Archive for April 2020

The world's largest buyer of products and services is ________.

The world's largest buyer of products and services is ________.



A) the Department of Veteran Affairs
B) the Chinese government
C) the U.S. government
D) the General Services Administration
E) the Russian government



Answer: C

Many institutional markets are characterized by ________ and ________.

Many institutional markets are characterized by ________ and ________.



A) low budgets; vague criteria
B) special needs; vague criteria
C) low budgets; captive patrons
D) captive patrons; limited access
E) mismanagement; disgruntled workers


Answer: C

Which of the following statements about e-procurement security issues is true?

Which of the following statements about e-procurement security issues is true?



A) There are no security risks for companies doing business on the Internet.
B) Firewalls provide adequate security for all Internet exchanges.
C) Hackers are not interested in many business-to-business transactions.
D) Extranet users and Internet users face the same security risks and use the same security tools.
E) Providing e-procurement security can involve a substantial financial investment from a company.


Answer: E

A firewall is a(n) ________.

A firewall is a(n) ________.



A) commonly used technique to safeguard Internet and extranet transactions
B) method of communicating with e-commerce customers
C) tool used by hackers to infiltrate corporate Web sites
D) method for increasing employee productivity
E) effective method for efficiently linking buyer and seller Web sites


Answer: A

A problem with the rapidly expanding use of e-purchasing is that it ________.

A problem with the rapidly expanding use of e-purchasing is that it ________.



A) can erode established customer-supplier relationships
B) saves less time than expected
C) generates more transactions to document
D) generates less cost savings than predicted
E) reduces the amount of time purchasing people can spend on strategic issues



Answer: A

B-to-B e-procurement yields many benefits. These include all of the following EXCEPT ________.

B-to-B e-procurement yields many benefits. These include all of the following EXCEPT ________.



A) reduced transaction costs
B) more efficient purchasing for both buyers and sellers
C) elimination of inventory problems
D) reduced order processing costs
E) elimination of much of the paperwork associated with traditional ordering procedures


Answer: C

The Bentley department store chain makes extensive use of e-procurement. As a buyer, the store should expect to enjoy all of these benefits of e-procurement EXCEPT ________.

The Bentley department store chain makes extensive use of e-procurement. As a buyer, the store should expect to enjoy all of these benefits of e-procurement EXCEPT ________.



A) greater access to new suppliers
B) lower purchasing costs
C) hastened order processing and delivery
D) reduced payroll
E) more time for purchasing agents to focus on strategic issues


Answer: E

Which of the following statements about the supplier selection stage of the business buying decision process is true?

Which of the following statements about the supplier selection stage of the business buying decision process is true?



A) Price is the only factor businesses consider before making a purchase decision.
B) Even companies that have adopted a total quality management approach consider price to be the most important factor in choosing a supplier.
C) Price and warranty are the only two factors businesses consider before making a purchase decision.
D) Buyers do not negotiate for better terms before making a final supplier selection.
E) Before selecting a supplier, many companies consider the supplier's reputation for ethical corporate behavior and honest communication.


Answer: E

Members of the buying center at ABC Kid's World are drawing up a list of desired toy supplier attributes and their relative importance. Next, they intend to compare several suppliers to these attributes. In which step of the business buying process is the buying center at ABC Kid's World engaged?

Members of the buying center at ABC Kid's World are drawing up a list of desired toy supplier attributes and their relative importance. Next, they intend to compare several suppliers to these attributes. In which step of the business buying process is the buying center at ABC Kid's World engaged?



A) supplier search
B) proposal solicitation
C) supplier selection
D) order-routine specification
E) performance review


Answer: C

During which stage of the business buying process is a buyer most likely to conduct a value analysis, carefully studying components to determine if they can be redesigned, standardized, or made less expensively?

During which stage of the business buying process is a buyer most likely to conduct a value analysis, carefully studying components to determine if they can be redesigned, standardized, or made less expensively?



A) proposal solicitation
B) general need description
C) order-routine specification
D) performance review
E) product specification


Answer: E

In which stage of the business buying process is a supplier most likely to provide a buyer with information about the importance of different product characteristics?

In which stage of the business buying process is a supplier most likely to provide a buyer with information about the importance of different product characteristics?



A) problem recognition
B) general need description
C) supplier search
D) supplier selection
E) order-routine specification


Answer: B

The purchasing agent at your company is working with engineers and users to define the items to purchase by describing general characteristics and quantities needed. He is also ranking the importance of reliability, durability, and price. The buyer is preparing a(n) ________.

The purchasing agent at your company is working with engineers and users to define the items to purchase by describing general characteristics and quantities needed. He is also ranking the importance of reliability, durability, and price. The buyer is preparing a(n) ________.



A) value analysis
B) product specifications list
C) general need description
D) order-routine specification
E) product proposal


Answer: C

Business marketers often alert customers to potential problems and then show how their products provide solutions. These marketers are hoping to influence which stage of the business buying process?

Business marketers often alert customers to potential problems and then show how their products provide solutions. These marketers are hoping to influence which stage of the business buying process?



