Download MULTIPLE CHOICE

Final Exam, Mark 6361, Fall, 2008, Wednesday Class, Section 23884
Grades ranged from a high of 94 to a low of 53; the average was 75.
Multiple Choice: Each questions worth 2 points. Choose the one alternative that best
completes the statement or answers the question.
1)The point of describing in class the American Express lounge at a large New
Jersey mall was to illustrate a sales promotion experience that
A)would not be costly
B)could be combined with price reductions
C)had a specific set of behavioral objectives
D)would increase revenue, even if not profits
E)would increase profits, even if not revenue
2)Marketing CocoaVia bars, we said in class, will yield the most profit if the
price is set
A)to minimize demand
B)to maximize demand
C)to be raised later, possibly
D)to be lowered later, possibly
E)to be held constant throughout the product life cycle
3)A “trade promotion”
A)involves barter rather than an exchange of funds for goods
B)usually involves international channel partners
C)usually targets retailers or distributors
D)cannot be implemented without the written consent of its target audience
E)cannot be expected to increase the profitability of the firm undertaking the
promotion
4)Our class discussion and the textbook both make the point that logistics
decisions have marketing consequences, particularly in terms of
A)transportation costs
B)sales lost due to delays
C)fixed warehouse costs
D)variable warehouse costs
E)inventory costs, including interest and spoilage
5)Pricing decisions are important because
A)they are the most difficult to change
B)they are independent of channel, product, or promotional decisions
C)even small changes can lead to large profit consequences
D)they are made only once for a given product
E)they can be made only in cooperation with other firms in an industry
6)Which of the following groups is the largest group of adopters?
A)The divisibility majority.
B)The innovative majority.
C)The early majority.
D)The opinion leaders.
E)The early adopters.
7)Because services are difficult to standardize
A)it is important to standardize their pricing
B)it is impossible to standardize their pricing
C)they lack variability
D)they may be difficult for buyers to judge in quality
E)they will be less profitable than tangible goods
8)A zero-level channel
A)has three members
B)may also be called a backward channel
C)refers to intensive distribution channels where there are an indeterminate
number of channel members
D)is the same as a direct marketing channel
E)has only one intermediary between producer and consumer
9)We said in class that a coupon can do double duty, for example by
A)including favorable information about the product
B)telling the potential customer about other products offered by the same
company
C)telling the potential customer about other products offered in similar product
categories
D)listing uses for the product that the coupon can be used for
E)listing stores at which the product is available on the coupon
10)If a product is a small part of the cost to obtain an important benefit,
according to the textbook,
A) price sensitivity on the part of a prospective buyers will be high
B) price will be viewed as a proxy for product quality
C) total cost of ownership will be influenced significantly by the price
D) raising the price will not decrease demand proportionately
E) it would be wise for a marketer to target more price sensitive buyers
11)Orlando Solis is a successful Nissan salesman. He is the type of salesperson
who has many regular customers return and buy their next car with him. His
ability to retain customers would lead you to believe that Orlando is
effectively performing the __________ stage of the personal selling process.
A)prospecting and qualifying
B)preapproach
C)presentation and demonstration
D)closing
E)follow up and maintenance
2
12)According to the textbook, which is true?
A)Actual face-to-face selling is as little as 29 percent of total sales force
working time.
B)Additional calls do not generally produce more sales.
C)The average salesperson makes about 10 sales calls per day.
D)An increase in sales always justifies an increase in sales costs.
E)Salespeople are more efficient these days and are able to make more calls per
day than they could a decade ago.
13)The textbook makes the statement that
A)salesperson morale is harmed by creating special teams to serve key accounts
B)sales force size and compensation should drive the decisions involving sales
force strategy and structure
C)a properly implemented relationship management program lets a firm focus as
much on managing its customers as managing its products
D)sales force turnover is healthy, since a compensation system based on
commissions enables a company to “lose” its least effective salespersons
E)Multilevel selling is ethical only if salespeople receive commissions not only
on their own sales, but also on the sales of people they recruit and train
14) An example of transformational advertising would be
A) a message from a religious denomination
B) a funny scene of buyers using the product
C) an explanation of how to use the product
D) an explanation of why the advertised brand is superior to competitive brands
E) a message reporting that 5% of the profits from the sale of this brand will
be contributed to a healthcare research organization
15) U.S. antitrust laws make it illegal to
A) distribute through one channel only.
