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Exam 2018, questions and answers
Marketing Principles (Royal Melbourne Institute of Technology)
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Sample exam
Practice purposes only – actual exam will be different
from the questions proposed in this document
COURSE: MKTG 1025, Marketing Principles
Reading time:
Writing time:
15 minutes
2 hours
Total number of pages:
(This examination paper cannot be retained by the student.)
This exam paper contains Sections A, B, and C.
Section A:
Multiple Choice Questions = 20 marks
Number of questions: 20 questions
Section B:
Short Essay Questions = 15 marks
Number of questions: 4 questions
Section C:
Case Study Questions = 15 marks
Number of questions: 2 question.
Write your full name and student number on each examination booklet together with the
number of examination books used. Also write your name and student number on the
multiple choice answer sheet.
The entire examination question paper & multiple choice answer sheet are to be included
with your examination answer booklets and MUST NOT BE removed from the
examination room.
Section A (multiple choice) is to be answered on the multiple choice answer sheet
provided with your examination question paper.
Attempt all questions in Sections A, B, and C. Carry out the instructions on the front
cover of the examination booklet.
No written material can be brought into the examination.
No dictionaries are allowed in this examination unless you have a duly authorised special
consideration by the Course Co-ordinator, on recommendation of RMIT disabilities
Liaison Unit or a Student Counsellor. Students must bring this authorisation to the exam
Calculators: Only calculators without the capacity to store text (ie non programmable
calculators) are permitted in the exam.
NOTE: You must be a properly enrolled student in this course to be eligible to sit this
exam and to receive an official result. You are not entitled to sit this exam and no result
will be recorded if you are not properly enrolled or have gained special permission from
the Course Co-ordinator to sit this exam at this time.
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Multiple-Choice Questions
20 Multiple Choice Questions worth 1 mark each. (20 x 1 marks = 20 marks)
Select the ONE BEST answer. Multiple answers to the same question will
be marked as incorrect.
Circle your multiple choice answers on the answer sheet attached to this
paper. Place the entire examination paper, together with the answer sheet,
in your examination answer script.
Write your name and student number on the answer sheet that is on the
final page of this examination paper.
1. The Council of Australian Governments (COAG) Healthy Communities
Initiative is an Australian government initiative that aims to reduce the
prevalence of obesity within target populations. This initiative is best
described as an example of:
a. a not-for-profit organisation using marketing practices.
b. corporate social responsibility.
c. a societal market orientation.
d. a marketing mix decision.
e. a consumer orientation.
2. Marketing is defined as "the activity, set of institutions, and
_____________ for creating, communicating, delivering and _____________
offerings that have value for _____________, clients, partners and society
at large."
a. processes, exchanging, customers
b. procedures, exchanging, consumers
c. processes, producing, consumers
d. procedures, pricing, customers
e. producing, processes, consumers
3. A group of university students decide to quit smoking together after
seeing numerous government advertisements talking about the damage
that smoking will do to your lungs. Which part of the definition of marketing
is reflected by this change of behaviour in response to the governments'
education campaign?
a. A mutual exchange of value between a customer and an organisation.
b. Creating, communicating and delivering a good, service or idea.
c. Individuals and organisations that are part of a product's supply chain.
d. Both a and b.
e. All of the options listed.
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4. In the last few years, the consumers have been encouraged to use
reusable bags, for their groceries and other goods. This practice, which
seeks to minimise the negative impact of plastic bags on society is an
example of:
a. societal market orientation.
b. production orientation.
c. sales orientation.
d. market orientation.
5. With the development of infrastructure and technologies such as
production lines, businesses such as the Ford Motor Company focused on
manufacturing large quantities of goods, which they seemed to have no
trouble selling. People were happy to buy what was available. Which era of
marketing does this description relate to?
a. Market.
b. Production.
c. Consumer.
d. Sales.
e. Socially responsible.
