. Differentiation.

 

E. Market penetration.

 

279. _____ means trying to increase sales by selling present products in new markets.

A. Differentiation

 

B. Market development

 

C. Product development

 

D. Diversification

 

E. Market penetration

 

280. When a firm tries to increase sales by selling its present products in new markets, this is called:

A. product development.

 

B. diversification.

 

C. market penetration.

 

D. mass marketing.

 

E. market development.

 

281. When a company expands globally, this is an example of:

A. Market development.

 

B. Product development.

 

C. Diversification.

 

D. Market penetration.

 

E. Mass marketing.

 

282. When AT and T advertises in The Wall Street Journal that smartphones using its technology can make calls from more than 200 countries in the world, which market opportunity is AT and T pursuing?

A. Market penetration

 

B. Product development

 

C. Diversification

 

D. Market development

 

283. The Wall Street Journal has been trying to attract new customers by promoting its newspaper for student use in business courses. This is an example of

A. product development.

 

B. diversification.

 

C. market penetration.

 

D. market development.

 

284. An Embassy Suites hotel offers an inexpensive “Family Luncheon Buffet” on Sundays to get customers for its restaurant that is filled by business travelers during week days. This effort to get new customers for the available facility is an example of

A. a production orientation.

 

B. product development.

 

C. market development.

 

D. diversification.

 

E. market penetration.

 

285. Coca-Cola is taking advantage of the new willingness of Chinese leaders to engage in international trade by marketing its soft drinks in China. What type of opportunity is Coke pursuing?

A. Market development

 

B. Diversification

 

C. Product development

 

D. Market penetration

 

286. Avon, which in the past relied on door-to-door personal selling, is trying to reach new customers by distributing mail-order catalogs, adding toll-free telephone ordering, and opening online retail sites. Avon is pursuing a ______________ opportunity.

A. market development

 

B. market penetration

 

C. target marketing

 

D. product development

 

E. mass marketing

 

287. A mail-order marketer of flower bulbs to gardening hobbyists decides to sell the bulbs in grocery stores–to reach non-hobbyists who might be interested in pretty flowers. This is an example of:

A. market development.

 

B. diversification.

 

C. market penetration.

 

D. product development.

 

288. GreatGadgets, an Internet-based marketer of innovative gift items, decides to sell products in its own retail stores–to reach consumers who don’t like to buy without first seeing the item in person. This is an example of:

A. market development.

 

B. diversification.

 

C. market penetration.

 

D. product development.

 

289. An Australian wine producer, facing declining sales at home, set up a new channel of distribution to sell wine in the United States. This seems to be an effort at

A. market development.

 

B. diversification.

 

C. market penetration.

 

D. product development.

 

290. E-Z-Go, a producer of golf carts, promotes its carts to other users by advertising them as an easy and quiet way for workers to get around malls, airports, and big factories. E-Z-Go is trying to increase its sales through

A. market penetration.

 

B. differentiation.

 

C. product development.

 

D. market development.

 

E. diversification.

 

291. BeQuick, a fast-food restaurant, has always operated outlets in malls. With a new strategy that involves opening new outlets that sell the same menu but operate in airports, zoos, casinos, and military bases, BeQuick is pursuing what type of opportunity?

A. Product development.

 

B. Market development.

 

C. Differentiation.

 

D. Market penetration.

 

E. Diversification.

 

292. In an effort to increase its total sales, Champion has started exporting its spark plugs for use by several German auto producers. Champion is pursuing a ______________ opportunity.

A. diversification

 

B. market penetration

 

C. product development

 

D. mass marketing

 

E. market development

 

293. ____ refers to offering new or improved products for present markets.

A. Diversification

 

B. Market development

 

C. Differentiation

 

D. Market penetration

 

E. Product development

 

294. When a firm tries to increase sales by offering new or improved products to its present markets, this is called:

A. mass marketing.

 

B. product development.

 

C. market penetration.

 

D. diversification.

 

E. market development.

 

295. If Wendy’s decides to test market a hot dog in several stores to determine if it can make more profit from this menu item than from a “Wendy’s single,” which market opportunity is Wendy’s pursuing?

A. Diversification

 

B. Market development

 

C. Market penetration

 

D. Product development

 

296. To compete more successfully with its many competitors offering packaged cookies, Famous Amos added its own line of “extra chunky” premium cookies. This seems to be an effort at:

A. combination.

 

B. market penetration.

 

C. market development.

 

D. product development.

 

E. diversification.

 

297. A producer of frozen pasta dinners finds that its current target customers select among its frozen pasta dinners, going to a pizza restaurant, or staying home and eating an Italian sub sandwich. So the company set up a chain of pizza restaurants that also serve Italian sub sandwiches. This seems to be an effort at:

A. market development.

 

B. diversification.

 

C. market penetration.

 

D. product development.

 

298. Wendy’s continues to test possible new toppings for hamburgers, including grilled mushrooms and provolone cheese. This suggests that Wendy’s is pursuing ______________.

A. marketing myopia

 

B. mass marketing

 

C. product development

 

D. market development

 

E. diversification

 

299. Wendy’s continues to come out with new offerings like stuffed pitas. This suggests that Wendy’s is pursuing ______________.

A. marketing myopia

 

B. mass marketing

 

C. product development

 

D. market development

 

E. diversification

 

300. Converse started selling its “high-top” canvas basketball shoes in colors such as hot pink, lime green, and purple, to accompany their traditional colors of black and white. Converse seems to be pursuing a _____________ opportunity.

A. market penetration

 

B. market development

 

C. product development

 

D. diversification

 

E. breakthrough

 

301. Heinz, in order to boost its sales, came up with ketchup in gross green and funky purple colors. It packaged the ketchup in EZ Squirt dispensers molded to fit little hands. This is an example of:

A. Product development.

 

B. Market development.

 

C. Diversification.

 

D. Market penetration.

 

302. In developing trails for hiking and biking to bring its winter ski customers back in the summer, Mountain High Ski Resort is pursuing what type of opportunity?

A. Channel penetration.

 

B. Diversification.

 

C. Product development.

 

D. Market development.

 

E. Market penetration.

 

303. Zippo is pursuing _____ opportunities with its Multi-Purpose Lighter that is designed to light candles, fireplaces, grills, and more.

A. market penetration

 

B. market development

 

C. product development

 

D. diversification

 

E. channeling

 

304. Hewlett-Packard decided that too many other companies were attracting its customers by advertising their computer printers as “having all of the features of Hewlett-Packard’s LaserJet.” So Hewlett-Packard designed a new color printer with a completely new set of features which no competitors’ equipment offered. Hewlett-Packard then introduced it to the same market with the hope that it could develop a larger and more profitable share. This was an effort at:

A. market development.

 

B. diversification.

 

C. market penetration.

 

D. product development.

 

305. To improve its profits, Delta Tool Corp. has redesigned its entire line of rechargeable power drills–adding several new or improved features and three new models. Apparently, Delta Tool is pursuing a ______________ opportunity.

A. combiner

 

B. market development

 

C. product development

 

D. diversification

 

E. market penetration

 

306. Professional Dental Supply has been successfully selling dental instruments to dentists for the past twenty years, and has developed strong customer relations. When looking for new marketing opportunities, Professional Dental Supply will most likely look first at

A. market penetration.

 

B. diversification.

 

C. market development.

 

D. product development.

 

E. Professional Dental Supply will look at all opportunities equally.

 

307. ______ means moving into totally different lines of business, perhaps entirely unfamiliar products, markets, or even levels in the production-marketing system.

A. Diversification

 

B. Market development

 

C. Product development

 

D. Differentiation

 

E. Market penetration

 

308. When a firm tries to increase its total sales by offering new products to new markets, it’s pursuing:

A. diversification.

 

B. product development.

 

C. market development.

 

D. market penetration.

 

E. All of these.

 

309. When Sony Corp., an electronics producer, purchased the Pebble Beach golf course in California, it was pursuing what type of opportunity?

A. Diversification

 

B. Market development

 

C. Market penetration

 

D. Product development

 

310. Cheese manufacturer, Ashe Mountain Corp., started a new chain of movie theaters called Ashe Mountain’s Movie World. The theaters have been a major success and significantly increased the revenues of Ashe Mountain Corp. This is an example of:

A. Diversification.

 

B. Market development.

 

C. Product penetration.

 

D. Differentiation.

 

E. Market penetration.

 

311. A beer distributor, concerned about increasing regulation of alcoholic beverages, decides to start a new business distributing children’s toys. This company seems to be pursuing

A. market development.

 

B. diversification.

 

C. product development.

 

D. market penetration.

 

312. Industrial Plastics Corporation has decided to manufacture and sell electric motors for fishing boats. The firm appears to be pursuing a ______________ opportunity.

A. combiner

 

B. product development

 

C. market development

 

D. market penetration

 

E. diversification

 

313. A producer of home burglar alarm devices decides to start manufacturing portable video cameras for use in industrial security situations. This is an example of

A. market development.

 

B. diversification.

 

C. product development.

 

D. market penetration.

 

314. If a cola producer bought out a Mango juice producer in an attempt to appeal to health-conscious consumers who do not drink soft drinks, it would be pursuing a ______________ opportunity.

A. market development

 

B. diversification

 

C. market penetration

 

D. product development

 

315. The most risky and challenging opportunities usually involve:

A. market development.

 

B. product development.

 

C. diversification.

 

D. market penetration.

 

E. all of these are similar in terms of risk.

 

316. The most risky types of marketing opportunity to pursue usually involve

A. market development.

 

B. market penetration.

 

C. diversification.

 

D. product development.

 

E. All of these are equally risky.

 

317. Because companies are likely to be most familiar with their own operations, ____________ opportunities are usually the easiest to pursue.

A. market penetration

 

B. product development

 

C. market development

 

D. diversification

 

E. All of these are equally easy.

 

318. Which of the following statements is True regarding international opportunities in marketing?

A. There is no need to consider international opportunities when the domestic market is prosperous.

 

B. International trade is decreasing worldwide.

 

C. A product with slow sales growth in a domestic market may experience faster growth in another country.

 

D. Only large firms can engage in international marketing.

 

E. All of these statements about international opportunities in marketing are True.

 

319. All of the following are reasons why international opportunities should be considered by managers, EXCEPT

A. the world is getting smaller.

 

B. serving international markets may improve economies of scale.

 

C. favorable trends at home and unfavorable trends in other countries make international marketing particularly attractive.

 

D. around the world, potential customers have needs and money to spend.

 

E. it helps to develop a competitive advantage at home and abroad.

 

 

Chapter 03

Evaluating Opportunities in the Changing Market Environment

 

True / False Questions

1. The marketing manager can control the variables in the market environment.

True    False

 

2. Company objectives should shape the direction and operation of the whole business.

True    False

 

3. Earning a profit probably should be one of the objectives of a firm, but it should not be the only one.

True    False

 

4. Objectives should set the firm’s course.

True    False

 

5. A mission statement sets out the organization’s basic purpose for being.

True    False

 

6. A mission statement should focus on just the key goals for the organization.

True    False

 

7. A mission statement can help a manager decide which opportunities to pursue and which to screen out.

True    False

 

8. A mission statement sets out the strengths and weaknesses of a firm as well as the opportunities and threats that it faces.

True    False

 

9. A mission statement substitutes for more specific objectives.

True    False

 

10. Trying to maximize short-run return on investment may not be compatible with a company’s other objectives.

True    False

 

11. Company objectives should lead to a hierarchy of marketing objectives.

True    False

 

12. The objectives of a firm should direct the operation of the marketing department, but aren’t important to the rest of the business.

True    False

 

13. Good marketing objectives should be ambitious and almost impossible to achieve.

True    False

 

14. Attractive opportunities should make use of a firm’s resources and its unique strengths.

True    False

 

15. A large producer with economies of scale always has a competitive advantage over smaller firms.

True    False

 

16. If the cost of production per unit goes down as the quantity produced increases, small producers can be at a great cost disadvantage.

True    False

 

17. As compared to larger competitors, smaller firms benefit from lower unit costs which they achieve with lower sales volumes.

True    False

 

18. Smaller producers always have a great advantage in competing with larger producers because of their flexibility.

True    False

 

19. Ownership of patents, a familiar brand name, and financial strength are some of the many resources of a firm that a manager should evaluate when searching for new opportunities.

True    False

 

20. A patent owner has a 20-year monopoly to develop and use its new product, process, or material.

True    False

 

21. Good relations with intermediaries, good locations, and good salespeople are some of the many resources of a firm that should be evaluated when searching for new opportunities.

True    False

 

22. The competitive environment affects the number and types of competitors the marketing manager must face and how they may behave.

True    False

 

23. Although the marketing manager cannot control the competitive environment, he can choose strategies that will avoid head-on situations.

True    False

 

24. When the competitive environment moves toward pure competition, producers offer very different products that consumers do not perceive as substitutes for each other.

True    False

 

25. Over the long run, most product-markets tend toward monopolistic competition.

True    False

 

26. In market-directed economies, unregulated monopolies are rare.

True    False

 

27. In monopolistic competition, one firm completely controls a broad product-market.

True    False

 

28. In monopolistic competition, managers sometimes try to differentiate very similar products by relying on promotion or other elements of the marketing mix.

True    False

 

29. In a competitor analysis, a current (or planned) target market and marketing mix is compared with what competitors are currently doing (or are likely to do).

True    False

 

30. Competitor analysis is an organized approach for evaluating the strengths and weaknesses of current or potential competitors’ marketing strategies.

True    False

 

31. The major shortcoming of competitor analysis is that it focuses on the weaknesses of competitors—but ignores their strengths.

True    False

 

32. The first step in a competitor analysis is to identify potential competitors.

True    False

 

33. Competitive rivals are always easy to identify.

True    False

 

34. Competitive barriers are conditions that make it difficult for a firm to compete in a market.

True    False

 

35. Competitive barriers are the conditions that make it possible for a firm to compete in a market.

True    False

 

36. The Internet is a powerful way to get information about competitors.

True    False

 

37. The Internet is an important aspect of the technological environment, but it isn’t very useful for getting information about competitors.

True    False

 

38. Many people think that it is unethical to spy on competitors to obtain their trade secrets, but it is perfectly legal.

True    False

 

39. Spying on competitors to obtain trade secrets, raises moral issues but is not illegal.

True    False

 

40. A firm may find that both the competitive and economic environments are better in a foreign market than in its domestic market.

True    False

 

41. The technological environment includes such things as national income, economic growth, and inflation.

True    False

 

42. Interest rates usually decrease during periods of inflation.

True    False

 

43. The inflation rate experienced by the United States in recent years was just about the highest in the world.

True    False

 

44. Compared to some countries in Latin America, the rate of inflation in the U.S. is low.

True    False

 

45. When the dollar is strong in international exchange, it is easier to sell U.S. products in overseas markets.

True    False

 

46. Technology is the application of science to convert an economy’s resources to output.

True    False

 

47. Technology is the application of voodoo to convert an economy’s resources to output.

True    False

 

48. Technology affects marketing through new products and new processes.

True    False

 

49. Technological advances like the World Wide Web and the Internet are leading to big advances in business.

True    False

 

50. The Internet is a system for linking computers around the world.

True    False

 

51. The Internet changes how consumers shop and marketers market.

True    False

 

52. Changes in technology can have major impacts on marketing strategy planning.

True    False

 

53. Technology provides new opportunities and new challenges for marketers.

True    False

 

54. Changes in the technological environment could be rejected by the cultural and social environment—through the political and legal environments—even though such changes might help the economic environment.

True    False

 

55. Nationalism may affect marketing strategy planning by determining to whom and how much a firm may sell.

True    False

 

56. Placing the interests of individual consumers before the interests of business is nationalism.

True    False

 

57. Nationalism—or the emphasis on a country’s interests before anything else—may affect the work of some marketing managers.

True    False

 

58. Strong sentiments of nationalism facilitate growth in importing and exporting.

True    False

 

59. Regional groupings of nations outside the United States have little effect on the decisions of marketing managers whose firms are headquartered in the U.S.

True    False

 

60. Marketers no longer encounter differences among European countries.

True    False

 

61. The elimination of separate barriers to inter-European trade is making Europe a large unified market.

True    False

 

62. Key countries in Europe have moved to the euro, a new unified money system for the European Union.

True    False

 

63. Because NAFTA is a short-term proposition, its economic impact has already been as significant as it is likely to be.

True    False

 

64. The political environment may either block or promote new marketing opportunities.

True    False

 

65. A basic idea in the legal environment in the United States is that attempts by business to limit competition are considered contrary to the public interest.

True    False

 

66. Business and individual managers are subject to both criminal and civil laws.

True    False

 

67. A manager could be fined for violating the antimonopoly laws, but he or she could not be sent to jail.

True    False

 

68. The Sherman Act deals with tying contracts, exclusive dealing contracts, and price discrimination by manufacturers.

True    False

 

69. The Clayton Act deals with tying contracts, exclusive dealing contracts, and price-fixing conspiracies.

True    False

 

70. The Clayton Act focuses on practices which may substantially lessen competition—such as tying contracts, exclusive dealing contracts and price discrimination by manufacturers.

True    False

 

71. The Magnuson-Moss Act regulates product warranties.

True    False

 

72. Product warranties are regulated by the Magnuson-Moss Act.

True    False

 

73. Before the Pure Food and Drug Act was passed, it was assumed that the common law and the warning “let the buyer beware” would take care of consumers.

True    False

 

74. Laws such as the Pure Food and Drug Act were passed because pro-competition legislation did not protect consumers very well in some areas.

True    False

 

75. The Consumer Product Safety Act provides for the creation of safety standards but has no power to set penalties for failure to meet these standards.

True    False

 

76. The Consumer Product Safety Commission tries to encourage safe product design, but the commission has almost no power to deal with unsafe products.

True    False

 

77. In the United States, the Consumer Product Safety Commission sets and enforces product safety standards.

True    False

 

78. Because the Consumer Product Safety Commission has no power to force a product off the market, safety is not a very important consideration in product design.

True    False

 

79. Marketers should be aware of federal legislation, as well as state and local laws, when planning marketing strategy.

True    False

 

80. The cultural and social environment affects how and why people live and behave as they do.

True    False

 

81. The cultural and social environment refers to where people live and their income.

True    False

 

82. Women’s changing role has created opportunities for marketing but also complications.

True    False

 

83. The U.S. does not have the largest population of any country in the world, but it does have the largest population growth rate.

True    False

 

84. The rate of growth of the U.S. population is lower than the rate of growth of some other countries’ population.

True    False

 

85. There are over 310 million people living in the United States.

True    False

 

86. The U.S. population is over 310 million people and the world population is more than 7 billion people.

True    False

 

87. India has more people than the United States, and China has more people than India.

True    False

 

88. Less-developed countries usually experience the slowest population growth.

True    False

 

89. In Argentina, Israel, and Singapore, for example, less than 20 percent of people live in urban areas.

True    False

 

90. The worldwide trend toward urbanization has prompted increased interest in international markets.

True    False

 

91. When considering international markets, income is often one of the most important demographic dimensions.

True    False

 

92. When considering international markets, income is usually not an important demographic dimension.

True    False

 

93. Both GDP and GNI measures of national income.

True    False

 

94. Gross domestic product is the total dollar value of a country’s exports during a one year period.

True    False

 

95. Gross domestic product includes foreign income earned in a country.

True    False

 

96. GNI is the total market value of all goods and services provided in a country’s economy in a year by both residents and nonresidents of that country.

True    False

 

97. GDP income measures can give the impression that people in less-developed nations have more income than they really do.

