BUS3310

BUS3310 Exercise 1 Page 1 of9
BUS3310,El Exercise 1 I
Complete the reading assignment and complete the mUltiPle-I hoice questions below
to the best of your ability. Then submit your answers to the i1structor email by 11:59
PM Central Time June 19, 2010. Each question is worth 2 points for a total of 100
points. See the course requirements section of the communJ4ations Guidelines for
assignment submission details. 01
Reading: Perreault, Cannon, and McCarthy text chapters 1 J 2
~~:~::~ ~ =~~~~~~~~'i~~:C;~OpCi~N~~~ERS'_fJrS--aN~$QCLEIY
Questions:
1. Which of the following is one of the three basic ideas in the "marke~ing concept?"
A. maximize sales. ~ I
B. the president has a marketing background. I< I
C. obtain economies of scale.~ 1vJ,~WJ-I 0 Y"' .
vf'. profit as an objective. u,.> fvMVv I
E. resource efficiency.
2. According to the text: I
\J{ marketing is much more than selling or advertising. I
B. the cost of marketing is about 25 percent of the consumer's d1l1ar.

C. marketing affects every single aspect of your daily life.
D. marketing discourages research and innovation.
E. all of the above are true statements.
3. When a firm produces a large quantity of a product, the cost of pr~ducing each individual unit
usually goes down. This is known as: I
A. macro-marketing.lI..
B. discrepancies of assortment.
C. discrepancies of quantity.
D. exchange efficiency.
\ft. economies of scale.
4. FlyFar Airlines uses marketing research to determine customer needs and assess how well the
company meets them. This suggests that FlyFar managers exhibi _
...(;( a marketing orientation

B. separation of information I
C. the innovation concept

D. social responsibility I
E. a production orientation
5. Which of the following is MOST likely to be classified as a marketi~g interm'jdiary?
·\.f'C'Lillian'S Mini-Market. I I
B. Apex Manufacturing, Inc. I

C. Kellogg.
I 1;/17/')1'111'1
D. McGraw Hill/Irwin.
6. During the sales era
~ncreased competition made firms focus on winning customers.

B. characteristic management thinking said, "If we can make it, it ill selL"
C. all marketing activities were brought under the control of one d partment.
D. families traded or sold their surplus output to local distributors.
E. marketing people did both short-run and long-run marketing pia ning.
7. According to the text, marketing means:
A. making a good product that sells itself. 't-

B. producing goods and/or services.,j..
C...,..doing whatever it takes to be able to offer consumers a "better ousetrap."~
\,..J2f. much more than selling and advertising.
E. selling and advertising. ~
8. One basic idea of the marketing concept is
A. a firm's obligation to have a positive effect on society.

B. a production orientation must guide the whole system.
C. a firm should "give customers what it produces best."
$ survival and success require a profit.
E. an organization should build "fences" around its own departme
9. SouthFace Corporation just named Chloe Perry to a marketing m nagement position. One of
the reasons she accepted a position with this company was its re utation for market-oriented
long-range planning. SouthFace Corp. is probably operating in th era.
A. planning
.....e( marketing company
C. marketing research
D. marketing department
E. none of the above
10. Which of the following statements about customer value is True?
A. BUilding relationships with customers means providing custom r value before, but not after
the purchase of a product or service. OL
~etaining current customers is usually less costly than taking ustomers away from a
competitor. .
C. A firm's advertising department cannot be expected to develo ads to convince a customer
to buy from the firm more than once. tJ.
D. People in the organization who are not in the sales or custom r service areas should never
be called upon to help resolve a customer's problem. Il'..
E. None of the above.
11.The "universal functions of marketing" do NOT include:
A. financing and risk taking.

B. buying and selling.
~standardization and grading.
yt:J. producing. v
E. transporting and storing.

12. The term "economies of scale" means that:
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BUS3 310 Exercise 1 Page 3 of9
A. The largest producers are always the most efficient.

~The cost of a product goes down as a company produces lar er numbers of it.
C. The more one produces, the greater the profit.
D. It is more efficient for an economy to have a large number of ransactions.
13.A "production-oriented" firm typically:
A. focuses advertising on need-satisfying product benefits.

B. sets inventory requirements with customer needs in mind.
C. views customer credit as a customer service.
~ies to sell the products it can make easily.
E. operates as an integrated unit.
14. Identify the incorrect statement about market-directed economies.
A.~ market-directed economy adjusts itself. +

ur The American economy is completely market-directed.
C. Consumers in a market-directed economy decide what is to b produced and by whom
through their dollar "votes."~
D. Consumers in a market-directed economy enjoy great freedo of choice.~
E. All of the above are correct. 't1
15.ln a firm that has a total company effort in implementing the mark ting concept:
A. ]"he firm lacks a central focus.

~Departments-even very specialized ones-are guided by whtt customers want.
C. There are "fences" around individual departments.
D. Not all departments impact customer satisfaction.
E. The firm is more production-oriented than marketing-oriented.
16._ _ NOT the government's job in a market-directed economy.
A. Regulating radio and television broadcasting is '1

B. Setting import and export rules is ~
C. Protecting property and enforcing contracts are '\j..
~ Determining what and how much is to be produced is
E. Controlling interest rates and the supply of money are l.f

17.Marketing encourages research and , the development and spread of new
ideas, goods and services.
A. Analysis.
.JY."'I nnovation.
C. Evaluation.
D. Assessment.
E. Introspection.
18. Marketing will not happen unless:
A. intermediaries are present to facilitate exchange.

B. e-commerce is flourishing.
C. collaborators are present to simplify exchange.
$ two or more parties each have something they want to excha ge for something else.
E. an economy is market-directed rather than command.

19.Consumers in a market-directed economy
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·Jare taxed to provide for goods and services that benefit societ , such as public health,
~ational defense, highways, police and fire protection.
~. e:njoy limited freedom of choice.
C. do not decide what is to be produced and by whom.
D. do not have to buy any goods or services.
E. have to buy what is being produced.
20. Which of the following is LEAST LIKELY to be found in a produc ion-oriented firm?
A. Disagreements among departments about how to improve th company's product.

B. Making products that are easy to produce.
..LProducing goods that exactly meet the customer's needs.
D. A mass marketing approach.
21. is defined as the performance of activities that seek to a complish an organization's

objectives by anticipating customer needs and directing a flow of eed-satisfying goods and
services from producer to customer.
A. Innovation
B. Advertising
C. Selling
D. Sales promotion
.~arketing
22.ln the _ _ era, families traded or sold their "surplus" output to 10 al distributors.
A. pure subsistence
B. yroduction
~ simple trade
D. marketing company
E. sales
23. The fact that producers usually prefer to produce products in larg quantities, while most
consumers prefer to buy in small quantities, results in:
A. separation of ownership.
B. spatial separation.
C. discrepancies of assortment.
D. temporal separation.
~discrepancies of quantity.
24. The difference between "production orientation" and "marketing 0 ientation" is best explained
as follows:
A. production-oriented firms usually do not have a marketing ma ager.
B. ).here are no separate functional departments in a marketing-o iented firm.
\JY in a marketing-oriented firm, every department's activities are uided by what customers
need and what the firm can deliver at a profit.
D. all major decisions are based on extensive marketing researc studies in marketing
oriented firms.
E. in a marketing-oriented firm, the total system's effort is guided by what individual
departments would like to do.
25.ln an advanced economy, marketing costs account for about _ ents of every consumer
dollar.
A. 20.
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B. 10.
~
30.
D.50.
. 40. ~
26. 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 a effort at
~market development.
B. diversification.
C. market penetration.
D. product development.
27. __ refers to offering new or improved products for present mar ets.
A. Diversification
B. Market development
C. Differentiation
D. Market penetration
~ Product development
28. When a firm tries to increase its total sales by offering new prod cts to new markets, it's
pursuing:
\.Vdiversification.
B. product development.
C. market development.
D. market penetration. ~
E. All of the above.
29. Which of the following statements is a strategy decision, rather th n an operational decision?
A. "We will change the colors of our selection of shirts at the end r,f the season."
B. "We will increase the number of training sessions for new sale associates from two to
three."
~ "We will cut prices as needed to in order to protect our market share."
D. "We will place a special ad in the Sunday newspaper promoti~9 our upcoming sale."
E. "We will hire a merchandising specialist this month to help re odel our older stores."
30. A producer of frozen pasta dinners finds that its current target cu tomers 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.
..A:.. diversification.
~ market penetration.
~ product development. 'If.

31. means that a firm has a marketing mix that the target ma ket sees as better than a
competitor's mix.
A. Market development
B. Customer equity
C. Strategic policy
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~ompetitiveadvantage
E. Comparative opportunity
32. Wendy's continues to come out with new offerings like stuffed pita . This suggests that
Wendy's is pursuing _
A. marketing myopia.
-usl market development.
"'t'. mass marketing.
~product development.
E. diversification.
33.AII of the following are reasons why international opportunities sh uld be considered by
managers, EXCEPT
A. the world is getting smaller. If..

B. it helps to develop a competitive advantage at home and abro d. 'f..
~ favorable trends at home and unfavorable trends in other countries make international
marketing particularly attractive. '
D. serving international markets may improve economies of seal . tJ-.. .
E. around the world, potential customers have needs and money to spend.
34.When fast food restaurant, Tommy's Tacos, had poor sales in Ce tral City, marketing
managers closed one outlet on the east side of town and opened 0 new locations on the
south side of town. These moves represent
A. operational decisions in the product decision area.

B. strategy policies in the promotion area.
C. strategy policies in the product area.
D. strategy policies in the place area. ~
~operational decisions in the place area.
35. Kraft Foods recently increased its advertising and couponing to it present cheese customers.
It appears that Kraft is pursuing what kind of opportunity?
B. Mass marketing
c . .product development
C
.
~Market penetration
E. Diversification
36. Differentiation
J
£Can only be based on one important element of the marketing
ix.
often requires that the firm fine-tune all of the elements of its arketing mix to the specific
needs of a distinctive target market. ,
C. means that the marketing mix is similar to what is available fro a competitor. b(
D. is less obvious to target customers when there is a consistent heme integrated across the
four Ps decision areas.~
E. helps a firm get a competitive advantage if it just meets needs in the same way as other
firms.
37.Cheese manufacturer, Ashe Mountain Corp., started a new chain of movie theaters called Ashe
Mountain's Movie World. The theaters have been a major succes and significantly increased
the revenues of Ashe Mountain Corp. This is an example of:
B. Differentiation
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BUS3310 Exercise 1 Page 70f9
C. J70duct penetration
~Diversification
E. Market penetration
38. Hewlett-Packard decided that too many other companies were a tracting its customers by
advertising their computer printers as "having all of the features f 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-Pack rd then introduced it to the
same market with the hope that it could develop a larger and mo e profitable share. This was
an effort at:
A. market development.
B. diversification.
C. Ylarket penetration.
~ product development.
39. Hewlett-Packard sells personal computers through specialty com uter stores, electronics
superstores, and its own Internet site. The marketing mix variable that is being considered here
is:
A. j'ersonnel.
~ Placement.
C. Product.
D. Promotional.
E. Pricing.
40. Differentiation means that
~a firm's marketing mix is distinct from and better than what is vailable from a competitor.
B. a firm should screen out opportunities using different criteria t an those used by other firms.
C. a firm uses its resources in a different way than competitors u e their resources.
D. the firm should aim its efforts at a target market that is differen from a target market that a
competitor would find attractive.
E. when a firm's marketing strategy is not going well it should ch nge to a different set of
operational decisions.
41. _ _ assume(s) that everyone is the same-and consider(s) ev ryone to be a potential
customer.
v(" Mass marketing

B. Target marketing
C. Target marketers
D. Objective marketing
E. Mass marketers
42.ln which quadrant of the SWOT analysis tool does the following fi ? A firm is in a fast-growing
industry.
A. Weaknesses.
~Opportunities.
C. Strengths.
D. Threats.
43. Customer equity ,I

A. is important to marketing managers but of little interest to inve tors.
B. is of concern to top management, but not very relevant in plan ing a particular marketing
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n.~trategy.
~/increases as long as the number of customers that a firm serv s increases over time.
-0. takes the perspective of the owners of (investors in) a firm.
E. always increases over time, at least as long as a firm can stay in business.
44.Target marketing, in contrast to mass marketing:
A Assumes all customers have the same needs.

B. Assumes everyone is a potential customer.
~Tailors a marketing mix to fit some specific group of customer .
D. Focuses only on small market segments.
E. Makes it more likely that a firm will face direct competition.
45.Any series of firms or individuals that participate in the flow of pro ucts from producer to final
user or consumer is known as:
A a production line.
. B. J-packaging line.
\V"a channel of distribution.
D. customer service.
E. mass marketing.
46.Dell, Inc. wants to offer customers televisions in addition to comp ters. This is a change in their
_ _ _ _ _ _ _ _ _ strategy.
A Personnel.
~Product.
C. Promotional.
D. Pricing.
E. Placement. I
47./f Frito-Lay (which has products in almost all the submarkets for srack foods) were to try to
increase its share of one of these markets, it would be pursuing a 1 _
opportunity.
"f..
~mass marketing
~product development
t-..ld'. market penetration
D. diversification
E. market development
48.A retailer's operational decision to hire new salespeople would be t relate to the marketing mix
decision area of
Ayroduct.
\...iY." promotion. I'
C. place.
D. people..·
E. price.
49. BeeQuick, a fast-food restaurant, has always operated outlets in ails. With a new strategy
that involves opening new outlets that sell the same menu but op!rate in airports, zoos,
casinos, and military bases, BeeQuick is pursuing what type of o~portunity?
A Diversification.
B. Differentiation.
C. Market penetration.
D. Product development.
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~arket development. . /
50. E-Z-Go, a producer of golf carts, promotes its carts to other advertising them as an
easy and quiet way for workers to get around malls, airports, and factories. E-Z-Go is trying
to increase its sales through
A. diversification.
B. product development.
C. market penetration.
D. differentiation.
~ market development.
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BU53310.El Exercise 2
I
Complete the reading assignment and complete the mUltiPle-bhoice questions below
to the best of your ability. Then submit your answers to the irstructor email by 11:59
PM Central Time June 26, 2010. Each question is worth 2Foints for a total of 100
points. See the course requirements section of the Communi ations Guidelines for
assignment submission details.
Reading: Perreault, Cannon, and McCarthy text chapters 3 ~4

Chapter 03 - EVALUATING OPPORTUNITIES IN THE CH NGING MARKETING
E~_VJRQJ~_""'U:J\~I
Chapter 04 - FOCUSING MARKETING STRATEGY WITH SEGMENTATION AND
POSITlONING
Questions: J I
1. Using General Electric's "strategic planning grid," an opportunity r ted "medium" in terms of
industry attractiveness and "high" in terms of business strengths ould be evaluated as:
A. red-for no growth. I
B. yellow-borderline. I
C. could be yellow, red, or green-because the grid suggests tha~ opportunities with medium
~atings need more analysis. I
( vreen-for growth.
2. A total profit approach to evaluating product-market strategic Plats
A. will not work if the plans are for the same number of years. ~
B. will be most useful when the plans require very different level of investment.
C. may support a particular plan even if it generates'poor profits in some years.
Jl. Both A and B are true. .
E. None of the above is true.
3. The Robinson-Patman Act specifically aims at:
J /(5) price discrimination.

B. deceptive advertising.
C. firms that rely on salespeople who sell "door to door."
D. unfair methods of competition.
E. attempts to monopolize. I
4. The marketi~.g manager for. Lucky Grains cereals is fo~ecasting£Jtentiallifetime sales, costs,
and profitability for a potential new product - Lucky Rice Square,. The marketing manager is
using __ to evaluate this opportunity. I
A. operating margins screen-.t-- J-. I
~ industry attractiveness matrix
.~. total profit approach
D. cost plus assessment ry.

E. strategic planning grid I-. I
5. Which of the following is NOT primarily an example of the influende of technology on the
external market environment: 1
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I
A. machines are developed to assemble defect-free electronic colponents.

B. a manufacturer of frozen food is finding that consumers prefer 90ntainers that can go from
the freezer direct to a microwave oven. ~
~
a camera producer finds a way to enable a camera to store digi al pictures - without film.
the government passes a law that prohibits use of cell phones hile driving a vehicle.
J \.e' robots on a production line make it possible to lower cost. I
6. The return-on-investment approach to evaluating possible productimarket strategic plans is

useful wh~n: . I
,@ the plans differ a lot in terms of investment required. . ~

B. the plans are for longer than two years.
C. the total pro'fitapproach would be misleading because it ignore costs.
D. the plans involve very different strategies. I
E. there is uncertainty about the profitability of each plan.

1
7.'
challengers. r '
are the firms that are considered to b the organization's closest
~
Aggressive rivals.
Competitive rivals.
· Indirect rivals.
D. Passive rivals.
E. Direct rivals.
1 I
8. Which of the following statements about nationalism is NOT TRU
A. Nationalism emphasizes one country's interests before eVeryt~ing else.t-
~
Nationalistic feelings can block all marketing activity in some i ternational markets.~
C. Nationalism can be limiting in international markets.
· A "Buy American" policy reflects nationalistic attitudes in the Ulited States.
E. Nationalistic feelings always reduce sales. ~
9. When Acme Tools was found guilty of giving one of its retailers 10 er prices on goods of "like
grade and quality" without any cost justification, the firm was char ed with a violation of the
A. Clayton Act
B. Antimerger Act
~
,Wheeler-Lea Amendment
Robinson-Patman Act
· Sherman Act
1a.A "Buy American" campaign is an example of:
A. transnationalism.
~
. environmentalism.
C. nationalism.
· consumerism.
E. federalism.
11. The _ _ dimension of the GE grid helps managers answer the ~uestion: Does this product-
market plan look like a good idea? I
. \, } ~ business strengths I
'\..)V"'1?' industry attractiveness

C. quantitative criteria
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D. relative positioning
E. qualitative criteria
12. Which of the following is a quantitative screening criteria?
A. increase sales by $100,000.

B. earn 25 percent return on investment.
d~
cover all start-up costs in the first year.
~ . all of the above are quantitative criteria. I
' . all of the above are qualitative criteria.
13. The early antimonopoly (or "procompetition") laws passed in the fnited States:
A. include the Federal Trade Commission Act and the Clayton Alt.
B. began with the Sherman Act in 1890.
/ / C. affect the 4Ps and marketing mix planning.
'<..:f/ ~~ocus more on protecting competnion than protecting consum rs.

~II of the above are true. I
14.ln the short run, a marketing manager usually cannot control: I
t;) Any of the above.
J \.f?' the economic environment.
C. the cultural environment.

D. the legal environment.
E. the competitive environment.
15. Which of the following is a QUALITATIVE screening criterion for tvaluating opportunities?
A. Sales target for the firm.
I <p.
I
Profit target for the firm.