6. Which of these is the aim of marketing?
a. To maximise profits for the business owners
b. To develop organisational goals
c. To develop mutually beneficial exchanges
d. To organise the various functions efficiently and effectively
e. To deliver the returns to the business
7. Supermarkets offering reusable bags for shoppers to pack their
groceries could best be described as:
a. a societal market orientation.
b. a consumer orientation.
c. a product orientation.
d. a sales orientation.
e. none of the options listed.
8. A customer's overall assessment of the utility of an offering based on
perceptions of what is received and what is given is known as:
a. benefit.
b. value.
c. exchange.
d. advantage.
9. Marketing is an approach to business that puts the ______ at the heart of
business decisions.
a. product
b. company
c. customer, client, partner and society
d. bottom line
e. employee
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10. You purchase a can of drink for a friend. This makes you a:
a. consumer.
b. customer and consumer.
c. partner.
d. customer.
e. affiliate
11. A degree in Marketing will qualify you for a job in which of the following
a. Governments.
b. Not-for-profit organisations.
c. Multinational organisations.
d. Both a and c.
e. All of the options listed.
12. Early in the New Year, you decide to turn an unwanted Christmas gift
into cash by selling it on eBay. The auction is a success; your unwanted
gift sells at a high price, and the winning bidder is very happy with their
purchase. This scenario is an example of a successful marketing
a. exchange
b. procedure
c. processes
d. campaign
e. value
13. Which phase of the marketing process explains why wine marketers, for
example, would access market insight reports from a market research
company such as the Nielson Company?
a. Understand.
b. Create.
c. Communicate.
d. Deliver.
e. Exchange.
14. The set of moral principles that guide attitudes and behaviour are
known as:
a. morals.
b. ethics.
c. doing what is 'right'.
d. corporate social responsibility.
e. the law
15. Which of the following statements regarding value is correct?
a. Value means different things to different people.
b. Value can be based on perception.
c. Value can be a comparison of the benefits a customer receives from a product
in relation to its price.
d. Value can include product quality and after sales service.
e. All of the options listed.
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16. Individuals, organisations and other groups that have a rightful interest
in the activities of a business can be classified as:
a. stakeholders.
b. customers.
c. owners.
d. partners.
e. employees.
17. When buying your first car, you choose to buy a used Mazda 3 from a
dealer rather than a slightly cheaper Mazda 3 advertised privately. Your
mum thinks you made a good choice, but your dad thinks the privately
advertised car would have been a better deal. Why is there a difference in
a. Value means different things to different people.
b. Value can be based on perception.
c. Value can be a comparison of the benefits a customer receives from a product
in relation to its price.
d. Value can include product quality and after sales service.
e. All of the options listed.
18. The campaign by many retailers to reduce the use of plastic bags in
favour of reusable bags is an example of:
a. greenwashing.
b. socially responsible production.
c. corporate social responsibility.
d. a service.
e. advertising.
19. A market can best be described as:
a. a group of customers with similar needs and wants.
b. a group of customers with different needs and wants.
c. a group of customers living in the same geographic area.
d. both a and c.
e. both b and c.
20. Corporate social responsibility is the obligation of businesses to act in
the interests of the societies that sustain them. This means that companies
must act:
a. in the best interests of their stakeholders.
b. ethically.
c. lawfully.
d. ethically, lawfully and in the best interests of their stakeholders.
e. proactively.
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Short Essay Questions
Answer all 4 of the following questions
4 Short Essay Questions worth 5 marks each. (3 x 5 marks = 15 marks)
In answering these questions, it is expected that students will include
examples of real life organisations to illustrate their response.
Question 1
Distinguish between the different aspects of a market offering.
5 marks
Chapter 1 page 24-28
The marketing mix describes the different elements that marketers need to
consider. Many different frameworks have been used by marketing scholars to
teach marketing and all have been designed to be memorable. Frameworks
include the 4 Ps, 5 Ps, 6 Ps and 7 Ps.
A product is bundle of attributes that when exchanged have value for customers,
clients or society. A product can be a good, a service, an idea or even a person.