True    False

 

98. GNI income measures can give the impression that people in less-developed nations have less income than they really do.

True    False

 

99. Generally the nations with the fastest growth in GDP are not the nations with the largest GDPs.

True    False

 

100. The fastest rate of growth in GDP is occurring in the nations with the largest current GDP.

True    False

 

101. Even though the more developed industrial nations don’t have the largest populations, they do have the biggest share of the world’s GDP.

True    False

 

102. Countries where gross national income (GNI) per capita is low do not offer any opportunities for marketers.

True    False

 

103. Because almost all of the world’s population can read and write, international marketers have no problems in communicating with potential customers no matter where they live.

True    False

 

104. Adoption of the Internet and cell phones is having its greatest impact in developing countries.

True    False

 

105. California is the state with the largest population, and Texas is a distant second.

True    False

 

106. New York is the state with the largest population, and California is a distant second.

True    False

 

107. In the United States, the West and the South are growing faster than the Northeast and the North Central areas.

True    False

 

108. Areas with small populations may still be attractive target markets for some firms—because there may be less competition.

True    False

 

109. In 1980, the median age of the U.S. population was 37.

True    False

 

110. The median age in the United States increased from 30 in 1980 to 37 in 2010.

True    False

 

111. Gen X is smaller in numbers as compared to the boomers that came before.

True    False

 

112. Gen X is less educated than previous generations.

True    False

 

113. Gen Y is the result of the echo boom and its members are more techno-savvy than any other group.

True    False

 

114. Most changes in the cultural and social environment come slowly.

True    False

 

115. Changes in the cultural and social environment tend to come about quickly.

True    False

 

116. Because the cultural and social environment tends to change slowly, firms should try to identify and work with cultural attitudes rather than trying to encourage big changes in the short run.

True    False

 

117. When evaluating opportunities, quantitative screening criteria help a manager decide what kind of opportunities to pursue.

True    False

 

118. Product-market screening criteria should be mainly quantitative in nature, because qualitative criteria are too subjective.

True    False

 

119. Screening criteria should be in quantitative form—based on factors such as profit and expected sales—so that they are objective and not subject to qualitative judgments and interpretations by different managers.

True    False

 

120. Managers are now applying a new screening criteria, sustainability, that reinforces the importance of meeting present needs without compromising the ability of future generations to meet their own needs.

True    False

 

121. Sustainability, as a screening criteria, supports the idea of focusing completely on the company’s present needs.

True    False

 

122. Forecasts of the probable results of implementing whole strategic plans are needed to apply quantitative screening criteria.

True    False

 

123. In the total profit approach, management forecasts potential sales and costs during the life of the plan to estimate likely profitability.

True    False

 

124. The profit potentials of alternative strategic plans can be evaluated at the same time only if the plans are very similar.

True    False

 

125. The General Electric “strategic planning grid” forces company managers to make three-part judgments (high, medium, and low) about the business strengths and industry attractiveness of all proposed or existing product-market plans.

True    False

 

126. GE’s strategic planning grid considers two dimensions—industry attractiveness and business strengths—to identify opportunities that may be growth, borderline, or no growth.

True    False

 

127. Opportunities which fall into the red boxes in the General Electric “strategic planning grid” are growth opportunities.

True    False

 

128. Using the General Electric strategic planning grid, an opportunity rated “medium” in terms of both industry attractiveness and business strengths is an opportunity that the firm should always avoid.

True    False

 

129. The General Electric “strategic planning grid” relies on subjective judgments about business strengths and industry attractiveness.

True    False

 

130. The GE “stop-light” evaluation method is a very objective approach because GE feels there are too many possible errors if it tries to use subjective criteria for judging “attractiveness” or “strength.”

True    False

 

131. In international markets marketing managers usually have an easier time understanding the variables in the market environment.

True    False

 

132. Consumer products that are linked to cultural variables tend to be lower risk when entering international markets.

True    False

 

133. Most industrial products tend to be near the “insensitive” end of the continuum of environmental sensitivity.

True    False

 

134. The “continuum of environmental sensitivity” suggests that industrial products are more sensitive to the cultural environments in which they are placed than high-style consumer products.

True    False

 

135. If the risks of getting into international marketing are difficult to evaluate, it may be wise to start with exporting

True    False

 

 

Multiple Choice Questions

136. Marketing managers should remember that there are many variables in the ____________ that affect strategy planning.

A. economic and technological environments

 

B. competitive environment

 

C. cultural and social environment

 

D. political and legal environments

 

E. all of these environments have variables that affect strategy planning

 

137. When planning a marketing strategy, managers have control over:

A. the political and legal environment.

 

B. the cultural and social environment.

 

C. the economic environment.

 

D. their response to forces in the external market environment.

 

E. consumers.

 

138. All of the following are part of the direct marketing environment except:

A. the company.

 

B. the economy.

 

C. competitors.

 

D. customers.

 

E. All of these are part of the direct marketing environment.

 

139. Which of the following is not an element of the external market environment?

A. Technological environment.

 

B. Company environment.

 

C. Legal environment.

 

D. Economic environment.

 

E. Cultural and social environment.

 

140. In the short run, a marketing manager usually cannot control:

A. the competitive environment.

 

B. the cultural environment.

 

C. the legal environment.

 

D. the economic environment.

 

E. Any of these environments are uncontrollable in the short run.

 

141. The direct market environment

A. includes customers, the company, and competitors.

 

B. consists of variables that can be controlled.

 

C. is broader in scope than the external environment.

 

D. includes economic and technological environments.

 

E. is made up of the political, legal, and social environments.

 

142. All of the following are part of the direct market environment EXCEPT:

A. customers.

 

B. competitors.

 

C. the company itself.

 

D. the technological environment.

 

143. Which of the following is not a part of the direct market environment for Starbucks?

A. McDonald’s and its coffee.

 

B. Starbucks objective to open 50 new stores in the United States in 2014.

 

C. Rising interest rates worldwide.

 

D. High awareness of Starbucks brand name.

 

E. Growing interest in brewed cacao a prospective competitor for coffee.

 

144. Setting objectives and strategies for the whole company is a job performed by:

A. marketing managers.

 

B. the company’s accountants.

 

C. top executives.

 

D. shareholders.

 

E. the marketing department.

 

145. A mission statement has the following purposes except:

A. to keep managers working towards a common purpose.

 

B. to communicate the firm’s basic reason for being.

 

C. to help firms decide what opportunities to pursue.

 

D. to help firms decide what opportunities to avoid.

 

E. to provide detailed goals and plans.

 

146. In a firm’s hierarchy of objectives, the top-level objectives that guide all other objectives are known as:

A. R&D objectives.

 

B. company objectives.

 

C. price objectives.

 

D. personal selling objectives.

 

E. marketing objectives.

 

147. How might an organization ensure that marketing objectives are compatible and aligned with top-level company objectives?

A. Involve marketing managers in setting company objectives

 

B. See how plans worked out at the end of the year

 

C. Maintain effective e-mail communication

 

D. Require every individual to set personal objectives

 

E. Require the marketing department to set objectives

 

148. Which of the following could serve as a firm’s mission statement?

A. Green is good

 

B. Promote all brands using viral videos

 

C. We aim to boost annual sales by 15 percent

 

D. Create three new product lines

 

E. We exist to provide customers with the best shopping experience anywhere in cyberspace.

 

149. The basic objective of a firm should be to:

A. engage in some specific business activity that will perform a socially and economically useful function.

 

B. develop an organization to carry on the business and implement its strategies.

 

C. earn enough profit to survive.

 

D. All of these are basic objectives of a firm.

 

150. Which of the following objectives of a business is the most important?

A. To engage in some specific business activity which will perform a socially and economically useful function.

 

B. To develop an organization to carry on the business and implement its strategies.

 

C. To earn enough profit to survive.

 

D. All three of these objectives are equally important, because a failure in any one could lead to a total failure of the business.

 

151. A mission statement

A. should never be revised.

 

B. sets out the organization’s basic purpose for being.

 

C. should embrace everything rather than focus on a few key goals.

 

D. substitutes for more specific objectives.

 

E. supplies guidelines for general situations but not for situations where managers face difficult decisions.

 

152. Nike claims in its Annual Report that “the reasons every NIKE employee comes to work every day is to create great product, to lead the athletic industry in innovation, and to serve the athlete.” This is Nike’s:

A. competitive barrier.

 

B. technology.

 

C. portfolio management.

 

D. mission statement.

 

E. competitor analysis.

 

153. When setting objectives for the whole firm, TOP MANAGEMENT should:

A. involve the marketing manager in the objective setting process.

 

B. set objectives that focus on the highest possible immediate profit potential.

 

C. stick to general objectives—in order to maintain flexibility.

 

D. set objectives beyond what can actually be achieved—so everyone will work harder.

 

E. All of these are useful when setting objectives.

 

154. Overall company objectives should:

A. be specific.

 

B. focus on returning some profit to the business.

 

C. be realistic and achievable.

 

D. be compatible with one another.

 

E. All of these are correct.

 

155. Which of the following statements about company objectives is true?

A. Company objectives should be stated in vague terms to provide flexibility to lower-level managers.

 

B. Company objectives should be set by top management with no input from marketing managers.

 

C. A good mission statement can substitute for more specific company objectives.

 

D. Company objectives should be compatible with each other.

 

E. All of these statements about company objectives are true.

 

156. Company objectives

A. should be set within the framework of marketing objectives.

 

B. are made redundant by mission statements.

 

C. should always be overly ambitious.

 

D. should only be revised every five years.

 

E. guide managers as they search for and evaluate opportunities.

 

157. Typically, firms need a hierarchy of objectives. Which of the following best represents a correct hierarchy of a firm’s objectives?

A. Company objectives, sales promotion objectives, marketing objectives, promotion objectives.

 

B. Marketing objectives, company objectives, promotion objectives, sales promotion objectives.

 

C. Company objectives, marketing objectives, promotion objectives, sales promotion objectives.

 

D. Marketing objectives, promotion objectives, sales promotion objectives, company objectives.

 

E. Promotion objectives, sales promotion objectives, company objectives, marketing objectives.

 

158. Of the following objectives, the LAST objective(s) that a firm should specify is its ______________ objective(s).

A. marketing

 

B. sales promotion

 

C. price

 

D. company

 

E. promotion

 

159. Of the following, the last objectives that a firm should specify are its

A. company objectives.

 

B. marketing objectives.

 

C. promotion objectives.

 

D. advertising objectives.

 

E. price objectives.

 

160. Which of the following would a firm need to specify BEFORE deciding on its sales promotion objectives?

A. Company objectives.

 

B. Production objectives.

 

C. Product objectives.

 

D. Marketing objectives.

 

E. All of these objectives would need to be specified beforehand.

 

161. Along with studying trends in the environment, a first step in looking for attractive opportunities is to:

A. understand the resources and objectives of the firm.

 

B. decide which product-markets the firm will enter.

 

C. find new markets for present products.

 

D. estimate product-market potentials.

 

E. hire a marketing strategy planner.

 

162. Which of the following is not a marketing strength for a book publisher?

A. Flexible production facilities.

 

B. A stable of popular authors.

 

C. A good sales force.

 

D. An efficient online ordering system for customers.

 

E. Good relationships with book wholesalers and retailers.

 

163. An energy company that has expertise in drilling for oil would also likely have the resources to:

A. manufacture automobiles.

 

B. operate a chain of gas stations.

 

C. drill for natural gas.

 

D. sell office supplies.

 

E. make medical devices.

 

164. A first step in evaluating marketing opportunities is to:

A. decide which markets the firm wishes to enter.

 

B. consider the objectives and resources of the firm.

 

C. hire a “futurist” as a marketing consultant.

 

D. estimate market and sales potentials.

 

E. find out if potential competitors are larger.

 

165. When looking for attractive opportunities, a marketing manager should consider:

A. the firm’s producing capability and flexibility.

 

B. the firm’s financial strengths.

 

C. whether the firm has good relations with established intermediaries.

 

D. the firm’s marketing strengths.

 

E. All of these should be considered.

 

166. Which of the following would NOT be a marketing strength for a local coffee shop?

A. A well-recognized brand.

 

B. A patented coffee blend.

 

C. Established relations with local businesses.

 

D. Access to large amounts of capital from a long-term relationship with a local bank.

 

E. Counter staff that knows and understands customer preferences.

 

167. When a firm is searching for attractive opportunities, a good manager should keep in mind that ___________ strength is very important.

A. financial

 

B. production and flexibility

 

C. marketing

 

D. pricing

 

E. all of these strengths are important

 

168. The number and types of competitors a marketing manager must face—and how they might behave—is called the ______________ environment.

A. cultural

 

B. competitive

 

C. economic

 

D. political

 

E. social

 

169. A(n) _______ is a marketing mix that customers see as better than a competitor’s mix and cannot be quickly or easily copied.

A. resource combination

 

B. sustainable competitive advantage

 

C. objective-centered approach

 

D. competitor analysis plan

 

E. competitor matrix

 

170. A useful tool for organizing the competitor analysis is:

A. the table of competitive rivals.

 

B. rivals chart.

 

C. the oligopoly chart.

 

D. a competitor matrix.

 

E. the competitive summary.

 

171. The competitive environment that most marketing managers experience in developed economies is:

A. monopoly.

 

B. monopolistic competition.

 

C. pure competition.

 

D. oligopoly.

 

E. regulated competition.

 

172. When conducting a competitor analysis, it is important for managers to take the viewpoint of:

A. competitors.

 

B. the CEO.

 

C. target customers.

 

D. supply chain partners.

 

E. the industry leader.

 

173. Regarding the competitive environment, a marketing manager usually can:

A. choose strategies to avoid head-on competition.

 

B. control it with the help of the legal environment.

 

C. control it in the short run.

 

D. control it with the help of the political environment.

 

E. control it in the long run.

 

174. Which of the following is not a basic kind of market (competitive) situation?

A. Pure competition

 

B. Oligopoly

 

C. Capitalistic competition

 

D. Monopolistic competition

 

E. Monopoly

 

175. Most product-markets head toward ______ over the long run.

A. pure competition

 

B. monopolistic competition

 

C. capitalistic competition

 

D. monopoly

 

E. collectivism

 

176. Which of the following statements about the competitive environment is FALSE?

A. Competition-free environments are rare.

 

B. Marketing managers should choose strategies that avoid head-on competition.

 

C. A firm that has a marketing mix that its target market sees as better than its competitors’ has a competitive advantage.

 

D. Over the long run, most product-markets tend toward monopolistic competition.

 

E. In a competitor analysis, the firm’s first step should be to identify all potential competitors.

 

177. In a _____________ situation, competitors offer very similar products which customers see as close substitutes, and managers just compete with lower and lower prices as profit margins shrink.

A. capitalistic competition

 

B. pure competition

 

C. monopoly

 

D. monopolistic competition

 

E. collectivist competition

 

178. ____ refers to market situation where one firm completely controls a broad product-market.

A. Monopoly

 

B. Oligopoly

 

C. Pure competition

 

D. Monopolistic competition

 

E. Collectivist competition

 

179. In monopolistic competition,

A. one firm completely controls a broad product-market.

 

B. each competitor tries to get control in its “own” target market.

 

C. competitors offer the same marketing mix.

 

D. different marketing mixes are nevertheless seen as the same by all customers.

 

E. all customers view various alternatives as substitutes.

 

180. Which of the following observations is NOT TRUE of monopolistic competition?

A. A number of different firms offer marketing mixes that at least some customers see as different.

 

B. Marketing managers try to differentiate very similar products by relying on other elements of the marketing mix.

 

C. Each competitor tries to get a monopoly in its own target market.

 

D. Most marketing managers in developed economies do not face monopolistic competition.

 

E. Competition exists because some customers see various alternatives as substitutes.

 

181. Swanson Beverages, Inc., is using ______________ to compare the strengths and weaknesses of its current target market and marketing mix with what its competitors are doing (or are likely to do).

A. clustering

 

B. scenario analysis

 

C. brand positioning

 

D. marketing mix review

 

E. competitor analysis

 

182. Regarding the competitive environment:

A. It is easy to find environments that are “competitor-free.”

 

B. Monopoly situations are more common than are situations characterized by monopolistic competition.

 

C. “Competitive rivals” are a firm’s closest competitors.

 

D. Competitor analysis should begin with an identification of competitors from the viewpoint of the manager, not the consumer.

 

183. ________ are the firms that are considered to be the organization’s closest challengers.

A. Aggressive rivals

 

B. Competitive rivals

 

C. Direct rivals

 

D. Indirect rivals

 

E. Passive rivals

 

184. Competitive barriers

A. facilitate cooperation among competitors.

 

B. may make it difficult for a firm to compete in a market.

 

C. refer to legal constraints on importing.

 

D. are the weaknesses in a competitor’s strategy.

 

E. are a firm’s closest competitors.

 

185. A ________ is an organized table that compares the strengths and weaknesses of a company with those of its competitive rivals.

A. competitive advantage

 

B. competitor matrix

 

C. insight table

 

D. positioning graph

 

E. competitor analysis

 

186. A marketing manager may ethically and actively seek information about current or potential competitors by

A. searching a firm’s public website.

 

B. waiting at a landfill for competitors’ trash to find copies of confidential company reports.

 

C. using computer “hackers” to break into a competitor’s computer network.

 

D. hiring people from competing firms and then asking them confidential information about the competitor.

 

E. spying on competitors to obtain trade secrets.

 

187. The economic environment:

A. Has no relationship to the technological environment.

 

B. Is not affected by the way all of the parts of the macro-marketing system interact.

 

C. Is the same from country to country.

 

D. Can change very rapidly.

 

E. Never requires marketing managers to make immediate changes in strategy.

 

188. A firm that is unable to obtain financing to manufacture new products is likely encountering negative pressures from:

A. the competitive environment.

 

B. the technological environment.

 

C. the economic environment.

 

D. the political/legal environment.

 

E. the cultural/social environment.

 

189. Which of the following demonstrates how the technological environment is changing the way marketers promote products?

A. Marketing aimed at youth is increasingly regulated by governments.

 

B. Search engines match consumer searches with relevant banner ads.

 

C. Marketers make routine claims that products are eco-friendly.

 

D. Manufacturers partner with local retailers to buy ads that feature both firms.

 

E. New laws regulate consumer privacy.

 

190. Low consumer spending and a lack of adequate financing are conditions that arise mostly due to factors in:

A. the competitive environment.

 

B. the cultural and social environment.

 

C. the technological environment.

 

D. the political environment.

 

E. the economic environment.

 

191. The economic environment

A. of an individual country has little effect on other countries.

 

B. refers to the application of science to convert resources to output.

 

C. includes changes in interest rates and inflation.

 

D. has little impact on an organization’s marketing strategy.

 

E. does not change rapidly.

 

192. X-Brand Bikes, a manufacturer of off-road bicycles, carefully developed a strategy for moving into South America. The strategy had poor results after interest rates and inflation rose rapidly in most of its South American markets, demonstrating the influence of the _____ on marketing strategy.

A. economic environment

 

B. technological environment

 

C. social environment

 

D. legal environment

 

E. political environment

 

193. A change in the _____ environment can affect consumer purchases of homes, cars, and other items usually bought on credit.

A. legal

 

B. political

 

C. social/cultural

 

D. technological

 

E. economic

 

194. Rising costs and inflation are part of the uncontrollable ______________ environment.

A. technological

 

B. economic

 

C. competitive

 

D. legal

 

E. cultural and social

 

195. Interest rates

A. often change with changes in the economy.

 

B. affect consumer markets, but not business customers.

 

C. usually decrease during periods of inflation.

 

D. do not directly affect the total price borrowers must pay for loans.

 

E. don’t affect the prices buyers pay.

 

196. The marketing manager for a financial services firm knows that customer preferences for mutual funds and bond accounts will differ depending on the current interest rate. She must plan her offerings with the _____ environment in mind.