A) general need description
B) alternative evaluations
C) problem recognition
D) order-routine specification
E) performance review


Answer: C

The first step of the business buying process is ________.

The first step of the business buying process is ________.



A) general need description
B) alternative evaluations
C) problem recognition
D) order-routine specification
E) performance review


Answer: C

Which of the following is an example of an internal stimulus that might lead to the business buying process stage of problem recognition?

Which of the following is an example of an internal stimulus that might lead to the business buying process stage of problem recognition?



A) A buyer gets a new idea from an advertisement.
B) A buyer gets a new idea at a trade show.
C) A buyer is unhappy with a current supplier's price.
D) A buyer receives a call from a salesperson offering better service terms.
E) A buyer learns about a new product at an industry convention.



Answer: C

Charlie Van Dusen, executive vice president of National Central Bank, is going through all of the stages of the buying process to purchase a computer system for the bank. Charlie is facing a(n) ________ situation.

Charlie Van Dusen, executive vice president of National Central Bank, is going through all of the stages of the buying process to purchase a computer system for the bank. Charlie is facing a(n) ________ situation.



A) straight rebuy
B) modified rebuy
C) new-task buying
D) limited budget
E) independent buying


Answer: C

Which of the following is the best advice for an international marketer planning to interact with businesspeople from many different cultures?

Which of the following is the best advice for an international marketer planning to interact with businesspeople from many different cultures?



A) Trust your instincts and behave as you normally do.
B) Remember that countries all over the world are fascinated with American culture.
C) Cultures really are different, so do your best to learn about those differences.
D) Use the same strategies with all of your clients, no matter what their cultural backgrounds are.
E) Assume that businesspeople from different cultures will make accommodations for you



Answer: C

Which of the following accurately describes a cultural difference international marketers should be aware of?

Which of the following accurately describes a cultural difference international marketers should be aware of?



A) Outside of English-speaking countries, most business leaders do not speak English.
B) British businesspeople are accustomed to making more business deals over the telephone than in person.
C) German people tend to be impressed by overstatement and showiness.
D) Japanese people tend to put a high value on rank.
E) French businesspeople are accustomed to building relationships between buyer and seller through quick and easy familiarity.


Answer: D

The major influences on the buying process at General Aeronautics include company policies and systems, technological change, and economic developments. The types of influences on the buying process in this scenario are most accurately categorized as ________ and ________.

The major influences on the buying process at General Aeronautics include company policies and systems, technological change, and economic developments. The types of influences on the buying process in this scenario are most accurately categorized as ________ and ________.



A) individual; environmental
B) organizational; interpersonal
C) individual; organizational
D) environmental; interpersonal
E) organizational; environmental


Answer: E

Which of the following statements about buying centers is true?

Which of the following statements about buying centers is true?



A) The buying center is like a standing committee.
B) The buying center roles are specified on the organizational chart.
C) The typical buying center has five employees, one to assume each of the buying center's roles.
D) An individual's role in the buying center does not change.
E) The buying center may involve informal participants who are not obvious to sellers


Answer: E

Which of the following is NOT included in the decision-making unit of a buying organization?

Which of the following is NOT included in the decision-making unit of a buying organization?



A) individuals who use the product or service
B) individuals who influence the buying decision
C) individuals who make the buying decision
D) individuals who supply the product
E) individuals who control buying information


Answer: D

Don Amspacher, in his role on the buying committee, provides information for evaluating the alternative purchase decisions and helps define and set specifications for evaluating alternatives for purchasing. Don is a(n) ________.

Don Amspacher, in his role on the buying committee, provides information for evaluating the alternative purchase decisions and helps define and set specifications for evaluating alternatives for purchasing. Don is a(n) ________.



A) user
B) influencer
C) decider
D) gatekeeper
E) buyer


Answer: B

A ________ consists of the actual users of products, those who control buying information, those who influence the decisions, those who do the actual buying, and those who make the buying decisions.

A ________ consists of the actual users of products, those who control buying information, those who influence the decisions, those who do the actual buying, and those who make the buying decisions.



A) supplier development team
B) cross-functional team
C) buying center
D) quality management center
E) partnership management team



Answer: C

You just lost a major account because a competitor provided the most complete system to meet the customer's needs and solve the customer's problems, and made the sale. In other words, the competition beat you with ________.

You just lost a major account because a competitor provided the most complete system to meet the customer's needs and solve the customer's problems, and made the sale. In other words, the competition beat you with ________.



A) solutions selling
B) team selling
C) cross-functional skill
D) customer relationship management
E) promotions


Answer: A

The owners of the company you work for have developed a core network of suppliers they are working closely with to ensure an appropriate and dependable supply of products. This is an example of ________ management.

The owners of the company you work for have developed a core network of suppliers they are working closely with to ensure an appropriate and dependable supply of products. This is an example of ________ management.



A) value chain
B) network relationship
C) channel captain
D) core channel
E) supplier development


Answer: E

Large business purchasers usually call for detailed product specifications, written purchase orders, careful supplier searches, and formal approval. These are all examples of how the business buying decision process is more ________ than the consumer buying decision process is.