C. Kind of business the firm wants to be in.
'-' . Return on investment (ROI) target for the firm.
16. Maria Lopez runs an errand service from her home. For a fee, s~e will pick up dry cleaning,
buy groceries, plan small parties, and do errands for her custom~rs. The demand for this type
(.Of service has increased because of changes in the I
"'-....J ~ cultural/social environment.

B. legal environment.
C. technological environment.
D. political environment.
E. none of the above.
17. Underlying any economic environment is technology which affect :
A. how aggressive competitors are in planning new marketing str tegies.

B. how competitors react to each other.
C. how fast consumer attitudes change.
D. how qUickly technological developments lead to new consum r protection laws.
E. how the economy's resources are converted to output.
18.When evaluating the potential of possible opportunities (prOduct-+arket strategies), a

marketing manager should:
~valuate each opportunity over the life of the project, since sh rt-term losses may hide long
~erm profitability.
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BUS3310 Exercise 2 I Page 4 of9
B. avoid using quantitative criteria because they tend to overSimPlill the problem.
C. look at each opportunity on its own, since there is no good way to compare different
plans.
D. look only at internal resources, since they are controllable.

E. All of the above are true.
19.The North American Free Trade Agreement (NAFTA): I
A. Provides a plan to reshape the rules of trade among Canada, tJe United States, and
Colombia.
B. Has resulted in the movement of production jobs to Mexico duel to lower labor
costs.
C. Eliminates the need for companies to adjust strategies. I
~. Makes it more difficult to resolve trade disputes among the couhtries participating in NAFTA.
(VNOne of the above.
20. Consumer emphasis on fitness has created opportunities for firms like Nike, Nautilus and
Schwinn, and illustrates the impact of the changing:
A. political and legal environment.
J
~
competitive environment.
· cultural and social environment.
· technological environment.
E. economic environment.
21. Regarding the current legal environment facing U.S. marketing m nagers,
~
~ A. state and local laws rarely are important because they are alWJyS less restrictive than
\ \ federal laws.-\- 1
- B. the focus has shifted from "let the seller beware" to "let the buy~r '
• beware."+
I
1
~
the emphasis is now on restricting monopolies~
J.l . safety is now a big concern and must be considered in produc design.
· All of the above are true.
22. The marketing manager for a financial services firm knows that cubtomer preferences for
mutual funds and bond accounts will differ depending on the curr1nt interest rate. She must
plan her offerings with the _ _ environment in mind.
J ~ technoJ~gicaJ
B. economic
i
· legal
I
D. cultural
E. social
23. The basic objective of a firm should be to:
~
. ~ A. engage in some specific business activity that will perform a S!ciall Y and economically
useful function.
B. develop an organization to carry on the business and impleme t its strategies.
~
earn enough profit to survive.
· All of the above.

I
· Only Band C above.
24. Increased demand for new homes due to low interest rates is an !xamPle of the impact of the
_ _ _ _ _ environment:
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r;) Economic.
\? Competitive.
C. Social.
D. Cultural.
E. Technological.
25. A firm may find itself in-or moving toward-pure competition be ause:
fA) customers see the firm's product as having close substitutes.

J
\..:e? a firm with a unique product has no choice.
C. customers don't have much information about competing sU P liers.
26. Which of the following statements is True regarding positioning?

1
D. when the number of competitors is small, they usually make s milar decisions.
G) Positioning
market.
refers to how managers think about proposed or prisent brands in a
B. Positioning issues are not important when competitors in a ma I et appear to be very

similar.
C. Usually, the positions of products are related to six or seven pr duct features that are
important to product managers.
D. None of the above.
27. _ _ aim at one or more homogeneous segments and try to dev lop a different marketing mix
for each segment.
A Segment combiners
t\§) Segmenters
C. Multipliers
D. Combiners I
E. Segment aggregators
28.Which of the following possible segmenting dimensions is a IIdem~graPhiCII dimension?

A. Benefits sought I
B. Purchase relationship I
C. Brand familiarity I
~ate of use
~ocial class I
29.Coorgs Coffee, Inc., has substantial market share in South Ameri a but seeks growth. Its
managers want to expand into North America and target cities wit populations of 50,000
99,999. Identify the segmenting dimension most probably being u ed by Coorgs Coffee.
A. Urgency to get need satisfied

B. Attitudes of consumers
~
DemOgraPhiC I
. Geographic
. Behavioral I
30. Which of the following offers a firm the greatest potential for profitf
QB. Any of the above-depending on the situation

The multiple target market approach I
I
C. The single target market approach

D. Mass marketing I
E. The combined target market approach
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31. is a marketing management aid which refers to iow customers think about
proposed and/or present brands in a market.
A. Brand familiarity
B. Market segmentation
~
. Customer relationship management (CRM)
D. Positioning
· Market scanning
32. Segmenting international markets (as contrasted with domestic ~arketS):
~
is more complicated because qualifying dimensions are not h~IPfUI.
'B may be more difficult because critical data may not be availab e or dependable.
. usually involves less risk because more potential target mark ts are available.
D. usually involves fewer segmenting dimensions. I
33. The process of naming broad product-markets and then segmentitg them in order to select
target markets and develop suitable marketing mixes is called: I
A. Market development.
B. Market pioneering. I
~
Market penetration .
. D Market segmentation.
I
· Market research.
34. The first step in the seven-step approach for segmenting product-~arkets is to
A. identify the determining dimensions. I
B. form homogeneous submarkets.
liE) select the broad product-market.

I
( 'o! estimate the size of each product-market segment.

E. identify potential customers' needs. I
A. are sometimes called "perceptual mapping" techniques. f

35. Which of the following statements about positioning is NOT true? rositioning techniques
B. require a firm to collect data about consumer perceptions of pr ducts.

C. may use information about consumers' "ideal" products, so th t the preferences of different
~
segments of consumers can be considered.
D. position products on a graph based on price level and quantitY!demanded.
· typically rely on a "product space" diagram to show the relatio ship among various
products.
36. In the example for the seven-step approach to market segmenta ion (used in the text), which
of the following is a qualifying need?
A. a good bed
B. heating and cooling
C. a clean bathroom
D. security
E. all of the above
37.A basic difference between a "generic market" and a "product-ma ket" is:
A. There is NO DIFFERENCE-the terms mean the same thing.

B. whether or not sellers in the market rely on e-commerce.
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( ' ow similar the competing sellers' products are.
\~hether the market includes only buyers-or both buyers and Jellers.
E. whether customer needs are similar or different. l

38. Which of the following statements about "segmenting" and "combiJing" is TRUE?
A. A segmenter assumes that a broad product-market consists of fairly homogeneous group

of customers.
B A combiner tries to meet the demand in several segments.
("\Jsegments-to obtain economies of scale. J

Af.lSegmenters try to develop a marketing mix that will have gene al appeal for several market
D. Both segmenters and combiners try to satisfy some people ve well rather than a lot of
people fairly well.
E. Combiners usually have more sales potential than segmenters
39.According to the text, segmenting: I
~ssumes that ~ach person should be treated as a separate tartet market.
@ · IS an aggregating process.
· is a disaggregating or "breaking down" process.

D. assumes that all customers can be clustered into profitable market segments.
E. uses scientific rules to decide how many submarkets exist.
40.Segmenting, in contrast to combining:
~. tends
~
to focus more on customer similarities than on differenc~s.
tries to identify homogeneous submarkets and develop differe t marketing mixes for each
submarket.
C. usually means settling for a smaller sales potential.
D. relies more on promotion appeals and minor product differenc s to create general customer
appeal among several submarkets.
E. All of the above are true statements except C.
41. The main difference between a generic market and a product-ma et is that:
A. There is no difference between the two. I
B. product-markets usually don't involve competition, but generic markets do.
~.
sellers in a generic market are more concerned with prices thaln sellers in a product-market.
a generic-market involves a less similar set of needs than doe$ a product-market.
· a product-market is usually larger than a generic market.
42. The combined target market approach:
A. tends to focus on small, homogeneous market segments.

~ aims at several target markets and offers each target market a unique marketing mix.
~ tries to improve the general appeal of a firm's basic marketing mix rather than tailor it to
meet the strongly felt needs of some people.
D. works well only when each submarket of a product-market ha~ a different demand
curve.
E. All of the above. ~
43.A __ is a group of potential customers with similar needs who re willing to exchange
something of value with sellers offering various goods or services
A. product
B. generic industry
'~
... segment
~market
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BU53310.El Exercise 3 I
Complete the reading assignment and complete the mUltiPlelchoice questions below
to the best of your ability. Then submit your answers to the instructor email by 11:59
PM Central Time July 3, 2010. Each question is worth 2 pints for a total of 100
Reading: Perreault, Cannon, and McCarthy text chapters 5, ,& 7
Chapter as -D_EMOGRAP_/jlC_QIMENSlQ1'LS OF GLQJ3A CQNSUI'~'U:R MARKETS

Chapter 06 - FINAL CONSUMERS AND THEIR BUYING EHAVIQR
Chapter 07 - BUSINESS AJ'JD QRGANIZATIONAL Ct,JST __MEBS AI\IDTHEIR
BUYING BEHAVIOR
Questions:
1. Identify the INCORRECT statement about the effect of marital sta us, age, and the age of any
children in the family, on how people spend their income.
A. People in the age group of 35-49 save less of their income.

., JVYounger people usually earn more than older consumers, but pend less on discretionary
items.
C. People in the age group of 35-49 often make more purchases n credit.
D. Singles and young couples are more willing than older married people to try new products
and brands.
E. Only as children arrive and grow does family spending shift to r0ft goods and services.
2. Information on demographic dimensions I
A. helps managers make decisions based on guesses. 1

B. is chargeable-if available-because it is collected by private rganizations.,...
S- of consumer markets around the world is not available. 1-.
'-'10. makes valid data available to managers.
E. even if "partly true," is good enough to make marketing strate y decisions.'"/'

3. About what percentage of TOTAL U.S. income goes to the 20 per ent of families with the top
incomes? I
A. About 25 percent I
vi!. About 50 percent /

C. About 15 percent I
D. About 75 percent
E. About 95 percent I
4. Which of the following is NOT an accurate statement about consumer markets in the United
States?
A. The average age of the U.S. population is rising.

"fi. The number of people in the 65+ age group will decline very s bstantially in the next
decade. X
C. The number of people in the 45-64 age group will increase ve substantially in this decade.
D. There are already over 309 million people in the United Statesl'v"
E. The post-WWII baby boom produced over 25 percent of the U S. population .....
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I
BUS3310 Exercise 3 Page 2 0[9
5. 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 discr1tionary income for the year
was:
A. $15,000.
B. $34,000. I
C. $35,000.
D. $50,000.
~ $19,000.
6. A Metropolitan Statistical Area (MSA) is:
previous 10 years.
B. a city with 250,000 or more people.
f
A. an area where there has been at least a 15 percent change in the population during the
--G':"" generally centered on one city or urbanized area of 50,000 or ore inhabitants and includes
bordering urban areas.
D. a Census Bureau term that corresponds to county-by-county ptlitical
boundaries.

7. The median family income in the U.S. in 2005 was about:
A. $36,000 I
B. $26,000 I
C. $76,000
'-'E'J."'$56 ,000
E. $96,000
I
8. Identify the INCORRECT statement pertaining to Metropolitan Sta istica Areas (MSAs) .
...x- MSAs are integrated economic and social units with large pop,l'lation nuclei. .."..
B. The U.S. Census Bureau reports data by MSA. 1
. . About 38 percent of all Americans live in the 20 largest CMSA

.
W MSAs with a population of below 50,000 inhabitants are called

Consolidated Metropolitan
Statistical Areas.
E. MSAs center on a city of 50,000 or more inhabitants and inclu e bordering urban areas.
9. Gross national income (GNI) is the:
A. total market value of goods (but not services) produced in an conomy in a year.
B. total market value of goods (but not services) consumed in an conomy in a year.
~total market value of goods and services provided in an econo y in a year by residents of
that country.
D. total market value of goods and services consumed in a Year.~
E. total cost of producing all goods and services sold in a year.
10. The number of babies born per year per 1,000 people is called th :
~birthrate. I
B. baby boom index.

C. future market index.
D. consumer surplus.
E. economic index.
11. The traditional family flow, according to the family life cycle, does rot include people who are
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A. middle-aged married with children. DC..

B. young married with children. Il,
C. middle-aged married without dependent children .....
u;Y"middle-aged divorced without dependent children.
E. young married with children. 1( I
12.A young working couple earned $35,000 last year, and paid $10,0~0 in taxes. They spent
$13,000 on rent, food, insurance, and other "necessities." What is ,heir disposable income?
A. there is not enough information to tell.

B. $22,000 .
C. $35,000
D. $12,000
~$25,000
13.The current U.S. population is LARGEST in which of the following states:
A. Florida.
B. Texas.g,
C. New York.
'J!f California.
E. Illinois.
14.__ refers to the total market value of all goods and services pro ided in a country's economy
in a year by both residents and nonresidents of that country.
A. Gross fixed capital formation

B. Gross national income
~ Gross domestic product
D. Gross output
E. Gross investment
15.The median family income in the U.S.:
A. was about $74,000 in 2005. y..,

B. does not vary much from one state to another.
C. has increased for the last twenty years, primarily because gro th in service industries has
created more high paying jobs.
D. has risen continuously since 1960.
E. reflects the upward shift in the income distribution. /
16. Senior citizens:
A. Are defined as people over age 50.
B. Are a market that is shrinking. X . /
Are more prosperous than ever before. V
&
o Have the same needs as younger consumers.
. None of the above.
17. An expectation is
A. an event that a person likes to remember.
B. a positive cue.
C. an unfulfilled need.
~ an outcome that a person looks forward to.
18. Which of the following in NOT one of the levels of consumer pro lem solving discussed in the
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text?
~Dissonance problem solving

B. Routinized response behavior
C. Extensive problem solving
D. Limited problem solving
E. None of the above, i.e. all four are discussed.
19. Ranked from lowest level to highest level, the "hierarchy of needs" model includes:
A. physiological, safety, personal, and social needs.

~. physiological, safety, social, and personal needs.
C. social, personal, safety, and physiological needs.
D. personal, social, safety, and physiological needs.
E. safety, personal, social, and physiological needs.
20.With regard to the adoption process,
A. decision follows confirmation.
~ evaluation precedes trial.
C. awareness follows interest.

D. interest is the first step. ~
E. decision is the final step. "f....
21. When studying consumer needs, a marketer should:
A. know that total consumer satisfaction is not likely.

B. try to understand how the marketing mix can satisfy a set of n eds, rather than only one. """""
~
realize that he or she~annot cr te needs, merely identify th
m.
all of the above.
. none of the above.
22. Which of the following is an example of using a cue to attract con umers?
A. using a label with red, white, and blue colors to stir patriotic fe lings.
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.
~II of the above are examples.\,../""
23. What is the likely level of involvement in a purchase decision for a new couch?
A. Limited.
~
B.. Routine.
. Low.
Extensive .
. Moderate.
24. When Joe runs out of shampoo he buys whatever brand is on sal at his local CVS drugstore.
What is his level of involvement in the purchase decision for sham oo?
A. Modest.
B. Extensive.
C. Moderate.
,J;Y.' Routine.
E. Limited.
25. Regarding consumer buying behavior,
http://ecourse.amberton.edu/under/BUS3310E1/Exercise%203.htm 6/2812010
A. attitudes affect the selective processes and learning.

B. many consumers with a favorable attitude toward a product m y have no intention to buy it.
C. j)eliefs are less action-oriented than attitudes. .....
~AII of the above are true.
E. None of the above is true. I
26. Routinized response behavior probably would be used by many cpnsumers in the purchase
of:
A.
soap.
B.
canned fruit.
C.
salt.
D.
milk.
~II of the above.
27. _ _ is a social influence that affects a person's buying behavior.
A. Motivation
B. Perception .,...
C. Attitude l(
D. Learning
~Family
28. Consumers' attitudes can be learned from:
A. exposure to the attitudes of others.

B. promotion which is directed toward them.
C. previous experiences.
~ All of the above could be true.
E. None of the above. I
29.0n his way to a GM dealership to pick up a new truck he has purc~rasedl

Luke Bigfist hears a
Ford ad that says that Ford trucks have more power than Chevy tr cks. Luke thought that the
ad said that the Chevys had more power. This illustrates
A.
..,/ selective retention.
.
~. selective perception.
C. learning. ~
D. reinforcement.""
E. selective exposure.
30. Routinized response behavior
A. is likely in a new purchase situation. I
B. is more likely when previous behavior has not yet been reinfor~ed.
~...c is most common for purchases where the consumer has much experience in how to meet a
need.
D. is most likely when past purchases of similar products have no satisfied the consumer's
needs.
E. increases the time required to make a purchase decision.
31. An attitude:
A. is easily changed.
\..B':1s a person's point of view toward something.
C. is the same as opinion and belief.
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D. is a reliable indication of intention to buy.

E. All of the above are true statements.
32. Regarding the adoption process:
A. "Interest" is the first stage in the process. ".,
~'Confirmation" is the last stage in the process. ..,

C. "Trial" precedes "evaluation" in the process. 1..
D. "Evaluation" precedes "interest" in the process. 'I..
E. None of the above. ~
33. With respect to culture and consumer behavior, t
A. culture is the whole set of beliefs, attitudes, and ways of doing hings of a reasonably
homogeneous set of people.
B. culture may exert many subtle influences on other aspects of c nsumer
behavior.
C. ~ifferent cultural subgroups are likely to require different marke ing mixes.
~all of the above are correct.
E. none of the above is correct.
34. Regarding the size of manufacturing concerns, large firms (with ore than 250 employees)
A. outnumber small firms more than two to one.

B. account for nearly half of all the manufacturing establishment .
......z:- are few in number but their employees account for nearly half of all employed people.
D. provide no more "value added" than the many small firms.
35. Which of the following statements about operational linkages is F
A. Operational linkages may involve the routine activities of indivi uals who almost become
_ ~art of the customer's operations.
# Operational linkages are direct ties between the internal operat ons of the buyer and seller
~firms.
~ Operational
selling firms.
D. Just-in-time delivery is an example of an operational linkage.
E. None of the above is false.
J
linkages involve only occasional coordination of a ivities between buying and
36. Which of the following is a business or organizational customer?
A. producers of goods or services.

B. a retailer.
C. a wholesaler.
D. a government agency.
~AII of the above are business and organizational customers.
37. Which of the following statements about resident buyers is true?
A. They buy fill-in items once a year for their customers.'c..

B.;1"hey operate in rural markets in developing countries. V
< They help small channel members reach each other inexpensi ely. ~
D. They usually are paid a monthly commission based on the ma ket they work in.
E. They are independent buying agents who work for a particular retailer or wholesaler
customer. I
38. Which of the following is NOT an example of an organizational bfyer?
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A. a government buyer purchasing a new desk for the mayors Jce.