A. economic

 

B. social

 

C. technological

 

D. cultural

 

E. legal

 

197. Increased demand for new homes due to low interest rates is an example of the impact of the ___________ environment.

A. technological

 

B. cultural

 

C. competitive

 

D. economic

 

E. social

 

198. When a local bank in Kansas City makes loans to its small business customers, it charges them an interest rate for borrowing money. Interest rates are part of the ____________ environment.

A. cultural and social

 

B. economic

 

C. legal

 

D. political

 

E. competitive

 

199. The economies of the world are connected and changes in one economy quickly affect others. One key reason for this is that:

A. The amount of international trade is decreasing.

 

B. The amount of international trade is difficult to forecast.

 

C. The amount of international trade is increasing.

 

D. The amount of international trade is unstable.

 

E. The amount of international trade is stable.

 

200. The _____ refers to how much one country’s money is worth in another country’s money.

A. monetary value

 

B. exchange rate

 

C. dollar value

 

D. net worth

 

E. purchasing power

 

201. The way in which an economy’s resources are converted to output is part of the _______________ environment.

A. competitive

 

B. economic

 

C. political

 

D. technological

 

E. social

 

202. Underlying any economic environment is technology which affects:

A. how the economy’s resources are converted to output.

 

B. how quickly technological developments lead to new consumer protection laws.

 

C. how competitors react to each other.

 

D. how aggressive competitors are in planning new marketing strategies.

 

E. how fast consumer attitudes change.

 

203. Which of the following is NOT primarily an example of the influence of technology on the external market environment?

A. A camera producer finds a way to enable a camera to store digital pictures—without film.

 

B. Machines are developed to assemble defect-free electronic components.

 

C. Robots on a production line make it possible to lower cost.

 

D. A manufacturer of frozen food is finding that consumers prefer containers that can go from the freezer direct to a microwave oven.

 

E. The government passes a law that prohibits use of cell phones while driving a vehicle.

 

204. Which of the following is NOT an example of how the technological environment might affect marketing management?

A. A manufacturer uses a computer to send orders directly to a supplier’s computer.

 

B. A retailer installs a computerized checkout scanner to replace a manual cash register system.

 

C. A firm develops a substitute for saturated fat in manufactured foods.

 

D. All of these are examples of how the technological environment might affect marketing management.

 

205. AT&T reacted to the popularity of the cellular phone by adding several cellular models to its line of regular phones. Availability and popularity of cellular phones is most likely due to changes in the ____________ environments.

A. political and cultural

 

B. technological and legal

 

C. legal and economic

 

D. social and technological

 

206. Which of the following statements about the technological environment is NOT TRUE?

A. The Internet changes how firms communicate with customers.

 

B. The transfer of technology from one part of the world to another is automatic.

 

C. A focus on technology may cause firms to develop a production orientation.

 

D. New technologies create new product-markets.

 

E. Technology is the application of science to convert an economy’s resources to output.

 

207. An emphasis on a single country’s interests before everything else is known as

A. socialism.

 

B. democracy.

 

C. nationalism.

 

D. capitalism.

 

E. entrepreneurship.

 

208. Which of the following statements about the legal environment in the United States is not true?

A. Individual managers are not subject to criminal penalties—only their employer can be punished.

 

B. Consumer protection laws are not new.

 

C. Many laws try to promote competition among firms.

 

D. A commission has authority to oversee product safety.

 

E. The Food and Drug Administration controls manufacturers of these products.

 

209. A firm may use all of the following methods for beating the competition except:

A. apply for patents.

 

B. seek a monopoly.

 

C. develop a sustainable competitive advantage.

 

D. conduct a competitor analysis.

 

E. utilize advanced technology.

 

210. A marketer considering a business opportunity in the U.S. health care market must first evaluate new rules and regulations originating from:

A. the competitive environment.

 

B. the economic environment.

 

C. the technological environment.

 

D. the legal environment.

 

E. the cultural and social environment.

 

211. In the political environment, an emphasis on a single country’s interests before everything else is called:

A. Elitism.

 

B. Socialism.

 

C. Extremism.

 

D. Regionalism.

 

E. Nationalism.

 

212. “Nationalism” is an issue in the ______________ environment.

A. competitive

 

B. political

 

C. economic

 

D. cultural

 

E. technological

 

213. Which of the following statements about nationalism is NOT TRUE?

A. Nationalism can be limiting in international markets.

 

B. A “Buy American” policy reflects nationalistic attitudes in the United States.

 

C. Nationalistic feelings can block all marketing activity in some international markets.

 

D. Nationalistic feelings always reduce sales.

 

E. Nationalism emphasizes one country’s interests before everything else.

 

214. A “Buy American” campaign is an example of:

A. transnationalism.

 

B. nationalism.

 

C. environmentalism.

 

D. consumerism.

 

E. federalism.

 

215. With the “unification of Europe”:

A. many of the taxes and rules that have limited trade among member countries of the European Union were eliminated.

 

B. the need to adjust strategies to reach submarkets of European consumers disappeared.

 

C. firms operating in Europe have harder access to large markets.

 

D. consumer prices rose.

 

216. The North American Free Trade Agreement (NAFTA):

A. Provides a plan to reshape the rules of trade among Canada, the United States, and Colombia.

 

B. Has resulted in the movement of production jobs to Mexico due to lower labor costs.

 

C. Eliminates the need for companies to adjust strategies.

 

D. Makes it more difficult to resolve trade disputes among the countries participating in NAFTA.

 

217. NAFTA:

A. is a free-trade pact between the U.S., Canada, and Mexico.

 

B. is a long-term proposition.

 

C. has already eliminated most trade barriers with Mexico.

 

D. All of these are correct.

 

218. Identify the incorrect statement concerning the North American Free Trade Agreement (NAFTA).

A. NAFTA lays out a plan to reshape the rules of trade among the U.S., Canada, and Mexico.

 

B. NAFTA enlarges the free-trade pact that had already knocked down most barriers to U.S.-Canada trade.

 

C. NAFTA has already eliminated most barriers to U.S.-Mexico trade.

 

D. NAFTA prohibits moving of production and jobs from the U.S. to Mexico.

 

E. NAFTA establishes a forum for resolving future trade disputes.

 

219. Which of the following newspaper headlines would be LEAST likely to involve the political environment?

A. U.S.-Vietnamese Joint Ventures in the Future.

 

B. Egg Sales Fall as Consumers Switch to Low Cholesterol Diets.

 

C. U.S. Signs Trade Agreement with Venezuela.

 

D. FDA Adopts New Regulations for Generic Drugs.

 

E. Consumers Urged to “Buy American.”

 

220. The largest producer of “fuzz-busters” (radar detectors) sees that many states are increasing the penalty for using them. Clearly, this firm’s marketing strategy may have to adapt to these changes in the

A. economic and technological environments.

 

B. resources and objectives of the firm.

 

C. competitive environment.

 

D. political and legal environments.

 

E. cultural and social environment.

 

221. The _____ environment sets the basic rules for how a business can operate in society.

A. legal

 

B. social

 

C. economic

 

D. technical

 

E. cultural

 

222. American economic and legislative thinking is based on the idea that

A. encouraging competition harms public interest.

 

B. competition among many small firms helps the economy.

 

C. attempts by business to limit competition aids large firms during recessions.

 

D. the economic environment provides a base for the technological environment.

 

E. laws should protect companies and not consumers.

 

223. American legislative and economic thinking assumes that:

A. competition among many small firms helps the economy.

 

B. firms must have their prices approved by the Federal Trade Commission.

 

C. the free enterprise system is dying.

 

D. laws are needed to prevent firms from competing with similar (“me-too”) products.

 

E. government officials are needed to run the economy.

 

224. The early antimonopoly (or “procompetition”) laws passed in the United States:

A. include the Federal Trade Commission Act and the Clayton Act.

 

B. began with the Sherman Act in 1890.

 

C. affect the 4Ps and marketing mix planning.

 

D. focus more on protecting competition than protecting consumers.

 

E. All of these are correct.

 

225. The Sherman Act and the Clayton Act:

A. were intended to protect large producers.

 

B. were designed to limit competition.

 

C. were passed during the rash of corporate takeovers in the 1980s.

 

D. None of these is correct.

 

226. The Sherman Act and the Clayton Act:

A. were intended to protect small producers.

 

B. were aimed at efforts to restrain trade or lessen competition.

 

C. were passed before the Depression of the 1930s.

 

D. All of these are correct.

 

227. The Sherman Act sought to:

A. prevent monopolies or conspiracies in restraint of trade.

 

B. establish the Federal Consumer Protection Agency.

 

C. eliminate price differences among different competing suppliers.

 

D. prevent fraud on the Internet.

 

E. restrict importing into the United States.

 

228. The Sherman Act is primarily designed to:

A. prevent monopolies or conspiracies in restraint of trade.

 

B. stop the flow of foreign products into the United States.

 

C. prevent unfair or deceptive acts or practices in commerce.

 

D. reduce price discrimination by manufacturers.

 

E. eliminate deceptive selling practices.

 

229. The _____ _____ prohibits monopoly or conspiracy in restraint of trade.

A. Sherman Act

 

B. Clayton Act

 

C. Robinson-Patman Act

 

D. Antimerger Act

 

E. Magnuson-Moss Act

 

230. Which of the following U.S. antimonopoly laws deals with conspiracy to fix prices?

A. Clayton Act (1914)

 

B. Magnuson-Moss Act (1975)

 

C. FTC Act (1914)

 

D. Sherman Act (1890)

 

E. Wheeler-Lea Amendment (1938)

 

231. Which of the following U.S. antimonopoly laws deals with “tying contracts” where the sale of one product is contingent on the business customer purchasing other products from the same supplier?

A. Sherman Act (1890)

 

B. Robinson-Patman Act (1936)

 

C. Antimerger Act (1950)

 

D. Wheeler-Lea Amendment (1938)

 

E. Clayton Act (1914)

 

232. The Clayton Act specifically aims at:

A. tying contracts.

 

B. price discrimination by manufacturers.

 

C. exclusive dealing contracts limiting a buyer’s sources of supply.

 

D. All of these are correct.

 

233. The ____ prohibits exclusive dealing contracts.

A. Antimerger Act

 

B. Clayton Act

 

C. Magnuson-Moss Act

 

D. Wheeler-Lea Amendment

 

E. Federal Trade Commission Act

 

234. The Clayton Act is NOT concerned with:

A. product warranties.

 

B. price discrimination by manufacturers.

 

C. exclusive dealing contracts.

 

D. tying contracts.

 

E. encouraging competition.

 

235. The Federal Trade Commission Act of 1914 is primarily concerned with:

A. deceptive warranties.

 

B. price-fixing agreements.

 

C. conspiracies in restraint of trade.

 

D. mergers which might substantially lessen competition.

 

E. unfair methods of competition.

 

236. The Federal Trade Commission Act of 1914 focuses on:

A. mergers between competitors.

 

B. unreasonable practices related to product warranties.

 

C. unfair methods of competition.

 

D. tying contracts.

 

E. attempts to monopolize.

 

237. The Sherman Act and the Federal Trade Commission Act:

A. were passed to make it difficult for small companies to win customers away from large companies.

 

B. are not taken seriously, since there are no penalties for violations.

 

C. are quite different, with the FTC Act focusing on stopping deceptive business practices and the Sherman Act focusing on controlling monopolies.

 

D. are just different names for the same thing—a law proposed by Sherman to establish the Federal Trade Commission.

 

E. were passed to protect consumers from abuses by business, rather than to protect some businesses from others who had an “unfair” advantage.

 

238. The Robinson-Patman Act specifically aims at:

A. unfair methods of competition.

 

B. price discrimination.

 

C. deceptive advertising.

 

D. firms that rely on salespeople who sell “door to door.”

 

E. attempts to monopolize.

 

239. A firm that discriminates in price on goods of “like grade and quality” may be in violation of the ___________ Act.

A. Sherman

 

B. Robinson-Patman

 

C. Wheeler-Lea

 

D. Magnuson-Moss

 

E. Antimerger

 

240. When Acme Tools was found guilty of giving one of its retailers lower prices on goods of “like grade and quality” without any cost justification, the firm was charged with a violation of the ___________.

A. Sherman Act

 

B. Clayton Act

 

C. Robinson-Patman Act

 

D. Antimerger Act

 

E. Wheeler-Lea Amendment

 

241. Which of the following laws focuses on price discrimination on goods of “like grade and quality” without a cost justification?

A. The Fair Prices Act

 

B. The Robinson-Patman Act

 

C. The Federal Trade Commission Act

 

D. The Magnuson-Moss Act

 

E. There are no laws regulating price discrimination.

 

242. The Wheeler-Lea Amendment specifically aims at:

A. product warranties.

 

B. product safety.

 

C. unfair or deceptive practices.

 

D. tying and exclusive dealing contracts.

 

E. mergers and acquisitions.

 

243. A carpet cleaning firm runs a newspaper ad stating: “Special this month only! Three rooms of carpet cleaned for $39.95!” In each of the next ten months, the firm runs the same ad. A consumer advocacy group files suit against the carpet cleaning firm, contending that the ad is deceptive. The suit charges that the ad makes it seem as though the $39.95 price is a special price that will increase at the end of the month, when in reality, the price never changes. The U. S. federal law governing this type of situation is the:

A. Robinson-Patman Act.

 

B. Clayton Act.

 

C. Sherman Act.

 

D. Magnuson-Moss Act.

 

E. Wheeler-Lea Amendment.

 

244. Despite the Antimerger Act, there has been some leniency in allowing mergers between firms that have been competitors. When considering a merger, companies should take this aspect of the _____________ environments into consideration.

A. legal and political

 

B. cultural and economic

 

C. technological and legal

 

D. social and cultural

 

E. political and economic

 

276. Ford Motor Co. asks members of its target market to rate its cars and those of General Motors and Chrysler on a 7-point scale in terms of two dimensions (comfortable seats and engine power) so that it can establish a quadrant-grid map of these ratings. What type of analysis is Ford conducting?

A. Positioning

 

B. Combining

 

C. Qualifying

 

D. Dimensional

 

E. Insight management

 

277. “Positioning” might cause a marketing manager to:

A. introduce a new product for a segment with unsatisfied needs.

 

B. change a product’s promotion to make its image fit more closely with the needs and attitudes of the target market.

 

C. shift attention to another market segment where competition is weaker.

 

D. physically change his or her product to compete more effectively with a competitor aiming at the same target market.

 

E. Any of these could be true.

 

278. Which of the following statements about positioning is NOT true? Positioning techniques

A. position products on a graph based on price level and quantity demanded.

 

B. require a firm to collect data about consumer perceptions of products.

 

C. are sometimes called “perceptual mapping” techniques.

 

D. typically rely on a “product space” diagram to show the relationship among various products.

 

E. may use information about consumers’ “ideal” products, so that the preferences of different segments of consumers can be considered.

 

279. Which of the following statements about positioning is NOT true?

A. It often makes use of techniques such as perceptual mapping.

 

B. It refers to how customers think about proposed or present brands in a market.

 

C. Positioning issues are especially important when competitors in a market are very dissimilar.

 

D. It helps marketing managers know how customers view the firm’s offering.

 

E. Managers make graphs for positioning decisions by asking consumers to make judgments about different brands.

 

280. Which of the following statements is True regarding positioning?

A. Positioning refers to how managers think about proposed or present brands in a market.

 

B. Positioning issues are not important when competitors in a market appear to be very similar.

 

C. Usually, the positions of products are related to six or seven product features that are important to product managers.

 

D. None of these statements is true.

 

281. Positioning analysis

A. helps managers understand the actual characteristics of their products.

 

B. is not a product-oriented approach.

 

C. is a visual aid to understanding a product-market.

 

D. shows that managers and customers usually view present brands similarly.

 

E. always leads a firm to segmenting and not combining.

 

282. When a company provides its advertising agency with a statement about a new product to use in designing an advertising campaign, and this statement includes a description of the target market, the product type, the primary benefits of using the product, and how this product is different from, and better than, competitive products, what type of statement is this?

A. Qualifying

 

B. Positioning

 

C. Determining

 

D. Clustering

 

E. Combining

 

283. When PepsiCo asked its advertising agency to develop an advertising program for its Mountain Dew soft drink, it gave the agency a statement describing the age and fun-loving spirit of its target market and the one-of-a-kind citrus flavor of the new product, what type of statement was this?

A. Clustering

 

B. Determining

 

C. Combining

 

D. Positioning

 

E. Qualifying

=============

 

 

Chapter 05

Final Consumers and Their Buying Behavior

 

True / False Questions

1. The economic-buyer theory assumes that consumers know all the facts and logically compare choices.

True    False

 

2. Most economists assume that consumers are “economic buyers” who logically evaluate choices to get the greatest satisfaction from spending their time and money.

True    False

 

3. Economic needs include such things as self-respect, accomplishment, fun, freedom and relaxation.

True    False

 

4. The “economic buyer” view of consumers says that individuals will only buy the cheapest goods and services available—regardless of quality.

True    False

 

5. Economic needs are concerned only with getting the best quality at the lowest price.

True    False

 

6. The median income of U.S. families in 2010 was about $49,445.

True    False

 

7. In 2010, half of all American households earned more than $75,442.

True    False

 

8. By 2010, after taking inflation into account, the median income in the U.S. declined by 7 percent in the previous decade.

True    False

 

9. In 2010, 50 percent of U.S. families received less than $49,445 in income.

True    False

 

10. Discretionary income is what is left after paying taxes.

True    False

 

11. Discretionary income is the income from investments.

True    False

 

12. Discretionary income is the income adjusted to take out the effects of inflation.

True    False

 

13. Discretionary income is an elusive concept because the definition of necessities varies from family to family and over time.

True    False

 

14. Most marketing managers think that the economic-buyer theory explains buyer behavior very well.

True    False

 

15. According to the text, consumer buying decisions are influenced by economic needs, psychological variables, social influences, and the purchase situation.

True    False

 

16. Motivation, perception, learning, attitudes, trust, and lifestyle are psychological variables which affect consumer buying.

True    False

 

17. Family, social class, reference groups, and culture are the psychological variables that affect a consumer’s buying decisions.

True    False

 

18. Wants are the basic forces that motivate a person to do something.

True    False

 

19. Wants are needs which are learned during a person’s life.

True    False

 

20. A drive is a strong stimulus that encourages action to reduce a need.

True    False

 

21. Food, liquid, sex, and rest are examples of physiological needs.

True    False

 

22. Examples of personal needs include self-esteem, accomplishment, fun, freedom, and relaxation.

True    False

 

23. The “hierarchy of needs” model suggests that most products must fill more than one need at the same time.

True    False

 

24. According to the Hierarchy of Needs, consumers are motivated to first satisfy their higher-order needs, then they will focus on their lower-level needs.

True    False

 

25. Motivation theory suggests that a consumer would not try to satisfy physiological and safety needs until social and personal needs have been completely satisfied.

True    False

 

26. Motivation theory suggests that only one need can be satisfied at a time.

True    False

 

27. Consumers do not usually see or hear all the stimuli that come their way.

True    False

 

28. In selective exposure we screen out or modify ideas, messages, and information that conflict with previously learned attitudes and beliefs.

