Download Chapter 1—An Overview of Marketing

SECTION 1 POOL ITEMS
Chapter 1—An Overview of Marketing
MULTIPLE CHOICE
1. The term marketing refers to:
a. new product concepts and improvements
b. selling
c. advertising and promotion activities
d. a philosophy that stresses customer satisfaction
e. planning sales campaigns
ANS: D
PTS: 1
REF: 3
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 01-1 TYPE: Def
2. A business is concerned with many day-to-day activities. Some of the most important of these
activities are the planning and development of a product, its pricing policy, and the distribution
strategy. These activities are all a part of:
a. a control system
b. marketing
c. accounting
d. production
e. human resources
ANS: B
This description contains three of the four main activities included in the marketing function. Many
students may mistakenly believe that marketing is only concerned with promotion.
PTS: 1
REF: 3
OBJ: 01-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Pricing| TB&E Model Product| TB&E Model
Distribution
3. _____ is a philosophy, an attitude, a perspective, or a management orientation that stresses customer
satisfaction.
a. Planning strategy
b. Customer management
c. Marketing
d. A control system
e. Reciprocity
ANS: C
PTS: 1
REF: 3
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 01-1 TYPE: Def
4. The American Marketing Association's definition of marketing:
a. is limited to promotional activities
b. focuses on the value of empowerment, teamwork, and customer value
c. shows how marketing benefits the marketer
d. relies on the synergy created by exchange
e. includes the processes marketers use to establish and maintain relationships with
customers
SECTION 1 POOL ITEMS
ANS: E
According to the American Marketing Association, marketing is the activity, set of institutions, and
processes for creating, communicating, delivering, and exchanging offerings that have value for
customers, clients, partners, and society at large.
PTS: 1
REF: 3
OBJ: 01-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Product
5. _____ is a key ingredient in the philosophy of marketing; it occurs when people give up something in
order to receive something that they would rather have.
a. Exchange
b. Synergy
c. Transformation
d. Leveraging
e. Reciprocity
ANS: A
PTS: 1
REF: 3-4
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 01-1 TYPE: Def
6. In order for exchange to occur:
a. a complex societal system must be involved
b. organized marketing activities must also take place
c. a profit-oriented organization must be involved in the process
d. money or other legal tender is required
e. each party must have something the other party considers to be valuable
ANS: E
Exchange involves the trade of items of value, but does not necessarily involve formal organizations,
profit, or money/legal tender.
PTS: 1
REF: 3-4
OBJ: 01-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Product
9. For an exchange to take place:
a. there must be at least two parties involved
b. money must be used in the transaction
c. each party must feel obligated to accept the offer
d. at least one party must have something of value that the other party desires
e. neither party must communicate with the other
ANS: A
PTS: 1
REF: 3-4
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 01-1 TYPE: Def
10. Indonesian logging companies harvest the rainforests for timber and assume that a market exists for
their products. The typical Indonesian logging company has a(n) _____ orientation.
a. exchange
b. product
c. production
d. sales
e. environmental
ANS: C
The logging companies do not focus on the needs and desires of the marketplace.
SECTION 1 POOL ITEMS
PTS: 1
REF: 4-5
OBJ: 01-2 TYPE: App
TOP: AACSB Ethics| TB&E Model Product
11. The concept of exchange is important to marketing because:
a. if all the conditions for an exchange are in place, then the exchange will be completed
b. exchange provides money to marketers
c. marketing activities help to create exchange
d. marketing activities are a requirement for exchange to take place
e. money is the only medium of exchange for business marketers
ANS: C
Marketing activities help the exchange to take place, but marketing can occur without an exchange.
PTS: 1
REF: 3-4
OBJ: 01-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Product
14. Which of the following is NOT a marketing management philosophy?
a. sales orientation
b. societal marketing orientation
c. market orientation
d. profitability orientation
e. production orientation
ANS: D
PTS: 1
REF: 4-6
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 01-2 TYPE: Def
15. Firms with a _____ orientation focus on the internal capabilities of the firm rather than on the desires
and needs of the marketplace.
a. sales
b. production
c. market
d. customer
e. customer-benefit
ANS: B
PTS: 1
REF: 4-5
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 01-2 TYPE: Def
16. A company that sets its goals and strategies based on what its current equipment can produce, what
products engineering can design, and what the company itself can do best, has a(n) _____ orientation.