B. a woman buying cookware to sell to her friends and neighbors.
~ a sales rep buying a new necktie to make a good impression.
D. a wholesaler buying a delivery truck.

E. None of the above is a good example.
39. U.S. business manufacturing markets tend to be concentrated:
A. by industry.
B. with a relatively few large manufacturing plants.
C. by geographical location.
\Jk" All of the above.
E. Only Band C above.
40. Regarding organizational buying,
A. a "national accounts" sales force often makes sense when firmt with many facilities buy
from a central location.
B. purchasing managers are more likely to be found in large
organizations. t
C. a geographically bound salesperson can be at a real disadvant ge.
~AII of the above are true.
E. None of the above is true. j

41. Which of the following is NOT a key dimension of buyer-seller rela ionships in business
markets?
~bid rigging
B. relationship-specific adaptations
C. operational linkages y.
D. legal bonds . ",
E. cooperation ~
42. Close buyer-seller relationships may not make sense because:
A. Flexibility may be reduced for the firms involved.

B. Not all purchases are important enough to the buyer to justify a close relationship with a
supplier.
--e:'Some suppliers do not want to deal with buyers who place sm II orders.
D. There are situations when the buyer could get reduced prices y letting suppliers compete
~ for the buyer's business. w V
\.5IAII of the above.
43.lf you obtain a customer's four digit NAICS code, you should kno that:
A. this firm might be manufacturing quite different products than olher firms with the same
number.
B. the firm may also have a five digit code.
C. a number of other firms probably have the same code.
D. the firm may also have a six digit code.
~II of the above are true.
I
44. Which of the following is NOT a key dimension of buyer- seller re,ltionshiPs in business
markets?
A. Legal bonds. ~
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B. Operational linkages. '"
vc:: Competition.
D. Information sharing. ~
E. Relationship-specific adaptations.
45. A requisition
A. is only used for nonroutine purchases.

~s the same as a purchase order.
C. sets the terms under a negotiated contract.
H a formal contract between a buyer and a seller.
~Jone of the above is true.
46. Which of the following statements about close buyer- seller relatio ships in business markets is
FALSE?
~In close relationships, buyers and suppliers can share tasks at lower total cost of doing
business. V
B. The buyer can gain a more dependable source of supply.
~
Buyers and suppliers can engage in joint problem solving. f...
. Long-term commitments on larger order quantities often cause he supplier to raise its
selling price. ~
E. None of the above statements is false. ..,/
47. Which of the following buying situations gives a seller the most c ance for promotion impact?
v'
A. Selective task buying
~
Modified rebuy buying
. C New-task buying
. Straight rebuy buying
E. All of the above are equal.
48. Specific adaptations are usually required when a buyer chooses - t - - ' which is a contract with
an external firm to produce goods or services rather than the buye producing them internally.
~tsourcing
B. gatekeeping
C. competitive bidding
D. resident buying
E. auctioning
49.A straight rebuy
A. is an in-between process where some review of the buying situ tion is done.
B. occurs when an organization has a new need and the custome wants a great deal of
information.
C. occurs when an organization has a new need but the custome wants only minimal
information.
D. involves setting product specifications and evaluating sources
~s a routine repurchase that may have been made many times
50.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 ne ds 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.v
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D. Is only interested in finding the lowest possible price for a

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BUS3310 Exercise 4 Page 1 ofll
BU53310,El Exercise 4
Complete the reading assignment and complete the multiple- hoice questions below
to the best of your ability. Then submit your answers to the i structor email by 11:59
points. See the course requirements section of the Communications Guidelines for
Reading: Perreault, Cannon, and IVJcCarthy text chapters 8, ,& 10
Chapter 08 - IM£JSQYlr~.LG DECISIONS WITI:LMABKI;TIl'I_JNEQRMAnO~

Chapter 09 - ELEMENTS OF PRODUCT PLANNING FOR OODS~ND SERVICES
Chapter 10 - £RODUCT l"1i\NAGEMENT AI"-JDj'if;W-PROO __-CT DEVELOPMENT
Questions:
1. Why are personal interviews usually preferred for research with b siness customers?
They are usually less expensive per interview than mail or tele hone surveys.~
· The interviewer can explain complicated directions and perha s get better responses.
· They are more convenient than mail or telephone surveys.
D. They are effective for getting quick answers to simple questio s.
' E. None of the above is correct.
2. The percent of people contacted in a survey who complete a que tionnaire is the:
A. qualitative rate.
B. sample rate.
~
population rate.
response rate.v'"
· none of the above.
F»' 1.15
3. Identify the correct sequence in the marketing research process. f>"'J' 208
® Defining the problem, analyzing the situation, getting problem- pecific data, interpreting the
data, solving the problem. i f
B. Analyzing the situation, getting problem-specific data, interpreting the data, defining the
problem, solving the problem. ~
C. Analyzing the situation, defining the problem, getting problem- pecific data, interpreting the
data, solving the problem. "i-
D. Getting problem-specific data, interpreting the data, analyzing he situation, defining the
problem, solving the problem.
E. Getting problem-specific data, interpreting the data, defining th problem, solving the
problem, analyzing the situation.
4. In small companies,
1;::\ salespeople often do what marketing research gets done.
'i" there usually isn't enough money for a manager to use a sear h engine.
C. there should be a marketing research department-or there wi I be no one to do marketing

research.
D. there is no need for marketing research.
E. the emphasis of marketing research should be on customer 5 rveys.
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BUS3310 Exercise 4 Page 2 of 11
5. Focus groups:
A. Are expensive compared to other marketing research methods.

B. Are usually composed of 10-15 people as participants."\.
~ Always do a good job of representing the broader target market.
(g)Yield results that are largely dependent on the viewpoint of the r

searcher.v
E. Are conducted in a formal group setting.i
6. Which of the following is NOT part of the five-step marketing resea h process discussed in the
text?
A. Interpreting the data. P'd "

B. Analyzing the situation.
C. Defining the problem.
~ Solving the problem.
\.:) Developing the marketing information system (MIS).V
7. utilizes qualitative and qu ntitative analysis

procedures to help marketing managers make more informed deci ions.
A. Marketing processing.
B. Marketing strategy.
C. Marketing planning.
~~arketing structure.
~arketing research.",
8. Which of the following is NOT an advantage of mail surveys as a ethod of quantitative

research?
A. Ability to do extensive questioning.
~
Low cost relative to personal interview surveys.
C High response rates.
. Greater willingness of the respondent to provide personal infor ation.
E. Ability of the respondent to compete the survey at his/her conv nience.

9. Regarding an estimate from a survey, the range on either side of t e survey result that is likely
to contain the "true" value of the relevant population is called:
A. sample range.
B. accuracy range.
~
validity interval.
D confidence interval.
. population estimate.
10.The _ _ is a decision-making approach focuses on being objec ive and orderly in testing
ideas before accepting them?
r1A)scientific method
~ marketing information system
C. idea generation process

D. decision support system
E. situation analysis
11. Marketing research is concerned with developing and analyzing ew information to help
marketing managers do a better job of:
A. executing marketing strategies.

B. planning marketing strategies.
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C. making operational decisions.
~ controlling marketing strategies.
~AII of the above.
12.The marketing manager at Massimino & McCarthy, a chain of retail stores that sells men's
clothing, is reviewing marketing research data to try to determine iffhangeS in marketing
strategy are needed. Which of the following sources of data would e a secondary data
source?
A. Reviewing videotapes of a recent focus group.

B. Spending time in stores observing customers' behavior.
1
1
+
Looking through the results of an online customer satisfaction s rvey.
· Making phone calls to some of the best customers to learn

clothing.
thei~interest
Looking through the company's marketing information system t see past sales trends.
'I
in a new line of
13. Which of the following is the correct sequence of steps in the mark~ting research process?
A. Getting problem-specific data; interpreting data; defining thepr~blem; analyzing the

situation; solving the problem. r
B. Analyzing the situation; getting problem-specific data; interpreti g data; defining the
problem; solving the problem.
C. Defining the problem; getting problem-specific data; interpretin~ data; analyzing the
... situation; solving the problem. b
@Defining the problem; analyzing the situation; getting problem-s ecific data; interpreting the
data; solving the problem. I
14.A marketing manager wants to know why her sales are down. She talks with several sales reps
and finds that a competitor has introduced a successful new produrt. This "research" seems to
be part of
A. the data interpretation stage. I
~
obtaining problem-specific data.
· the situation analysis.
· the problem solution stage.
E. the problem definition stage of the research process. I
15. The first thing a marketing manager should do if one of his firm's products drops in sales
volume is:
A. do a situation analysis.
B. set research priorities.
C. conduct a survey to see what is wrong.
(5) define the problem.
'¥" interview representative customers.
16.A small manufacturing firm has just experienced a rapid drop in sdles . The marketing manager
thinks that he knows what the problem is and has been carefully ~nalyzing secondary data to
check his thinking. His next step should be to: I
A. initiate corrective action before sales drop any further. I
~ conduct informal discussion with outsiders, including intermedi~ries, to see if he has

~ correctly defined the problem.
C. conduct an experiment.
D. develop a hypothesis and predict the future behavior of sales.
E. develop a formal research project to gather primary data.
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I
17.ln a grocery store's "valued customer" program, every shopper getsl a card that he/she
presents to the clerk in the checkout aisle. The card is scanned alo g with the customer's
groceries. The store's computer system tracks each shopper's purc ases and automatically
provides special valued customer discounts. Every month, the cust mers in the program
receive a newsletter containing coupons that are based on the cust mer's purchase history.
For example, someone purchasing a lot of baby formula and dispo able diapers might get a
coupon for a free box of baby wipes. This valued customer progra is based to a large extent
on which of the following types of research?
fi;:j
Observation.
1( Questioning.
C. Personal interviews.
D. Online surveys.
E. Experimentation.
18. According to the text, which of the following is NOT a product?
A.
space in Playboy Magazine sold to an advertiser
B.
a Sony PlayStation III
C.
a Broadway musical play
D
the San Diego Zoo
~II of the above are products.
19. Convenience products include:
A. impulse products.
B. staple products.
emergency products.
9 All of the above .
. Only A and C above.

I
20. The Nutrition Labeling and Education Act of 1990 requires food ~anufacturers to
---------------j~.
A. List the nutritional value of the food product.
B. Use a uniform format in the Nutrition Facts panel.
-istthefatcontentofthefoodprodUCt.
@ II of the above .
. A and Conly.
21. Consumer product classes

I
A. are based on how the product will be used. I
B. are based primarily on how much effort is actually involved in ~aking a purchase.
C. suggest the type of marketing mix that should be used, but bu iness product classes have
little to do with the marketing mix that should be used.
@ D are based on how consumers think about and shop for prodUc~s.
. None of the above is true. I
22. Which of the follOWing business products are usually treated as ~xpense items?
A. component parts and materials

B. raw materials
C. professional services
~supplies
~II of the above
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23. Luke Flaherty wants to bUy an electric drill for some jobs around his home. Deciding that all
such drills are similar, he reads all the advertisements in his Sunda paper in search of the best
price. For Luke, these drills are:
A. a heterogeneous shopping product.
a specialty product. b(
~G a homogeneous shopping product.
· a staple product. ox,
E. an emergency product.
24. A trademark or brand name can become pUblic property if:
A. the owner doesn't renew the registration each year.
~
it becomes a common descriptive word for the product.
. he owner doesn't register it under the Lanham Act.
. it is sold in international markets.

25. For a homogeneous shopping product, a marketing manager shoul
A. recognize that consumers see a lot of differences across altern tives. l(

B. understand that price sensitivity is likely to be low.
know that consumer purchases are typically unplanned and bo
@ · provide enough exposure to facilitate price comparison.
· realize that consumers usually pay little attention to price.
26. The text's business product classes are based on:
A. how buyers think about products.

B. how the products are to be used.
C. the shopping behavior of the buyer.
~~II of the above.
~othAandB.
27. Use of family brands
A. may involve several firms-if one licenses its brand.

B. is common among both producers and intermediaries.
C. can provide customers with cues about the quality of new pro ucts.
~ can be efficient, since the brand name will carry over in the fir 's advertising.
(1.§/ All of the above are true.
28. Which of the following statements about branding is TRUE?
A. Customers are willing to buy by brand only when it assures "to quality."
B. Branding provides product identification for sellers but usually i not important to
consumers.
C. What brand is familiar often varies from one country to anothe .
~AII of the above.
\SJ None of the above.
29. A "product" might include:
A. a brand name, a package, and a warranty.

B. instructions.
C. a service which does not include a physical good at all.
D. some physical item and its related features.
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o All of the above.
30.A Hewlett-Packard "all-in-one" printer that serves as a computer prihter, fax machine, copier,
and scanner would fall into which of the following business product ,laSSeS?
A. Installations.
B. Accessories.
C. Components.
~.. Raw materials.
\§I Supplies.
31. The Federal Fair Packaging and Labeling Act I
A. was created due to consumer criticism of packaging and labelihg.
1
B. calls on government agencies and industry to try to reduce thel ~umber of
~
aCkaging sizes. ~
c. equires that consumer goods be clearly labeled in understan able terms.
. all of the above.
E. A and B only.
32. Product class is based on the type of _
A. Marketing strategies.
~
hOPPing strategies.
. arketing mix.
. . Manufacturing process.
E. Final customer.
33. Which of the following is NOT a level of brand familiarity?
(i) Brand nonexistence.

B. Brand nonrecognition.
C. Brand insistence.
D. Brand rejection.""' I
E. Brand preference.'k
34. Carlotta Issa is shopping for a new pair of jeans. She has had gooL experiences with Jordache
jeans in the past and is looking for Jordache now. She probably will buy Jordache if she finds
some that are at least as good-looking as competitive jeans. This if a good example of:
A. brand insistence. ~ I
B. brand rejection. '(
~ brand remembrance.1-
@)brand preference.
E. brand recognition.
35.Allan Clapp is a purchasing agent for Deep River Mfg. Co. He reglfJlarly buys items such as
nails, light bulbs, brooms, and sweeping compounds. In other wortls, he buys:
fA)supplies.
II
'i" components.
C. professional services.~
D. accessory equipment.
E. installations. I
36. As a product moves into the market maturity stage of the produc~ life cycle:
~onsumers tend to view products as being more similar. I
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I
B. The competitive situation moves toward monopoly.

C. Promotion emphasizes informing consumers more than persuading them.
D. There is less consideration of competition in setting prices.
37. The Consumer Product Safety Commission can:
A. order costly repairs of "unsafe products."

B. back up its orders with fines.
C. order returns of "unsafe products."
~ack up its orders with jail sentences.

I
~ ~II of the above are true.
38. Over the past several years, like other auto manufacturers, Genera~ Motors (GM) has
introduced many new models of sport utility vehicles (SUVs) in all ~f its major divisions. This
proliferation of SUVs and an increase in gasoline prices have caU~d sales to level off. In
response, General Motors offered rebates of up to $5,000, or no-in erest financing, on selected
models of SUVs. The largest rebates went to current owners of G vehicles, so that they would
replace their current vehicles with a GM model instead of switching to another brand. The
rebates have been heavily advertised on national television. Profit rarginS per vehicle have
shrunk as a result of these costly promotions. In what stage of the roduct life cycle is GM
currently operating?
A. Market introduction.
~Market growth.
~Market maturity.
D. Market establishment. I
E. Sales decline.
39. Concerning product life cycles: I
A. each of a producer's individual products follows the life cycle dattern.

B. in the early part of market maturity, new products begin to repllace the old.
C. the stages usually have varying lengths. '" I
D. in general, life cycles are. getting longer.~ I
~ None of the above is tru

w
40. As a product moves into the market maturity stage of its life cYciel the marketing manager
should:
A. try to build primary demand.

B. move toward exclusive distribution.
C. expect the market to move toward pure competition. I
~ All of the above are true. I
IC§jNone of the above is true.

Use this information for questions that refer to the Wire pro~ucts Inc. (WPI) case.
Rob Rose sat back to review the portfolio of products his compa y, Wire Products Inc. (WPI),
has in its product line. The company specializes in making various products for consumer and
industrial uses from hard laminated wire - coated with special prints.
1) WPl's "Wire Closet" products have been on the market for 10 ears. Consumers install the
wire shelves and closet rods themselves. The market leader, Clo etmaid, has been selling
similar products for more than 20 years, but so far the sales volu e and profits for the market
continue to grow. Recently, several new competitors have come nto the market.
2) Three months ago, WPI entered the lawn and garden market ith folding fences made with
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laminated wire and branded as "Wire Fold-Fence." Previously, WPI had never made fences or
been in lawn and garden - although other companies have been aking products in this
market for years. However, Rob Rose has discovered that recent ales of wire garden fencing
have leveled off and profits are declining overall. Still, WPI thinks i has some cost advantages
and can grow its own sales and profits in this market.
3) WPI has just developed "Oil Wire," a new concept for the envir~nmental cleanup market.
Oil Wire is coated with a special material that cleans up oil spills.1[here has never been a
product like this and WPI wants to quickly get the word out about ifs benefits. The product is
now being rolled out in selective markets. I
4) Another business product is "Wire Locker" used for secure stor,ge by gymnasiums or
companies. This style of locker has now gone out of fashion and ost customers are finding
better materials to use for lockers. Aggressive selling has helped ire Locker's sales stay flat,
but the total market for wire style lockers is only half of what it wa 10 years ago.
5) WP\'s "Wire Window" product is used as a security product to p otect glass windows. It sells
to homeowners and retailers looking for additional safety. WPl's s les of this product have
dropped in recent years because competitors have introduced ma~ntenance-free products.
However, the overall market for this type of product continues to srow good growth.
6) WPI is running concept tests of a new wire car-top carrier calle~ "Wire Car Top." There are
other car-top carrier products on the market, but WPI plans to inc~de options in its carrier that
will make it easier to load bikes, skis, and suitcases. "Wire Car To "is also very easy to put
on and take off of the car because of its light weight and ease-of- se features. The concept
tests are helping WPI analysts develop rough estimates of costs, ales, and profits.
7) Another new product idea, tentatively called "Wire Tent," is bei g considered. It would use
laminated wires to create a portable tent frame. This product is currently being evaluated to
determine its fit with the company's objectives and external mark t trends.
Rob is thinking about the product life cycle, where each product fi S, and what he should be
doing as part of his marketing plan for each of these products.
41.ln which stage of the product life cycle is "Wire Fold-Fence"?
A. Sales decline
B. Market development
A Market maturity
\QI Market introduction
E. Market growth
42.lt is toward the end of the _ _ stage of the product life cycle wh n industry profits begin to
decline.
A. market growth
~
market decline
C market maturity:<:;
. sales decline...>V
E. market introduction
43. Which of the following observations concerning the market maturit stage is NOT TRUE?
A. Many aggressive competitors have entered the race for profits.
~
Persuasive promotion becomes more important during this sta e.
. New firms cannot enter the market at this stage.
. Promotion costs rise and some competitors cut prices to attrac business.
E. There is a long-run downward pressure on prices.
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I
44. Seeking to stop declining sales for an established mouthwash, a s~les

manager suggests that
new coloring be added to the product and a major promotion effort be started for the "new"
product. The Federal Trade Commission would: l
A. be concerned about the possibility of the firm getting a mOnOP~IY.