True    False

 

29. “Selective exposure” refers to a person’s ability to screen out or modify ideas, messages, and information that conflict with previously learned attitudes and beliefs.

True    False

 

30. Learning is a change in a person’s thought processes caused by prior experience.

True    False

 

31. According to learning theory, a cue is likely to result in a consumer response only if there is a drive to satisfy.

True    False

 

32. Reinforcement of a response decreases the likelihood of the same response the next time the drive occurs.

True    False

 

33. Reinforcement strengthens the relationship between the cue and the response.

True    False

 

34. Adding lemon scent to Pledge furniture polish is an example of using a positive cue.

True    False

 

35. A perfume ad that suggests that people who use the product have more appeal to the opposite sex is an example of a positive cue.

True    False

 

36. That “new car” smell that includes an aroma of leather and wood is an example of using a positive cue.

True    False

 

37. Many needs are culturally (or socially) learned.

True    False

 

38. Americans’ preoccupation with deodorants is an example of a culturally learned need.

True    False

 

39. An attitude is a person’s point of view about something, and usually involves liking or disliking.

True    False

 

40. The main difference between attitudes and beliefs is that beliefs always involve liking or disliking, but attitudes don’t necessarily involve liking or disliking.

True    False

 

41. Beliefs are not as action-oriented as attitudes.

True    False

 

42. Beliefs are more action-oriented than attitudes.

True    False

 

43. Beliefs may help shape a consumer’s attitudes but don’t necessarily involve any liking or disliking.

True    False

 

44. A consumer’s belief about a product may have a positive or negative effect on his or her attitude about the product.

True    False

 

45. Attitudes are very good predictors of intention to buy.

True    False

 

46. It is easier for a marketer to work with existing attitudes than to try to change them.

True    False

 

47. It is possible for marketing managers to change or create new attitudes about goods and services—but overcoming negative attitudes is a really tough job.

True    False

 

48. An expectation is an outcome or event that a person anticipates or looks forward to.

True    False

 

49. Consumers may evaluate a product not just on how well it performs but on how it performs relative to their expectations.

True    False

 

50. In light of the relationships between consumer expectations and satisfaction, it’s usually best for promotion to slightly “over promise” what the firm can actually deliver.

True    False

 

51. Trust is the confidence a person has in the promises or actions of another person, brand, or company.

True    False

 

52. Highly trusted people, brands, and companies have many disadvantages in the marketplace.

True    False

 

53. Activities, Interests and Opinions are the “AIO” variables used in lifestyle analysis.

True    False

 

54. Attitudes, Income and Opinions are the “AIO” variables used in lifestyle analysis.

True    False

 

55. Psychographics is the analysis of a person’s day-to-day pattern of living as expressed in that person’s Activities, Interests, and Opinions.

True    False

 

56. The VALS approach to understanding consumer behavior considers values, attitudes, and lifestyles.

True    False

 

57. Marital status, age, and the age of any children in a household are the three demographic dimensions that determine stage of family life cycle.

True    False

 

58. In international marketing, it’s important to rely on intuition and to generalize the cultural influences on consumer behavior from one country to another.

True    False

 

59. It’s hazardous to rely on intuition in generalizing about cultural influences on consumer behavior from one country to another.

True    False

 

60. Stage of family life cycle is usually determined by two demographic dimensions—income and number of children.

True    False

 

61. Singles and young couples seem less willing to try new products because they earn less.

True    False

 

62. Younger families with no children are a good market for durable goods such as automobiles and furniture.

True    False

 

63. Older people seem to be more open to new products and brands than younger people.

True    False

 

64. Families with teenagers tend to spend more on durables than younger families.

True    False

 

65. Teens play an increasingly minor role in shaping family purchases.

True    False

 

66. “Empty nesters” are people whose children are grown and who are now able to spend their money in other ways.

True    False

 

67. “Empty nesters” is a term that refers to young couples with no children.

True    False

 

68. Consumer buying decisions are affected by social influences such as motivation, perception, learning, attitudes, and personality.

True    False

 

69. Buying responsibility and purchase influence between husband and wife vary greatly—depending on the product and the specific family.

True    False

 

70. Income by itself is usually a pretty good measure of social class.

True    False

 

71. According to the text, the U.S. social class system is much more rigid than those in most countries.

True    False

 

72. According to the text, the U.S. social class system is usually measured in terms of occupation, education, and housing arrangements.

True    False

 

73. People who have the same amount of income—but who are in different social classes—tend to spend their income in the same way.

True    False

 

74. Given the same income, consumers in different social classes will handle themselves and their money very differently.

True    False

 

75. The group of people to whom an individual looks when forming attitudes about a particular topic is his reference group for that topic.

True    False

 

76. A person normally has several reference groups.

True    False

 

77. Reference group influence is likely to be greater for products which will not be seen by other individuals.

True    False

 

78. Reference groups are more important when others will be able to “see” which product or brand we’re using.

True    False

 

79. An opinion leader is usually wealthier and better educated than the people he or she influences.

True    False

 

80. Opinion leaders for one subject or product are also usually opinion leaders for many other subjects or products.

True    False

 

81. Word-of-mouth publicity from opinion leaders can be favorable or unfavorable.

True    False

 

82. Marketers who want to aim at people within several different cultures usually will be able to use the same marketing mix for all of them.

True    False

 

83. In the U.S., ethnic submarkets are growing at a faster rate than the overall population.

True    False

 

84. Both the birthrate and the buying power of ethnic groups in the U.S. are increasing.

True    False

 

85. In ethnic markets within the U.S., the median age is higher and the birthrate is lower than the overall population.

True    False

 

86. Hispanic Americans are now the largest and fastest-growing ethnic group in the U.S.

True    False

 

87. Asian Americans are the largest and fastest-growing ethnic group in the United States.

True    False

 

88. Of all the major ethnic groups in the U.S., Asian Americans have the highest median family income.

True    False

 

89. African Americans have the highest median family income of the major ethnic groups.

True    False

 

90. The buying power of Hispanics and African Americans exceeds $1 trillion a year.

True    False

 

91. Planning for cultural differences in international markets is easier than in domestic markets.

True    False

 

92. The reaction of Italian women to Swiffer is an example of cultural influence.

True    False

 

93. Needs, benefits sought, attitudes, motivation, and even how a consumer selects certain products all vary depending on the purchasing situation.

True    False

 

94. Different purchase situations may require different marketing mixes, even though the same target market is involved.

True    False

 

95. The consumer decision process begins when a consumer becomes aware of an unmet need.

True    False

 

96. As part of the basic problem-solving steps, a consumer searches for information, identifies alternatives and what factors are important, and then evaluates one or more products before deciding how best to meet a need.

True    False

 

97. How much effort is put into a buying decision depends on the economic needs, psychological variables, social influences, purchase situation, and the amount of risk involved.

True    False

 

98. Consumers use extensive problem solving when they put SOME effort into deciding how to satisfy a need.

True    False

 

99. Consumers use limited problem solving when they put MUCH effort into deciding how to satisfy a need.

True    False

 

100. Limited problem solving is used by consumers when some effort is required in deciding the best way to satisfy a need.

True    False

 

101. A consumer interested in making a low involvement purchase is most likely to use “limited problem solving”—rather than one of the other levels of problem solving.

True    False

 

102. Limited problem solving is used when the consumer has a lot of experience in meeting a need and has no need for additional information.

True    False

 

103. Routinized response behavior is typical for low-involvement purchases.

True    False

 

104. Finding her favorite brand of shampoo temporarily out of stock, a supermarket shopper is more likely to take part in routinized response behavior than limited problem solving.

True    False

 

105. The idea of a decision process implies that consumers always apply rational processes in their buying decisions.

True    False

 

106. Dissonance takes place when an individual is NOT confident about the rightness of a decision.

True    False

 

107. After making a purchase, buyers often wonder if they made the right choice. The resulting tension is called dissonance.

True    False

 

108. The power of negative purchase experiences is greater than that of positive experiences.

True    False

 

109. The adoption process refers to the steps individuals go through on the way to accepting or rejecting a new idea.

True    False

 

110. The steps in the adoption process are awareness, interest, evaluation, trial, decision, and confirmation.

True    False

 

111. In the evaluation stage of the adoption process, a consumer begins to give the product a mental trial, applying it to his or her personal situation.

True    False

 

112. In the confirmation stage of the adoption process, the adopter continues to rethink the decision and searches for support for the decision.

True    False

 

113. In the adoption process, the confirmation step usually precedes the decision step.

True    False

 

 

Multiple Choice Questions

114. Which of the following would be most helpful for predicting why a final consumer selects one of several similar brands?

A. population data

 

B. consumer spending patterns

 

C. behavioral science theories

 

D. consumer income

 

E. all would be equally helpful

 

115. Which of the following is not a need that affects the buying behavior of “economic buyers”?

A. Economy of purchase or use

 

B. Convenience

 

C. Dependability in use

 

D. Motivation

 

E. Efficiency in operation or use

 

116. Discretionary income is the portion of a person’s income that pays for:

A. rent.

 

B. food.

 

C. luxuries.

 

D. taxes.

 

E. insurance.

 

117. The appeal that has the most relevance to an economic buyer is:

A. “I’m lovin’ it” (McDonald’s).

 

B. “Expect great things” (Kohl’s).

 

C. “Live for now” (Pepsi).

 

D. “Who doesn’t want 50% more cash?” (Capital One Rewards Card).

 

E. “Relentlessly protecting your identity” (LifeLock).

 

118. An economic buyer is a person who

A. logically compares choices to get the greatest satisfaction from spending time and money.

 

B. makes buying decisions based only on price.

 

C. will not pay extra for convenience.

 

D. always buys products at the lowest price possible.

 

E. is averse to spending time and money.

 

119. An “economic buyer” is a person who:

A. Makes buying decisions based on behavioral needs rather than economic needs.

 

B. Logically compares choices to get the greatest satisfaction from expenditures of time and money.

 

C. Always buys the product that has the lowest price.

 

D. Is not willing to pay extra for convenience.

 

E. All of these are characteristics of an “economic buyer.”

 

120. Economists’ economic-buyer theory assumes that:

A. income data are very useful for predicting consumer behavior.

 

B. buyers logically compare choices in order to maximize their satisfaction.

 

C. consumers should purchase only low-priced products.

 

D. buyers focus primarily on price.

 

E. None of these is correct.

 

121. _____ are concerned with making the best use of a consumer’s time and money—as the consumer judges it.

A. Economic needs

 

B. Psychological needs

 

C. Social influences

 

D. Behavioral influences

 

E. Perceptual needs

 

122. Which of the following is an “economic need”?

A. Desire for self-satisfaction and convenience.

 

B. Desire for efficiency in the use of the consumer’s money.

 

C. Desire for efficiency in the use of the consumer’s time and money.

 

D. Desire for prestige and paying a high price for the best quality.

 

E. Desire for status and paying a high price for the best quality.

 

123. Which of the following is NOT an economic need?

A. Dependability in use

 

B. Hunger

 

C. Economy of use

 

D. Convenience

 

E. Efficiency in use

 

124. Which of the following is NOT an economic need of consumers?

A. Convenience.

 

B. Dependability in use.

 

C. Economy of purchase.

 

D. Efficiency.

 

E. Hunger.

 

125. At Home Depot, a customer can purchase a gallon of one-coat paint that contains the ingredients for both a primer and a color. What is the primary economic need being satisfied by this type of paint?

A. Dependability in use

 

B. Economy of purchase

 

C. Improvement of earnings

 

D. Convenience

 

126. A magazine ad for GEICO car insurance shows the GEICO gecko lying down while the copy reads, “Don’t take high car insurance rates lying down.” What primary economic need is being satisfied in this magazine ad?

A. Convenience

 

B. Improvement of earnings

 

C. Dependability in use

 

D. Economy of purchase

 

127. An application for the iPhone that includes voice directions for a built-in GPS system can be helpful in finding a motel that is “off the beaten track”. What is the primary economic need being satisfied by this app?

A. Economy of purchase

 

B. Dependability in use

 

C. Efficiency in use

 

D. Convenience

 

128. In a television commercial for Maytag appliances, the spokesperson “Old Lonely” acts bored because no one is calling him to schedule a repair of their appliances. What is the primary economic need being illustrated in this TV ad?

A. Dependability in use

 

B. Convenience

 

C. Economy of purchase

 

D. Improvement of earnings

 

129. A busy mom stops at a 7-Eleven store on the way home from work to purchase some bread, milk, and ice cream. What primary economic need is being satisfied by the 7-Eleven?

A. Dependability in use

 

B. Economy of purchase

 

C. Efficiency in operation

 

D. Convenience

 

130. The economists’ view of buyers

A. puts a great deal of emphasis on differences in buying behavior related to individual differences among consumers.

 

B. is based on the idea that consumers value time and select the first alternative they learn about.

 

C. assumes that consumers always buy the lowest-price alternative.

 

D. emphasizes psychological variables rather than social influences.

 

E. None of these answers is correct.

 

131. The percentage of U.S. families with incomes above $49,445 in 2010 was:

A. about 50.

 

B. about 75.

 

C. 20.

 

D. 10.

 

E. less than 5.

 

132. The median family income in the U.S. in 2010 was about:

A. $30,000.

 

B. $40,000.

 

C. $50,000.

 

D. $75,000.

 

E. $100,000.

 

133. Discretionary income is defined as:

A. total market value of goods and services produced.

 

B. gross domestic product per capita.

 

C. income available after taxes.

 

D. income available before taxes.

 

E. income available after taxes and necessities.

 

134. “Discretionary income:”

A. is a family’s income AFTER taxes.

 

B. is a measure of a family’s total purchasing power.

 

C. is the amount of income spent on durable goods.

 

D. is a family’s income AFTER paying taxes and paying for necessities.

 

135. The amount of income a family has left after paying taxes and paying for its necessities is called its ______________ income.

A. personal

 

B. discretionary

 

C. marginal

 

D. family

 

E. modified

 

136. What is left of income after paying for taxes and paying for necessities?

A. Net income.

 

B. Real income.

 

C. Deductible income.

 

D. Gross income.

 

E. Discretionary income.

 

137. Misty Hancock is a sales rep for a computer producer. Her salary last year was $30,000, and she earned another $5,000 in sales commissions. She paid $6,000 in taxes, and spent $8,000 on food, housing, a car, and other “necessities.” What is Misty’s discretionary income?

A. $21,000

 

B. $34,000

 

C. $15,000

 

D. $24,000

 

E. $8,000

 

138. A young working couple earned $55,000 last year. They paid $16,000 in taxes and $20,000 in rent, food, insurance and other necessities. What was their discretionary income for the year?

A. $39,000.

 

B. $55,000.

 

C. $30,000.

 

D. $35,000.

 

E. $19,000.

 

139. A young working couple earned $35,000 last year, and paid $10,000 in taxes. They spent $13,000 on rent, food, insurance, and other “necessities.” What is their discretionary income?

A. $12,000

 

B. $35,000

 

C. $22,000

 

D. $25,000

 

140. Keith McPherson earned $20,000 last year as a carpenter. He paid $6,000 for food, rent, medical expenses and other “necessities.” There was little construction work in February, so he took a trip to the Caribbean and spent $4,000. What was Keith’s discretionary income last year?

A. $4,000

 

B. $20,000

 

C. $10,000

 

D. $12,000

 

E. There is not enough information to determine Keith’s discretionary income.

 

141. As the owner of a women’s clothing store, Caroline Lipscomb has an income of $75,000. She pays $30,000 per year in taxes and another $17,000 per year in grocery bills, house mortgage, and car payment. Last year she went to Italy and spent an additional $4,000. What was Caroline’s discretionary income last year?

A. $45,000.

 

B. $75,000.

 

C. $26,000.

 

D. $28,000.

 

E. $24,000.

 

142. A young working couple earned $50,000 last year. Of that, they paid $16,000 in taxes and $15,000 in rent, food, insurance and other necessities. Their discretionary income for the year was:

A. $35,000.

 

B. $50,000.

 

C. $19,000.

 

D. $34,000.

 

E. $15,000.

 

143. Ginny Paulson was just promoted to marketing manager for her company. She also gets a big raise with the promotion. Because Ginny’s discretionary income will increase, which of the following products is MOST likely to benefit?

A. Furnace repairs.

 

B. Automobile insurance.

 

C. A CD stereo system.

 

D. Medical services.

 

E. Grocery staples.

 

144. As the owner of a Bluetooth specialties store, Alicia Fountainbleau has an income of $72,000. She pays $30,000 per year in taxes and another $22,000 per year in grocery bills, house mortgage, and car payment. Last year she spent an additional $4,000 on a two-week vacation at a Club Med in Rio de Janeiro. What was Alicia’s discretionary income last year?

A. $20,000.

 

B. $4,000.

 

C. $42,000.

 

D. $26,000.

 

E. $50,000.

 

145. Bart Thunderheart has an annual income of $75,000 a year. He pays $25,000 in taxes, and spends another $15,000 on his home, car, food, and other “necessities.” Last year, he decided to really enjoy his annual vacation, so he spent $5,000 to go skiing in Austria. What was Bart’s discretionary income last year?

A. $20,000

 

B. $5,000

 

C. $35,000

 

D. $30,000

 

E. $50,000

 

146. Manuel Acala is a marketing analyst, but made only $28,000 last year because he was employed only part of the year. He paid $5,000 in taxes, and spent another $10,000 for food, housing, a car, and other “necessities.” Manuel’s discretionary income was:

A. $28,000

 

B. $13,000

 

C. $23,000

 

D. $18,000

 

E. There is not enough information to tell.

 

147. Kira Johannson’s salary as a sales rep was reduced to $32,000 last year, but she earned an additional $10,000 in sales commissions. Her tax bill was $14,000 and bills covering other necessities such as food, housing, and transportation amounted to $11,000. Kira’s discretionary income last year was:

A. $17,000.

 

B. $11,000.

 

C. $32,000.

 

D. $28,000.

 

E. $42,000.

 

148. Alberto Romez earned $100,000 last year as a Mercedes sales rep. He paid $10,000 in taxes, and another $25,000 on food, housing and other necessities. Alberto’s discretionary income was _________________.

A. $75,000

 

B. $65,000

 

C. $55,000

 

D. $45,000

 

E. $35,000

 

149. According to the text, the economic-buyer theory

A. says that most consumers do not know the economic value of products they purchase.

 

B. explains why people behave the way they do.

 

C. includes psychological variables and social influences.

 

D. is too simplistic to explain consumer behavior.

 

E. assumes that consumers always buy the lowest price alternative.

 

150. The “economic-buyer” model:

A. is seen as too simplistic by most marketing managers.

 

B. assumes that consumers are affected by psychological variables and social influences.

 

C. suggests that men and women behave differently as buyers.

 

D. assumes that buyers don’t have enough information to make logical choices—and as a result buy products that are not a good value.

 

E. None of these is true of the economic-buyer model.

 

151. ADT commercials that advertise the value of having a home burglar alarm system appeals to consumers’:

A. personal needs.

 

B. economic needs.

 

C. social needs.

 

D. safety needs.

 

E. physiological needs.

 

152. Firms most likely to attract consumers by making an appeal to social needs are:

A. tire companies.

 

B. online dating sites.

 

C. tax preparation services.

 

D. banks.

 

E. electric companies.

 

153. Many consumers mentally block out marketing messages that do not interest them. This phenomenon is part of a person’s _____.