a. marketplace
b. sales
c. market
d. exchange
e. production
ANS: E
PTS: 1
REF: 4-5
OBJ: 01-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Strategy| TB&E Model Product
19. A firm with a production orientation is most likely to survive if:
a. there are many small competitors in the marketplace
b. demand for the product it produces exceeds supply
SECTION 1 POOL ITEMS
c. the needs of the marketplace are constantly shifting
d. supply for the product it produces exceeds demand
e. any of the above conditions exist
ANS: B
The production orientation can survive in the short term under a variety of conditions; however, if
market needs change, long-term survival is difficult.
PTS: 1
REF: 4-5
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
20. A firm that adopts a(n) _____ orientation to marketing will fail to consider whether what the firm
produces most efficiently also meets the needs of the marketplace.
a. customer
b. exchange
c. product
d. market
e. production
ANS: E
The production orientation forces a company to build whatever it builds best, that is, whatever it has
the experience and expertise in doing.
PTS: 1
REF: 4-5
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
22. The _____ orientation assumes people will buy more if aggressive selling techniques are used.
a. market
b. sales
c. customer
d. production
e. exchange
ANS: B
The sales orientation assumes aggressive selling is what is needed to increase demand.
PTS: 1
REF: 5
OBJ: 01-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Pricing
23. A _____ orientation assumes marketing means selling things and collecting money. It also assumes
people will buy more goods and services if aggressive marketing techniques are used.
a. sales
b. production
c. market
d. customer
e. marketplace
ANS: A
PTS: 1
REF: 5
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 01-2 TYPE: Def
25. If a company uses a sales orientation, consumer complaints would most likely result in:
a. a modification of the sales presentation
SECTION 1 POOL ITEMS
b.
c.
d.
e.
product reinvention
continuous market research
philanthropy
attempts to cut production costs
ANS: A
The sales orientation relies on aggressive sales techniques to fuel business.
PTS: 1
REF: 5
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
29. Companies that rely on the marketing concept and that have implemented a market orientation strategy
recognize that:
a. price is the most important variable for customers
b. sales depend predominantly on an aggressive sales force
c. what the customer thinks he or she is buying is what is important
d. a company has to apply scientific management techniques to survive
e. selling and marketing are essentially the same thing
ANS: C
The perceived product and perceived value are what the customer is buying, and the marketing
concept and market orientation have endeavored to understand those perceptions.
PTS: 1
REF: 5-6
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
30. A company that has a market orientation and adheres to the marketing concept does NOT:
a. integrate all the activities of the firm to satisfy customer wants
b. focus on consumer needs and wants
c. differentiate the firm's products from its competitor's products
d. fuel sales growth through the application of aggressive sales techniques
e. concentrate on long-term goal achievement (such as profits and growth) for the firm
ANS: D
Aggressive sales techniques are part of the sales orientation and are not needed if a company is
meeting needs and wants of its customers.
PTS: 1
REF: 5
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy| TB&E Model Product
31. The statement, "Marketing should be introduced at the beginning rather than the end of the production
cycle and integrated into each phase of the business," is consistent with a(n) _____ orientation.
a. production
b. market
c. retail
d. sales
e. enterprise
ANS: B
Understanding the competitive arena and competitors' strengths and weaknesses is a critical
component of market orientation.
PTS: 1
REF: 5-6
OBJ: 01-2 TYPE: Comp
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Product
36. The marketing concept involves:
a. focusing on customers' wants so that the organization can distinguish its product (or
products) from the competitors' products
b. satisfying management's needs and wants with the idea of maximizing profits in the short
run
c. selling as much product as possible under the assumption people will buy more goods and
services if aggressive selling techniques are used
d. selling as much as possible under the assumption consumers will buy more at lower prices
e. focusing on production in order to increase product quality and lower prices
ANS: A
PTS: 1
REF: 5-6
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 01-2 TYPE: Def
37. The marketing concept includes a goal orientation to remind managers that:
a. achieving long-term organizational goals is as important as satisfying customers
b. customers must be satisfied no matter what the long-term effect on the firm
c. the only reason for any business to exist is to make a profit
d. the objective is to find a target market that differs from that of the competition
e. functional integration of all departments is useful but not essential
ANS: A
The goal orientation refers to the company's goals, such as profit, growth, service, and survival.