~
. IIow the company to call the product "new" for only six month .
robably not approve of this at all because the product doesn't meet the FTC's
~efinition of "new." -I
D. allow the promotion effort if it felt that consumers would think t~e coloring made it "new."
E. none of the above is true. 1
45.This type of a new-product idea is high on both long-run consumer fNelfare and immediate
satisfaction. 1
A. Deficient product 1
B. Salutary product
~
safety product
. Desirable product/'
1
. Pleasing product
46. According to the FTC, for a producer to call a product "new," the ~roduct:
A. must be no more than two months old. 1
must have achieved brand insistence.
4'
1
C must be entirely new or changed in a functionally significant o~ substantial respect.

. must have been changed in some way during the last year. 1
E. None of the above is a correct answer.
47.ln screening new product ideas, Willie Baker came upon an idea f~r
a new mountain bike that
struck him as relatively dangerous and potentially harmful to cons mer welfare. However, he
thought it would provide very high immediate customer satisfactio . Such a product would be
:Y
considered a
4
star product.
desirable product
'~ pleasing product.

~ . ~ '1 .
D. salutary product.
E. deficient product.v<:/ 1
48. Industry profits are largest in which of the following product life cY11e stages?
A. any of the above. 1
B. sales decline.
C. market introduction.
~ market maturity.
\:J market growth.

1
customers. After identifying the biggest problem, he may create a r---

49.Jack Johnson uses a Pareto chart to identify the frequency of diff1rent complaints from his
to solve it.
~
Pie chart 1
B. fishbone diagram 1
. competitor profile
D. waterfall chart
E. demographic report
50. The Consumer Product Safety Commission can:
Page 10 of II
BUS3310 Exercise 4
A. order costly repairs of "unsafe products."

B. back up its orders with fines or jail sentences.
~ set safety standards for products.
(Q)AII
.
of the above.
E. Both A and C-but NOT B.
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Page 11 ot 11
BUS3310 Exercise 4
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BU53310.El Exercise 5 ~I
Complete the reading assignment and complete the multiple hoice questions below
points. See the course requirements section of the Communic tions Guidelines for
Reading: Perreault, Cannon, and McCarthy text chapters 11,112, & 13
Chapter 11 - PLA~J:~ND DEYELOP.MEJ~"'Il)F CJ::lANNEb__ YSIEMS

Chapter 12 - DISTRIBUTIOI\J CUSTOfVlER SERVICE AI\JD LOGISTICS
Chapter 13 - RETAILER_S. WHOLESA"'-ER~_AI\JD TH_EIR TRATEGY PLANNIN~
Questions:
Use this information for questions that refer to the World Tenhis Ball (WTB) Company
case. I-
World Tennis Ball Co. (WTB) makes tennis balls and sells them o~ly in the U.S. Raul
Fernandez, the firm's marketing manager, is comparing his firm's tlistribution with two major
competitors. 1
1) WTB sells its products through four regional distributors who thfn sell to 22 sporting goods
wholesalers. The wholesalers sell to a total of 7,000 retail outlets. From its website, WTB also
sells directly to any customer who will purchase a minimum quantity of 24 tennis balls. WTB
cooperates with members of its channel, but maintains some con rol through its economic
power and leadership. It helps to direct the activities of the whole bhannel and tries to avoid or
resolve channel conflicts. I
2) American Tennis Ball (ATB) is a competitor that sells through t~o distributors - each with
half the country. The distributors then sell through 6 sporting gooqs wholesalers, and they, in
turn, sell to 1,000 retail outlets (split between two national sportin$ goods chains and two
general merchandise stores). ATB and its channel make little effort to work together. However,
because of a relatively low level of competition between the distri utors, the wholesalers, or
the retail stores, each member of the channel gives the product s ecial attention.
3) National Tennis Ball (NTB) sells its products through only thre tennis specialty wholesalers
that sell only to tennis clubs. NTB actually owns the wholesale fir s that handle its products.
NTB's balls are only available at certain tennis clubs and NTB lim ts coverage to only one club
in a particular geographic area.
1. If American Tennis Ball adds more wholesalers and more retail outlets, this is likely to
A. lead to vertical channel conflict.

B. create horizontal channel conflict.
C. require that the largest wholesaler take over the channel capta n role.
D. increase trust and cooperation in the channel.
exompt both vertical and horizontal channel conflict.

1
2. INDIRECT channels are probably a better choice than direct chanrels when:
A. the firm has limited financial resources.

B. the product is a consumer product instead of a business produ t.
C. target customers already have established buying patterns for here to search for the
rage L. Vl 7
'110 Exercise 5 I
product. I
2"" retailers are already conveniently located where consumers shop.
~ all of the above.

3. "Intensive distribution" means selling through:
ro all responsible and suitable retailers or wholesalers. . .

~ only those intermediaries who give the product special attention.
C. all retail outlets.
D. only one channel of di~tributio~. .
E. only one intermediary In a particular geographic area.
j
4 Yakima Valley Produce, Inc. bUys artichokes from many small far ers, assembles them into
. larger quantities, and ships in carloa~ quan~it~e~ ~o a cen~ral mark1 where they are sold to
large food processors. This "regrouping activity IS called.
A. bulk-breaking.
B. wholesaling.
~
sorting.
o accumulating .
. assorting. I
5. With respect to consumer prod~cts, which of the following is the rost common system for
distributing consumer products In the U.S.?
A. direct channel systems.

B. vertical marketing systems. ve.-.
C. traditional channel systems.
D. horizontal marketing systems.
E. none of the above. ..
6. If a firm's involvement in international marketing is limited to man1ging others' production
facilities, it is using:
A. direct investment.
B. joint venturing.
C. licensing.
~g. exporting.
. 'Y")' , '511 I ~
l_~) management contracting.~ I .

7. A producer using several competing channels to distribute its pro ucts to its target market is
using distribution.
A. intensive
B. horizontal
C. selective
~ administered
l3Jmultichannel
8. Which of the following statements about Place is NOT true? l

A. Most consumer products move from producer to intermediarie to final customer.
B. A series of participants in the flow of goods and services from~producer to final customer is
~
called a channel of distribution.
C. There is always one Place arrangement that is "best" for a pr duct.
\ . Intermediaries develop to adjust discrepancies in quantity and assortment.
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BUS3310 Exercise 5 Page 3 ofY
9. Which of the following is typically the lowest risk approach for movi g into international
markets:
A. licensing
B. joint venturing
C. direct investment
~ management contracting
(I!) exporting
1O.A publisher of photography books finds that it is cost-effective to pr nt 10,000 or more at a time.
But a bookstore orders only a few copies of each book since its cu tomers want to select from
a wide variety. This example shows
fA) why discrepancies of quantity occur.

V why both discrepancies of quantity and assortment occur.
C. why discrepancies of assortment occur.
Act'\- D. neither discrepancies of assortment or quantity.
" V E. multichannel distribution.
~ 11.ln _ _ channel systems, the channel members agree by contra t to cooperate with each
other.
A. corporate
B. traditional
C. administered
D. selective
(9 contractual
12. _ _ distribution is commonly used for convenience products an business supplies.
A. Exclusive
B. Selective
C. Internal
& Specialized
<..9 Intensive
13.A joint venture is:
A. a firm that provides only management skills, while others own he production and
distribution facilities.
B. a firm selling the right to use some process, trademark, or oth r right for a fee.
~
a separate firm owned by a parent company.
a domestic firm entering into a partnership with a foreign firm.
. none of the above.
14. Retail stores that sell "seconds" and "irregular" products at disco nt prices are flourishing all
over the country. These stores are needed because of what regr uping activity?
A. Accumulating
B. Bulk-breaking
C. Sorting
D. Assorting W
E. None of the above
15. means selling a product through only one whol saler or retailer in a particular
geographic area.
A. Selective distribution
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BUS3310 Exercise 5 Page 4 of
~
Intensive distribution
C Exclusive distribution
. Direct distribution
E. Multichannel distribution
16. The railroad service which picks up truck trailers at a producer's 10 ation, loads them onto rail
flatcars, hauls them close to the customer, and then delivers them 0 the buyer's door is:
A. pool car service.

B. truck service.
C. trailer service.
~ fast freight.
(!;) piggyback service.
17. The physical distribution customer service level is important beca se:
/lA)it is a measure of how rapidly and dependably a firm delivers hat its customers want.
\Y it may result in lost sales if it is too low.
~ ,<;t C. it may result in high costs (and thus lower profits) if it is too hi
<fJ D. All of the above.
18.Tammy works in transportation for a company that manufactures t actors and other farm
equipment in China for the U.S. market. Cost is her primary conce n in getting products to farm
states in the U.S. Midwest. Which mode(s) of transportation would you suggest?
A. Air only.
~
Air then truck ?
C. Water then rail. .

~ . Water then truckW
I E. Air then rail.
19. The transporting function adds value by:
A. making products available where they're needed.

B. helping achieve economies of scale in production. V""
C. making products available when they're needed.
~ Both A and C.
~ All of the above.
20. Piggyback service means
GJ loading truck trailers on railcars to increase flexibility. \.,./

B. linking truck trailers to save fuel.
C. special handling of important farm equipment.
D. providing door-to-door service in cities.
E. combining small shipments of many shippers into more econo ical quantities.
21.Which of the following statements is NOT TRUE?
A. Storing allows the producer to achieve economies of scale in roduction.

B. Storing is necessary when production of goods doesn't match onsumption. K
C. Storing allows producers and intermediaries to keep stocks at onvenient locations.b(
9~<t V @> Storing can increase the value of goods, but does not involve 08tS.
1~· ~ E. Storing is a marketing function.
~ 22. Shipping by air
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A. is most useful for smaller, high-value items.

B. may reduce handling costs.
enerall Y involves higher transportation costs than other mode of transportation.
@ D :A.II of the above are true.
. None of the above is true.
1
.
Use this information for questions that refer to the United To Is case.
Terry Harter is marketing manager for United Tools and Mike O'R illy is the firm's logistics
manager. They work together to make decisions about how to get United's hand and power
tools to its customers - a mix of manufacturing plants and final co sumers (who buy United
tools at a hardware store). United Tools does not own its own tran port facilities and it works
with wholesalers to reach its business customers.
Together, Harter and O'Reilly try to coordinate transporting, storin ,and product handling
activities to minimize cost while still achieving the customer servic level their customers and
intermediaries want. This usually requires that United keep an inv ntory of most of its products
on hand, but demand for its products is fairly consistent over time so inventory is easy to
manage.
Harter has identified four options for physical distribution systems she could use to reach two
of her key wholesalers, Ralston Supply and Ricotta Tool Co. The otal cost for each option
and the distribution service levels that can be achieved-are as f 1I0ws:
,_.~!~li"le_(lJlIN! glsl~te'!E._ . J _T(J!~~l c:."st . I2istrillllt!01!Serl,ice
I .. Airfreigl1t $l,OOO,(~~OL 95p~rcent
2. Inland waterways $300.000 60 percent
3~ Truc-ks" ."'_. .,~?g.~.~~.(~O . . ?~,J?,ercent
4. Rail and regiouaf $650.000' 80 percent
\varehouaes
Ralston Supply expects a very high level (90 percent) of distributi n customer service. Ricotta
Tool Co. is willing to settle for a 70 percent customer service level, even if that means some
products will occasionally be out of stock, if it gets products at a I wer price.
For its large retail hardware customers (like Home Depot), Unite regularly ships smaller
orders directly to individual stores or in some cases to the the ret it chain's warehouses.
Cross-country shipments usually go by rail while regional shipme ts usually go by truck.
23. When United Tools considers its total inventory cost, which of th following would NOT be
included?
A. Costs of damage to products while in inventory.

8. Costs of inventory becoming obsolete. 1
C. Cost of a storage facility.
~ Cost of capital invested in the inventory.
t.:JAll of the above should be included in total inventory cost.
24.A supply chain:
A. focuses on making services available whereas a channel of di tribution focuses on making

goods available.
~ may involve many firms, but only one manufacturer.
~ includes all the activities involved in procuring materials, trans orming them into products,
and distributing them to customers. ~
D. is easier to coordinate than a channel of distribution.
E. all of the above.
25.lt is usually most economical to ship bulky nonperishable items, su h as coal and iron ore, by
fA) water.
~ pipeline.
C. truck.
D. air.
E. None of the above is a good answer, since the cost of shipping product usually does not
vary from one mode to another.
26. Transporting by water:
A Is the fastest transporting mode.
(§) Is the least expensive transporting mode for heavy freight.
?...vt. C. Is only important for international transportation.
q~ . :I D. Is especially useful for lightweight goods.
'\ E. All of the above.
27. To help in managing excess inventory, United Tools would most likely use:
A. a private warehouse.
B. a public warehouse.
C. piggyback mode. ()
....::JI:'>a distribution center.~ (
E. all of the above would help with excess inventory.~ •

28. Compared to a pUblic warehouse, a private warehouse
A. has lower unit costs.
~
eqUireS no fixed investment.
C. as less flexibility. ~
. . tends to have less managerial control.
E. works better when large volumes of goods must be stored irre ularly.
29. Inventory refers to
A. the marketing function of holding goods.

~ the quality of goods being stored.
~the amount of goods being stored.
D. minimizing storage costs.

E. the amount of goods being sold.
30.Alex has to transport iron ore from New Orleans to Memphis. Whi h mode of transport is he
more likely to use?
A. Railroad
B. Airways
C. Monorail
~t. , ,)1r'\ t1D'nland waterways
\ J Y Truck
31. A _ _ is the complete set of firms, facilities, and logistics activ ties that are involved in
procuring materials, transforming them into intermediate or finished products, and distributing
them to customers.
(t)SUpply chain
B. physical distribution group
C. logistics partnership
D. just-in time group

32. Which of the following products would have the lowest transporting costs as a percentage of
the selling price?
~
_. Electronic equipment.
B. Pharmaceuticals. 1'\
. Manufactured food. \
D. Chemicals and plastics.

E. Sand and gravel\X/
33. The wheel of retailing concept
QB. explains
is consistent with the emergence of supermarkets in the 1930s.
the early success of convenience (food) stores.
C. explains the early success of vending machines.
D. suggests that new types of retailers usually emerge as high-pri e, high-cost operations, and
7 ~ then cut their prices as competitors enter the market.
U None of the above is true.
34. Regarding discount houses, which of the following statements is T UE?
A. The early discount houses emphasized hard goods.

B. While some conventional retailers cut price on competitive item , discount houses regularly
~ sell all of their products at smaller markups.
\..SIAs early discounters were able to offer full assortments, they al o sought "respectability"
and moved to better locations.
D. Discount houses are fast-turnover, price-cutting operations.
35. Which of the following is not a type of service wholesaler?
A. Single-Iine'i
B. General-line
~Specialty 'I{:..
c.g...,.cash-and-carry{J. ~
E. General merchandise II
36.A full-service wholesaler in Madrid takes title to the "oriental foods' she sells to supermarkets,
gourmet shops, and restaurants. This wholesaler is a:
A. specialty wholesaler. V'

B. selling agent.
7,
C. manufacturers' agent.
D. single-line wholesaler.
E. general merchandise wholesaler.
37. Specialty shops:
A. offer fewer services than the typical limited-line store.

B. have trouble deciding what to carry because it's hard for them 0 get to know what their
~
customers want.
C rely heavily on knowledgeable salesclerks.
. All of the above.

38. The main difference between retailing and wholesaling is that:
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A. Retailing involves selling to business customers and wholesaling does not.

~ Wholesaling involves selling to final consumers and retailing does not.
~. Wholesaling involves selling mainly to other merchants and business customers, but
retailing involves selling mainly to final consumers.
D. Technology is more important in wholesaling than in retailing.
E. Retailing involves selling to other merchants and wholesaling does not.
39.Time-pressured, dual-career families are a prime target market for
~
specialty shops.
B. telephone and direct-mail retailing.
. door-to-door selling.
D. department stores.
E. category killers.
40. Regarding merchant wholesalers, which of the following statements is TRUE?
A. They own (take title to) the products they sell.

B. Merchant wholesalers are the most numerous wholesalers and handle over 60 percent of all
wholesale sales.
C. General merchandise wholesalers of consumer products handle a broad variety of
nonperishable items, including both convenience and shopping products.
D. A specialty wholesaler generally would offer a narrower range of products than a single-line
C\ wholesaler.
VAil of the above are true.
41.Franchisors:
A. leave it to franchisees to carry out the strategy in their own units.

B. often help franchisees by providing purchasing power and promotion support.
C. usually receive fees and commissions from the franchise holder.
D. reduce the risk of starting a new retailing business because a good strategy has already
been developed and tested.
(9AII of the above are true statements.
42.A drop-shipper is an example of a(n)
A. producer.
B. service merchant wholesaler.
C. manufacturer's agent.
D. agent wholesaler.
~ limited-function merchant wholesaler.
43. Regarding wholesalers, which of the following descriptions is TRUE?
A. MANUFACTURERS' AGENT: does not own the products, usually carries stocks, represents
several competing manufacturers within a geographic area. ~
B. MERCHANT WHOLESALER: does not take title to products, takes possession, provides full
service, and usually handles a broad variety of products. ~
C. BROKER: does not own the products, does not take possession, major function is selling,
and does not anticipate customer needs.
f8
. D.
E.
SELLING AGENT: does not own the products, does the whole marketing job nationally, and
may handle competing lines.
All of the above are true.
44. Department stores:
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BUS3310 Exercise 5 Page 9 019
A. Have increased their share of retail business since the 1970s.
~
Have increased in number since the 1970s.
Usually offer many product lines.
· Are no longer a major retail force in large U.S. cities.

E. Are not threatened by mass-merchandising retailers.
45. Retailing on the Internet:
A. makes it hard for consumers to compare products or prices.

B. is limited to only a few mass-merchandisers.
C. makes shopping very convenient for some consumers.
~ is not expected to grow very fast.
~ all of the above.
46.The biggest advantage of this limited-function wholesaler is that th y promptly deliver

perishable products that regular wholesalers prefer not to carry.
A. Specialty wholesalers
B. Drop-shippers
Rack jobbers
$ D. Truck wholesalers
· Catalog wholesalers
47.The percentage of new retailing ventures which fail during their fir t year is:
~
one-fourth.
.B three-fourths.
· one-third.
D. one-half.
E. two-thirds.
48. Mass-merchandisers:
face a bright future and increasing profits-because of decre sing competition.

$B.
D.
.
usually operate with low margins on individual items.
operate on the "buy low, sell high" philosophy.
try to reduce costs by reducing inventory turnover.