A. motivation

 

B. needs

 

C. perception

 

D. attitudes

 

E. learning

 

154. Marketers cannot assume that a product that meets consumer needs in one country will do so in another. This is because:

A. some people do not have physiological or safety needs.

 

B. many needs are culturally learned.

 

C. economic needs do not influence purchases in many regions of the world

 

D. the purchase situations may be different.

 

E. family life cycles may be different.

 

155. ____ is one of the psychological variables that affects a person’s buying behavior.

A. Perception

 

B. Family

 

C. Social class

 

D. Reference groups

 

E. Convenience

 

156. Which of the following is NOT a psychological variable?

A. Culture.

 

B. Personality.

 

C. Learning.

 

D. Perception.

 

E. Attitudes.

 

157. Which of the following is NOT a psychological variable?

A. Attitudes

 

B. Social class

 

C. Motivation

 

D. Learning

 

E. Perception

 

158. Regarding consumer motivation, the text states that:

A. wants are the basic forces which motivate people to do something.

 

B. all needs and wants are caused by drives.

 

C. wants are learned needs.

 

D. the terms “needs” and “wants” mean the same thing.

 

E. None of these alternatives is correct.

 

159. What are the basic forces that motivate a person to do something?

A. Desires.

 

B. Drives.

 

C. Actions.

 

D. Aspirations.

 

E. Needs.

 

160. Wants

A. are an effort to satisfy a drive.

 

B. are more basic than needs.

 

C. are strong stimuli that encourage action to reduce a need.

 

D. are needs that are learned during a person’s life.

 

E. remain the same during a person’s life.

 

161. Marci Bello is status-oriented. When she buys clothing she only considers items with well-known “labels” that her friends will notice. This behavior illustrates

A. satisfying a need.

 

B. satisfying a want.

 

C. satisfying a belief.

 

D. the “economic buyer” model of buyer behavior.

 

E. All of these are equally good answers.

 

162. A _____ is a strong stimulus that encourages action to reduce or satisfy a need.

A. want

 

B. motivation

 

C. drive

 

D. desire

 

E. deed

 

163. When a consumer actually purchases a particular product it is the direct result of a

A. need.

 

B. want.

 

C. drive.

 

D. desire for physical well-being.

 

E. None of these is more true than the others.

 

164. Good marketing managers know that

A. marketing strategies can’t influence consumer “wants.”

 

B. marketers can’t create internal drives in consumers.

 

C. it is not that difficult to develop a marketing strategy that gets consumers to do what they don’t want to do.

 

D. None of these alternatives is correct.

 

165. After working for 18 hours, Katrina arrived home exhausted and wanted to go straight to sleep. Katrina’s need to sleep is a ______________ need.

A. psychological

 

B. social

 

C. physiological

 

D. behavioral

 

E. emotional

 

166. Frustrated by a lack of freedom to make decisions at her work, Betty quit her job to find one with greater independence. What type of need motivated Betty’s actions?

A. Psychological

 

B. Social

 

C. Physiological

 

D. Economic

 

E. Cultural

 

167. The text discusses a four-level hierarchy of needs. Which of the following is NOT included in that model?

A. Social needs.

 

B. Psychological needs.

 

C. Safety needs.

 

D. Physiological needs.

 

E. Personal needs.

 

168. Ranked from lowest level to highest level, the “hierarchy of needs” model includes:

A. personal, social, safety, and physiological needs.

 

B. physiological, safety, social, and personal needs.

 

C. safety, personal, social, and physiological needs.

 

D. social, personal, safety, and physiological needs.

 

E. physiological, safety, personal, and social needs.

 

169. According to the “hierarchy of needs” model, the first needs most people try to satisfy are their ______________ needs.

A. safety

 

B. personal

 

C. physiological

 

D. social

 

E. any of these are correct.

 

170. Physiological needs are concerned with

A. protection and physical well-being.

 

B. love, friendship, status, and esteem.

 

C. an individual’s need for personal satisfaction.

 

D. biological needs.

 

E. responsibility and independence.

 

171. ______ needs are concerned with things that involve a person’s interaction with others.

A. Physiological

 

B. Safety

 

C. Biological

 

D. Personal

 

E. Social

 

172. Needs such as accomplishment and relaxation, which are unrelated to what others think or do, are known as:

A. physiological needs.

 

B. safety needs.

 

C. social needs.

 

D. personal needs.

 

E. biological needs.

 

173. Which of the following are examples of “personal needs”?

A. Needs for food, liquid, and rest.

 

B. Needs for accomplishment, fun, and freedom.

 

C. Needs for solutions, protection, and physical well-being.

 

D. Needs for love and friendship.

 

E. Needs for status and connecting with others.

 

174. L’Oreal advertises its hair color with the popular tagline, “So it costs a bit more. But I’m worth it!” Here, L’Oreal’s marketing effort focuses on satisfying what level in the hierarchy of needs?

A. Social needs

 

B. Safety needs

 

C. Physiological needs

 

D. Personal needs

 

175. Newman’s Own (a salad dressing brand) donates 100 percent of its after-tax profits to progressive causes. Newman’s Own is focusing on satisfying what level in the hierarchy of needs?

A. Social needs

 

B. Personal needs

 

C. Safety needs

 

D. Physiological needs

 

176. Hallmark advertises its gift items with the popular tagline, “When you care enough to send the very best.” Here, Hallmark’s marketing effort focuses on satisfying what level in the hierarchy of needs?

A. Social

 

B. Safety

 

C. Physiological

 

D. Personal

 

177. Harley Owners Group connects motorcycle riders to one another. This group is focusing on satisfying what level in the hierarchy of needs?

A. Safety

 

B. Physiological

 

C. Social

 

D. Personal

 

178. Allstate Insurance promotes its auto and home insurance by telling consumers, “You’re in good hands with Allstate.” Which of the following types of needs is Allstate trying to satisfy?

A. Personal needs.

 

B. Social needs.

 

C. Physiological needs.

 

D. Safety needs.

 

E. Behavioral needs.

 

179. The American Heart Association promotes its awareness campaign with the popular tagline, “Learn and Live.” Here, The American Heart Association’s marketing effort focuses on satisfying what level in the hierarchy of needs?

A. Social

 

B. Safety

 

C. Physiological

 

D. Personal

 

180. At its website, Tylenol identifies the top headache triggers and offers solutions to headache sufferers. Tylenol is focusing on satisfying what level in the hierarchy of needs?

A. Physiological needs.

 

B. Behavioral needs.

 

C. Personal needs.

 

D. Safety needs.

 

E. Social needs.

 

181. In the PSSP Hierarchy of Needs model, which level is illustrated by a Fidelity campaign on TV that proclaims its IRA is a sound investment for the future?

A. Personal needs

 

B. Physiological needs

 

C. Social needs

 

D. Safety needs

 

182. The Cleveland Water Department promotes its safe water with a catchy tagline, “The label says Fiji because it’s not bottled in Cleveland.” Here, the Cleveland Water Department’s marketing effort focuses on satisfying what level in the hierarchy of needs?

A. Physiological

 

B. Social

 

C. Safety

 

D. Personal

 

183. The California Dairy Association promotes its milk campaign with the popular tagline, “Got milk?” Here, the California Dairy Association’s marketing effort focuses on satisfying what level in the hierarchy of needs?

A. Social

 

B. Safety

 

C. Physiological

 

D. Personal

 

184. In the PSSP Hierarchy of Needs model, which level is illustrated by a “Got Milk?” magazine campaign that encourages customers to drink more milk?

A. Physiological needs

 

B. Safety needs

 

C. Social needs

 

D. Personal needs

 

185. A marketing manager who wants to apply the “hierarchy of needs” model should keep in mind that:

A. most consumers are already satisfied and promotion will be needed to “create a need.”

 

B. the same marketing mix might satisfy two or more levels of need.

 

C. not enough attention is focused on physiological needs.

 

D. “social needs” focus on the psychological variables in consumer behavior.

 

E. None of these alternatives is correct.

 

186. Motivation theory

A. suggests that most products must fill more than one need at a time.

 

B. suggests that we are obsessed with lower-level needs.

 

C. explains why marketing efforts targeted at affluent consumers should always focus on lower-level needs.

 

D. suggests that individuals choose a specific response depending on cues.

 

E. emphasizes that, for greatest satisfaction, higher level needs should not be our focus.

 

187. Which of the following statements about “needs” is true?

A. A higher level need may develop before lower level needs are all satisfied.

 

B. If lower level needs are reasonably satisfied, those at higher levels become more dominant.

 

C. A particular product may satisfy more than one need at the same time.

 

D. All of these statements about “needs” are true.

 

188. Which of the following statements about “hierarchy of needs” is FALSE?

A. As soon as lower level needs are reasonably satisfied, those at higher levels become more dominant.

 

B. A higher level need may develop before lower level needs are completely satisfied.

 

C. The order in which needs are satisfied follows a definite pattern—with lower level needs being completely satisfied first.

 

D. A particular product may satisfy more than one need at a time.

 

E. None of these statements about “hierarchy of needs” is FALSE.

 

189. When studying consumer needs, a marketer should:

A. know that a product may be a want or a need depending on what the consumer has learned during his/her life.

 

B. try to understand how the marketing mix can satisfy a set of needs, rather than only one.

 

C. realize that he or she cannot create needs, merely identify them.

 

D. All of these alternatives are correct.

 

190. _____ refers to how we gather and interpret information from the world around us.

A. Retention

 

B. Perception

 

C. Attitude

 

D. Learning

 

E. Lifestyle analysis

 

191. Which of the following is not a selective process used in gathering and interpreting information from the world around us?

A. Selective exposure

 

B. Selective perception

 

C. Selective retention

 

D. Selective attention

 

192. Which of the following is NOT one of the selective processes?

A. Selective perception.

 

B. Selective distribution.

 

C. Selective exposure.

 

D. Selective retention.

 

E. All of these are selective processes.

 

193. The fact that our eyes and minds seek out and notice only information that interests us is called:

A. conscious cognition.

 

B. selective exposure.

 

C. selective retention.

 

D. preconscious perception.

 

E. selective perception.

 

194. ______ refers to processes that screen out or modify ideas, messages, and information that conflict with previously learned attitudes and beliefs.

A. Selective exposure

 

B. Selective learning

 

C. Selective retention

 

D. Selective attention

 

E. Selective perception

 

195. When consumers screen out or modify ideas, messages, and information that conflict with previously learned attitudes and beliefs, this is called:

A. cognitive perception.

 

B. selective perception.

 

C. selective retention.

 

D. conscious perception.

 

E. selective exposure.

 

196. Consumers remembering only what they want to remember is called:

A. conscious response.

 

B. selective retention.

 

C. selective exposure.

 

D. cognitive learning.

 

E. selective perception.

 

197. While planning a vacation, Betty Jo visited the website of a package tour provider and closed a pop-up ad without even noticing what it was for. This is an example of

A. selective retention.

 

B. selective exposure.

 

C. selective perception.

 

D. selective learning.

 

E. selective action.

 

198. When listening to music on the radio, many consumers automatically switch stations when commercials begin to run, and they search until they find another station that is playing music. This tendency is an example of:

A. Selective exposure.

 

B. Selective perception.

 

C. Selective retention.

 

D. Selective learning.

 

E. Selective reception.

 

199. Tammi Soloft has itchy eyes and a stuffy nose, and suddenly becomes aware of many TV ads for allergy products that she never noticed before. This illustrates:

A. selective exposure.

 

B. selective perception.

 

C. selective retention.

 

D. reinforced cognition.

 

E. None of these alternatives is correct.

 

200. Carmela Sanchez is planning to buy a pair of running shoes. Recently, she has been noticing more Adidas advertising in magazines. This is an example of:

A. a physiological need.

 

B. dissonance.

 

C. need satisfaction.

 

D. selective exposure.

 

E. a consumer expectation.

 

201. On his way to a GM dealership to pick up a new truck he has purchased, Ian Mann hears a Ford ad that says that Ford trucks have more power than Chevy trucks. Ian thought that the ad said that the Chevys had more power. This illustrates

A. selective perception.

 

B. learning.

 

C. selective retention.

 

D. reinforcement.

 

E. selective exposure.

 

202. After his Political Science class, Andre only remembered the parts of his professor’s lecture that he agreed with. This is an example of:

A. selective retention.

 

B. selective exposure.

 

C. selective information.

 

D. selective attention.

 

E. selective action.

 

203. _____ is a change in a person’s thought processes caused by prior experience.

A. Selective retention

 

B. Processing

 

C. Wanting

 

D. Learning

 

E. Perception

 

204. Which of the following is NOT a major step in the learning process?

A. Dissonance

 

B. Drive

 

C. Response

 

D. Cues

 

E. Reinforcement

 

205. The order of the steps in the learning process is:

A. drive, cue, response, reinforcement.

 

B. cue, response, drive, reinforcement.

 

C. cue, response, reinforcement, drive.

 

D. drive, response, reinforcement, cue.

 

E. reinforcement, drive, cue, response.

 

206. Which of the following statements about the learning process is TRUE?

A. A cue is a strong stimulus which drives an individual.

 

B. Learning occurs only when a drive is satisfied.

 

C. Cues are the causes of drives.

 

D. Reinforcement strengthens the relationship between a cue and a response.

 

E. All of these statements about the learning process are TRUE.

 

207. Which of the following statements about learning is NOT correct?

A. Satisfaction with a product purchase is reinforcement.

 

B. Repeated reinforcement is likely to lead to routine buying.

 

C. A marketing manager can use a package as a “cue.”

 

D. Reinforcement in the learning process weakens the relationship between a cue and a response.

 

E. Almost all consumer behavior is learned.

 

208. Which of the following statements concerning reinforcement is FALSE?

A. Reinforcement of the learning process occurs when the response is followed by satisfaction.

 

B. Reinforcement strengthens the relationship between the cue and the response.

 

C. Reinforcement leads to satisfaction and an increase in the drive.

 

D. Repeated reinforcement leads to development of a habit.

 

E. If an experience is satisfactory, positive reinforcement occurs.

 

209. Which of the following observations about learning is NOT true?

A. Learning is rarely based on direct experience.

 

B. Consumer learning may result from things that marketers do.

 

C. Learning can be based on indirect experience or associations.

 

D. Consumer learning may result from stimuli that have nothing to do with marketing.

 

E. Almost all consumer behavior is learned.

 

210. A movie theater runs a film clip that shows pictures of candy, popcorn and soft drinks prior to running the featured movie. The intent is to get theater patrons to make purchases at the concession stand in the theater lobby. This process is an example of which of the following behavioral influences on buying behavior?

A. Attitudes.

 

B. Beliefs.

 

C. Selective processes.

 

D. Learning.

 

E. None of these choices is correct.

 

211. In the learning process, _____ can be in the form of products, signs, ads, and other stimuli in the environment.

A. reinforcement

 

B. responses

 

C. signals

 

D. retention

 

E. cues

 

212. Which of the following is an example of using a cue to attract consumers?

A. Using a label with red, white, and blue colors to stir patriotic feelings.

 

B. Adding lemon scent to a soap.

 

C. Using a package that looks like the one for a popular brand.

 

D. Adding pine scent to a cleansing fluid.

 

E. All of these are examples of using a cue.

 

213. When Taco Bell shows a large close-up of a chicken taco in a television ad, it is:

A. encouraging selective retention.

 

B. hoping to encourage extensive problem solving by the audience.

 

C. appealing to the social needs of the audience.

 

D. appealing to the economic needs of the audience.

 

E. using a cue to encourage a particular response to the hunger drive.

 

214. A divorced dad commuting to work on a major highway notices a billboard for McDonald’s any-size $1 soft drink. This billboard is an example of a(n):

A. reinforcement.

 

B. response.

 

C. drive.

 

D. cue.

 

E. attitude.

 

215. A grocery store sprays an aerosol scent that smells like fresh baked bread near its packaged bakery items. This is

A. a case of a manager developing a need.

 

B. likely to have no effect because selective retention will eliminate any effect of the smell.

 

C. a case of linking a response with a drive.

 

D. an example of trying to link a cue with a marketing mix.

 

E. a violation of the selective processes.

 

216. An attitude is:

A. the same as an “intention to buy.”

 

B. a person’s point of view about something.

 

C. easy to change.

 

D. the same as a belief.

 

E. All of these alternatives are correct.

 

217. _____ is a person’s point of view towards a product, an advertisement, a salesperson, a firm, or an idea.

A. An attitude

 

B. A belief

 

C. A preference

 

D. An impression

 

E. A cue

 

218. Attitudes are:

A. things we believe strongly enough to be willing to take some action.

 

B. more action-oriented than beliefs.

 

C. reasonably enduring points of view about something.

 

D. usually thought of as involving liking or disliking.

 

E. All of these alternatives are correct.

 

219. Regarding consumer buying behavior,

A. attitudes affect the selective processes, learning, and buying decisions.

 

B. many consumers with a favorable attitude toward a product may have no intention to buy it.

 

C. beliefs are less action-oriented than attitudes.

 

D. All of these alternatives are true.

 

220. Some marketers stretch the meaning of “attitude” to include:

A. intention to buy.

 

B. needs.

 

C. beliefs.

 

D. psychographics.

 

E. actual purchasing behavior.

 

221. Consumers’ attitudes can be learned from:

A. exposure to the attitudes of others.

 

B. promotion which is directed toward them.

 

C. previous experiences.

 

D. family and friends.

 

E. All of these could be true.

 

222. Which of the following observations concerning beliefs is FALSE?

A. Beliefs don’t necessarily involve any liking or disliking.

 

B. A belief is a person’s opinion about something.

 

C. Beliefs may help shape a consumer’s attitudes.

 

D. Beliefs are more action-oriented than attitudes.

 

E. None of these observations is FALSE.

 

223. The statement, “I like Southwest Air,” is an example of a(n):

A. belief.

 

B. intention.

 

C. attitude.

 

D. drive.

 

E. None of these alternatives is correct.

 

224. The statement, “Almond Joy is made with real almonds” is an example of:

A. a belief.

 

B. an intention.

 

C. an attitude.

 

D. a cue.

 

E. None of these alternatives is correct.

 

225. The statement, “I plan to see the new Tom Hanks movie,” is an example of:

A. a drive.

 

B. reinforcement.

 

C. an attitude.

 

D. a belief.

 

E. an intention.

 

226. Which of the following would be the most difficult task facing a marketing manager?

A. Discover the attitudes of the firm’s target market.

 

B. Change existing negative attitudes.

 

C. Create new attitudes toward his or her brand.

 

D. Promote existing attitudes.

 

E. Strengthen existing positive attitudes.

 

227. When dealing with consumer attitudes, marketers should know that:

A. it is usually easier to change a negative attitude about a product than to reinforce a positive attitude.

 

B. consumer attitudes tend to be enduring.

 

C. attitudes are very good predictors of how people will behave.

 

D. consumer attitudes are less action-oriented than consumer beliefs.

 

E. None of these alternatives is correct.

 

228. _____ is an outcome or event that a person anticipates or looks forward to.