Large business purchasers usually call for detailed product specifications, written purchase orders, careful supplier searches, and formal approval. These are all examples of how the business buying decision process is more ________ than the consumer buying decision process is.


A) formalized
B) creative
C) relationship-oriented
D) independent
E) concentrated



Answer: A

Which of the following is true about business marketers in comparison to consumer marketers?

Which of the following is true about business marketers in comparison to consumer marketers?



A) They deal with far fewer but far larger buyers.
B) They deal with far more but far small buyers.
C) They deal with a more elastic market.
D) They deal with fewer demands in fluctuation.
E) They deal with the same decision buying process.


Answer: A

Business buying behavior refers to the buying behavior of organizations that buy all of the following EXCEPT ________.

Business buying behavior refers to the buying behavior of organizations that buy all of the following EXCEPT ________.



A) products for use in production of other products
B) services for use in production of other services
C) products purchased to resell to others
D) products purchased to rent to others
E) products purchased for personal consumption


Answer: E

As a purchasing agent, Benni Lopez buys goods and services for use in the production of products that are sold and supplied to others. Benni is involved in ________.

As a purchasing agent, Benni Lopez buys goods and services for use in the production of products that are sold and supplied to others. Benni is involved in ________.



A) consumer buying behavior
B) postpurchase dissonance
C) retail buyer behavior
D) business buyer behavior
E) interpretive business research


Answer: D

In which of the following ways is Boeing like most other large companies?

In which of the following ways is Boeing like most other large companies?



A) It produces hundreds of products for a wide range of markets.
B) It has an entertainment division.
C) It has an investment division.
D) Most of its business comes from final consumers.
E) Most of its business comes from commercial and industrial customers


Answer: E

Which of the following is NOT a challenge presented by the product life cycle that a firm must face?

Which of the following is NOT a challenge presented by the product life cycle that a firm must face?



A) All products eventually decline.
B) Changing tastes, technologies, and competition affect the marketing of the product as it passes through life-cycle stages.
C) A firm must be good at developing new products to replace aging ones.
D) A firm must be good at adapting its marketing strategies.
E) It is difficult to plot the stages as a product goes through them.


Answer: E

Which of the following most accurately identifies a difference between a weakness and a threat in SWOT analysis?

Which of the following most accurately identifies a difference between a weakness and a threat in SWOT analysis?



A) A company is more able to change a threat than a weakness.
B) A company is more able to change a weakness than a threat.
C) A company can be more negatively affected by a weakness than by a threat.
D) A company can be more negatively affected by a threat than by a weakness.
E) A company can more easily identify threats than weaknesses.


Answer: B

Fence Patrol has developed an entirely new mounting system for chain link fences. Although it is a local company, through the acquisition of a distributor it now has the ability to market its products nationwide. Fence Patrol is most likely following a ________ strategy.

Fence Patrol has developed an entirely new mounting system for chain link fences. Although it is a local company, through the acquisition of a distributor it now has the ability to market its products nationwide. Fence Patrol is most likely following a ________ strategy.



A) market penetration
B) market development
C) downsizing
D) divesting
E) product development


Answer: B

The pharmaceuticals division of Omni Healthcare holds low market share in a high-growth market. In order to increase market share, managers would be most likely to decide which of the following?

The pharmaceuticals division of Omni Healthcare holds low market share in a high-growth market. In order to increase market share, managers would be most likely to decide which of the following?



A) hold the pharmaceuticals division's share
B) implement a harvest strategy
C) use money from a cash cow to promote the pharmaceuticals division
D) divest the SBU
E) diversify the pharmaceutical division



Answer: C

The current mission statement of the Girl Scouts of America is to build "girls of courage, confidence, and character, who make the world a better place." The organization's former mission statement had read "to prepare young girls for motherhood and wifely duties." This change reflects the guideline that mission statements should be ________.

The current mission statement of the Girl Scouts of America is to build "girls of courage, confidence, and character, who make the world a better place." The organization's former mission statement had read "to prepare young girls for motherhood and wifely duties." This change reflects the guideline that mission statements should be ________.



A) realistic
B) broad
C) narrow
D) market-oriented
E) specific


Answer: D

Emerson Studios, a chain of 25 portrait stores in five states, has organized its marketing organization into groups headed by a sales manager, an advertising manager, and a customer- service manager. What type of organization is this?

Emerson Studios, a chain of 25 portrait stores in five states, has organized its marketing organization into groups headed by a sales manager, an advertising manager, and a customer- service manager. What type of organization is this? 



A) geographic
B) product
C) functional
D) customer
E) market


Answer: C

Serengeti makes lightweight sunglasses with 100 percent UV protection for people who love to hunt, hike, and bike ride. Its long-term plans include the development of lenses that, in addition to protecting users from UV rays, will also have effective water-sheeting action to reduce lens spotting. This new feature will be valuable to people who fish. Serengeti has determined that fishing is one of the fastest growing sports in the United States. In terms of a SWOT analysis, Serengeti has recognized a market ________.