49.Which of the following is LEAST likely to be sold by a supercenter.
A. Lawn care materials

B. Photo finishing
C. Milk
~Aspirin
vTrash compactor
50. covers all of the activities involved in the sale of products to final consumers.
A. Wholesaling
B. Marketing
C. Distributing
~. . Manufacturing
,~Retailing
Complete the reading assignment and complete the mlJltiple- hoice questions below
PM Central Time July 24, 2010. Each question is worth 2 points for a total of 100
Reading: Perreault, Cannon, and McCarthy text chapters 14, 15, & 16
Questions:
1. Direct marketing communication designed to prompt immediate fe dback by customers is also

called
~ direct-response promotion.
Y interactive communication.
C. online marketing.
D. direct mail advertising.
E. downward communication.
2. "Advertising":
e)is any paid form of nonpersonal presentation of ideas. goods. of services by an identified
sponsor.
B. is the only form of mass selling. I
C. is concerned with "promotion" using samples, coupons, and co~tests.

D. is also called "sales promotion."
E. involves direct spoken communication between sellers and pot ntial customers.
.,
3. In the market introduction stage
• A. promotion emphasis shifts from building primary demand to sti ulating selective demand.
B. more competitors enter the market. ~
© the basic promotion objective is informing.
D. mass selling and sales promotion dominate the promotion bien s of consumer products
firms.
E. the main job is to persuade customers to buy, and keep buying the company's product.
4. Regarding PRODUCT LIFE CYCLES and PROMOTION:
A. During market introduction, the basic promotion objective is to r mind.

B. In sales decline, the amount spent on promotion usually increa1es as firms use reminder
promotion to increase demand.
f2> Persuading becomes important in the market growth stage./
'11 In market maturity, more competitors enter the market and the romotion emphasis must
now shift to building selective demand for the firm's own brand.
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5. Which of the following groups is likely to be the first to adopt a new product?
A. late majority
A early adopters
. ~ innovators
I
D. laggards
fJ ..,ctb E. early majority
6. The innovators are the group of customers who I
A. have fewer contacts outside their own social group or communit lt .

B. tend to be older, less well educated, and cling to the status quo ~hinking it is the safest way.
C. tend to have the greatest contact with salespeople. ~
D. tend to avoid risk and wait to consider a new idea after many e rly adopters have tried it
and liked it.
f)
.",,1- @ are likely. to be mobile and have many contacts outside their loc I social group and
communrty. \...-'"
7. The adoption curve I
~mPhasizes the relations among groups and shows that individ~als in some groups act as
leaders in accepting a new idea.
B. is the intentional coordination of every communication from a firf.n to a target customer to
convey a consistent and complete message. I··
C. emphasizes the importance of securing the wholehearted COOP1.ration of channel members
to promote the product in the channel and to the final user.
D. puts more emphasis on technology and less on relationships.
E. is any distraction that reduces the effectiveness of the communication process.
8. Blending the firm's promotion efforts to convey a complete and con~istent message is the goal
of: I
A. Sales promotion communications. I
B. Sales management communications.

C. Integrated promotional marketing.
t
I
R Integrated sales promotion.

Vlntegrated marketing communications.
9. Merchandising aids and promotional allowances are sales promoti n activities aimed at
~
• A. final users.
\
~.ft
$
t..y'~ ..
--t \
1
B. buyers.
?ompan~'s ?wn sales force.
D. Intermedlanes.
I
1 J . final consumers.
10. Regarding the adoption curve, marketers may determine that ther, is little to be gained from
trying to inform or influence the:
A. Early adopters.
B. Innovators.
C. Late majority. 1
D. Laggards. ~;~/
E. Early majority. I
11. When firms promote products to their own employees as part of a~ internal marketing effort,
they are using a I
I
digital marketing approach.
pulling approach.
US mg a ro ~
D. personal selling approach.
i[}A- 1-;'& 1, E. telemarketing approach. \.
r- J 12.lf customers already have a positive attitude about a product, WhiC~ promotional objective
would you recommend? I
A. Inform.
B. Change position.
perSuade.
<v&\'
1 .J
~14
$ D. Remind.
. Educate. I
13. _ _ prefer to do things the way they have been done in the past ~nd are very suspicious of
new ideas. I
A. Early adopters
B. Opinion leaders
<po lnnovators
Laggards or nonadopters
. Late majority customer group
14. The basic promotion objective of informing consumers correspon s to which stage(s) of the
AIDA model?
A. Getting attention.
B. Holding interest.
C. Arousing desire.
~. Obtaining action.
vothAand B.
15. The _ _ can help the promotion effort by spreading word-of-mo th information and advice
among other consumers.
A. innovators
B. laggards
C. late majority customer group
~
nonadopters
lLb ~ E. early adopters
(J h,' 7l> 'J

, J 16. "Personal selling:"
170 involves direct spoken communication between sellers and po entiaI customers.
'l:( costs less than advertising for reachinga large, widespread m rket.
C. tries to communicate with many customers at the same time.
D. refers to "promoting" at trade shows, demonstrations, and con ests.
Use this information for questions that refer to the "salespe~Ple" case.
Wilson Alvaro graduated with a marketing degree almost a year go. Like many of his friends,
he took a job in sales and really enjoys it. A description of Wilson's job and those of some of
his friends are noted below.

I
Wilson Alvaroloves biking and has his dream job. He works for a ~holesale company that sells
mountain bikes for a manufacturer. He works with a small group ~f people who call on the
buying offices for two large retail chains, Wal-Mart and Toys R Ui' The group includes a
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finance person and a production person, and they all work togeth r to meet the specific needs
of these two big accounts; for example, sometimes they recomme d a model of bike that will
be available from only that retailer's stores. However, Wilson's ma n job focuses on bUilding
relationships and solving customer problems. Only occasionally is he expected to try to
persuade the retailers to buy more bikes.
Amy Bowdensells life insurance. She calls on new parents and persuades them to buy
insurance products. It is difficult for a manager to control Amy's w rk, but she has incentive to
work hard because her job security and income depend on gettin sales. She is a confident
self-starter, so she likes it that way.
Ben Petersonworks for a fashionable men's clothing store. He enj ys spending time with
customers who come in, learning about their fashion needs, and elping them pick clothes
that really work for them. While the store manager can easily obs rve and direct Ben's
activities, the manager wants Ben to have the incentive to increa e customer purchases and
satisfaction.
Emily Wintershandles inside sales for a major industrial distributo . She deals with a regular
set of established customers, most of whom know what they wan. Emily talks to them on the
phone and answers questions about products, delivery time, and ricing. She sometimes
works with outside sales reps who visit customers and help introduce new products. Emily is
the first person her customers call when there's a problem with a urchase, so she spends a
lot of time dealing with customer problems. As an inside salesper on, Emily's work is easily
supervised by a sales manager - and she has little influence on h w much her customers buy.
Melissa Tranworks for a company that sells paper products (like apkins, paper towels, and
paper plates) primarily through small independent grocers. Most f the grocers are regular
customers, but sometimes she makes cold calls to new grocery s ores. Melissa's job is to
develop goodwill and try to increase sales. For example, she ofte sets up special promotional
displays in stores. Her compensation plan gives her income secu ity, but she also can receive
a bonus for sales growth in her territory. 'f....
Charlie Riggs is a telemarketer for an Internet service provider. e calls people on a list
provided by his firm and tries to sign them up for Internet service. Charlie relies heavily on a
presentation he learned during his training. Charlie is very good t what he does and loves
that the more success he has the more he earns. \(
17.Which salesperson's main sales task is supporting?
rA) Melissa Tran

'1? Emily Winters
~
WilsonAlvaro
Ben Peterson v'
1 8.st sales presentations follow the AIDA sequence which stands for
A. Attention, Involvement, Desire, Appeal

B. Attention, Interaction, Development, Action
C. Attention, Interest, Develop, Appeal
~'1'< ~ Attention, Involvement, Desire, Action
~1' J (5jAttention, Interest, Desire, Action
19.The two basic decisions to be made in developing a compensatio plan are the method of
payment and
A. career advancement.
B. number of years of service.
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'. l'
~5 ~
~ designation of the salesperson.
(Q) level of compensation.
E. number of client commendations received.
20. The commission method of payment:
A. increases the amount of sales supervision needed.

B. is tied to results projected in the sales plan.
~
includes some salary and some commission.
[) offers the most incentive for the salesperson.
. offers the most security for the salesperson.
21. A good sales manager knows that:
( ; ) order takers usually do very little aggressive selling.
'1? order takers can be used by wholesalers-but not by produce
C. order getters complete almost all sales in our country.

D. whenever possible, order takers should be replaced by order etters.
22.According to the text, missionary salespeople are sometime called as
A. customer service reps.

B. technical specialists.
account managers.
$D. detailers.
. order takers.
23. With the approach, the salesperson uses a memor zed presentation that is not
adapted to each individual customer. ~
7;:) Prepared sales
¥ Selling formula
C. Consultative selling
D. Differentiated value
E. Fixed sales
24.Jeffrey O'Donnell works for a producer of dairy products and kno s all about these products.
He is responsible for only two very large chain customers. Other s les reps, like Jeffrey, call on
other large chains for this producer. They regularly call on the cen ral offices of these big retail
chains and encourage them to buy the company's full line. Jeffrey is: c
'52-- v
(;) a member of his company's major accounts sales force.
B. a manufacturers' agent.
C. a technical specialist.
D. a retail order taker.
E. a missionary salesperson.
25. A good order getter:
A. is likely to use a high level of personal persuasion.

B. is especially important for .. . ccessory quipment.
elp solve customers' problems.
D. All 0 e a ove are rue. ~
E. !'Jone of the above is true.f,.
26. New hardware and software available to salespeople:
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A. Change the basic sales tasks that must be performed, but don't hange how well the tasks
are done.
B. Involve no costs to the firm except the purchase of the hardwar and software.
A Do not provide any new ways to meet customer needs.
\Q)May provide a real competitive advantage to a firm if they are u ed properly.
27. The compensation plan increases the amount of sales upervision needed.
A. Commission pay
B. Bonus plan
C. Combination plan
~ Profit-sharing plan
VStraight salary
28. Which salesperson's primary task is order taking?
A. Melissa Tran
B. Amy Bowden
C. Wilson Alvaro
..JkCharlie Riggs
l§) Emily Winters
29. Producers who know something about their target customers' nee s and attitudes often supply
their relatively untrained salespeople with a sales presentation in hich (1) the salesperson
does most of the talking at the beginning, (2) then brings the custo er into the discussion to
clarify the customer's needs, and (3) tries to close the sale. They are using a:
A consultative selling approach.

(§..)selling formula approach.
C. target market presentation.
O. quota system.
E. prepared sales presentation.
30.CeCe Springer works for a large cosmetics company. She calls 0 retailers to tell them about
her firm's new products, to train the retailers' salespeople, and to et up promotion displays.
Her boss actually handles the order-related activities. CeCe is:
A. a manufacturers' agent.
B. a technical specialist.
~
n order getter.
o missionary sales rep.

. an order taker.
31. Tamika White is a sales associate for a prestigious jewelry store. hen she started with the
store, she relied almost completely on serving customers who just happened to walk into the
store and who knew exactly what they wanted-all she had to do as ring up the sale. With
experience, she began to gather information about her customers and use them as a source of
referrals. She now maintains a large database of her current cust mers, regUlarly
communicates with them to keep track of their needs, and activel solicits referrals to new
customers. When she gets a new referral, Tamika sends the pros ective client an invitation to
visit the store so that she can work with him/her personally. As a r suit, her sales are almost all
from current customers and referrals, with almost no sales from c sual"walk-in" customers.
Tamika started out as a(n) , but has now b come a(n)
A. Order getter; supporting salesperson.
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BUS3310 Exercise 6 Page 7 of 1U
QC. Order taker; order getter.

Order taker; supporting salesperson.
D. Supporting salesperson; order taker.
E. Order getter; order taker.
32. Which of the following statements about a salesperson's role is TR E?
I'll\The salesperson represents the customer back inside the sellin firm.
~ The salesperson also holds titles such as management speciali t and chief engineer.
C. The salesperson rarely serves as a link between the firm and it customers.
D. A salesperson is seldom responsible for negotiating prices or di gnosing technical
problems.
E. The salesperson only aims to sell the customer.
33. Retailers of expensive heterogeneous shopping products usually h ve a strong need for:
A. merchandisers.
B. technical specialists.
~
order takers.
o order getters.
. supporting salespeople.
Use this information for questions that refer to the Super Ga ing Company and
Accessories (SGCA) case.
Kayla Jurgenson, marketing manager for Super Gaming Comput rs and Accessories (SGCA),
is reviewing her company's plans for the coming year.
SGCA sells its products through retail computer dealers and som specialty gaming stores.
Currently, SGCA is carried in 25 percent of all retail computer sto es nationwide, but in
California is carried in only 10 percent of stores. So, Kayla has stan objective of being in
25% of all retail computer stores in California within one year.
SGCA plans to introduce a new SuperDuperGamer model with s ecial features that fits its
target market of teen and young adult gamers. The SuperDuper amer uses a new technology
and is expected to be a breakthrough product, but it will be impo ant to build awareness for it
to succeed. So, the advertising objective is for 40% of SGCA's ta get market to be aware of
the new SuperDuperGamer model within 3 months. SGCA also ants to help its retailers
reduce their current stock of SuperGamer computers before the ew model comes out in a
month. The SuperGamer has been on the market for two years a d has been a top seller in
the category. SGCA's advertising objective for the SuperGamer omputer is to reduce current
dealer stock by 80% within the next month.
SGCA is also introducing a SuperEnhancer sound card, which is designed to significantly
enhance the game-playing experience with older computers. Re earch with gamers show that
it is very well received, so the advertising objective for the Super nhancer sound card is to
gain 40% market share among all gaming-specific sound cards i the next year. To help
achieve that objective, Jurgenson is planning to use an ad that sows the sound card and a
game player being knocked off his chair by the sound. The headline on the ad reads, "9 Out of
10 Gamers Say that the SuperEnhancer Sound Beats All Others"
34. In making her decisions about media, Jurgenson has to:
A. decide which target market(s) should be reached.J

B. know the costs of alternative media. '
C. decide on promotion objectives.• /
.
~ decide what must be said.
rVall of the above.
35.A producer and intermediaries sharing the cost of ads in local medir is called:
A. pioneering advertising. I
B. campaign advertising.
C. institutional advertising.
'1'4'7'
Q. comparative advertising.
(9cooperative advertising.
j
~ 36. Effectiveness of an advertising medium depends on all of the folio ing except
A. funds available for advertising. ~

B. promotion objectives.\......
C. who the media reaches.-' I
1...- ~ markets targeted. '" I
~ ,4'~ 7l~nature of the product.

37.A competitor of SGAC has a magazine ad with a headline that c1ai~s
"Our new sound card
makes SGAC's SuperEnhancer old news." The Federal Trade Co mission
A. might criticize this ad as wasteful because it is institutional adv rtising and not product
advertising.
B. would view this as comparative advertising, which is illegal in t e U.S.
WOUld permit this ad in a trade magazine but not in a magazinel read by final consumers.
@
D. might require the competitor to provide evidence to support this copy thrust.
. . discourages ads such as this-since it is unfair to use another tirm's name in a way that is
not favorable to the firm. I
38. Regarding media selection:
.....-•• }",.
~v'"
(;:\)the media available in a country may limit the choices.
'if.'the low cost of television makes it a "must buy." t
C. the use of "mass market magazines" is growing in popularity to cut costs.
D. the only advertising medium available for direct-response ads is mail.
E. All of the above. I
39. Which of the following statements is NOT good advice for a mar~eting manager regarding
media selection? I
A. "The advertising media should support the promotion objectivbs."

B. "Choose media that reaches the target market." I
~
"Remember that not all media are equally effective."
D. "Target the mass market whenever possible."
. All of the above statements are good advice.
40.Advertising agencies ~
A. can be helpful, but they are always more expensive than a fir doing its own advertising
work.
B. must be selected very carefully since most agencies require lorg-term
~
contracts'l
of mega-agencies. 1
C. that are smaller in size will probably continue to play an important role despite the creation
D. usually don't cost local retailers anything to use, since the me ia commission is usually all
the compensation the agency expects.
41.lf Jurgenson wanted to demonstrate the new SuperDuperComput~r, which media would be
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BUS3310 Exercise 6 Page 9 of 1U
best: _ if')1--
~ RadiO
<c::- . Television vt/'..--7
\~
. Each of these media would be equal in this regard.
D. Magazine
E. Yellow pages
42.A producer of country music CDs pays a share of local retailers' co ts-to get them to promote
its new releases. This is an example of:
A. comparative advertising.
institutional advertising.
selective advertising.
pioneering advertisin .
ISing.
43. When selecting advertising media, a good advertising manager kn ws that:
A. direct-response ads are not a good alternative unless you alre dy have your own mailing
list.
(8) objective measures-like "cost per thousand"-can be mislead ng. ~
~ TV typically reaches more targeted markets than radi~
D. big national magazines, like TIME, may have wide circulation, ut are not practical for
reaching regional markets. ~
E. Magazines can't be used for reaching specific business or trad audiences."1
44.An ad for Toyota's lowest priced truck claimed that it "is tougher, g ves better mileage. and
costs less that any other truck"-and specifically named the direct y competitive trucks. This is:
A. pioneering advertising.
B. cooperative advertising.
institutional advertising.
$ D. comparative advertising.
. direct competitive advertising.
45. ads are small rectangular boxes that usually include te • graphics, and sometimes
video to create interest.
A. Virtual
~
Hover
C Banner
\p) ,I "}<Lf . Pop-under
,. "'\ 7P E. Pop-up
46. "Copy thrust" refers to:
~ what is to be communicated by the words and illustrations.
'-t(' how much the audience believes what the advertiser says.
C. an FTC challenge to the claims made by an advertiser.

q;t:\_~~4.. D. all the advertising copy prepared for a particular brand.
\ ' E. competitors who make similar claims in their ads.
47. Competitive advertising
A. tries to develop primary demand for a product category rather han demand for a specific
brand.
B. is used to present the company in a favorable light, perhaps t overcome image problems.
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BUS3310 Exercise 6 Page 10 ot 10
C. may be useful when the product has achieved brand preferenc or insistence.
~ries to keep the product's name before the pUblic.
~ries to develop selective demand for a specific brand.
48.Regarding measuring advertising effectiveness, which of the follow ng statements is FALSE?
A. If specific advertising objectives are set, then marketing resear h can help evaluate the
effectiveness of ads.
B. Managers probably should pretest advertising rather than relyin only on the judgment of
advertising "experts."
~
NO single research technique has proven most effective.
D. Advertising effectiveness is easily measured by looking at the s les results. 'V"""
. Some advertisers are now demanding laboratory or market test to evaluate effectiveness. )(
49. Competitive advertising which makes specific brand comparisons using actual names-is
_ _ _ _ _ _ advertising.
Pioneering
c1J
B.
D.
.
Comparative
direct competitive
Institutional
E. Cooperative
50. The copy thrust of the ad for the SuperEnhancer sound card is an example of what kind of
advertising?
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Complete the reading assignment and complete the mUltiPle-1hoice questions below
I
PM Central Time July 31, 2010. Each question is worth 2 points for a total of 100
points. See the course requirements section of the commun,atio= Guidelines for
Reading: Perreault, Cannon, and McCarthy text chapters 17 r 18
Chapter 17 - EBIC1NG OBJECTIVES A~,JJ2J~1)LI_CI~S

Chapter 18 - PRICE SETTING IN THE BUSINESS WORL _
Questions: I
1. Which of the following observations concerning F.O.B. pricing is n9t true?
A. A firm can use F.O.B. buyer's factory if it wants to pay the freigJ t.
~
Typically, it names the place. 1
C F.O.B. shipping point pricing complicates the seller's pricing.
. If a firm wants to pay the freight for the convenience of customJrs, it can use F.O.B.
delivered. i
E. F.O.B. shipping point pricing may narrow the market. I
A jewelry store advertises a one-carat diamond engagement ring ,S being discounted 50

percent off the original price of $10,000, for a sale price of $5,000. However, the ring was never
put on sale at the original price, and its actual cost to the retailer wrs only $1,500. This jewelry
store could be accused of using:
A. Price discrimination.
B. Price fixing.
C. Dumping.
(tjJ) Phony list prices.
~ Unfair trade practices.
3. The cash discount terms for a purchase worth $1,000 made on Aygust 1 are 3/10, net 30. How
much will the buyer have to pay if he makes the payment on Auguft 7?
~ $970
I
~ $30
I
C. $930 I
D. $1,000 I
E. $1,030
4. Producers offer trade (functional) discounts to: I
A. prevent retailers from becoming wholesalers.