Products cater to needs and wants. Needs are day to day survival requirements
while wants are desired but not required for survival. Price is the amount of
money a business demands in exchange for its offerings. Pricing is a complex
marketing decision that must take account of many factors, including production,
communication and distribution costs, required profitability, partners'
requirements, competitors' prices and customers' willingness to pay. Marketers
need to understand the relationship between price and quality to understand
value from a customer's point of view. Marketers need to understand what
customers would like to receive and what they are prepared to give in return.
Distribution or place refers to the means of making the offering available to the
target market at the right time and place while managing the costs of making the
products available. Many businesses sell their products directly to the public but
distribution usually also involves partners such as wholesalers and retailers.
Promotion describes the marketing activities that make potential customers,
partners and society aware of and attracted to the benefits of a business's
products. The product might be already established, modified, new, or
information designed to persuade. Promotional activities include advertising,
direct selling, sales promotions and loyalty schemes.
In the marketing framework, 'people' refers to all the people that may come into
contact with the customer and affect their experience of the product. Like the
other factors, the people must be managed to maximise value for the customer.
Process refers to the systems used to create, communicate, deliver and
exchange an offering.
Physical evidence refers to the tangible cues and physical environment a
marketer can provide to help potential customers evaluate service quality.
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Question 2
Explain key aspects of product management and positioning through the product
life cycle.
5 marks
Chapter 7 page 247-251
Within an organisation, the marketing issues surrounding products can be
managed through a functional approach or by using product managers, brand
managers or market managers. The last three approaches are often better able
to coordinate all of the activities across the organisation to ensure the product
strategy is implemented well. In addition to introducing new products, an
organisation can capitalise on existing products by modifying products or creating
line extensions.
The organisation needs to manage the positioning of the product in the
marketplace and it may sometimes be necessary to reposition the product during
the product life cycle. Line extensions, product upgrades and repositioning can
all help keep a product out of the decline phase. For some products, these
approaches can move the product back in the life cycle to enjoy a new phase of
Many products eventually become obsolete. A product in decline may be taking
valuable resources from away from other opportunities. Product deletion is the
process of eliminating a product from the product mix. Product deletion must be
managed in such a way as to minimise discontent among customers of the
deleted product. Otherwise the discontent can affect sales of continuing
Question 3
How do marketers analyse demand to inform the development of an appropriate
pricing strategy?
5 marks
Chapter 8 page 270-274
Demand is the relationship between the price of a particular product and the
quantity of the product that consumers are willing to buy. Demand analysis is
based on historical data, estimates of sales potential, and estimates of pricevolume relationships and price sensitivity. The data enable the marketer to
construct a demand curve. The traditional demand curve slopes downwards,
indicating that as prices rise, quantity sold falls, and vice versa. Prestige products
have a unique demand curve in which, to a threshold point, increasing prices
actually increase demand due to the perceived quality, prestige and exclusivity
conveyed by the product's price. The sensitivity of consumer demand to price
changes is known as the price elasticity of demand. In instances of price elastic
demand, a particular percentage change in price will cause a greater percentage
change in quantity demanded. In price inelastic demand, a particular percentage
change in price will cause a smaller percentage change in quantity demanded.
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Case Questions
Students are to read this case study and answer both the questions at the end of
the case.
2 x Case Questions worth 5 marks each. (2 x 7.5 marks = 15 marks)
In answering these questions, it is expected that students will relate
examples directly to the case to illustrate their response.
(Note: this case is not from the prescribed text – it is for practice purposes only)
Case: Promoting an alternative to the smartphone
Wayne Binney, Deakin University, Melbourne
Pride Ferrel Lukas, Schembri & Niinenen, Marekting Principles 2e Asia-Pacific Edition, Cengage
The Australian mobile phone market is one of the strongest in the world, showing
substantial growth and continuing to expand steadily as late adopters purchase
phones. Any global trends are likely to be mirrored in this market.