B) attempt, as a for-profit company, to gain publicity.
C) join with competitors to advertise on behalf of an entire industry.
D) set prices in concert with others in one’s industry.
E) replace one trademarked name with another on a product.
16) A retailer advertises a bargain price for a particular branded product, but
runs out. Offering a “rain check,” so that potential buyers can take advantage
of the low price later when the retailer restocks
A) is called “bait and switch”
B) is called “the principle of reliance”
C) makes the ad deceptive that offered the low price
D) is legal only if the retailer also offers two for the price of one
E) solves the problem
3
17)According to the textbook, message strategy in the context of marketing
communications involves
A)deciding what products to promote
B)selecting the “reward” for a prospective buyer to visualize
C)choosing media in which to advertise or seek publicity
D)finding the appropriate communicator to be the source of a message
E)budgeting for the total communications effort
18)In estimating how demand for a product will be affected by its price, the
textbook suggests
A) setting different prices in different geographic areas, to see how demand is
affected
B) varying other parts of the marketing mix along with price, to ascertain
interaction effects
C) consulting with competitors, so that price changes are coordinated
D) charging the lowest price possible, unless the product is price elastic
E) keeping in mind that price elasticity is in general higher for products in
the mature/decline stages of the product life cycle, compared to the
introduction/growth stages
19)Service missteps can hurt customer relationships. When something goes wrong,
the company should listen to the customer, apologize when appropriate, offer a
solution, and follow up. These are major steps in
A)good service recovery
B)making the sale
C)after-sale service
D)meeting company goals
E)the "12-step" program for better service
20)Mazda's Miata convertible originally drew the most interest from women
between the ages of 35-55. In order to interest more potential customers in the
roadster, Mazda beefed up the model with heavier shocks and a faster engine,
then emphasized performance in its advertising. This is an example of creating a
new product by
A)repositioning
B)a market diversification strategy
C)a new-to-the-world product
D)the development of a new product line
E)a product development strategy
21)In an ideal world the __________ is the preferred method of setting a
promotion budget.
A)objective-and-task method
B)percentage-of-sales method
C)affordable method
D)competitive-parity method
E)arbitrary allocation
22)We said in class that a company with a new product will benefit from the role
of “divisibility” in speeding adoption if
A)the market has few potential buyers
B)the product is one that a prospect can borrow and try
C)the product is regulated by some governmental entity
D)the adoption curve is a long one
E)the adoption curve is a short one
4
23)The use of mail, telephone, fax, email, or the Internet to communicate
directly with or solicit a response or dialogue from specific customers or
prospects is a good way to describe
A)personal selling.
B)direct marketing.
C)viral marketing.
D)sales promotion.
E)brand building.
24)Hotels might sensibly reduce their exposure to a potential service disaster,
as was illustrated in class, by
A)restructuring their physical plant to reinforce their service objective
B)creating a slogan that focuses on service reliability
C)maintaining clean and inviting lobbies
D)standardizing the service process and providing more training to service
personnel
E)using differential pricing
25)Among the suggestions in the book and in class for reducing potential channel
conflict is the recommendation that a manufacturer consider
A)adding one or more employees of their industrial distributor to their own
organization for a period of time
B)selling direct to the ultimate buyer, even if it means setting up retail
stores to do so
C)using more channels through which it sells a product, to increase competition
D)keeping members of the distribution channel on short-term contracts, so that
it will be easy to substitute another channel partner in case of a problem
E)using random assignment of territories to reduce charges of favoritism
26)__________ marketing describes the work done by the company to train and
motivate its employees to serve the customers well.