B. encourage quantity purchases by customers.
C. encourage customers to pay their bills quickly.
D. encourage customers to buy out-of-season merchandise.
~over the cost of work wholesalers or retailers are expected to do.
5. A business products producer which has given its salespeople th right to adjust prices when
necessary to get new business is using a polic .
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A. one-price
B. skimming pricing
~ target-return pricing
(CO) flexible-price
E. penetration pricing
6. Some nonprofit organizations set prices to increase market share b cause
A. they are trying improve their image.

B. they wish to monopolize the market.
it is a regulatory requirement.
<0l1y ~\ $ D. they are not trying to earn a profit.
· they would never do any business otherwise.
.
\ 7. A flexible-price policy is MOST LIKELY to be set by a retailer sellin :
A. golf balls.
women's shoes.
1 · cars.
· T-shirts.
. . milk.
8. Which of the following is a status quo oriented pricing objective?
A. Growth in market share't/... I
B. Target return
Unitsales growth ~
@
I
D. Non price competition '-E:::-- I
· Profit maximization ':J..,..

9. Some top managers seek only enough profits to convince stockhoiliders that they are "doing a
good job." The pricing objective of such managers is:
A. status quoJ( II
profit maximization.
¢ C. satisfactory profits.
· meeting competition.
I
E. nonprice competition. Ii.. I
Use this information for questions that refer to the Pricing 1~ase. (WPI) case.
As a project for her marketing class, Emily Washington is resear hing how five local
businesses price their products. The following are brief sketches f what she has learned
about each company.

I
At Bella Computers, Emily has discovered that the company ear~ed a 6 percent return on
investment this year and wants to increase it to 9 percent next y ar. To its retailer customers,
Bella Computers gives cash discount terms of 2/1 0, net 30. It als gives retailers a 3%
reduction On the invoice amount due to advertise Bella products I cally. Bella gives retailers'
salespeople 2% of the sale price for each Bella Computer they s II.
At Ross Pharmaceuticals, she learned that the company has inv sted heavily in developing a
new product that recently received a patent. Because cash is tig t, the company wants to
achieve a rapid return on its investment. The new patented prod ct is badly needed in the
market, so a very inelastic demand curve is expected.
Digital Imaging makes photographic prints for wedding photogra hers. It is very concerned
about competitor reactions to its pricing, so it has selected price that will not draw the
I
attention of the competition and not start a price war. Digital Imagitg offers customers an 8%
discount if their purchases exceed $20,000 a year.
Jack's One Hour Cleaners recently opened for business. The comfan y invested a lot of
money in new equipment, and feels that it has to quickly get "at Ie st 10% market share to
stay in the game." This need obviously influences the company's ricing decisions. Jack's also
plans to offer customers 20% discounts on any order over $20.
National Printing Equipment (NPE) produces equipment that helpJ to print newspapers and
magazines. The company sells directly to prin.ters and through Wh~lesalers. Its salespeople
negotiate prices with individual customers and often have to matc competitors' prices. NPE
has a new product, the Gutenberg NP201, with some competitive dvantages now, but
competitors are expected to follow quickly with similar products. T e new product is being
introduced into a market with elastic demand. In regard to freight ~hargeS for its equipment,
NPE's invoice reads, "Seller pays the cost of loading equipment 0 to a common carrier. At the
point of loading, title to such products passes to the buyer, who a sumes responsibility for
damage in transit, except as covered by the transportation agenc~."
10. Which company uses administered prices? I
A. Bella Computers I
B. Ross Pharmaceuticals
C. Digital Imaging
D. Jack's One Hour Cleaners
(5) All of the companies use administered prices
11. What is Jack's One Hour Cleaners' pricing objective?
A. profit oriented
~
target return
sales oriented
. status-quo oriented I
E. none of the above I
12.A producer of plastic water bottles that can be attached to bikes gi~es retailers a 3 percent
price reduction to advertise its products locally. This is an exampl1 of:
~
'Vlf everyday low pricing.
B an advertising allowance.
(A , . a cash discount.
1
-J D. push money.
E. value pricing.
13. Which of the following observations is true?
A. Sales growth essentially means bigger profits. ,

B. A larger market share, gained at whatever price, leads to sust in able competitive
advantage.
C. Market share objectives are not popular among modern mana ers.
~ A sales-oriented objective does not refer to profit.
t:JMarket share objectives and straight sales growth objectives h ve similar limitations.
14.Caught between the threat of antitrust action, stockholder deman s, and public interest groups,
some large corporations set a(an) pricing objec ive.
A. profit maximization
B. increasing market share
C. "aggressive" competition
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BUS33 10 Exercise 7 Page 5 of 10
}- A. are not offered by sellers who use administered prices.

o ~QJ.,9J..t ~re illegal unless they are offered to meet a competitor's price.
~ &eflect the fact that marketing activities can often be shifted and hared in the channel in
different ways.
IJ~' ~are typically offered to consumers but not to intermediaries.
~' ~re a type of cash discount.
22. Which of the following is a STATUS-QUO pricing objective?
A. Growth in market share
~
SatisfactOry profits
~. C. Meeting competition
· Growth in sales
E. Maximize profits
23.A _ _ policy means offering the same price to all customers wh purchase products under
essentially the same conditions and in the same quantities.
A. skimming price
~
penetration price
Cone-price
· differentiated
E. flexible price
24.A producer of sports equipment offers its retailers a 2 percent pric reduction on all purchases
if the dealer advertises the products locally. Apparently, the produ er is using
A. a trade discount.
B. a cash discount.
q,o a functional allowance.

an advertising allowance.
· "push money."
25. National Printing Equipment has:
A. been violating the Robinson Patman Act

B. a status-quo pricing objective
a skimming price policy
@ D. a flexible pricing policy

· been violating the Sherman Act
26.A tire retailer is advertising a very low price on a popular size tire. hen a customer comes into
the store, the clerk says the low-priced item is sold out, and tries t convince the customer to
buy the top-of-the-Iine model-claiming the low priced model is n t a very good buy even at the
low price. This is an example of:
price lining.
fA.
c;P <1>B..bait pricing.
full-line pricing.
Q} D. value in use pricing.

\ E. leader pricing.
27.The total fixed costs are $10,000, and the average variable cost p r unit is $3. For a production
volume of 10,000 units, the average cost per unit is
~
$3.3.
~..J '" . $4.
J" . $1.
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BUS3310 Exercise 7 Page 6 oflO
D. $10
E. $3.
Use this information for questions that refer to the Sporting Products, Inc. (SPI) case.
Randy Todd, marketing manager for Sporting Products, Inc. (SPI) is thinking about how
changes taking place among retailers in his channel might impact his strategy.
SPI sells the products its produces through wholesalers and retail rs. For example, SPI sells
basketballs to Wholesale Supply for $8.00. Wholesale Supply use a 20 percent markup and
most of its "sport shop" retailer customers, like Robinson's Sporti g Goods, use a 33 percent
markup to arrive at the price they charge final consumers. Howev r, one fast growing retail
chain, Sports Depot, only uses a 20 percent markup for basketbal s, even though it pays
Wholesale Supply the same price as other retailers. Furthermore, Sports Depot occasionally
lowers the price of basketballs and sells them at cost-to draw cu tomers into its stores and
stimulate sales of its pricey basketball shoes.
Sports Depot is also using other pricing approaches that are diffe ent from the sports shops
that usually handle SPI products. For example, Sports Depot pric s all of its baseball gloves at
$20, $40, or $60-with no prices in between. There are three big ins - one for each price
point.
Todd is also curious about how Sports Depot's new strategy to in rease sales of tennis balls
will work out. The basic idea is to sell tennis balls in large quantiti s to nonprofit groups who
resell the balls to raise money. For example, a service organizati n at a local college bought
2,000 tennis balls printed with the college logo. Sports Depot cha ged $.50 each for the tennis
balls-plus a $500 one-time charge for the stamp to print the logo. The service group plans to
resell the tennis balls for $2.50 each and contribute the profits to shelter for the homeless.
Todd is not certain if Sports Depot ideas will affect SPl's plans. F r example, SPI is
considering adding tennis racquets to the lines it produces. This ould require a $500,000
addition to its factory as well as the purchase of new equipment t at costs $1,000,000. The
variable cost to produce a tennis racquet would be $20, but Todd thinks that SPI could sell the
racquet at a wholesale price of $40 each. That would allow most etailers to add their normal
markup and make a profit. However, if Sports Depot sells the rac uet at a lower than normal
price other retailers might decide to carry it.
28.lf Randy Todd wants to maximize profits for SPl's new tennis racq ets, then he should set a
price (and produce that related output) where:
A. price is as high as possible.
~
marginal cost is at its minimum.
C marginal cost is just Jess than or equal to marginal revenue.
. marginal revenue is zero.
E. total revenue equals total cost.
29. If a demand curve were elastic within a price range, then:
~
marginal revenue would be negative within this price range.
. lowering the price within this range would increase total reve ue.
. the marginal revenue curve would be above the demand cu e in this range.
D. in this range, raising price would increase total revenue.
30.Some consumers maintain a "price-quality association," meaning hat if a product has a high
price, they assume the product must have high quality. This "pric -quality association" is the
basis for the use of:
A. Odd~even pricing.
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~.
Price lining.
C Prestige pricing.
/..J - Leader pricing.
jJt.
1
E. Reference pricing.
31. The number of times an intermediary's average inventory is sold in la year is called the:
A. ROI (return on inventory).

B. markup ratio.
~.
asset factor.
D stockturn rate.
?1~ inventory ratio.

32.A college "marketing club" printed 1,000 "We're Number 1" bumpetstiCkers for sale at $3.00
each as a fund-raiser. Its fixed costs were $500, and the variable c st for each sticker was
$.50. The club's average cost was:
_t(I) $1.00. 1
r '1( $ .50.
/ C. $2.50.
D. There is not enough information to tell.

E. $2.00.
33. The text says "markups":
'" "t\
~
.
oQ.K
' ~ .
$ should always be stated as a percentage of cost.
are a percentage of selling price-unless otherwise stated.
. are never stated as a percentage of cost. ~

D. should never be stated in dollar amounts.
~. E. All of the above except B.
34. What is the final selling price Sports Depot charges for a SPI baskptball?
$12.00
4'D.
·
·
$12.50
$10.00
$15.00 1
E. $18.00
35. Sellers sometimes take the auction approach and adapt it by uSint sequential price reductions
over time. When or where is this approach most commonly used?
.
.4>
When the product supply is unlimited. 1
B With products that have a short life.

· When competition is absent.
D. With products that have extremely low inventory costs.
E. With heavy equipment manufacturing machinery.
36. When Sports Depot temporarily lowers the price of basketballs, it s using:
A. value-in-use pricing.
~
prestige pricing.
C leader pricing.
_ . psychological pricing.
E. bait pricing.
37. "Target return pricing":
A. is a type of demand-oriented pricing.
~
iS very different from average-cost pricing.
C seeks to earn a percentage return on investment or a specific to al dollar return.

. guarantees that the target objective will be hit because the targ t return is included in the
~"
Vq total cost.
. 38.A good marketing manager for a producer knows that the most pro itable price and level of
output:
GiS where the positive difference between the total revenue and t tal cost curves is the
r-. I t",K ' greatest.
..J'" B. is where the difference between marginal revenue and margina cost is the greatest.
C. is where total revenue equals total cost.
D. is where marginal revenue is maximized.
E. Both A and C are true.
39. Customers are likely to be less price sensitive when:
A. their share of the cost is high. ~

B. there are substitutes available.
C. the total expenditure is high. 1
D. it is easy to compare prices.\:}..
@ someone else pays the bill.
40.The price per unit is $1.00. The average variable cost per unit is 6 cents. The total fixed cost
is $20,000. Compute the break-even point.
A. 20,000 units
B. 33,334 units
C. 20,000 units
~ 75,000 units
C:J 50,000 units
41. Setting relatively high prices to suggest high-quality or high-status is:
A. psychological pricing.
B. price lining.
~
Ieader pricing.
D prestige pricing.
. odd-even pricing.
42. Which of the following is a TRUE statement about markups?
fA) A firm can lose money even when using a high markup.
Y Markup percents are computed as a percent of the cost of the roduct.
C. It's easier for a producer to administer the prices consumers p y for products if the markup
used varies from one intermediary to the next.
D. The lower the markup, the lower the profit.
43. Total variable cost:
A. is zero when the quantity produced is zero.

B. is the sum of those changing expenses that are closely relate to output.
C. may decrease as the quantity produced is increased.
D. All of the above are true.
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d) Both A and B are true.
44. Given the following data, compute the BEP in units:
Selling price =$2.00
=
Variable cost $0.75
=
Fixed cost $250,000
A. 400,000
A Cannot be determined with this information.
~200,000
D. 333,334
E. 125,000 I
45.The practice of setting different price levels for different quality classes of merchandise-with
no prices between the classes-is called: I
t":b price lining. I
~ full-line pricing.
C. prestige pricing. I
D. odd-even pricing.
E. psychological pricing. I
46. :a~~::~:::~:~Sthe firm's total revenue curve is a straight line. I
~
bases the analysis on the cost of the first few units sold. I
C. explicitly considers demand when calculating price. I
. All of the above are correct.

E. None of the above is correct. j
47.lf a service firm sets a specific price for each possible job-rather han setting a price which
applies for all potential customers-it is most likely using:
~ B:
ayera~~-cost
bid pricing .
pricing. ~ II
. price Iining."'- I
D. a one-price policy.
E. product-bundle pricing. I
48. Regarding a producer's cost structure: I
A. marginal cost begins to rise at a lower level of output than avetge cost.
B. total fixed costs increase continuously as more units are produ ed.
C. average cost is the extra cost of producing one more unit.
D. average costs usually drop for awhile and then start to rise wh$n the economies of scale
1'5\ "run out." I
\E'J Both A and D are true. I
49. Which of the following observations is FALSE? I
A. Negotiated pricing is a demand-oriented approach. I
~
Negotiated
price is a price set based on bargaining between t e buyer and seller.
Negotiated pricing is rare in situations where the marketing mi is adjusted for each
customer.
D. Some sellers fake their records to make costs seem higher th n they really are.
E. Competition need be considered when adding in overhead an profit for a bid price.
50.Which of the following is an example of a fixed cost?
Complete the reading assignment and complete the multiple-fhoice questions below
to the best of your ability. Then submit your answers to the i~structor email by 11:59
PM Central Time August 7, 2010. Each question is worth points for a total of 100
assignment submission details. I
Reading: Perreault, Cannon, and McCarthy text chapters 19 ~ 20
Chapter 19 - lMPLr;MENTII\J~_~_l'ibLCONTBOLLING__ M~g_h~_£LANS:
EVOL!JTJON~[\JDJtEVOJJ.JTIO~ I
Chapter 20 - M~~MA~NG'~~N~r~~~NA~~S
Questions: I
1. Which of the following statements illustrates the 80/20 rule? I
A. "80 percent of our target market doesn't respond to our marketirg mix, and we only have a
20 percent market share."
@ "Of the hundred retailers who carry our products, the top twent account for nearly 80
percent of our total business."
C. "20 percent of our marketing effort is wasted, but we don't kno which 20 percent."
D. "We don't know whether our profits are 20 percent higher than e deserve, or only 80
percent of what might be easily obtained."
E. None of the above. I
2. Information about five sales reps and their territories is presented telow. Which would have the
highest performance index?
Rep's Territory Potential e,-t.t.tU'(J I~~

~:~~ As A per~~: Of Total A~~~~,g(~(~es ~ ;,.~o -? 't" .,~ '/.
Bdlio }OOq $210.000 :"--:=:> ,00, 00 ~ ~O
CadtlJllS 1OI!o $120,000 ~ ';1>0, 0'0 ~ l~{)
Dooty 10(1'0 $150,000 ~ l
100 Df) t) ~ \ S'0
E,l~m~l 20~o $230.000 ~...... 1~100~l) __) '\ S
---- ) . . .1_'°
A. Cadams f ,00 0 rOOD I
B. Eayma
C. Aayak
,(i5)Dooty
'YBellio
I
3. According to the "80/20 rule": I
A. marketing accounts for 80 percent of the consumer's dollar. I

B. only 20 out of every 100 firms use formal marketing control pr1grams.
0. about 20 percent of a typical firm's customers are unprofitable Ito serve.
~ even though a firm might be showing a profit, 80 percent of its business might be coming
from only 20 percent of its products or customers.
E. None of the above is correct.
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4. Which of the following observations concerning performance anal~sis is true?
A. It doesn't help identify what data is most relevant. f'
B. It merely lists figures, but doesn't compare them against stand rds.
X. It doesn't look for differences or exceptions.
;::, {Q) It doesn't have to be limited to sales.

1
e.,1tt:; ~ E. None of the above is true.

'r' 5. Which of the following statements about a marketing audit is FALSf?
A. Ideally, a marketing audit should not be necessary, but it often t'. ..J<
t® ~ good audit is internal and is not concerned with gathering inf rmation from outside the
firm.
C. A marketing audit takes a detailed looks at the firm's current m~rketing plans to see if they
are still the best plans the firm can offer..>( 1
D. A marketing audit should be done on a regular basis.