A. A response

 

B. A need

 

C. A desire

 

D. An expectation

 

E. An attitude

 

229. An expectation is

A. an event that a person likes to remember.

 

B. a positive cue.

 

C. an unfulfilled need.

 

D. an outcome that a person looks forward to.

 

E. None of these alternatives is correct.

 

230. Trust is the confidence a person has in the promises or actions of

A. another person.

 

B. a brand.

 

C. a company.

 

D. a recommender.

 

E. All of these choices are correct.

 

231. Psychographics may also be called

A. personality analytics.

 

B. social group dynamics.

 

C. lifestyle analysis.

 

D. opinion insight.

 

E. attitude measures.

 

232. The AIO items used in life-style analysis include:

A. activities, intentions, and opinions.

 

B. attitudes, intentions, and opinions.

 

C. attitudes, income, and opinions.

 

D. activities, interests, and opinions.

 

E. attitudes, interests, and opinions.

 

233. Psychographics or life-style analysis analyzes an individual’s:

A. opinions.

 

B. demographics.

 

C. activities.

 

D. interests.

 

E. All of these alternatives are correct.

 

234. Psychographics is the analysis of a person’s day-to-day pattern of living as expressed in that person’s

A. safety, social, and personal needs.

 

B. actions, interests, and occupation.

 

C. activities, interests, and opinions.

 

D. culture, beliefs, and attitudes.

 

E. psychological and physiological needs.

 

235. Studying a consumer’s psychographic characteristics will help marketers understand the target audience’s hobbies, politics, and ______________________________.

A. geographic area

 

B. age bracket

 

C. family size

 

D. income level

 

E. recreational interests

 

236. In psychographics AIO analysis, all of the following are examples of “activities” EXCEPT:

A. age.

 

B. entertainment.

 

C. club membership.

 

D. shopping.

 

E. hobbies.

 

237. VALS and GeoVALS are examples of services offered by research firms to assist in:

A. Learning analysis.

 

B. Lifestyle analysis.

 

C. Reinforcement analysis.

 

D. Belief analysis.

 

E. Expectation analysis.

 

238. Consumer buying behavior is affected by:

A. opinion leaders.

 

B. social class.

 

C. physiological, safety, social, and personal needs.

 

D. reference groups.

 

E. All of these affect consumer buying behavior.

 

239. In developing marketing mixes for consumers in international markets, marketing managers should:

A. generalize from one culture to another.

 

B. use their intuition.

 

C. know about the specific social and intrapersonal variables.

 

D. follow their beliefs.

 

E. All of these are correct.

 

240. When planning strategies for international markets, a good manager will keep in mind that:

A. Relying on intuition may be misleading.

 

B. Understanding local cultural differences is of no real value.

 

C. Consumers in a foreign culture all tend to be the same.

 

D. International markets are very similar to local markets.

 

E. None of these is correct.

 

241. Which of the following observations concerning planning strategies for international markets is FALSE?

A. A marketing manager should know that relying on intuition or personal experience may be misleading.

 

B. A marketing manager should know that understanding local cultural differences is of no real value.

 

C. A marketing manager should know that consumers in a foreign culture are probably bound by some similar cultural forces.

 

D. A marketing manager should involve locals who have a better chance of understanding the interests of customers.

 

E. A marketing manager should understand that many specific influences do not generalize from one culture to another.

 

242. When planning strategies for international markets, keep in mind that:

A. a marketing manager must rely primarily on intuition because there is usually little available information about the social and cultural influences on buying behavior.

 

B. the effects of cultural influences on consumers are usually obvious, if you just take the time to think about the buying situation.

 

C. cultural changes may make outdated stereotypes even more misleading.

 

D. local cultural differences are seldom of any real value.

 

E. All of these should be kept in mind when planning strategies for international markets.

 

243. Which of the following social influences will likely have the greatest impact on a teenager’s purchase of a skateboard?

A. family

 

B. reference group

 

C. culture

 

D. ethnic group

 

E. social class

 

244. Parents who spent years limiting purchases to home necessities and kids’ entertainment often embrace more luxury-oriented buying patterns later in life. This phenomenon is related to:

A. changes in purchase situation.

 

B. selective retention.

 

C. reinforcement.

 

D. changed physiological needs.

 

E. empty nester behavior.

 

245. The inclusion of multiple language options in automated bank teller machines illustrates how some marketers are responding to:

A. the growing singles market.

 

B. emerging reference groups.

 

C. situational buying.

 

D. growing ethnic groups.

 

E. social class fragmentation.

 

246. Marketers increasingly hire celebrities and even full-time bloggers to engage consumers in social media discussions about new products. A person who is able to influence followers to try products is:

A. a channel captain.

 

B. a consumer advocate.

 

C. a marketer.

 

D. a figurehead.

 

E. an opinion leader.

 

247. _____ is a social influence that affects a person’s buying behavior.

A. Perception

 

B. Family

 

C. Motivation

 

D. Learning

 

E. Attitude

 

248. Which of the following is NOT a social influence in consumer buying?

A. Social class

 

B. Beliefs

 

C. Family

 

D. Reference groups

 

E. Culture

 

249. Which of the following dimensions affect family spending?

A. income

 

B. age of children

 

C. age

 

D. marital status

 

E. All of these dimensions affect family spending.

 

250. Which of the following is NOT a stage in the TRADITIONAL flow of the family life cycle?

A. Young single

 

B. Young married without children

 

C. Young divorced with children

 

D. Middle-aged married without dependent children

 

E. Young married with children

 

251. The traditional family flow, according to the family life cycle, does not include people who are

A. middle-aged divorced without dependent children.

 

B. young married with children.

 

C. middle-aged married with children.

 

D. middle-aged married without dependent children.

 

E. young married without children.

 

252. Which of the following statements is True?

A. Divorced families usually have more discretionary income than traditional families.

 

B. Singles and young couples are less willing to try new products than are older couples.

 

C. Empty nesters are frequently big spenders.

 

D. Buying responsibility and influence vary little from one family to another.

 

E. None of these statements is True.

 

253. Of the following, which are the most receptive to new products and new brands?

A. Families with small children.

 

B. Older people with no children.

 

C. Families with teenagers.

 

D. Families whose children are grown.

 

E. Younger people with no children.

 

254. Of the following, which are the most receptive to new products and new brands?

A. Young people

 

B. Senior citizens

 

C. Empty-nesters

 

D. Middle-aged people

 

E. All are equally receptive to new products and new brands.

 

255. Regarding the family life cycle, singles and younger couples without children

A. are more willing to try new products and brands.

 

B. tend to be carefree shoppers who are not very price-conscious.

 

C. often wait to buy basic durable goods until they have children.

 

D. feel more financially squeezed than couples with young children.

 

E. All of these are correct for singles and younger couples without children.

 

256. Ted and Amy Balderas were married last year, at age 24. They have no children and both are currently working hard to build their careers. Couples like Ted and Amy:

A. are likely to be a poor target for firms that are trying to market a new brand or new product concept.

 

B. usually focus on buying durables—such as furniture and appliances.

 

C. usually don’t spend money on discretionary purchases.

 

D. are unlikely to be careful, price-conscious shoppers.

 

E. None of these is a good answer for couples like Ted and Amy.

 

257. Identify the INCORRECT statement about the effect of marital status, age, and the age of any children in the family, on how people spend their income.

A. Singles and young couples are more willing than older married people to try new products and brands.

 

B. Younger people usually earn more than older consumers, but spend less on discretionary items.

 

C. Only as children arrive and grow does family spending shift to soft goods and services.

 

D. All of these statements are CORRECT.

 

258. Teenagers:

A. Have no influence on the buying behavior of their parents.

 

B. Are not an attractive market because they do not spend much money.

 

C. Have become a target for many firms.

 

D. Have essentially the same buying habits as they had before reaching their teen years.

 

E. None of these alternatives is correct.

 

259. American teenagers

A. are not interested in expensive clothes.

 

B. are not involved in shopping.

 

C. currently spend $200 billion a year.

 

D. develop recreation and education needs that are easy on the family budget.

 

E. do not influence family purchases.

 

260. U.S. teenagers spend about ______ billion per year.

A. $100

 

B. $150

 

C. $200

 

D. $250

 

E. $300

 

261. “Empty nesters”:

A. are senior citizens.

 

B. are people over 65 who live alone.

 

C. often have high incomes and fewer required expenses.

 

D. are singles and couples without children—who have much discretionary income.

 

E. None of these alternatives is correct.

 

262. Empty nesters

A. are usually in the 30-44 age group.

 

B. are not an attractive market for any items.

 

C. spend a larger percent of their income on housing, child care, and other necessities.

 

D. are people whose children are grown and who are now able to spend their money in other ways.

 

E. disrupt the family life-cycle pattern.

 

263. HomeFront Construction Company built large, single-family homes for 25 years. Then there was a shift toward more demand for small luxury condominiums—and HomeFront changed its focus. The change in demand could be explained by:

A. the increasing number of senior citizens who are “empty-nesters.”

 

B. the fact that consumers in urban areas generally have higher incomes.

 

C. the increasing number of 45-64 year olds whose children are grown.

 

D. All of these explanations could be relevant.

 

264. Current consumer research suggests that the family’s purchasing agent is now:

A. the husband.

 

B. the children.

 

C. the wife.

 

D. it varies, depending on the product and the family.

 

265. Peter Janca noticed during a weekly grocery shopping that 7-Up was on sale. Even though he could have saved money with the 7-Up, Peter bought Mountain Dew because that’s the brand his children prefer. Peter was responding to:

A. selective exposure.

 

B. dissonance.

 

C. marketing influence.

 

D. social influence.

 

E. a drive.

 

266. According to the text, your social class level does NOT depend directly on your:

A. type and location of housing.

 

B. income level.

 

C. occupation.

 

D. education.

 

E. any of these.

 

267. The social class system in the U.S.

A. does not affect how people spend, but does affect how they save.

 

B. may put people with the same income level in different social classes.

 

C. is based on a person’s educational level.

 

D. is much more rigid than in Europe and Asia.

 

E. does not affect people’s attitudes.

 

268. According to the text, social class in the U.S. is usually measured in terms of:

A. income.

 

B. occupation, education, and housing arrangements.

 

C. income, occupation, and education.

 

D. race, religion, and occupation.

 

E. income, occupation, and religion.

 

269. “Social class” in the U.S. is usually measured in terms of:

A. race, religion, and occupation.

 

B. occupation, education, and type and location of housing.

 

C. income.

 

D. income, occupation, and education.

 

E. income, occupation, and religion.

 

270. In the US, social class groupings are typically based on all of the following EXCEPT:

A. type of housing.

 

B. education.

 

C. community participation.

 

D. occupation.

 

E. location of housing.

 

271. Which of the following statements about social class is false?

A. The various classes tend to have different attitudes.

 

B. The various classes tend to save money in different ways.

 

C. Income by itself can be a pretty good measure of social class.

 

D. The various classes tend to have different beliefs.

 

E. The various classes tend to borrow money in different ways.

 

272. Which of the following statements concerning social class is FALSE?

A. Income by itself is usually a good measure of social class.

 

B. In most countries, social class is closely related to a person’s occupation.

 

C. In most countries, there is a general relationship between income level and social class.

 

D. Almost every society has some social class structure.

 

E. The U.S. class system is far less rigid than those in most countries.

 

273. Which of the following statements about social class is False?

A. People in different social classes tend to have different beliefs and feelings.

 

B. People with the same income level are always in the same social class.

 

C. Variables such as occupation, education, and type of housing form the basis of simple approaches for measuring social class.

 

D. The U.S. class system is far less rigid than those in most other countries.

 

E. None of these statements about social class is False.

 

274. ______ refers to the people to whom an individual looks when forming attitudes about a particular topic.

A. Family

 

B. A social class

 

C. An ethnic group

 

D. A focus group

 

E. A reference group

 

275. Reference group

A. influence is so strong that a person normally has only one reference group.

 

B. influence is greatest for older people.

 

C. influence is equally strong for all products and brands.

 

D. members may not even know the people who influence their values and attitudes.

 

E. None of these alternatives is correct.

 

276. A good marketing manager knows that

A. a consumer’s reference group may consist of people with whom the consumer has no face-to-face contact.

 

B. most consumers have only one reference group.

 

C. a consumer’s family is not a reference group.

 

D. reference groups usually have the most influence on purchases of products which are not easily seen by others.

 

E. None of these alternatives is true.

 

277. Which of the following observations about reference groups is FALSE?

A. Reference groups are people to whom an individual looks when forming attitudes about a particular topic.

 

B. An individual usually has a single reference group for all topics.

 

C. An individual may make buying decisions based on what the group thinks.

 

D. Reference group influence is stronger for products that others “see.”

 

E. Reference group influence is stronger for products that relate to status in the group.

 

278. Reference-group influence would be WEAKEST for determining which particular ______________ a person buys.

A. watch

 

B. cosmetics

 

C. clothing

 

D. laundry soap

 

E. car

 

279. Reference group influence is likely to have the strongest effect on the particular BRAND of ______________ purchased.

A. dishwasher detergent

 

B. frozen peas

 

C. batteries

 

D. watch

 

E. Reference group influence would be about the same for each of these products.

 

280. Natasha Talbott was interested in a new set of golf clubs. She discussed the various types with some knowledgeable friends and relied on their advice. Natasha’s friends were acting as:

A. an economic influence.

 

B. routinized decision-makers.

 

C. a social class.

 

D. a lifestyle group.

 

E. a reference group.

 

281. In the Jockey underwear ads using young people on the beach and the slogan, “Let ’em know you’re Jockey”, the company is hoping to use __________ groups to influence consumer behavior.

A. cultural

 

B. family

 

C. opinion

 

D. reference

 

E. social

 

282. When Ariat gave boots away to popular rodeo riders, other riders began asking for the Ariat brand and Western stores were eager to sell the boots. Ariat used _____________ groups to influence consumer behavior.

A. social

 

B. family

 

C. reference

 

D. cultural

 

E. opinion

 

283. Opinion leaders:

A. are usually better educated.

 

B. are usually wealthier.

 

C. are people who influence others.

 

D. are rarely actually involved in product-related discussions with the people who “follow” them.

 

E. All of these alternatives are true.

 

284. Opinion leaders

A. for one subject are also usually opinion leaders for other subjects too.

 

B. are usually wealthier than their followers.

 

C. can really help a marketing mix by providing favorable word-of-mouth publicity.

 

D. are usually better educated than their followers.

 

E. None of these alternatives is correct.

 

285. Which of the following statements about opinion leaders is true?

A. Opinion leaders are usually wealthier and better educated than others.

 

B. Opinion leaders on one subject aren’t necessarily opinion leaders on another.

 

C. Firms always aim their marketing mixes at general consumers, not opinion leaders.

 

D. Favorable publicity from opinion leaders rarely helps a marketing mix.

 

E. Opinion leaders are the same as reference groups.

 

286. The whole set of beliefs, attitudes, and ways of doing things of a reasonably homogeneous group of people is a(n):

A. culture.

 

B. family.

 

C. evoked set.

 

D. social class.

 

E. reference group.

 

287. The whole set of beliefs, attitudes, and ways of doing things of a reasonably homogeneous set of people is a(n):

A. tradition.

 

B. class.

 

C. society.

 

D. culture.

 

E. ethnicity.

 

288. The whole set of beliefs, attitudes, and ways of doing things of a reasonably homogeneous set of people is called a(n):

A. personal environment.

 

B. culture.

 

C. motivation.

 

D. learned set.

 

E. opinion set.

 

289. With respect to culture and consumer behavior,

A. culture is the whole set of beliefs, attitudes, and ways of doing things of a reasonably homogeneous set of people.

 

B. culture may exert many subtle influences on other aspects of consumer behavior.

 

C. different cultural subgroups are likely to require different marketing mixes.

 

D. All of these alternatives are correct.

 

290. People from different ethnic groups

A. create challenges and not opportunities for marketers.

 

B. do not play an important role in the American marketplace.

 

C. may be influenced by very different cultural variables.

 

D. have common needs.

 

E. have similar ways of thinking.

 

291. Which of the following observations regarding ethnic shifts in the American market is FALSE?

A. Estimates indicate that Hispanics spend nearly $1 trillion a year.

 

B. Estimates indicate that African Americans spend nearly $1 trillion a year.

 

C. Estimates indicate that Asian Americans spend over $500 billion a year.

 

D. The buying power of ethnic submarkets is increasing rapidly.

 

E. None of these observations about ethnic shifts is FALSE.

 

292. Which of the following statements about ethnic dimensions of the U. S. market is True?

A. Ethnic groups buy differently and have different needs.

 

B. Many firms make the mistake of treating all consumers in an ethnic group as homogeneous.

 

C. The number of ethnic consumers is growing at a faster rate than the overall society.

 

D. The buying power of ethnic submarkets is increasing rapidly.

 

E. All of these statements about ethnic dimensions are True.

 

293. Ethnic markets are becoming more important to marketers because

A. the buying power of ethnic submarkets is decreasing.

 

B. the median age of Asian Americans, African Americans, and Hispanics is much higher than that of whites.

 

C. the number of ethnic consumers is growing at a much faster rate than the overall society.

 

D. they make a clear segment with similar backgrounds and common language, religion, and culture.

 

E. the birthrate of Asian Americans, African Americans, and Hispanics is lower than that of whites.

 

294. Which of the following statements by marketing managers is NOT logical and true?

A. “We are planning to appeal more to Hispanic consumers, since this group has surged and is now over 15 percent of the population.”

 

B. “We’re building supermarkets that will appeal to Hispanic consumers; it’s a big investment, but the Hispanic population in the U.S. spends nearly $1 trillion a year.”

 

C. “We are adapting our diaper promotion to target African American and Hispanic parents, since the birthrate in those groups is higher than for whites.”

 

D. “We will target Asian Americans in California, New York, and Texas since over half of their population in the U.S. is concentrated in those three states.”

 

E. “We are going to appeal to the African American group because it is a large, homogeneous target market.”

 

295. Which of the following statements pertaining to the Hispanic Americans is FALSE?

A. Hispanic Americans are the largest and fastest-growing ethnic group.

 

B. In 2010, the Hispanic population made up 16 percent of the total population.

 

C. The Hispanic population tends to be older than the U.S. population as a whole.

 

D. In 2010, the Hispanic population in the U.S. spent nearly $1 trillion.

 

E. Recently the Hispanic American population has increased at a rate of about 1 million per year.

 

296. The largest and fastest growing ethnic minority group in the United States is composed of:

A. African Americans.

 

B. Asian Americans.

 

C. Native Americans.

 

D. Polish Americans.

 

E. Hispanics.

 

297. Compared to U.S. averages, the median age of Hispanic Americans is:

A. slightly higher.

 

B. much higher.

 

C. much lower.

 

D. about the same.

 

298. with regards to the Hispanic population, which of the following is not true?

A. About 23% of all children under 18 are Hispanic.

 

B. About 20% of the U.S. population is Hispanic.

 

C. In 2010, the Hispanic population of the U.S. was about 50.5 million.

 

D. Hispanics are the largest ethnic group in the U.S.

 

E. Hispanics are the fastest growing ethnic group in the U.S.

 

299. Identify the INCORRECT observation about Asian Americans.

A. Asian Americans are the largest and fastest-growing ethnic group in the United States.

 

B. The number of Asian Americans has more than tripled since 1980.

 

C. Asian Americans have the highest median family income of the major ethnic groups.

 

D. In 2010 they spent over $500 billion.

 

E. Because of their income, a lot of companies are targeting these consumers.

 

300. A college student on her way to take an exam remembers that she doesn’t have a pencil with an eraser—which the instructor asked everyone to bring. The store where she stops doesn’t have regular pencils—but it does sell Scripto mechanical pencils priced at $2.95. That is what she buys. This case illustrates the effect of:

A. personal environment.

 

B. culture.

 

C. purchase situation.

 

D. learned set.

 

E. dissonance.

 

301. A person who purchases flowers will select different floral arrangements for a retirement party, a funeral, and a Valentine’s Day date. This illustrates the impact of _____ on purchase decisions.

A. economic needs

 

B. psychological variables

 

C. social influences

 

D. the purchase situation

 

E. extensive problem solving

 

302. Which of the following illustrates that time and surroundings are factors of the purchase situation that can greatly stimulate buying behavior?