Serengeti makes lightweight sunglasses with 100 percent UV protection for people who love to hunt, hike, and bike ride. Its long-term plans include the development of lenses that, in addition to protecting users from UV rays, will also have effective water-sheeting action to reduce lens spotting. This new feature will be valuable to people who fish. Serengeti has determined that fishing is one of the fastest growing sports in the United States. In terms of a SWOT analysis, Serengeti has recognized a market ________.



A) weakness
B) strength
C) threat
D) opportunity
E) trend


Answer: D

Serengeti makes lightweight sunglasses with 100 percent UV protection for people who love to hunt, hike, and bike ride. Its long-term plans include the development of lenses that, in addition to protecting users from UV rays, will also have effective water-sheeting action to reduce lens spotting. This new feature will be valuable to people who fish. In terms of a SWOT analysis, the company believes it can use the ________ of its reputation as a sunglass manufacturer for a specialized market in combination with its current manufacturing facilities and labor force to enter this new market.

Serengeti makes lightweight sunglasses with 100 percent UV protection for people who love to hunt, hike, and bike ride. Its long-term plans include the development of lenses that, in addition to protecting users from UV rays, will also have effective water-sheeting action to reduce lens spotting. This new feature will be valuable to people who fish. In terms of a SWOT analysis, the company believes it can use the ________ of its reputation as a sunglass manufacturer for a specialized market in combination with its current manufacturing facilities and labor force to enter this new market.



A) weights
B) strengths
C) threats
D) opportunities
E) trends


Answer: B

Harris, the marketing manager at a small sports retail chain, has conducted a marketing analysis. He has investigated the company's internal resources and situational factors, as well as factors and trends in the competitive sports retail chain market. Which of the following has Harris completed?

Harris, the marketing manager at a small sports retail chain, has conducted a marketing analysis. He has investigated the company's internal resources and situational factors, as well as factors and trends in the competitive sports retail chain market. Which of the following has Harris completed?



A) a SWOT analysis
B) a business portfolio analysis
C) an executive summary
D) a marketing plan
E) a marketing mix



Answer: A

Paul Pendergraff has identified a group of potential customers who seem to respond in a similar way to a series of magazine and radio advertisements for his company's product. Paul has identified a(n) ________.

Paul Pendergraff has identified a group of potential customers who seem to respond in a similar way to a series of magazine and radio advertisements for his company's product. Paul has identified a(n) ________.



A) target market
B) market segment
C) market
D) market position
E) undefined niche


Answer: B

Walmart relies on sound relationships with its low-cost suppliers in order to pass low prices on to consumers. Thus, forming a ________ is crucial to Walmart's success.

Walmart relies on sound relationships with its low-cost suppliers in order to pass low prices on to consumers. Thus, forming a ________ is crucial to Walmart's success.



A) value delivery network
B) growth-share matrix
C) customer relationship management policy
D) market concept philosophy
E) diversification strategy


Answer: A

Starbucks Coffee has recently begun selling and playing compilation CDs and is supporting its own XM satellite radio station. This represents which strategy for growth?

Starbucks Coffee has recently begun selling and playing compilation CDs and is supporting its own XM satellite radio station. This represents which strategy for growth?



A) product development
B) market development
C) market penetration
D) diversification
E) partner development


Answer: D

Acme, Inc. has slightly modified the production processes of its widgets and gadgets in order to tap into the Eastern European market. Acme is likely following a ________ strategy.

Acme, Inc. has slightly modified the production processes of its widgets and gadgets in order to tap into the Eastern European market. Acme is likely following a ________ strategy.



A) market penetration
B) market development
C) diversification
D) harvesting
E) product development


Answer: B

Walmart, the world's largest retailer, has successfully launched its stores in Mexico, Canada, the U.K., Germany, and other nations. This is an example of how Walmart is pursuing ________ as a growth strategy.

Walmart, the world's largest retailer, has successfully launched its stores in Mexico, Canada, the U.K., Germany, and other nations. This is an example of how Walmart is pursuing ________ as a growth strategy.



A) market penetration
B) product development
C) demographic market development
D) geographic market development
E) diversification


Answer: D

Kimball Gardens is a company that operates as two distinct businesses: one that sells lawn and garden products and one that markets booklets. Each business is called a ________.

Kimball Gardens is a company that operates as two distinct businesses: one that sells lawn and garden products and one that markets booklets. Each business is called a ________.



A) return on investment (ROI)
B) strategic business unit (SBU)
C) cash cow
D) star
E) business portfolio


Answer: B

Which of the following is NOT a step in the marketing control process?

Which of the following is NOT a step in the marketing control process?



A) setting goals
B) measuring performance
C) taking corrective action
D) defining the mission
E) evaluating the causes of gaps between expected and actual performance


Answer: D

The marketing control process entails the following steps in order: setting goals, ________, evaluating performance, and ________.

The marketing control process entails the following steps in order: setting goals, ________, evaluating performance, and ________.