E. The marketing strategy planning framework is useful in conduc~ing a marketing audit. J(
6. Which of the following statements about customer complaints is F
@Customer complaints that are handled well by the company us ally help it win new
customers. ~
B. In business markets, customer complaints are usually handled y the sales
C. ~~r~~~:mer markets, customer complaints are usually handlei by toll-free telephone lines,
websites, and e-mail customer service reps.
D. Customer complaints that are handled well by the company us ally help it keep its
customers.
E. None of the above is false.
7. A marketing audit is necessary because:
A. it is a standard practice adopted by all companies worldwide. 1 1
/Er.'\ managers may pursue certain strategies blindly, when other st ategies might be more
~ effective.
C. regulators require marketing audits at the same time as accou1ting audits.
D. all of the above.
8. Sales analysis: 1
A. requires more information than is available from traditional atounting reports.

- B. can be done in different ways-there is no single "best way."
C. often studies how sales patterns change over time.
9. The main purpose of a performance analysis is to: 1
A. determine who should receive a performance bonus when pro~it

is greater than expected.
B. determine if the marketing budget is large enough to achieve t~e expected sales
performance. ~
C. provide a detailed breakdown of a company's sales records.
-) . [ \ see whether or not the 80/20 rule applies in a particular situati n.
(.;J'uncover variations in performance that may be hidden in sum~ary information.
10.With respect to marketing control,
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~
all cost records should be kept in the marketing department.
B. faster feedback can often be the basis for a competitive advant~e.
. many advances have been made, but there is still no effective ay for a manager to be sure
JpJ' that a product is actually selling to the intended target market ra her than to some other
group.
11 .Regarding sales analysis: I
rA') Sales analysis can highlight important trends and help manager~ develop more accurate
V sales forecasts. I
B. A detailed sales analysis is most effectively presented with tabl s containing rows and
columns of numbers as opposed to charts and graphs. 'h
C. Sales analysis is difficult and expensive because the data are d fficult to obtain. '(
D. There is only one best way for analyzing sales data....
E. Sales data should be broken down according to customer char cteristics such as
demographics, because those are the only relevant dimensions y..
12. A marketing audit:
A. takes a big view of the business.'/

B. evaluates the whole marketing program./
C. may be done internally or externally.
A requires a detailed look at the company's current marketing plfns.
~ all of the above. I
13. The "iceberg principle": I
.PAJ suggests that much good information may be hidden in summar data. "
'-13. explains why some customers are more profitable than others.
C. suggests that sales will vary from one territory to another.

D. explains why some firm's sales are "cooler" that others. I
E. says that sales reps should never make "cold calls" on custom1rs.
14. The "80/20 rule" says that:
honly 20 out of every 100 firms use formal accounting controls.

(~ven though a firm is showing a profit, 80 percent of its busine~s might be coming from only
20 percent of its customers.. I
C. a firm should hire 20 sales reps for every 80 customers.

D. usually about 20 percent of a firm's customers are unprofitableJ
E. marketing accounts for 80 percent of a typical consumer's dOlir'
1
15. A "marketing audit" should: I
A. be done by someone inside the finance department.

B. be conducted whenever a crisis arises.
~ be conducted by the person most familiar with each of the fir I's marketing plans.
yl" (9) evaluate a company's whole marketing program on a regular asis.

16. Sales analysis:
~
tYPiCaIlY involves reorganizing existing information rather than gathering new information.
B. may involve analyzing many different breakdowns of overall s~les.\Jc::....
. is usually a good first step when setting up a control system. I
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I
D. All of the above are true. I

17.Studies have shown that customers who weren't satisfied with resp~nse to their complaints
G on average told ten people about their experience. I
B. usually never spoke about it. ~
t;1'V C. spoke about their experience only when prodded by researcher .
<f)~- D. on average told one person about their experience. I
\ E. will make at least two more complaints.
18.A _ _ is a systematic, critical, and unbiased review and appraisJI of the basic objectives and
policies of the marketing function and of the organization, methodsj procedures, and people
employed to implement the policies. I
A. full-cost assessment 1
marketing strategy survey
C marketing audit
<W . benchmarking study

E. sales analysis.,.. f I
19.A systematic, critical, and unbiased review and appraisal of the ba ic objectives and policies of
the marketing function-and of the organization, methods, proced res, and people employed to
implement the policies-is called a:
A. marketing information system.

r (8) marketing audit.
(;. . ,l }' . "-( management review.
• v/ D. MIS report.
~~ E. marketing analysis survey.
20.Sales analysis is a:
A. well-accepted trend analysis method.

B. necessity for making all important marketing decisions.
.A way of assuring that future sales will be profitable.
"lQ) detailed breakdown of a company's sales records.

I
E. detailed report of likely profitability.

21.A good marketing plan helps managers make strategic planning d~cisions and provides a
framework for effective implementation and .1
A. Supervision. I
B. Organization.
~
AnaIYSis.
D. Control.
. Research.
22. The "contribution-margin approach" to marketing cost analysis:
~considers only those costs which are directly related to partic~lar alternatives. ."
'i?'is especially useful for estimating the long-run profit of a prop?sed strategy.
£ t.. ~ C. allocates variable costs which are hard to measure to overherd.
0&\ • ? / D. is especially useful for determining if there should be more c ntrols on fixed costs.
r) E. All of the above.
23.Avon, Inc., has analyzed the market potential in its territories and bet sales quotas for its
salespeople. It is now in a good position to develop ~ indexes at the end of the
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I
year.
A. MIS
B. PERT
C. contribution
~sales
/ \.Vperformance
24. Using cost analysis to analyze the money being spent by a firm is analogous to using
______ to analyze t~e money coming into the firm. I
? TQM methods
d>
I
B. performance analysis I
. traditional accounting reports

D. the iceberg principlex
E. sales analysis
25. A marketing audit should help determine if:
A. current marketing strategies are good ones. V'"

B. the company's marketing objectives are reasonable.
~
implementation of a marketing program was effective.
D All of the above.
I
26.When a new marketing plan is more successful than expected, ~
A. scarce supply may result in a waste of marketing resources, es ecially promotion spending.
1
B. the firm may face problems finding enough well-trained people 0 handle the growth that
occurs.
~
the firm is more likely to be able to fund expansion through its wn cash flow.
r _ lX, D all of the above are correct
JJ'" . none of the above is correct I
27. _ _ looks at when money will be available. I
~
Net profit
B Cash flow
~Il~' . Profit and loss
JJJ'" D. Balance sheet
E. Gross margin
28. Which of the following is NOT a FUNCTIONAL cost account?
A. Packaging
B. Billing
C. Order entry
. 4"'9-..Selling
\5J Rent
29.Which of the following observations is true?
A. There's no reason for a firm's marketing manager and financiall manager to work together
since they are in different functional areas.
B. The chief operations officer usually handles money matters in ~ firm. I{
C. In an organization, opportunities rarely compete for capital. I
D. A dividend refers to the money invested in a firm.

@)Marketing plans that are funded usually must work within a bUrget constraint.
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I
I
30. Which of the following aspects of production capacity should be co~1 sidered in marketing
planning?
in new facilities. r
A. A firm can produce only limited quantities of its current product .l.ithout a major investment
B. Other firms are available to handle production on a contract or ~uPPlier basis.

C. A firm's production capacity allows it to produce some products quickly but not others.
D. A firm has more production capacity than it can use.
~ All of the above.
31. A marketing manager who wants to calculate the cost of marketin several products to several
target markets will probably have to:
A. read all requisitions very carefully. I
B. allocate advertising expense to general overhead.

C. reorganize some of the company's functional cost accounts tol natural accounts.
D. reclassify all natural accounts into functional accounts. I
E. None of the above-it is impossible to link the costs of marketilng to target markets.
32. Marketing cost analysis can: I
A. Determine if a change in the marketing mix will improve profit. II
B. Assign costs to product lines and customers.

C. Prepare a profit and loss statement for each customer.
D. Show which customers contribute the most to the firm's profit
p~. @AII of the above.
33. The department within a company that is typically concerned with roviding money to invest in
marketing plans and meet ongoing expenses is the:
A. Accounting department.
B. Human resources department.
. C. Production department.
~ . \~~ ~ Marketing department.
}F '~Financedepartment.
I
34.Which of the following statements regarding marketing cost analY~is is FALSE?
A. Traditional accounting methods do not show the purpose for which marketing expenditures
tI::\ are made. I'
.,. ..X'" \..§I Functional accounts include itel}1s such as salaries, wages, supplies, raw materials, and
)Jf" advertising. I
C. Functional accounts can be used to show the profitability of tenritories, products, customers,
sales representatives, and so on. 'I
D. The costs allocated to the functional accounts will be equal in otal to those in the natural
accounts.
E. Cost analysis is not performance analysis.
35. Working capital may be used to pay for:
A. what it costs to store inventory
B, marketing research .J
C. advertising J
~what a firm owes suppliers-J
VII of the above
36. If a firm has excess production capacity, it
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(J can serve as a safety net if demand suddenly picks up.
'1i may be a sign that there's too much competition.
C. may make sense for the marketing manager to try to find new arkets for current products.
D. can be costly.
E. all of the above.
37. Service firms are finding ways to reduce the cost of some of their p oduction work with _ _'
using telecommunications to move service operations to places wh re there are pools of skilled
workers.
(JY task transfer

8. turnkey projects
C. mobile environments
D. knowledge transfer
E. skill transfer
38. As compared to natural accounts, FUNCTIONAL ACCOUNTS:
~ are the accounts to which various costs are charged in the no mal accounting cycle.
?~\JYShOW the purpose for which expenditures are made.
~ ,e, I C. include items such as storing, salaries, and taxes~
~ , D. All of the above.'" "
E. 80th A and C above.
39.A firm is doing a marketing cost analysis involving two products, three target markets, and $6
million in advertising costs. The firm should:
A. allocate $2 million of the advertising costs to each target mark t.

8. allocate these costs to each product and target market on the asis of their percentage of
total sales.
C. allocate these costs to general overhead.
l@)determine the purpose of the advertising and allocate costs to

roducts and target markets
accordingly.
E. allocate $3 million of the advertising costs to each product.
40. _ _ are an internal source of capital.
~
Sale of stocks ~
8 Retained earnings ~
. Sale of bonds ~
D. Private equity
E. Loans "/...
41.A virtual corporation:
A. has strong capital, but it can only survive if it develops a close elationship (i.e., a
~ partnership) with another firm that has developed a good mark ting plan.
\..§/' looks for capable suppliers who can meet the specs it lays out _
C. handles all of its sales using the Internet.

D. all of the above
42. Managed Care Concepts facilitates the processing of medical cl ims for organizations, such
as government agencies, whose employees are injured while pe orming their jobs. The
company does not actually process the claims. Instead, it coordi ates the work of customer
service personnel, nurses, physicians, case managers, and pha macists who work for other
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companies and have some role to play in the processing of an inj red worker's claim.
Managed Care Concepts relieves its clients of the burden of proc ssing their own injured
worker claims and can usually save the organizations a significan amount of money.
Managed Care Concepts operates like a:
A. Merchant wholesaler.
B. Manufacturer's agent.
C. Virtual Corporation. ~
D. Manufacturer.
43. Which of the following statements concerning human resources is NOT true?
~ Most of the people affected by a new strategy are under the coltro' of a marketing manager.
'i:( Communication is very important because you can't expect pe9Ple to pull together in an
organization-wide effort if they don't know what's going on.
C. People are one of a company's most important resources.
D. It is the marketing manager's job to communicate with others i the organization and explain
the new strategy, what needs to happen, and why.
44. Firms that use mass customization
A. may target either business customers or final consumers.

B. may be able to take advantage of the Internet for orders.
C. may be able to give their customers more or better choices:
D. are likely to have higher costs than do firms who produce more standardized products, but
" ;
~ may earn better profit margins.
~AII of the above
45.which of the following would NOT be paid for using working CaPi,l?
A. advertising expense "'"
~.
emPIOyee salaries '-""
r h,.... C. purchase of new facilities
f) .S'(\. what it costs to store inventory ./
E. what a firm owes suppliers
46. The problems of matching supply and demand occur less frequen Iy when a marketing plan
calls for:
A. rapid penetration into many different types of channels.

B. quick expansion into many different market areas at once.
C. a national roll out instead of a regional roll out.
.1' .$the staged distribution of a new product.
"6" 47. Which of the following statements about mass customization is Trre?
A. There h~s been a widespread shift to mass customization by t~ousands of

companies.
B. The biggest successes in mass customization have all been in consumer markets as
opposed to business markets.;
r@ If a company is to succeed with a mass customization strategy it must be able to find a low
cost way to produce the products.
D. All of the above."'"
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48. Generating capital by means of debt financing:
A. Involves borrowing money, either from a bank loan or from the se of corporate bonds.
B. Means that the firm borrowing the money will have to pay interrt charges.
C. May be worth it if the borrowed money is used to implement a arketing plan that earns a
return greater than the cost of borrowing the money. .
~ Means that the firm will have to put up some of its assets as a I an guarantee.
\.:JAil of the above.
49.Any increase in profit contribution that a strategy generates, witho t increasing capital
invested,
A. increases the risk associated with that strategy.

B. increases the firm's return on investment.
C. increases the debt to equity ratio.
D. reduces shareholder value.
E. is an impossible task.
50. Working capital may be used to pay for:
A. advertising .
B. what a firm owes suppliers,.
C. employee salaries -
~ marketing research--
'Vall of the above
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Complete the reading assignment and complete the multiple- hoice questions below
PM Central Time August 14, 2010. Each question is worth 4 points for a total of
100 points. See the course requirements section of the Com unications Guidelines
for assignment submission details.
Reading: Perreault, Cannon, and IlIIcCarthy text chapter 21
Chapter 21 - ETliJCt\LMARK_ETING lI'>LA_CQ~_SU!'v"LER-Q JE['.JTJ:D WQRLD~_

AFPRAISAL AND CHALLENGES
Questions:
Use this information to answer the following questions that r fer to the PSI case.
Pump Systems, Inc. (PSI) produces two major kinds of water pu ps. The smaller pumps
range in price from $5-$30, and are used in drinking fountains an soft-drink machines. Most
of these pumps are bought by manufacturers of these machines nd built into their product.
PSI also builds larger pumps used in swimming pools and reserv irs. The prices of these
items range from $250-$500. These are usually purchased by co tractors who build the pools
and reservoirs.
PSI sells nationally through sales reps located in the large indust ial centers. These reps
handle the selling function for PSI in their geographic areas and rovide market information.
They usually do the same thing for 10 to 20 similar manufacturer of noncompeting
products-and are paid on a commission basis.
There are no other producers of the smaller pumps in the United tates-because PSI has
patent protection. As a result of this, management has decided t follow a policy of pricing
high-to maximize profits-while the patent lasts.
Several competitors are in the market for the larger pumps. Indu try prices and profits of these
pumps have dropped in the past few years as a result of firms try ng to increase their market
shares. The product design has remained fairly stable over the I st few years-and one firm
dropped out as it saw that it would lose more money with its "me too" product. Industry sales
are increasing-but at a very slow rate. The price of these produ ts is determined by adding a
standard markup percentage to the variable cost of the items-t cover fixed costs and profit.
For instance, pump Z has variable costs of $250 per unit, and a arkup of 40 percent of this
cost is added to the $250 to get its selling price. Management ha estimated that fixed costs
applicable to this product are $200,000 per year.
PSI publishes a product catalog which is revised annually. Also, 't exhibits in most trade
shows. PSI follows a policy of charging the same price to all cust mers-so all will have the
same costs at their own plants. All purchases are shipped directl from PSI's factory to its
customers-and title passes at PSI's factory.
1. What is the contribution to fixed cost and profit of PSI's pump Z?
~
$25,000
B. $100 per unit
. Cannot be determined unless you know the sales volume.
D. $75 per unit
E. $50 per unit
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I
2. Consumer satisfaction: I
B. is easy to measure because it is a highly personal concept.

C. is the objective of all macro-marketing systems.
r
A. is a highly reliable standard for evaluating macro-marketing effLctiveness.
In).depends on consumers' level of expectation.-- I
~ None of the above is true.

Use the following information to answer questions that refer 10 the Jewel Craft case.
Jewel Craft, Inc. is a leading producer in the United States wome 's costume jewelry and
accessories market. Its brands are well known and are sold by de artment stores and better
women's stores. Several stores in a city may carry Jewel Craft's brands because most of
Jewel Craft's customers will not consider any other brand.
Jewel Craft's sales force calls on one wholesaler in each state. G mco, Inc., of Boston,
Massachusetts, is the Jewel Craft distributor in that state. Gemco stocks and sells women's
accessories (noncompeting lines) for several manufacturers like ewel Craft. Wholesalers are
allowed a 20 percent markup by Jewel Craft-but pay the freight harges to their warehouses.
Jewel Craft's policy of using one wholesaler per state comes fr01 its desire to control its
distribution. Jewel Craft uses national magazine advertising and Iso supports a cooperative
ad program with retailers.
Jewel Craft's prices allow for a 40 percent retail markup-an attrdctive percent when one
considers that Jewel Craft's products require little in-store selling~ecause of their well-
established reputation. I
Recently, Jewel Craft was approached by a watch producer with the idea of expanding to
watches under the Jewel Craft name. It was argued that althOUg~national watch sales have
leveled off, Jewel Craft could enjoy growing sales for several yea s because of the fine
reputation the company has achieved. If watches are added, Je el Craft will use its present
policies regarding distribution, pricing, and advertising. Further, it will offer the wholesalers and
retailers an attractive "package" deal as an incentive to carry Je el Craft watches.
Intermediaries will be required to carry the watches if they wish t handle the jewelry and
accessories.
3. The degree of brand familiarity for Jewel Craft products-among i s present consumer
buyers-is:
A. brand rejection.
B. brand recognition.
C. brand insistence.
D. no brand recognition.
® brand preference.
I
4. The future poses many challenges for marketing managers becaulse:
A. ultimately it is marketing managers who must determine whiChl products are in the best
~n~erests of. consumers. . .. I
B. It IS marketmg managers who have full responsibility to preserve our macro-marketing

system. I
~
the marketing ~oncept has. be~ome.obsolete. . I
, new technologies are makIng It easier to abuse consumers' rights to privacy.
. social responsibility applies only to firms-not to consumers. I
5. A study revealed that when consumers are dissatisfied with a pro uct or an individual business
A. most of their complaints are fully resolved-if they are just rep rted.
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@ a majority of their complaints are never reported.