A. Routine trip to grocery store

 

B. Using mass transit to and from work

 

C. Black Friday shopping

 

D. Buying online

 

E. Paying monthly cell phone bill

 

303. A salesperson driving to visit a client located two hours away has a tire blow out on the highway. He walks about a mile to the next exit where he finds a service station. The owner of the station says he can replace the blown tire, but it will cost twice as much as it would to purchase a tire in the salesperson’s home city. The salesperson, not wanting to be late for his appointment, agrees to pay the higher price in order to get back on the road. This case illustrates the effect of ______________________ on buying behavior.

A. cultural background

 

B. social groups

 

C. purchase situation

 

D. learning situation

 

E. reference groups

 

304. An on-site auction may stimulate a different response than an online auction. This is an example of ___________ affecting the purchase decision.

A. demographics

 

B. time

 

C. surroundings

 

D. task

 

E. culture

 

305. The consumer decision process begins with

A. a routinized response.

 

B. need awareness.

 

C. information search.

 

D. problem solving.

 

E. alternative evaluation.

 

306. For a home-based purchase of a furnace, the consumer decision process typically begins:

A. when home heating commercials create product awareness.

 

B. when a furnace sale is advertised in coupon mailings.

 

C. when the first cold day of winter sets in.

 

D. when a malfunction occurs in an older furnace.

 

E. every ten years.

 

307. Which of the following would have the least influence on a consumer purchase of a 5-gallon waterproof sealant for wood decks and fences?

A. The purchase situation

 

B. Social influences

 

C. Economic needs

 

D. Psychological variables

 

E. Opinion leader

 

308. A consumer who seeks to purchase an HDTV for the first time for a home entertainment theater is:

A. likely to use routinized response behavior.

 

B. likely to engage is limited problem solving.

 

C. likely to engage in extensive problem solving.

 

D. about to make a low-involvement purchase.

 

E. likely to seek the brand with the lowest prices.

 

309. A consumer who purchases a new computer but encounters frustration with set up and technical support may experience: _____.

A. limited problem solving

 

B. extensive problem solving

 

C. dissonance

 

D. evaluation

 

E. an information search

 

310. A consumer who is interested in making the switch from a desktop computer to a tablet computer may require a prolonged learning and trial process known as:

A. the consumer decision process.

 

B. limited problem solving.

 

C. the adoption process.

 

D. selective exposure.

 

E. lifestyle analysis.

 

311. When developing marketing mixes for international markets, it is detrimental for managers to predict consumer behavior based on:

A. economic needs.

 

B. culture.

 

C. personal intuition.

 

D. physiological needs.

 

E. input from locals in overseas markets.

 

312. Which of the following is not relevant for international marketers who seek to understand consumer behavior?

A. The pitfalls of stereotyping

 

B. Culture

 

C. Ethnicity

 

D. Social classes

 

E. Domestic trends

 

313. Which of the following is NOT an important problem-solving step for a consumer trying to satisfy a need?

A. search for information

 

B. identify alternatives

 

C. set criteria

 

D. evaluate alternatives

 

E. None of these (i.e., all are important steps).

 

314. When consumers use a problem-solving process to make purchase decisions, what is the next step after they become aware of a problem?

A. Evaluating alternative solutions.

 

B. Gathering information about possible solutions.

 

C. Deciding on the appropriate solution.

 

D. Evaluating the decision.

 

E. Making the commitment to purchase a particular product or service.

 

315. Which of the following is NOT one of the levels of consumer problem solving discussed in the text?

A. Dissonance problem solving

 

B. Routinized response behavior

 

C. Extensive problem solving

 

D. Limited problem solving

 

E. None of these, i.e. all four are discussed.

 

316. When a consumer puts much effort into deciding how to satisfy a need, he engages in

A. extensive problem solving.

 

B. critical problem solving.

 

C. routinized response behavior.

 

D. limited problem solving.

 

E. intensive problem solving.

 

317. What is the likely level of involvement in a purchase decision for a new couch?

A. Extensive.

 

B. Limited.

 

C. Low.

 

D. Moderate.

 

E. Routine.

 

318. Extensive problem solving probably would be required by a recent college graduate in the purchase of:

A. living room furniture.

 

B. a color TV set.

 

C. a new home.

 

D. a sports car.

 

E. All of these are correct.

 

319. Extensive problem solving probably would NOT be required by young newly-marrieds in the purchase of:

A. a stereo system.

 

B. soft drinks.

 

C. a home.

 

D. a DVD player.

 

E. a car.

 

320. Lars Sorenson is a college student who needs to purchase a suit for job interviews. In the past his father has helped him buy suits. This time, he is the sole decision maker and is paying for the $450 suit with money he earned at his part-time job. Lars is concerned about good fit and good value so he visits several stores before making his purchase. For Lars, this situation seems to be one of:

A. Routinized response behavior.

 

B. Low involvement purchasing.

 

C. Extensive problem solving.

 

D. Limited problem solving.

 

E. Adoption purchasing.

 

321. Chelsea is buying her first flat panel television. She wants to make the right decision, so she consults several websites for product reviews, talks to friends and salespeople at electronics stores, determines several key criteria, and evaluates six different sets. For her flat panel purchase, Chelsea used

A. extensive problem solving.

 

B. focused information search.

 

C. routinized response behavior.

 

D. limited problem solving.

 

E. low involvement buying.

 

322. Limited problem solving is used

A. when consumers put much effort into deciding how to satisfy a need.

 

B. for purchases that have little importance or relevance for the customer.

 

C. by consumers when some effort is required in deciding the best way to satisfy a need.

 

D. when consumers regularly select a particular way of satisfying a need when it occurs.

 

E. mostly for impulse purchases.

 

323. Monica does not find her regular brand of shampoo at the store. She looks at the bottles of three brands before deciding on the Shine-On brand. Monica has engaged in

A. limited problem solving.

 

B. intensive problem solving.

 

C. routinized response behavior.

 

D. extensive problem solving.

 

E. analytical problem solving.

 

324. What is the level of involvement in a purchase decision for a small kitchen appliance?

A. Extensive.

 

B. Limited.

 

C. Low.

 

D. Moderate.

 

E. Routine.

 

325. Limited problem-solving probably would NOT be required in the purchase of:

A. running shoes.

 

B. an encyclopedia.

 

C. new suit.

 

D. coffee maker.

 

E. fast-food restaurant meal.

 

326. Limited problem solving probably would be required by “empty-nesters” in the purchase of:

A. sports clothes.

 

B. restaurant’s services.

 

C. plumbing repair service.

 

D. a replacement garbage disposer.

 

E. All of these are correct.

 

327. Eddie Falco went to a grocery store to buy his favorite brand of ice cream. However, the store was temporarily out of that brand, so he looked over the other familiar brands and decided to try a well advertised brand. This case illustrates:

A. Routinized response behavior.

 

B. Intensive problem solving.

 

C. Limited problem solving.

 

D. Extensive problem solving.

 

328. This type of problem solving is typical for a low-involvement purchase.

A. Extensive problem solving.

 

B. Critical problem solving.

 

C. Limited problem solving.

 

D. Intensive problem solving.

 

E. Routinized response behavior.

 

329. Routinized response behavior

A. is most likely when past purchases of similar products have not satisfied the consumer’s needs.

 

B. is more likely when previous behavior has not yet been reinforced.

 

C. is most common for purchases where the consumer has much experience in how to meet a need.

 

D. increases the time required to make a purchase decision.

 

E. is likely in a new purchase situation.

 

330. More than 600,000 loyal customers signed up in advance to purchase the iPhone4 in an Apple store the first day it was available for sale in the U.S. What type of response behavior were these Apple followers demonstrating?

A. Low-involvement buying

 

B. Limited problem solving

 

C. Extensive problem solving

 

D. Routinized response

 

E. Dissonance response

 

331. When Corey runs out of shampoo he buys whatever brand is on sale at his local CVS drugstore. What is his level of involvement in the purchase decision for shampoo?

A. Extensive.

 

B. Limited.

 

C. Moderate.

 

D. Modest.

 

E. Routine.

 

332. Which of the following is LEAST likely to be an example of routinized response behavior?

A. Buying a Coke.

 

B. Purchasing a new pair of shoes.

 

C. Buying soap at a convenient supercenter.

 

D. Buying a burrito at Taco Bell.

 

E. Filling the car with gasoline.

 

333. Routinized response behavior probably would be used by many consumers in the purchase of:

A. soap.

 

B. canned fruit.

 

C. salt.

 

D. milk.

 

E. All of these are correct.

 

334. Which of the following products probably would result in the lowest involvement purchase for most consumers?

A. Paper towels

 

B. Summer vacation

 

C. CD player

 

D. Sweater

 

E. Cough syrup

 

335. Dissonance is a:

A. tension caused by uncertainty about the rightness of a decision.

 

B. conflict between opinion leaders.

 

C. confirmation in the learning process.

 

D. kind of belief.

 

E. form of social influence.

 

336. Dissonance

A. discourages a consumer from considering further information once a purchase has been made.

 

B. is likely to result in a consumer buying the same product next time.

 

C. is more likely to occur with low involvement products.

 

D. is less likely to occur when a consumer has repeatedly purchased the same product.

 

E. occurs in the adoption process after a consumer becomes interested in a product.

 

337. Laurie Michaels just bought a cell telephone for her car after spending several weeks considering all the possibilities. She likes the new phone, but is still wondering if another brand at a slightly higher price would have been better. This is an example of:

A. the relationship between drives, cues, and reinforcement.

 

B. dissonance.

 

C. reference group influence.

 

D. stimulus-response reaction.

 

E. routinized response behavior.

 

338. After buying an expensive new mobile phone, Kevin experiences ____ when he has second thoughts and wonders if he made the right choice.

A. attitude adjustment

 

B. variance

 

C. conflict

 

D. dissonance

 

E. evaluation

 

339. Billy Longstreet had just bought a new car and was a bit uncertain about whether or not he had done the right thing in buying it. Two days after he purchased it, he decided to take it back to the dealer so that the dealer could install some additional optional equipment. When Billy went to the dealership to pick up the car after the installation, the salesman who sold Billy the car said, “You know, in the last two hours three different customers told me how much they liked the looks of your new car. One of them even wanted to know if it was for sale!” This attempt by the salesman to confirm the wisdom of Billy’s purchase decision seems to be aimed at reducing:

A. post-purchase regret.

 

B. reference group influence.

 

C. adoption jitters.

 

D. stimulus-response reaction.

 

E. dissonance.

 

340. For a long time Jessica felt disappointment over a new pair of jeans that never fit quite right. Jessica experienced

A. high involvement purchase.

 

B. dissonance.

 

C. post-purchase regret.

 

D. confirmation.

 

E. selective feedback.

 

341. The steps individuals go through in accepting or rejecting a new idea is known as

A. the adoption process.

 

B. the dissonance process.

 

C. belief formation.

 

D. information search.

 

E. extensive problem solving.

 

342. Which of the following is NOT one of the steps of the “adoption process?”

A. Involvement

 

B. Awareness

 

C. Interest

 

D. Evaluation

 

E. Trial

 

343. Which of the following gives the correct ORDERING of the steps in the “adoption process?”

A. Interest, awareness, trial, decision, evaluation, dissonance

 

B. Awareness, interest, evaluation, trial, decision, confirmation

 

C. Awareness, interest, trial, evaluation, decision, dissonance

 

D. Awareness, interest, trial, decision, evaluation, confirmation

 

E. Awareness, interest, evaluation, decision, trial, confirmation

 

344. Consumers go through six steps when deciding to accept or reject a new idea. In this adoption process:

A. the confirmation step follows the decision step.

 

B. the evaluation step follows the trial step.

 

C. the awareness step follows the interest step.

 

D. the trial step follows the awareness step.

 

E. None of these is correct for the steps in the adoption process.

 

345. With regard to the adoption process,

A. interest is the first step.

 

B. decision is the final step.

 

C. awareness follows interest.

 

D. evaluation precedes trial.

 

E. decision follows confirmation.

 

346. Regarding the adoption process:

A. “Interest” is the first stage in the process.

 

B. “Confirmation” is the last stage in the process.

 

C. “Trial” precedes “evaluation” in the process.

 

D. “Evaluation” precedes “interest” in the process.

 

E. None of these is correct.

 

347. The “adoption process” suggests that:

A. confirmation must come before the decision to adopt or reject.

 

B. evaluation usually comes before trial and decision.

 

C. the decision to reject may follow confirmation.

 

D. confirmation comes from a satisfactory evaluation.

 

E. decision usually follows trial and confirmation.

 

348. A marketing manager for a new brand of bar soap decides to mail free samples to consumers. The logic for using this approach is best explained by

A. the “economic buyer” model.

 

B. the stimulus-response model.

 

C. the typical consumer’s adoption process.

 

D. the need to reduce dissonance.

 

E. the high level of problem solving required with such a product.

 

349. In the _____ step of the adoption process, a consumer begins to give the product a mental trial by applying it to his or her personal situation.

A. interest

 

B. confirmation

 

C. trial

 

D. decision

 

E. evaluation

 

350. Ken Prescott has noticed several television commercials for BestYet—a new brand of shampoo. While washing his hair, he thinks about what would happen if he replaced his current shampoo with BestYet. What stage in the adoption process has Ken reached?

A. evaluation

 

B. feedback

 

C. decision

 

D. interest

 

E. awareness

 

351. In the ____ stage of the adoption process, the consumer may buy the product to experiment with it in use.

A. interest

 

B. awareness

 

C. evaluation

 

D. trial

 

E. decision

 

352. A potential customer for a new Audi A4 sedan takes the car for a two-hour test drive to see how it responds on the open road. This customer is at the ___________ stage of the adoption process.

A. awareness

 

B. interest

 

C. decision

 

D. confirmation

 

E. trial

 

353. In this step of the adoption process, the adopter continues to rethink the decision and searches for support for the decision.

A. Interest

 

B. Evaluation

 

C. Trial

 

D. Confirmation

 

E. Awareness

 

================

 

Chapter 06

Business and Organizational Customers and Their Buying Behavior

 

True / False Questions

1. There are more final consumers than business and organizational customers, so more is purchased by final consumers.

True    False

 

2. Organizational buyers are often referred to as the B2B market.

True    False

 

3. Organizational buyers are also referred to as industrial or intermediate buyers.

True    False

 

4. The process of organizational buying is entirely different from consumer buying.

True    False

 

5. Like final consumers, organizations make purchases to satisfy specific needs, but their basic need is for goods and services that will help them satisfy their own customers or clients.

True    False

 

6. Business and organizational customers are selective buyers who buy for the sole purpose of resale.

True    False

 

7. Organizations always focus on economic factors when they make purchase decisions and are never as emotional as final consumers in their buying behavior.

True    False

 

8. Dependability of supply is usually much less important than price for most business customers.

True    False

 

9. The approaches used to serve business customers in international markets are even more varied than those required to reach individual consumers.

True    False

 

10. Organizational buyers often buy on the basis of a set of purchasing specifications.

True    False

 

11. A description of what a firm wants to buy is called its purchasing specifications, whether that description is written or electronic.

True    False

 

12. Purchasing specifications should be used only with products where quality is highly standardized.

True    False

 

13. Purchase specifications for services are usually very simple because services tend to be very standardized.

True    False

 

14. Purchasing managers seldom use purchasing specifications to buy on the Internet.

True    False

 

15. Purchasing specifications may be very simple (with only a brand name or part number) or very detailed (as with services).

True    False

 

16. ISO 9000 is a way for a supplier to document that its quality procedures meet internationally recognized standards.

True    False

 

17. ISO 9000 is only relevant to domestic suppliers.

True    False

 

18. ISO 9000 is only relevant to international suppliers.

True    False

 

19. ISO 9000 is relevant to both domestic and international suppliers.

True    False

 

20. With ISO 9000 someone is responsible for quality at every step.

True    False

 

21. ISO 9000 reduces the need for a customer to conduct its own audit of a supplier’s quality procedures.

True    False

 

22. Purchasing managers are buying specialists for organizations and may have a lot of power.

True    False

 

23. “Multiple buying influence” means that several people in an organization share in making a purchase decision, but top management is never involved.

True    False

 

24. Multiple-buying influence means that the buyer shares the purchasing decision with several people.

True    False

 

25. Multiple buying influence means that several people except top management share in making a purchase decision.

True    False

 

26. A buying center is generally thought of as all the people who participate in or influence a purchase.

True    False

 

27. In a large company, the “buying center” refers to all of the purchasing managers who work for the firm.

True    False

 

28. A seller’s marketing mix should satisfy BOTH the needs of the customer company and the needs of individuals in the buying center.

True    False

 

29. A requisition is a request to buy something.

True    False

 

30. A person who needs to purchase something usually completes a requisition.

True    False

 

31. A straight rebuy is a routine repurchase that may have been made many times before.

True    False

 

32. New-task buying is an in-between process where some review of the buying situation is done.

True    False

 

33. Straight-rebuy buying takes longer than modified-rebuy or new-task buying and offers more chance for promotion impact by the seller.

True    False

 

34. Few purchasing managers have been able to turn over any of their order placing to computers because so few organizational purchases are routine.

True    False

 

35. The Internet is making even straight rebuys more competitive.

True    False

 

36. When a variety of information sources are readily available in new-task buying, a buyer is much less likely to use a trusted source.

True    False

 

37. Most purchasing managers use search engines as their FIRST step to satisfy new or unfamiliar questions.

True    False

 

38. Specialized search engines can help a business buyer search for products by description.

True    False

 

39. Specialized search engines can help a business buyer search for products using purchase specifications.

True    False

 

40. Specialized search engines can help a business buyer search for products by inspection.

True    False

 

41. A business buyer who uses general purpose and/or specialized search engines may reduce the need to arrange for custom-produced items.

True    False

 

42. White papers, case studies, blogs, and videos are all ways for a seller’s website to provide a buyer with useful content.

True    False

 

43. Online communities are one way for buyers to connect with others who have already dealt with a similar need.

True    False

 

44. As B2B buyers rely more on social networks, it’s more likely that communications from sellers will have even more influence.

True    False

 

45. A competitive bid is the terms of sale offered by a supplier in response to the purchase specifications posted by a buyer.

True    False

 

46. The Internet is making it faster and easier for organizational buyers to use competitive bidding procedures.

True    False

 

47. Procurement sites operate for the benefit of buyers by directing suppliers to them at one convenient site.

True    False

 

48. At a procurement site, competition among sellers is likely to increase.

True    False

 

49. So far, B2B e-commerce has had little effect on the way organizations make purchase decisions and deal with suppliers.

True    False

 

50. Internet tools used in the B2B market that focus primarily on lowering price do not always lower TOTAL purchasing costs.

True    False

 

51. In business markets, suppliers usually want close relationships with customers; however, there’s little benefit to the customer of having closer relationships with suppliers.

True    False

 

52. A close buyer-seller relationship in a business market may reduce a firm’s flexibility.

True    False

 

53. A long-term commitment by an organization to a partner may reduce flexibility.

True    False

 

54. In business markets, a seller would always prefer to have a closer relationship with a customer.

True    False

 

55. In business markets, buyer-seller relationships tend to be an “all-or-nothing” arrangement—either very close or not at all close.

True    False

 

56. Although we talk about close “relationships” between firms in business markets, in practice it is just the relationship between the salesperson and purchasing manager that becomes close.

True    False

 

57. In cooperative relationships in a business market, the buyer and seller work together to jointly achieve both mutual and individual objectives.