A) evaluating goals; measuring performance
B) achieving goals; measuring performance
C) taking corrective action; measuring performance
D) measuring performance; taking corrective action
E) taking corrective action; following up



Answer: D

Your new employer has asked you, as a new marketing graduate, to develop a group of potential customers who might respond in a similar way to a given set of marketing efforts. You have been asked to develop a(n) ________.

Your new employer has asked you, as a new marketing graduate, to develop a group of potential customers who might respond in a similar way to a given set of marketing efforts. You have been asked to develop a(n) ________.



A) target market
B) market segment
C) market
D) market strategy
E) undefined niche


Answer: B

The process of customer-driven marketing involves which of the following?

The process of customer-driven marketing involves which of the following?



A) product; price; promotion; adaptation
B) market segmentation; market targeting; differentiation; positioning
C) marketing analysis; planning; implementation; feedback
D) analysis; targeting; implementation; control
E) problem identification; information search; decision; implementation


Answer: B

Your firm is attempting to divide up the total market to determine the best segments it can serve. Which is the correct order of doing so?

Your firm is attempting to divide up the total market to determine the best segments it can serve. Which is the correct order of doing so?



A) market segmentation then market targeting
B) differentiation then market targeting
C) positioning then differentiation
D) market segmentation then positioning
E) market targeting then differentiation


Answer: A

Lucy Ortiz is preparing a PowerPoint presentation of the marketing process to show at a sales meeting. ________ should appear in the center of her diagram depicting marketing strategies and the marketing mix.

Lucy Ortiz is preparing a PowerPoint presentation of the marketing process to show at a sales meeting. ________ should appear in the center of her diagram depicting marketing strategies and the marketing mix.



A) Sales goals
B) Customer value and relationships
C) Company objectives
D) Customer retention rates
E) Competitors


Answer: B

Multinationals like Honda Motor Co. and Walmart stores have designed programs to work closely with their suppliers to help them reduce their costs and improve quality. This illustrates the importance of an efficient ________.

Multinationals like Honda Motor Co. and Walmart stores have designed programs to work closely with their suppliers to help them reduce their costs and improve quality. This illustrates the importance of an efficient ________.



A) business portfolio
B) low-cost operator
C) product mix
D) value delivery network
E) value chain


Answer: D

Which of the following is NOT a reason that a firm might want to abandon products or markets?

Which of the following is NOT a reason that a firm might want to abandon products or markets? 



A) The market has changed, making some of the products less profitable.
B) The firm has entered areas in which it does not have expertise.
C) The economic environment is showing signs of recovery.
D) The firm has grown too rapidly.
E) The firm has not properly researched foreign markets which it has entered.



Answer: C

If Under Armour, the successful maker of moisture-wicking shirts and shorts, considered introducing a line of Under Armour fitness equipment, the company would be considering ________.

If Under Armour, the successful maker of moisture-wicking shirts and shorts, considered introducing a line of Under Armour fitness equipment, the company would be considering ________.



A) marketing controls
B) market development
C) diversification
D) market penetration
E) product adaptation



Answer: C

Mountain Home Farms is now using the product/market expansion grid to develop strategies. The owners of the company have most likely found the grid to be quite useful for identifying ________.

Mountain Home Farms is now using the product/market expansion grid to develop strategies. The owners of the company have most likely found the grid to be quite useful for identifying ________.



A) target markets
B) growth opportunities
C) key customers
D) new products
E) suppliers


Answer: B

Which of the following does NOT accurately reflect a problem with the BCG matrix approach?

Which of the following does NOT accurately reflect a problem with the BCG matrix approach? 



A) It focuses on planning for the future.
B) It can be costly to conduct.
C) It can be time consuming to implement.
D) It is difficult to define SBUs and measure market share and growth.
E) It focuses on classifying current businesses.


Answer: A

In the BCG approach, ________ are high-share, high-growth businesses or products. They need heavy investment to finance rapid growth. When their growth slows down, they turn into ________.

In the BCG approach, ________ are high-share, high-growth businesses or products. They need heavy investment to finance rapid growth. When their growth slows down, they turn into ________.



A) cash cows; stars
B) question marks; dogs
C) stars; question marks
D) stars; cash cows
E) dogs; cash cows


Answer: D

The BCG growth-share matrix classifies four types of SBUs. They are ________, ________, ________, and ________.

The BCG growth-share matrix classifies four types of SBUs. They are ________, ________, ________, and ________.



A) product; price; promotion; placement
B) sales; market share; price; promotion
C) stars; cash cows; question marks; dogs
D) planning; implementing; leading; controlling
E) market penetration; market development; product development; diversification


Answer: C

Most portfolio analysis methods evaluate SBUs on two dimensions, namely ________ and ________.

Most portfolio analysis methods evaluate SBUs on two dimensions, namely ________ and ________.



A) market share; strength of the SBU's position
B) market diversification; relative market share
C) market or industry attractiveness; strength of the SBU's position
D) market growth rates; profits E) market penetration; market development



Answer: C

Business portfolio planning involves two steps: ________ and ________.