I
C. a marketing manager should just ignore most complaints becaufe they are the result of
dealing with consumers. I

6. Which of the following statements about future trends in marketing t·s True?
A. Marketers should welcome international competition because it ill speed the adoption of
marketing innovations that improve people's lives.
B. Marketers need to come to conclusions about the proper uses f technology.
C. Marketers need to be aware of their responsibilities to the broa er society.
D. Marketers must be sensitive to consumers' rights and privacy.
f)AII of the above.
7. When companies in a market-directed economy try to find "little m nopolies" for themselves,
. they will fail.

C. this reduces innovation, new investment, and economic growth
D. the allocation of resources will be the same as in a purely com etitive economy.
E. this forces consumers to buy new-possibly more expensive- roducts that they do not
wa~. I
8. Which of the following is NOT a current trend affecting marketing ~trategy planning?
A. international expansion by retailers. I
~
. more attention to profitability, not just .sales.
II
C slower new-product development.
. HTML e-mail and instant messagin~

E. growth of value pricing. I
Use this information to answer the following questions that Jefer to the EI (Electech
Inc.) case. I
Electech, Inc. (EI) produces a line of semiconductors for electron cs products manufacturers.
These items range in price from $5-$100 and are used in produc s the buyer is producing. EI
also desjgns and builds computer networking equipment. The pri es of these items range form
$5,000 to $100,000. These are used to control production equip ent. Usually, they are
custom-made to the specifications of the buyer-the firm which ill use the product in its own
production process.
EI sells nationally through independent sales reps-paid on com ission-who work in the
than with the number of them. All of them also sell other lines. EI also uses five full-time
salaried salespeople who work out of its corporate headquarters under a sales manager.
The home office salespeople are "technical specialists" who sell Imost all the networking
equipment, while the "reps" mostly sell the semiconductors. Sometimes, however, the reps will
send in leads to customers who want networking equipment. E'i'SO sells some of its
semiconductors through a Los Angeles wholesaler who carries sock for West Coast
customers.
There are many producers and importers of semiconductors in tJe U.S.-but several firms
have captured large shares of the networking equipment marke;J EI has held its own, and in
fact, over the past five years has increased its market share of t~ese products to over 25
percent-because of its better technical designs. I
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I
Industry-wide prices of the more or less homogeneous semicondulctors have been forced
further and further down over the last seven years-as have indu try profits. The price of
networking equipment is set by adding a standard markup percen to the direct cost of the
items-for overhead and for profit. Following industry practice, all rices are quoted at the
seller's factory.
EI publishes a catalog which is revised periodically. And it exhibit in most equipment trade
shows.
9. What kind of distribution is EI seeking for its networking equipment.
A. Direct distribution I
~Intensive distribution I
C. Exclusive distribution
D. Selective distribution I
10. Many Internet sites, such as Autobytel.com and Edmunds.com, hake extensive information
about the prices of new and used vehicles that anyone can use for free. In light of the
availability of this information, what is the responsibility of consum rs to use it?
A. Consum,ers shouldn't use it because it gives them an unfair ad antage over car
dealers~
/~Consumers have a responsibility to use the information and be smarter customers.
~ Consumers can use it, but should not feel a responsibility to dOl so.
D. Consumers should not trust any information they receive from $ny source except the
government. I
11.Which of the following is NOT a trend that is affecting marketing stategy planning?
A. growth of JIT and ECR."-i.....
.A. more attention to quality ~
f:g less attention to distribution service.

D. faster new-product development.
E. more international market development.
12. Marketing strategy planning is difficult for marketing managers be ause:
A. they rarely know enough about the needs and attitudes of thein target markets.
B. ot~er dimensions of the marketing environment may force chamI ges in possible marketing
mIxes.
C. proposed plans for each of the "four Ps" have to be blended to ether.
~. competitors are usually trying to satisfy the same or similar ne ds.
~ All of the above are true.
13.ln the EI case, which stage of the product life cycle do semicondu tors appear to be?
A. Sales decline
B. Market introduction
~arket maturity I
~v,arket growth
Use this information to answer the following questions that rfer to the CPI case.
Conservo Products, Inc. (CPI), with annual sales of $200 million,1 is a well-known producer of a
variety of paper products, almost all of which are made from recycled materials. Picnic plates
account for about 70 percent of CPl's sales. The rest of the firm' sales comes from custom
designed materials-such as box liners and spacers, small boxe , and disposable products
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like trays, towels and napkins. i

CPI's picnic plates are sold through "sales reps" to grocery whole alers and retail grocery
chains. The sales reps are paid a 5 percent commission on all sal s in their assigned
territories. They usually handle related-but noncompeting-Iinesl for several other
manufacturers. Along with their selling duties, the sales reps help ICPI with local advertising
and sales promotion efforts.
Orders for the custom products are obtained by area managers W~hO are paid a straight salary
to call on business and institutional customers. The area manage s are trained paper
specialists and often help their customers design the products th y order.
The picnic plates are priced to give CPI a 90 percent markup on t e cost of producing the
product-with the cost figured by taking the total factory cost for~e previous year and dividing
that total cost by the number of units produced and sold during th t period. The firm's invoices
read "F.O.B.-Delivered" and "1/10, net 30." Customers are allo ed to deduct 3 percent from
the face value of the invoice for buying plates in carload qUantitief' and another 2 percent for
advertising them locally.
The custom products are sold ''F.O.B. mill"-with cpr offering a p~ice
for each job.
Competition is strong from many other manufacturers who are ablle to offer very similar
products which meet the customers' specifications. I
CPI forecasts that sales will increase to $250 million by 1999. H0r.ever, much of this growth is
tied to picnic plates-a market in which the firm has about a 7 pe cent market share and faces
aggressive price competition from many smaller firms with greater brand familiarity. Further,
CPI has been late with more than 50 percent of its plate orders d e to scheduling conflicts
with orders for custom products.
14.The "sales reps" who sell CPl's plates are:
A. limited-function wholesalers. v:
B. the firm's own order takers.
C. merchant wholesalers. 'I...
~manufacturers' agents.
Wselling agents.
15. The authors of the text contend that: I
A. Both micro- and macro-marketing cost too much.'i-- I
~
Neither micro- or macro-marketing costs too much~
Micro-marketing often does cost too much, but macro- marke ing does not.
. Micro-marketing does not cost too much, but macro- marketi g does.,
16. Which of the following is NOT a trend affecting marketing strategy planning in the area of
Channels and Logistics?
~
Growth of Internet selling.\:.
B. Less attention to distribution service.
. Growth of mass-merchandising.~
D. More vertical marketing systems. ~
E. More logistics outsourcing. If
17. Which of the following observations provides some hope that mi ro-marketing is becoming
more efficient and effective?
A. More firms are becoming profit-oriented.

B. More firms are becoming production-oriented. ¥..
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~
Fewer firms are becoming customer-oriented.~
D. Firms are embracing new technologies and diversity.
· None of the above.
18. Suppose you were able to start new cities on a planet in outer sp ceo Suppose also that these
cities will be self-supporting. Further, they will be democratic-wit the objective of maximizing
consumer welfare-measured by the level of consumer satisfacti n. The economic decisions
will be made through the "market mechanism." Which of the folio ing statements might be
made by some of the settlers?
A. "The price of food is too high."

B. "Intermediaries should be eliminated."
C. "Advertising expenditures are too high."
D. "Marketing costs too much."
~ All of the above are likely to be made.
19. MICRO-marketing effectiveness is to measure t an MACRO-marketing

effectiveness.
~ easier
~ harder
C. not any easier or harder
20. The monopolistic competition that is typical of the U.S. economy
A. always leads to higher prices, but it may not lead to higher co sumer satisfaction.
~
iS a problem because it does not result in products that reflect consumer's social values.
· is the result of consumer preferences. --.
· is the result of manipulation of markets by business firms.
21.Marie Callender has developed a new brand of frozen dinners to ompete with the well
established brands. It probably should use a marketing mix of:
~
intensive distribution, price cutting, reminder advertising, and ar"pull" policy.
B. intensive distribution, introductory price dealing, selective dem nd advertising, and a
combined "push" and "pull" policy.--
C. selective distribution, skimming pricing, selective demand adv~rtiSing, and a "push" policy.
D. selective distribution, penetration pricing, pioneering advertisin ,and a "push" policy,.,..,/
E. exclusive distribution, skimming pricing, and persuasive adve ising. .
22. Regarding the laws that place limits on marketing activity: J

A. Managers who ignore consumer attitudes may cause new law to be enacted or existing
laws to be modified.
B. Some existing laws may need to be modified or enforced mor carefully instead of adding
new laws. I
C. Strict enforcement of eXisting laws and heavy penalties could ~ave far-reaching effects on
the macro-marketing system. ~
D. Laws set the minimum standards for ethical behavior as defin d in a
;- (!)
society.
All of the above. I
23. When evaluating the effectiveness of the macro-marketing syste1s of different countries:
A. the evaluation should be limited to basic economic objectives fhiCh are common across
countries.
I
I
!l the best approach is to see if firms are making a profit. r

l
(51 it doesn't make sense to try to compare the effectiveness of sys ems for different nations
that have different objectives.
they-the consumers-see them.

t.
D. the evaluation should be based on how well each system satisfirs consumers' needs as
24.A measure of overall consumer satisfaction in the United States, c ated by researchers at the
University Michigan, and called the s based on the results of
regular interviews with thousands of customers.
A. Survey of Consumer Sentiment.
~
Index of Consumer Confidence.
C American Customer Satisfaction Index.
. Gallup Poll.
E. United States Customer Satisfaction Index.
A. Raw materials
B. Accessory equipment
C. Supplies
A. Installations
I
~Component parts
26.0ffering a marketing mix that is like what is available from ComPetirors usually
.
j 4>
,,'
. amounts to a feasible strategy.
doesn't provide superior value.
. reveals where customers are located.
I
D. offers a competitive advantage.

E. provides differentiation for the seller.
27. Which of the following is NOT a trend that is affecting marketing syategy planning?
A. more attention to service technologie~

" B. growing role of cross-channel logistics coordination. ~
,.~........... ~ greater use of database-directed promotion~
V) ~ fewer vertical marketing systems.
E. geographic shifts in populatio~

28.Which of the following statements is true?
A. Rese~rch shows that most customers are satisfied and feel thlt companies deliver on their
~ promIses. I
~ Research shows that many customers are not satisfied and fetl that companies do not
deliver on their promises.
C. Research shows that most customers are somewhat satisfied nd feel that companies
usually deliver on their promises. I
29. Ideally, the ingredients of a good marketing mix should: J

JA)flow logically from all the relevant dimensions of a target mar et.
~ match the ingredients typically used by key competitors. I
......-: .( . C. be determined by which ingredients cost the least.

y' D. not include much advertising because it's expensive.
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3D. Regarding shipping costs in the CPI case:
0p, uses freight-absorption pricing. ~
YePI pays the shipping costs for all its customers-keeping title the products until delivery.
costs themselves. t
C. all of CPl's customers take title to the products at the point of 10 ding and pay all shipping
D. CPJ pays the shipping costs for the plates, while its customers ay the shipping costs for the
custom products.
E. cpr uses zone pricing.
31. For its plates, cpr uses pricing. I
A. average-cost I
B. penetration
C. target return
~flexible
lVdemand-oriented I
32. The best way to improve the operation of our MACRO-marketing ~stem-given the current
objectives of our society-is: I
A. to spend more on advertising.

B. to move toward a command economy.
f
C. to eliminate intermediaries.
D. to encourage marketing managers to produce only what they f el is good for consumers.
@o do better marketing strategy planning and implementation.
33. Which of the following statements about putting together an in no ative marketing plan is
True?
A. The marketing plan blends the elements of the marketing mix

B. The marketing plan forecasts the size of the target market an potential sales.
$. The marketing plan includes implementation plans.
D All of the above.
. A and B only.
34. What kind of products are El's networking equipment?
A. Raw materials ~
B. Supplies'i
tfC) Component parts
'45: Installations
E. Accessory equipment I
35. A national restaurant chain encourages its customers to use its tebsite as a means of
providing comments about their experiences at the chain's locati ns. This website is one way
of measuring:
A. Macro-marketing effectiveness.
B. The effectiveness of competition. I
C. Employee empowerment.
1"5) Micro-marketing effectiveness.
¥' None of the above.
36. Most critics of marketing who argue that marketing managers he p create monopoly or
monopolistic competition feel this leads to:
A. restriction of output.
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B. higher prices.
reduction in the national income.
-, .X
JJ'" $ D. All of the above
37. Which of the following is NOT a trend affecting marketing planning strategy in the area of
Business and Organizational Customers?
Shift to NAICS. ~
d' . B Less use of e-commerce and supply chain management.
. Closer relationships and single sourcing. "4-.
D. ISO 9000.~
E. More use of ,liT and EDI. ~
38. When evaluating macro-marketing:
A. the evaluation is necessarily sUbjective.

B. the best approach is to consider the profit generated by individ al firms within the overall
system.
(pone must determine how efficiently the society's resources are used. ~
D. one must consider each individual firm's role in the marketing s stem.
39. CPI offers the grocery wholesalers and retail chains:
~umulative quantity discounts.

B. All of the above.
C. P.M.'s
D. brokerage allowances.
E. cash discounts for paying their bills quickly.
40.According to the text:
A. micro-marketing always costs too much. . .
kmacro-marketing costs too much in the United States'Lgiven t

e current objective.
~micro-marketing often does cost too much.
D. all macro-marketing systems cost too much.
E. marketing never costs too much.
41. Consumer satisfaction:
(J]) depends on one's own expectations and aspirations.

B. is easier to measure at the macro-level than at the micro-level.
C. is totally unrelated to company profits.
D. is the basic objective of all economic systems.
E. is hard to define.
42.ln the development of a marketing plan, blending the marketing ix would not generally
involve
A. product classes.
~
understanding the target market.
. strategy planning process;"--

. product life cycle.
E. predicting future behavior.
43.ln the PSI case, what kind of products are the small pumps for cu tomers who use them to
replace worn pumps in their own machines?
~
~
Component parts
Installations
C. Raw materials
D. Supplies
E. Accessory equipment
44.A market-directed economy
A. ensures that voters and politicians agree which problem has to be solved first.
hconcentrates solely on profit generation.
l,g,/makes efficient use of resources. /"
~
~l' I
D. guarantees that government aid programs .are effective.
E. spreads income evenly among the population. t

45. The main difference between a "strategy" and a "marketing plan" i :
A. There is no difference.
B. that a plan includes several strategies.
~.
that resource commit~ents ~re made. more clear in a strategy.
o hat time-related details are Included In a plan.
'J]l' that a plan does not consider the firm's target market.
46.A product strategy decision includes all of the following except:
A. Warranty.
B. Benefits.
~ Quality.
CU;V Exposure.
E. Features.
47. The future poses many challenges for marketing managers beca se:
A. international competition makes it even harder to gain a com etitive advantage.

B. consumers' rights of privacy are harder to protect.
C. the needs of the disadvantaged are not yet being met very su cessfully.
A environmental damage is no longer a hidden cost.
<.sJall of the above.
48.CPI uses:
A. a direct-to-customer channel system for all its products.

B. dual distribution.
@ an indirect channel system for the plates and a direct-to-custo er channel system for the
custom products.
D. an indirect channel system for all its products.
E. a direct-to-customer channel system for the plates and an indi ect channel system for the
custom products.
49. Which of the following statements regarding marketing's influence on values is FALSE?
A. Marketing tends to reflect social values in the short run.

B. Many companies work hard to determine their customers' be'ilfS and values.
C. Many companies refuse to use ads that would be offensive to heir target customers.
,., .X· (i)) Marketing never elevates the wrong values.
JJ'" ¥ Marketing tends to reinforce and enhance social values in the ong run.
50. Given the American economy's basic objective of meeting consuters' needs as THEY-the
http://ecourse.amberton.edu/under/BUS3 31 OE llExercise%209.htm I 6/28/2010

I
BUS33IO Exercise 9 Page 11 of 11
consumers-see them, it is sensible to evaluate our MACRO-mar+ting system in terms of:
A. how efficiently our resources are used. I
B. the value of the inputs to the system. I
C. our standard of living-as measured by GNI.

~ total business profits.
Vthe level of consumer satisfaction.\.lG/'
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BUS3310 Exercise 1 Page 1 of9

B. the president has a marketing background. I< I

C. obtain economies of scale.~ 1vJ,~WJ-I 0 Y"' .

vf'. profit as an objective. u,.> fvMVv I

\J{ marketing is much more than selling or advertising. I

B. the cost of marketing is about 25 percent of the consumer's d1l1ar.

\ft. economies of scale.

...(;( a marketing orientation

C. the innovation concept

B. Apex Manufacturing, Inc. I

~ncreased competition made firms focus on winning customers.

A. making a good product that sells itself. 't-

A. a firm's obligation to have a positive effect on society.

.....e( marketing company

10. Which of the following statements about customer value is True?

11.The "universal functions of marketing" do NOT include:

A. financing and risk taking.

E. transporting and storing.

http://ecourse.amberton.eduJunderlBUS3 31 OE 1/Exercise%20 l.htm 6/17/2010

A. The largest producers are always the most efficient.

13.A "production-oriented" firm typically:

A. focuses advertising on need-satisfying product benefits.

A.~ market-directed economy adjusts itself. +

A. ]"he firm lacks a central focus.

16._ _ NOT the government's job in a market-directed economy.

A. Regulating radio and television broadcasting is '1­

~ Determining what and how much is to be produced is

E. Controlling interest rates and the supply of money are l.f

A. intermediaries are present to facilitate exchange.

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

http://ecourse.amberton.eduJunderIBUS3 31 OE 1lExercise%201.htm 6/17/2010

A. Disagreements among departments about how to improve th company's product.

21. is defined as the performance of activities that seek to a complish an organization's

A. production-oriented firms usually do not have a marketing ma ager.

B. ).here are no separate functional departments in a marketing-o iented firm.

departments would like to do.

~ product development. 'If.

E. None of the above.

-usl market development.

"'t'. mass marketing.

A. the world is getting smaller. If..

A. operational decisions in the product decision area.

E. None of the above.

40. Differentiation means that

v(" Mass marketing

43. Customer equity ,I

http://ecourse.amberton.edu/underIBUS331 OEl/Exercise%20 1.htm 6/17/2010

44.Target marketing, in contrast to mass marketing:

A Assumes all customers have the same needs.

\V"a channel of distribution.

\...iY." promotion. I'

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BUS3310 Exercise 2 Page 1 of9

Reading: Perreault, Cannon, and McCarthy text chapters 3 ~4

3. The Robinson-Patman Act specifically aims at:

J /(5) price discrimination.

A. operating margins screen-.t-- J-. I

~ industry attractiveness matrix

.~. total profit approach

D. cost plus assessment ry.­

http://ecourse.amberton.edu/under/BUS 331 OE lIExercise%202.htm 6/17/2010

A. machines are developed to assemble defect-free electronic colponents.

6. The return-on-investment approach to evaluating possible productimarket strategic plans is

A. Regulating radio and television broadcasting is '1

D. cost plus assessment ry.