True    False

 

58. Just-in-time delivery reliably helps to get products and store them long before the customer needs them.

True    False

 

59. Just-in-time relationships between buyers and sellers usually require operational linkages and information sharing.

True    False

 

60. Negotiated contract buying means agreeing to contracts that allow for changes in the purchase arrangements.

True    False

 

61. Negotiated contract buying would be used when the buyer knows precisely what he wants and the requirements of the job aren’t likely to change as the job is done.

True    False

 

62. Relationship-specific adaptations involve changes in a firm’s product or procedures that are unique to the needs or capabilities of a relationship partner.

True    False

 

63. Specific adaptations are usually made when the buying organization chooses to outsource.

True    False

 

64. Relationship-specific adaptations are usually not required when the buying organization uses outsourcing.

True    False

 

65. To protect themselves from unpredictable events, most purchasing managers seek several dependable sources of supply.

True    False

 

66. Most manufacturers are quite small, with 250 or fewer employees.

True    False

 

67. Compared to final consumers, manufacturers tend to be more spread out geographically.

True    False

 

68. In the U.S., many factories are concentrated in rural areas.

True    False

 

69. It is very common for manufacturers to concentrate in certain geographic areas and by type of industry.

True    False

 

70. The U.S. government collects and publishes data by the NAICS codes.

True    False

 

71. The term “NAICS” stands for New Auto Industry Classification Survey.

True    False

 

72. The U.S. government reports data on the number of firms, sales volume, and number of employees by NAICS code.

True    False

 

73. Firms that are described by NAICS code 3152 are more similar than firms described by NAICS code 31.

True    False

 

74. In a market composed of service producers, most firms are small and geographically dispersed.

True    False

 

75. There are about 17 times as many service firms as manufacturing firms.

True    False

 

76. Purchasing managers are even more likely to be involved in buying by small service firms than in buying by large producers.

True    False

 

77. Purchases by small service firms are often handled by whoever is in charge or their administrative assistant.

True    False

 

78. Most retail and wholesale buyers see themselves as purchasing agents for their target customers.

True    False

 

79. Sales reps calling on large food retailers often must make their sales presentations to a buyer who doesn’t have the final decision responsibility.

True    False

 

80. Most wholesalers and retailers pay very close attention to each item they handle, treating most products as new-task purchases.

True    False

 

81. The government is the largest customer group in all countries.

True    False

 

82. Government is one of the smallest groups (in sales volume) of customers in the United States.

True    False

 

83. When selling to government customers, competitive bids are common.

True    False

 

84. To share in the government market, it is advantageous to be on the list of approved suppliers.

True    False

 

85. To compete in the government market, it is very important that marketing mixes are well matched with different bid procedures.

True    False

 

86. The Internet is not very useful for firms that want to target government markets.

True    False

 

87. Although outright influence peddling is common in some international markets, it is not allowed under the Foreign Corrupt Practices Act.

True    False

 

 

Multiple Choice Questions

88. Regarding U.S. business and organizational customers,

A. more goods and services are purchased by business and organizational customers than by final consumers.

 

B. there are more business and organizational customers than final consumers.

 

C. there are more manufacturers than all other types of business and organizational customers combined.

 

D. more goods and services are purchased by government buyers than by all other business and organizational customers.

 

E. None of these alternatives is correct.

 

89. In marketing, business and organizational customers are distinct from:

A. intermediaries

 

B. government units

 

C. final consumers

 

D. manufacturing and service firms

 

E. non-profit organizations

 

90. The “business-to-business” market (B2B market) is comprised of:

A. nonprofit organizations only.

 

B. wholesalers and retailers only.

 

C. manufacturers only.

 

D. all businesses, governments, and nonprofits.

 

E. government units only.

 

91. Which of the following statements accurately compares marketing to final consumers with marketing to organizational customers?

A. Marketing to organizations is just like marketing to final consumers.

 

B. Business-to-business marketing includes marketing to final consumers.

 

C. Purchasing decisions by organizational buyers are usually more economic and less emotional as compared to consumers.

 

D. Firms may choose to serve either organizational buyers or final consumers, but not both.

 

E. Consumers are more likely to utilize purchasing specifications as compared to B2B buyers.

 

92. Which of the following is not a concern of organizational buyers?

A. Original cost and ongoing costs of purchase

 

B. Impact of purchase on productivity

 

C. Product quality

 

D. Seller’s ability to provide speedy maintenance and repair

 

E. All of these are concerns for organizational buyers.

 

93. Which of the following are NOT “business and organizational customers?”

A. Wholesalers

 

B. Manufacturers

 

C. Financial institutions

 

D. Government units

 

E. All of these ARE business and organizational customers.

 

94. Which of the following is NOT an organizational buyer?

A. The Red Cross buying office supplies.

 

B. A sporting goods retailer buying skis.

 

C. A law office buying a background music service.

 

D. A country club buying tennis balls for a tournament.

 

E. All of these are organizational buyers.

 

95. Which of the following is NOT an example of an organizational buyer?

A. A government buyer purchasing a new desk for the mayor’s office.

 

B. A woman buying cookware to sell to her friends and neighbors.

 

C. A sales rep buying a new necktie to make a good impression.

 

D. A wholesaler buying a delivery truck.

 

E. None of these is a good example of an organizational buyer.

 

96. Which of the following is a business or organizational customer, as opposed to an individual final consumer?

A. A wholesaler purchasing merchandise for resale.

 

B. A business executive who purchases a new suit.

 

C. A teacher who fills her car with gasoline.

 

D. A homeowner who buys flowers at a garden center.

 

E. None of these is a business or organizational customer.

 

97. The college or university that you attend is considered which type of organizational customer?

A. Producer.

 

B. Intermediary.

 

C. Government.

 

D. Nonprofit.

 

98. John Deere is considered which type of organizational customer?

A. Producer.

 

B. Intermediary.

 

C. Government.

 

D. Nonprofit.

 

99. Bank of Omaha is an example of what type of organizational customer?

A. Government

 

B. Nonprofit

 

C. Producer

 

D. Intermediary

 

E. Resident buyer

 

100. Macy’s is considered which type of organizational customer?

A. Producer.

 

B. Intermediary.

 

C. Government.

 

D. Nonprofit.

 

101. Radio Shack is an example of what type of organizational customer?

A. Retailer

 

B. Producer

 

C. Government

 

D. Nonprofit

 

E. Wholesaler

 

102. The St. Louis Symphony is an example of what type of organizational customer?

A. Government

 

B. Wholesaler

 

C. Intermediary

 

D. Resident buyer

 

E. Nonprofit

 

103. Concerning consumer and business markets:

A. promotion to consumer markets usually relies more heavily on the use of personal selling.

 

B. it is often easier to define customer needs in business markets.

 

C. a marketing mix directed at an organizational customer is usually less precisely adjusted to the needs of the specific customer.

 

D. None of these alternatives is correct.

 

104. As compared to final consumers, organizations

A. always focus on economic factors.

 

B. have more varied needs, and require more varied marketing mixes.

 

C. have needs that are often easier to understand.

 

D. always set out detailed information about the performance standards the product must meet when quality is highly standardized.

 

E. are usually more emotional in their buying than final consumers.

 

105. Which of the following is NOT true regarding organizational buyers?

A. Buyers for all kinds of organizations (governments, nonprofit groups, intermediaries) tend to buy in much the same way as do manufacturers.

 

B. The basic aspects of business customer buying behavior tend to be quite similar in the U.S. and in international markets.

 

C. Marketing strategies aimed at them are often tailored to each individual customer.

 

D. Their purchases are made to help their organizations meet the demands for their products.

 

E. Their needs are usually harder to define than for final consumers.

 

106. Organizational customers:

A. Purchase goods in order to satisfy their customers, but the services they purchase are for themselves.

 

B. Are more emotional in their buying than final consumers.

 

C. Try to consider the total cost of selecting a supplier, not just the initial cost of the product.

 

D. Typically focus on behavioral needs instead of economic factors in making purchases.

 

E. None of these alternatives is correct.

 

107. If a firm targets business and organizational markets,

A. the geographic location of the customer is likely to be less important than in segmenting consumer markets.

 

B. NAICS codes may help in segmenting manufacturers but not producers of services.

 

C. each customer may need to be treated as a different segment.

 

D. All of these alternatives are correct.

 

108. Organizational buying based on a written (or electronic) description of a product is called buying by ______________.

A. purchasing specifications

 

B. inspection

 

C. negotiated contract

 

109. _____ is a written or electronic description of what the firm wants to buy.

A. An estimate

 

B. A negotiated contract

 

C. A new market order

 

D. A purchase order

 

E. A set of purchasing specifications

 

110. A set of ________________ contains a written or electronic description of what a firm wants to buy.

A. requirements

 

B. purchasing specifications

 

C. blueprints

 

D. quality certifications

 

E. request forms

 

111. Purchasing specifications may include:

A. the product grade.

 

B. the brand name.

 

C. the part number.

 

D. All of these may be included in purchasing specifications.

 

112. Purchasing specifications

A. may simply include a brand name or part number when purchasing requirements are complicated.

 

B. for services, as compared to goods, tend to be detailed because services are usually performed before they’re purchased.

 

C. for services, as compared to goods, tend to be detailed because services are more standardized than goods.

 

D. are often simple for manufactured items with highly standardized quality.

 

E. None of these alternatives is correct.

 

113. Which of the following buying methods would a supermarket buyer be MOST LIKELY to use in the purchase of grade A large eggs?

A. Purchasing specifications

 

B. Competitive bidding

 

C. Negotiated contract

 

D. Complex buying

 

114. Which of the following products would be bought using purchasing specifications?

A. 100 gallons of Du Pont brand muriatic acid.

 

B. 1,000 700MB CD-Rs.

 

C. 50 pounds of number 10 USX nails.

 

D. All of these products would be bought using purchasing specifications.

 

115. Which of the following buying methods would a purchasing manager be most likely to use on the Internet?

A. Inspection

 

B. Negotiated contract

 

C. Purchasing specifications

 

D. Complex buying behavior

 

116. ____ is a way for a supplier to document its quality procedures according to internationally recognized standards.

A. ISO 2000

 

B. ISO 9000

 

C. QSO 3000

 

D. ISO 8000

 

E. QSO 3001

 

117. Which of the following statements about ISO 9000 is NOT TRUE?

A. ISO 9000 is a way for a supplier to document its quality procedures according to internationally recognized standards.

 

B. ISO 9000 reassures a customer that the supplier has effective quality checks in place after it conducts a personal quality audit.

 

C. Some customers will not buy from a supplier who does not have ISO 9000 certification.

 

D. One requirement for ISO 9000 certification is that a company must show outside auditors who is responsible for quality every step of the way.

 

E. ISO 9000 helps organizational customers who are considering a new supplier.

 

118. Which of the following statements about ISO 9000 is FALSE?

A. ISO 9000 is a way for government suppliers to document their quality procedures, but it does not apply to other organizational suppliers.

 

B. A supplier that has met the ISO 9000 standard is always better than one that has not.

 

C. ISO 9000 applies to international suppliers only.

 

D. All of these statements are FALSE.

 

119. Buying specialists for organizations are commonly called:

A. supply agents.

 

B. vendor agents.

 

C. value analysts.

 

D. purchasing managers.

 

E. consumer buyers.

 

120. For marketers who seek to sell to organizational customers, initial contact with the customer is likely to be with a customer’s:

A. most senior salesperson.

 

B. clerk who process paperwork.

 

C. purchasing manager.

 

D. accounting department.

 

E. Chief Executive Officer (CEO).

 

121. Of the many people involved in making an organizational purchase, the one with the most power is usually the:

A. user.

 

B. influencer.

 

C. gatekeeper.

 

D. decider.

 

E. salesperson.

 

122. After conducting a vendor analysis on potential suppliers, purchasing managers are likely to choose the vendor that:

A. enables the firm to operate more efficiently with the least risk.

 

B. offers the lowest priced goods and services.

 

C. offers the widest assortment of business products.

 

D. received the best rating from gatekeepers.

 

E. was the friendliest.

 

123. Smart tips for selling to business customers include all the following except:

A. Emphasize various benefits that meet the differing needs and interests of each member of the buying center.

 

B. Offer fresh insight and ideas in e-mails and other correspondence.

 

C. Develop a marketing mix to satisfy the needs of the organization as well as the needs of individual purchasing managers.

 

D. Show appreciation by offering desirable gifts to purchasing managers.

 

E. Explain how products and services will reduce the firm’s risk.

 

124. A specialist within a company who is responsible for all of the company’s major purchases is called all of the following EXCEPT:

A. supply manager.

 

B. procurement officer.

 

C. buyer.

 

D. salesperson.

 

E. purchasing agent.

 

125. A purchasing manager:

A. Is basically a clerk who fills out paperwork to place orders.

 

B. Is the only person a business-to-business salesperson ever needs to see in order to make a sale to a buying organization.

 

C. May specialize by product area if he/she works for a large organization.

 

D. Is only interested in finding the lowest possible price for a product.

 

E. All of these alternatives are correct.

 

126. Purchasing managers in business markets (compared to buyers in consumer markets) are generally:

A. fewer in number.

 

B. more technically qualified.

 

C. less emotional in their buying motives.

 

D. more insistent on dependability and quality.

 

E. All of these alternatives are correct.

 

127. _____ are responsible for working with suppliers and arranging the terms of sale.

A. Gatekeepers

 

B. Deciders

 

C. Influencers

 

D. Users

 

E. Buyers

 

128. During the purchase of janitorial services for a new building, Teresa has responsibility for working with suppliers and arranging the terms of the sale. In this role, Teresa appears to be acting as

A. a gatekeeper.

 

B. a decider.

 

C. a buyer.

 

D. a user.

 

E. an influencer.

 

129. In a buying center, which of the following are likely to be influencers?

A. Purchasing managers who arrange the terms of the sale.

 

B. People who supply information for evaluating alternatives.

 

C. People who have the power to select or approve suppliers.

 

D. People who control the flow of information.

 

E. Purchasing managers who shield users or other deciders.

 

130. In the purchase of a new computer monitor, which of the following is an example of a user?

A. A purchasing manager who arranges the terms of the sale.

 

B. An IT manager who supplies information for evaluating alternatives.

 

C. A secretary whose computer monitor is being replaced.

 

D. A receptionist who controls the flow of information.

 

E. A supply manager who helps write specifications.

 

131. During the purchase of new tooling at Acme Tool and Die, which of the following is an example of a gatekeeper?

A. Sara, a purchasing manager, arranges the terms of the sale.

 

B. Ross, from research and development, supplies information for evaluating alternatives.

 

C. Charlotte, in manufacturing, has the power to select or approve suppliers.

 

D. Andre, a research assistant, gathers and distributes information about alternatives.

 

E. Rita, from the manufacturing floor, will use the new tooling.

 

132. Regarding organizational buying, the people who have the power to select or approve the supplier—especially for larger purchases—are called:

A. influencers.

 

B. deciders.

 

C. buyers.

 

D. gatekeepers.

 

E. users.

 

133. ABC Technologies manufactures computer accessories, such as modems and network cards. Even though the company has several purchasing managers, the company president has final authority on all purchases over $500, including the selection of the supplier. In the typical buying center in this company, the company president would have the primary role of:

A. User.

 

B. Buyer.

 

C. Influencer.

 

D. Decider.

 

E. Gatekeeper.

 

134. Natalie Simopoulos, director of procurement at Grecian Glass Company must approve every purchase order, and Anthony Markatos, purchasing manager, must authorize any sales rep who wants to talk to a Grecian Glass employee. Natalie and Anthony are acting as _____ and _____, respectively.

A. decider, gatekeeper

 

B. influencer, user

 

C. gatekeeper, influencer

 

D. buyer, decider

 

E. user, gatekeeper

 

135. A furniture producer has decided to buy its upholstery cloth from new suppliers. The president has given the purchasing manager responsibility to make the final selections and negotiate the terms. The purchasing manager looks through books with samples and specifications, and then calls salespeople to make presentations to the production manager, who is concerned about how easy the cloth will be to cut and sew. In this case, the purchasing manager is

A. an influencer.

 

B. a buyer.

 

C. a decider.

 

D. a gatekeeper.

 

E. All of these are correct.

 

136. For new-task buying, a good salesperson will try to contact the potential customer’s:

A. deciders.

 

B. gatekeepers.

 

C. influencers.

 

D. buyers (purchasing managers).

 

E. All of these would be contacted for new-task buying.

 

137. If many individuals are involved in a buying decision, this is:

A. a multiple input situation.

 

B. a selective rebuy.

 

C. a modified rebuy.

 

D. a multiple buying influence situation.

 

E. a straight rebuy.

 

138. Multiple buying influence is MOST likely to occur in which of the following purchases?

A. Note pads.

 

B. A voice-mail phone system.

 

C. A replacement for a broken chair.

 

D. Gasoline.

 

E. Paper clips.

 

139. A _____ refers to all of the people who participate in or influence a purchase.

A. procurement department

 

B. bidding group

 

C. set of gatekeepers

 

D. sales analysis group

 

E. buying center

 

140. A “buying center”

A. may vary from purchase to purchase.

 

B. refers to all the purchasing agents in a large firm.

 

C. is usually identified on a firm’s organization chart.

 

D. is usually controlled by the purchasing manager.

 

E. is usually located in major wholesale markets.

 

141. When a salesperson calls on a new business prospect,

A. he may have trouble identifying all of the buying center members.

 

B. he usually must see the purchasing manager first.

 

C. the probability of encountering a gatekeeper is high.

 

D. All of these alternatives are correct.

 

142. Regarding organizational buying,

A. a “national accounts” sales force often makes sense when firms with many facilities buy from a central location.

 

B. purchasing managers are more likely to be found in large organizations.

 

C. a geographically bound salesperson can be at a real disadvantage.

 

D. All of these alternatives regarding organizational buying are true.

 

143. Vendor analysis is a(n)

A. analytic processing of requests to buy something from a vendor.

 

B. formal rating of suppliers on all relevant areas of performance.

 

C. analytic processing of requests to sell something to a vendor.

 

D. request to buy something.

 

E. written description of what the firm wants to buy.

 

144. Vendor analysis

A. ensures objectivity by disregarding whether a supplier has been used in the past.

 

B. emphasizes the emotional factors in a purchase decision.

 

C. is used less now that multiple buying influence is more common.

 

D. None of these alternatives is true.

 

145. Vendor analysis:

A. Has the sole objective of getting the lowest possible price on a particular product or service from the supplier.

 

B. Does not take into account the behavioral needs of purchasing managers and others involved in the buying decision.

 

C. Is a formal rating of suppliers on all relevant areas of performance.

 

D. None of these alternatives about vendor analysis is correct.

 

146. When a company creates a rating form for its suppliers and rates their on-time delivery, product quality, service advice, and so forth, in order to determine which suppliers to put on an approved list of suppliers for specific products, this process is called a(n):

A. JIT rating.

 

B. resident buyer analysis.

 

C. vendor analysis.

 

D. ISO 9000 certification.

 

E. buying center analysis.

 

147. Vendor analysis

A. emphasizes the emotional factors in a purchase decision.

 

B. is a formal procedure used by a vendor’s salespeople to be certain that all members of a buying center have been contacted.

 

C. is used less now that multiple buying influence is more common.

 

D. is likely to favor a vendor that offers the customer the lowest total cost associated with the purchase.

 

E. None of these alternatives about vendor analysis is true.

 

148. The goal of vendor analysis is

A. just getting a low price from the supplier on a given part