Business portfolio planning involves two steps: ________ and ________.



A) identifying SBUs; assessing the attractiveness of SBUs
B) analyzing the current business portfolio; shaping the future business portfolio
C) identifying internal strengths; identifying external opportunities
D) conducting a SWOT analysis; establishing marketing controls
E) identifying growth opportunities; evaluating growth opportunities


Answer: B

Revlon has clearly defined its "mission" of selling lifestyle and self-expression. In order for the firm to launch its strategic plan, the mission needs to next be turned into detailed ________ that guide each level of the company.

Revlon has clearly defined its "mission" of selling lifestyle and self-expression. In order for the firm to launch its strategic plan, the mission needs to next be turned into detailed ________ that guide each level of the company.



A) sets of strategies
B) sets of tactics
C) product mixes
D) supporting objectives
E) sets of promotional tools


Answer: D

All of the following are accurate guidelines for a company's mission statement EXCEPT which one?

All of the following are accurate guidelines for a company's mission statement EXCEPT which one?



A) A mission statement should be realistic.
B) A mission statement should be narrow.
C) A mission statement should emphasize the company's strengths in the marketplace.
D) A mission statement should be specific.
E) A mission statement should motivate employees.


Answer: B

Which of the following is NOT a market-oriented business definition?

Which of the following is NOT a market-oriented business definition?



A) "to nourish lives by making them healthier, easier, and richer"
B) "to sell tools and home repair and improvement items"
C) "to deliver low prices every day"
D) "to be the guardian of our customers' financial dreams"
E) "to bring inspiration and innovation to every athlete in the world"


Answer: B

______ should be market oriented and defined in terms of ________.

______ should be market oriented and defined in terms of ________.



A) Annual plans; product needs
B) Strategic plans; company needs
C) Long-range plans; company needs
D) Mission statements; customers' needs
E) Objectives; competitors' threats


Answer: D

Which of the following provides an answer to these questions: What is our business? Who are our customers? What do our customers value? What should our business be?

Which of the following provides an answer to these questions: What is our business? Who are our customers? What do our customers value? What should our business be?



A) objectives and goals
B) a mission statement
C) a business portfolio
D) marketing and functional strategies
E) operational strategies



Answer: B

Which of the following is NOT a step in the strategic planning process?

Which of the following is NOT a step in the strategic planning process?



A) defining the company mission
B) setting company objectives and goals
C) designing the business portfolio
D) planning marketing and other functional strategies
E) evaluating all members of the value chain


Answer: E

Which of the following is the first step in strategic planning?

Which of the following is the first step in strategic planning?



A) set objectives and goals
B) develop the business portfolio
C) define the company mission
D) plan marketing strategies
E) identify threats and weaknesses


Answer: C

Consumers usually perceive higher-priced products as ________.

Consumers usually perceive higher-priced products as ________.



A) out of reach for most people
B) having high quality
C) having target-cost prices
D) having cost-based prices
E) being in the introductory stage of the product life cycle


Answer: B

If Canon Camera Company follows a high-price, high-margin strategy, what will competitors such as Nikon, Minolta, and Pentax most likely do?

If Canon Camera Company follows a high-price, high-margin strategy, what will competitors such as Nikon, Minolta, and Pentax most likely do?



A) They will go out of business.
B) They will want to compete against Canon.
C) They will advertise less.
D) They will bundle their products.
E) none of the above


Answer: B

In Vin del Mar, Chile, there are a dozen stores specializing in selling the same quality of seafood products on one street. An individual store dare not charge more than the going price without the risk of losing business to the other stores that are selling the fish at a common price. This is an example of what type of market?

In Vin del Mar, Chile, there are a dozen stores specializing in selling the same quality of seafood products on one street. An individual store dare not charge more than the going price without the risk of losing business to the other stores that are selling the fish at a common price. This is an example of what type of market?



A) pure competition
B) monopolistic competition
C) oligopolistic competition
D) pure monopoly
E) socialist


Answer: A

By pledging to be a leader in providing clean, renewable energy sources and developing products and services that help consumers protect the environment, Green Mountain Power competes successfully against "cheaper" brands that focus on more price-sensitive consumers. Green Mountain Power has the firm belief that even kilowatt-hours can be ________.

By pledging to be a leader in providing clean, renewable energy sources and developing products and services that help consumers protect the environment, Green Mountain Power competes successfully against "cheaper" brands that focus on more price-sensitive consumers. Green Mountain Power has the firm belief that even kilowatt-hours can be ________.



A) cost-plus priced
B) represented by a demand curve
C) differentiated
D) value-based priced
E) none of the above


Answer: C

PoolPak produces climate-control systems for large swimming pools. The company's customers are more concerned about service support for maintaining a system than its initial price. PoolPak may use this knowledge to become more competitive through ________.

PoolPak produces climate-control systems for large swimming pools. The company's customers are more concerned about service support for maintaining a system than its initial price. PoolPak may use this knowledge to become more competitive through ________.