A)Consultative
B)Relationship
C)External
D)Interactive
E)Internal
27) We said in class that the most common complaint by customers concerning
salespeople involves
A) pushy salespeople
B) exaggerated claims
C) failure to listen
D) failure to follow the company’s buying process
E) failure to know or respect their competition
28)Marketers who want to increase purchases of their products by channel members
such as distributors and retailers will
A)employ a push strategy if they can afford to do so
B)decide between push and pull strategies based on legal requirements for their
industry
C)employ a pull strategy if they believe their promotional dollars are best
spent targeting consumers
D)employ neither strategy if they target channel members
E)employ neither strategy if they target the ultimate use of the product
5
29)We said in class that retired people whose only income is derived from
interest and equities
A) should be referred to as “yuppies”
B) represent a group uninterested in new products
C) should be targeted for vacation travel and similar services
D) are particularly price sensitive
E) are the group likeliest to purchase over the Internet
30)The textbook offers the product innovation of jokes and pictures on Pringles
potato chips to illustrate the point that
A)most new products fail
B)most Procter & Gamble products succeed
C)adapting technology from an unlikely source can be a source of new product
success
D)pricing is the most important factor in launching a successful new product
E)technology can harm a new product as much as it can help
6
I will grade only one memo, and only what you write, legibly, on the front of this page. But please feel
free to draft a “practice” version on the back of any other page of this exam and then copy it onto this
page after careful rereading and editing for sensible reasoning and excellent use of English. I graded
this question without knowing whose answer I was grading; that’s why it’s on the back. And I took
off 2 points for an error in English usage, but most of you did just fine in that regard.
31. As a marketing consultant, you publish an e-newsletter for your varied
clients. Explain to them in a “memo to clients” the idea of the “experience
curve” and what it suggests that a marketer should at least consider in the
pricing of a new manufactured product.
If an experience curve applies to your product, it is a cost curve. It shows a
consistent percentage decline in per-unit cost with each doubling of cumulative
production. Those who knew something like that did a generally fine job of
explaining it and earned 35 points for doing so.
Some then earned the full 40 by pointing out the general lesson for pricing:
price low so you sell in high volume early, reducing your per-unit costs
quickly, thereby discouraging competition from entering the product category
because they can’t match your cost structure.
Some answers referred to the product life cycle, not the experience curve, and
earned 25 for knowing something. Those who talked about consumer experience
with the product got the 20 minimum for showing up.
OR
KTRH Radio wants to sell a package of drive-time 30-second commercials to the
Pizza Hut (PH) restaurants in Houston. KTRH will air two PH commercials between
7 and 9 a.m. each weekday and between 4 and 6 p.m., over a four-week period in
February, for $20,000, and claims that on average 200,000 different listeners
are tuned to their station during those intervals. Please write three questions
to Houston’s PH marketing team that will give you answers that should enable you
to advise PH whether to purchase the airtime.
I expected (wrongly) EVERYONE to notice that this is a mini-version of your team
project. You have to figure out whether the gross margin on
pizzas/drinks/whatever that PH wouldn’t otherwise have sold will cover the cost
of…in this case not your consulting team, but the radio commercials.
So question 1 is: what is the margin on a typical order? And/or
how many more orders does PH get from a reminded customer in a given month, say,
vs. one who isn’t reminded? And/or how many orders does PH get from a new
customer? The point is: I did expect to see one question about money.
Then we need a question on the overlap between KTRH listeners and/or drive time
listeners and Pizza Hut customers. You almost all did this just fine and since
there were three questions to be written and everybody starts with 20, you got 7
points per useful question topic (up to the max. of 40). Some of you asked
about demographics; some about why anybody would advertise in the
morning….perfectly sensible issues.
Then the final issue is what else PH could be doing with the money, or is doing.
Many of you asked whether PH would be running any promotions in February, or
what they were currently doing with their advertising budget, or something like
that. Fine: 7 more points. Lots of people got 34 on this question. Very few
got 40, but you HAVE to ask some version of that first question. In other
words, what is a customer worth?
7
8