It is the next stage in the development of the mobile phone market that has the
industry buzzing. A Nielsen Research report shows that, while statistics on
mobile phone ownership are difficult to accurately predict because at least 20 per
cent of Australians own more than one phone, it is known that at least 86 per
cent of Australians own a mobile phone. Phones with an advanced operating
system are referred to as smartphones while those without a touch screen and
advanced operating system are called feature phones. Telstra’s Research
Director, Foad Fadaghi reported that ‘More than 50 per cent of Australians have
a smartphone, so we are now looking to the second half of the population, that
don’t have the economic means, and are relying on ‘hand me downs’ and things
like that. That market has really gravitated towards lower end products’. Fadaghi
indicated that there is a market for lower price-point phones and plans. Market
leader Apple iPhone has shown little interest in pursuing this market, while
Samsung with the Android operating system has some lower-priced products.
It came as no great surprise to junior account manager Daniel Knights, a keen
marketer who constantly updates his knowledge of mobile communication
devices, that a new competitor would eventually enter the mobile phone market.
He was delighted when Geoffrey Bowll, Managing Director of Starship
Advertising, offered him the opportunity to prepare a fully integrated promotion
campaign to launch a new mobile phone developed by a Chinese manufacturer
that would retail at about half the price of the smartphone devices currently being
sold by Apple and Samsung. The new phone would have a touch screen but
limited capabilities for video and data downloads. He knew the main users of the
lower priced ‘feature’ phones were likely to be the very young who had been
given ‘hand me downs’ and were connected on pay-as-you-go plans, males in
the 45–65 age group and those who had owned their mobile phone for a
considerable period. More research was needed to provide insights into this
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He started to plan the task in hand. He knew that a fully integrated promotional
plan was essential for this market and the target audience was most likely
different to the target market. Younger consumers relied on their parents to make
the purchase and they needed to be informed and convinced about the product.
This would mean communicating with at least two distinctly different audiences.
Likewise, to reach the non-phone users and the more senior groups such as the
45–65-age cohorts, would mean that besides reaching these distinct groups, the
campaign would need to involve those who provide advice and influence their
decision making.
He pondered on the list of media that might be required for this diverse audience
and realised that besides traditional TV, print ads, brochures, radio, in-store
retail, ambient (taxi, train and billboard) and shopping centre promotions, the
campaign would need to reach those already online with mobile devices who
currently use the web to search for information. This cohort currently use their
phones, tablets and computers and source information from social media such as
Facebook, Youtube clips and online banner advertising. The task offered Daniel
the opportunity to demonstrate the breadth of his promotional management
expertise and he welcomed the challenge.
Question 1
How should Daniel define and estimate the market by setting out an analysis of
the possible target markets and target audiences. Both of these need to be
prioritised for the phone manufacturer.
Describe what Daniel needs to do and how he should do it.
7.5 marks
Daniel needs to conduct a study of previous mobile phone studies by agencies
such as Roy Morgan, Nielson Research, and Government agencies to accurately
define who will be the target market. This will allow him to understand the
characteristics of the target market and be able to describe their buying processfor example what their information sources are, who influences their decisions
and similar consumer behaviour decisions.
To estimate the size of the target market Daniel will need to use sources such as
ABS, Government reports and other secondary sources. The geographic location
of the target audience will assist him in deciding the location of the promotional
Prioritising the target market and target audience requires analysis of these
findings. One of the target markets may be selected in favour of others as it can
be more easily contacted. Advanced students should be capable of preparing
this recommendation.
Question 2
What key messages would be conveyed and how would you ensure that it is fully
integrated across the audiences so that there is a consistent story being
conveyed to each audience?
7.5 marks
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As with any new product market awareness will be an important objective.
The complexity of this project is the reality that each target market will have other
related target audiences.
Answers should explain what is involved in developing an integrated campaign
so that each target obtains the same message for example; the promotion is
introducing into the market a ‘good value’ mobile phone and not a ‘cheap’ phone.
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