A) target costing
B) value pricing
C) cost-plus pricing
D) a nonprice position
E) skimming pricing


Answer: D

P&G surveyed the market and identified an unserved segment of the electric toothbrush market. Using these results, P&G created Spinbrush. The unorthodox order of this marketing mix decision is an example of ________.

P&G surveyed the market and identified an unserved segment of the electric toothbrush market. Using these results, P&G created Spinbrush. The unorthodox order of this marketing mix decision is an example of ________.



A) competition-based pricing
B) cost-plus pricing
C) target costing
D) value-based pricing
E) penetration pricing


Answer: C

A manufacturer is trying to determine its break-even volume. With fixed costs of $100,000, a variable cost of $10, and expected sales of 50,000 units, what should the manufacturer's unit cost be to break even?

A manufacturer is trying to determine its break-even volume. With fixed costs of $100,000, a variable cost of $10, and expected sales of 50,000 units, what should the manufacturer's unit cost be to break even?



A) $10
B) $12
C) $16
D) $20
E) none of the above


Answer: B

Ecstasy Pharmaceuticals faces fixed costs with its new drug of $1,000,000. The company sells the drug in bottles of 50 pills for $10.00. It estimates that it must sell 200,000 bottles to break even. What is the total cost to produce a bottle of 50 pills?

Ecstasy Pharmaceuticals faces fixed costs with its new drug of $1,000,000. The company sells the drug in bottles of 50 pills for $10.00. It estimates that it must sell 200,000 bottles to break even. What is the total cost to produce a bottle of 50 pills?



A) $2.50
B) $5.00
C) $6.00
D) $7.50
E) not enough information to calculate


Answer: B

A company faces fixed costs of $100,000 and variable costs of $8.00/unit. It plans to directly sell its product to the market for $12.00. How many units must it produce and sell to break even?

A company faces fixed costs of $100,000 and variable costs of $8.00/unit. It plans to directly sell its product to the market for $12.00. How many units must it produce and sell to break even?



A) 20,000
B) 25,000
C) 40,000
D) 50,000
E) not enough information to calculate


Answer: B

The long-run average cost curve (LRAC) helps the producer understand which of the following?

The long-run average cost curve (LRAC) helps the producer understand which of the following?



A) how large a business should be in order to be most efficient
B) how to deal with competitors' prices
C) how to deal with external factors
D) how to price under conditions of inelastic demand
E) how to price under conditions of elastic demand


Answer: A

Xbox 360 decides to add a free subscription to XBOX magazine with every game bought in an effort to differentiate its offering from PS3 games. This is an example of ________.

Xbox 360 decides to add a free subscription to XBOX magazine with every game bought in an effort to differentiate its offering from PS3 games. This is an example of ________.



A) good-value pricing
B) add-on pricing
C) product-support pricing
D) value-added pricing
E) cost-based pricing


Answer: D

Trader Joe's offers an assortment of exclusive gourmet products at impossibly low prices. These prices are not limited-time offers or special discounts. Instead, they reflect Trader Joe's ________ strategy.

Trader Joe's offers an assortment of exclusive gourmet products at impossibly low prices. These prices are not limited-time offers or special discounts. Instead, they reflect Trader Joe's ________ strategy.



A) everyday low pricing
B) cost-plus pricing
C) dynamic pricing
D) value-based pricing
E) cost-based pricing


Answer: A

Amos Zook, an Amish farmer, sells organically grown produce. Often he will trade some of his produce for dairy products produced by other Amish farmers. The sum of the values exchanged for the produce is the ________.

Amos Zook, an Amish farmer, sells organically grown produce. Often he will trade some of his produce for dairy products produced by other Amish farmers. The sum of the values exchanged for the produce is the ________.



A) price
B) cost-plus price
C) dynamic price
D) common value price
E) penetration price


Answer: A

Dips in the economy and the instant price comparisons made possible by the Internet have both contributed to ________.

Dips in the economy and the instant price comparisons made possible by the Internet have both contributed to ________.



A) decreased consumer price sensitivity
B) increased consumer price sensitivity
C) a less direct relationship between supply and demand
D) a more direct relationship between supply and demand
E) decreased brand loyalty


Answer: B

Buyers are less price sensitive in all of the following situations EXCEPT ________.

Buyers are less price sensitive in all of the following situations EXCEPT ________.



A) when the product they are buying is unique
B) when the product they are buying is high in quality
C) when substitute products are hard to find
D) when the total expenditure for a product is high relative to their income
E) when the product is exclusive


Answer: D

Price elasticity of demand is ________ divided by ________.

Price elasticity of demand is ________ divided by ________.



A) percent change in quantity demanded; percent change in price
B) demand; price
C) percent change in price; percent change in quantity demanded
D) the going price; the asking price
E) retail value; list price


Answer: A

Which of the following is true about the demand curve?

Which of the following is true about the demand curve?



A) It is used to illustrate the effect of price on the quantity supplied.
B) It is always graphically depicted by a straight line.
C) It shows the quantity of product customers will buy in a market during a period of time even if other factors change.
D) It usually slopes upward and to the right.
E) It shows the relationship between product demand and product price.


Answer: E

Under ________, the market consists of one seller.

Under ________, the market consists of one seller.



A) a pure monopoly
B) monopolistic competition
C) oligopolistic competition
D) pure competition
E) capitalism


Answer: A

Firms are less affected by competitors' pricing strategies under ________ than under ________.

Firms are less affected by competitors' pricing strategies under ________ than under ________.



A) monopolistic competition; oligopolistic competition
B) pure competition; monopolistic competition
C) oligopolistic competition; pure competition
D) oligopolistic competition; monopolistic competition
E) pure competition; a pure monopoly


Answer: A

With target costing, marketers will first ________ and then ________.

With target costing, marketers will first ________ and then ________.



A) build the marketing mix; identify the target market
B) identify the marketing mix; determine product cost
C) design the product; determine its cost
D) use skimming pricing; penetrating pricing
E) determine a selling price; target costs to ensure that the price is met


Answer: E

Which of the following statements about break-even analysis is true?

Which of the following statements about break-even analysis is true?



A) It is used to determine how much production experience a company must have to achieve desired efficiencies.
B) It is a technique used to calculate fixed costs.
C) It determines the amount of retained earnings a company will have during an accounting period.
D) It is a technique marketers use to examine the relationship between supply and demand.
E) It is calculated using variable costs, the unit price, and fixed costs


Answer: E

The break-even volume is the point at which ________.

The break-even volume is the point at which ________.



A) the total revenue and total costs lines intersect
B) demand equals supply
C) the production of one more unit will not increase profit
D) the company can pay all of its long-term debt
E) a firm's profit goal is reached


Answer: A

Break-even pricing, or a variation called ________, is when the firm tries to determine the price at which it will break even or make the profit it is seeking.

Break-even pricing, or a variation called ________, is when the firm tries to determine the price at which it will break even or make the profit it is seeking.



A) competition-based pricing
B) target return pricing
C) fixed cost pricing
D) value-based pricing
E) customer-based pricing


Answer: B

Many people feel that ________ pricing is fairer to both buyers and sellers. Sellers earn a fair return on their investment but do not take advantage of buyers when buyers' demand becomes great.

Many people feel that ________ pricing is fairer to both buyers and sellers. Sellers earn a fair return on their investment but do not take advantage of buyers when buyers' demand becomes great.



A) skimming
B) markup
C) elasticity
D) inelasticity
E) penetration


Answer: B

Which of the following is a reason why markup pricing is NOT practical?

Which of the following is a reason why markup pricing is NOT practical?



A) Sellers earn a fair return on their investment.
B) By tying the price to cost, sellers simplify pricing.
C) When all firms in the industry use this pricing method, prices tend to be similar.
D) This method ignores demand.
E) With a standard markup, consumers know when they are being overcharged


Answer: D

The simplest pricing method is ________.

The simplest pricing method is ________.



A) value-based pricing
B) sealed-bid pricing
C) markup pricing
D) value-added pricing
E) target profit pricing


Answer: C

The company designs what it considers to be a good product, totals the expenses of making the product, and sets a price that adds a standard markup to the cost of the product. This approach to pricing is called ________.

The company designs what it considers to be a good product, totals the expenses of making the product, and sets a price that adds a standard markup to the cost of the product. This approach to pricing is called ________.



A) value-based pricing
B) fixed cost pricing
C) cost-plus pricing
D) variable pricing
E) skimming pricing


Answer: C

Which of the following is a risk a company takes when building a strategy around the experience curve?

Which of the following is a risk a company takes when building a strategy around the experience curve?



A) Competitors will likely not be able to meet the company's price cuts.
B) Existing technologies are likely to become more expensive as the company expands.
C) The method does not take competitors' prices into account.
D) The method may cause consumers to become frustrated with changing prices.
E) Aggressive pricing may give the product a cheap image, causing customers to lose interest.



Answer: E

The experience curve reveals that ________.

The experience curve reveals that ________.



A) repetition in production lowers costs
B) repetition in production enhances efficiency
C) the average cost drops with accumulated production experience
D) A, B, and C
E) none of the above


Answer: D

With a higher volume of product, most companies can expect to ________.

With a higher volume of product, most companies can expect to ________.



A) gain economies of scale
B) become less efficient
C) see fixed costs increase
D) have a straight, horizontal learning curve
E) find competitors using the experience curve strategically


Answer: A

The LRAC is most closely related to which of the following?

The LRAC is most closely related to which of the following?



A) long-term marketing plans
B) long-term business plans
C) the cost of producing a greater quantity of units
D) the cost of promoting a greater quantity of units
E) the legal responsibility of a company


Answer: C

_____ are the sum of the ________ and ________ for any given level of production.

_____ are the sum of the ________ and ________ for any given level of production.



A) Fixed costs; variable; total costs
B) Fixed costs; total; variable costs
C) Variable costs; fixed; total costs
D) Total costs; fixed; variable costs
E) Break-even costs; fixed; total costs


Answer: D
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