PTS: 1
REF: 5-6
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
38. The marketing concept stresses that the social and economic justification for an organization's
existence is the satisfaction of customer needs and wants while:
a. producing a good or service at the lowest possible cost
b. improving the general standard of living
c. constantly increasing sales volumes
d. applying scientific management techniques to improve efficiency
e. simultaneously meeting organization objectives
ANS: E
The marketing concept holds that the needs and wants of both the customer and the firm be served.
PTS: 1
REF: 5-6
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
40. An organization with a(n) _____ believes that it exists not only to satisfy customer wants and needs
and to meet organizational objectives but also to preserve or enhance individuals' and society's longterm best interests.
a. sales orientation
b. market orientation
c. ethical business mission
d. focused target market strategy
e. societal orientation
ANS: E
PTS: 1
REF: 6
OBJ: 01-2 TYPE: Def
SECTION 1 POOL ITEMS
TOP: AACSB Diversity| TB&E Model Customer
45. Which of the following statements about the societal orientation is true?
a. Companies that protect the environment by using all-natural materials in their products are
showing a societal marketing orientation.
b. Marketers cannot deliver all benefits sought by customers because these benefits may not
be in the long-term best interests of the customers.
c. The societal marketing concept is an important refinement of the market concept.
d. Organizations have both a social and economic justification for their existence.
e. All of these statements about the societal orientation are true.
ANS: E
PTS: 1
REF: 6
OBJ: 01-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Research| TB&E Model Customer
48. Organizations that sell products that are often unsought (such as life insurance and retirement plans)
may find themselves adopting a _____ orientation because the companies are marketing products that
most people do not want.
a. sales
b. production
c. marketing
d. product
e. customer
ANS: A
Aggressive selling is sometimes used by companies that sell products their customers do not want to
buy.
PTS: 1
REF: 5
OBJ: 01-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Promotion
57. _____ gives customers the feeling their concerns are being addressed and at the same time gives
employees the feeling their expertise matters to management.
a. Management-employee synergy
b. Organizational entropy
c. Managerial reciprocity
d. Empowerment
e. Delegation
ANS: D
PTS: 1
REF: 9
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 01-3 TYPE: Def
58. Market-oriented firms primarily focus their efforts upon:
a. improving the technological skills and competitive advantages of the firm
b. satisfying the organization's needs for low overhead
c. achieving the company’s societal responsibilities inexpensively
d. distributing goods and services
e. satisfying the wants and needs of their customers
ANS: E
Market-oriented firms are focused outward toward their customers.
PTS: 1
REF: 6
OBJ: 01-3 TYPE: Comp
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Customer
59. Which of the following statements about a typical sales-oriented business is true?
a. The company develops its products to meet the needs of specific groups of people.
b. The primary goal of the company is profit through customer satisfaction.
c. The company invests the majority of its resources in promoting its products and services.
d. The company is in business to satisfy customers' wants and needs and deliver superior
value.
e. All of these statements about a typical sales-oriented business are true.
ANS: C
See Review Learning Outcome 3.
PTS: 1
REF: 6 | 10
OBJ: 01-3 TYPE: Comp
TOP: AACSB Analytic| TB&E Model Customer
60. _____ is defined as the relationship between benefits and the sacrifice necessary to obtain those
benefits.
a. Opportunity cost
b. Marketing utility
c. Market quality
d. Satisfaction percentage
e. Customer value
ANS: E
PTS: 1
REF: 6
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 01-3 TYPE: Def
61. Marketers interested in offering customer value can:
a. offer products that perform
b. give the consumer facts
c. offer organization-wide commitment to service and after-the-sale support
d. avoid unrealistic pricing
e. do all of these
ANS: E
PTS: 1
REF: 6-7
OBJ: 01-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Pricing| TB&E Model Product| TB&E Model
Customer
64.
When customer expectations regarding product quality, service quality, and value-based price
are met or exceeded, _____ is created.
a. a value line
b. a quality rift
c. planning excellence
d. customer satisfaction
e. expectation satisfaction
ANS: D
PTS: 1
REF: 7
OBJ: 01-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Pricing| TB&E Model Product| TB&E Model
Customer
66. _____ is a strategy that entails forging long-term partnerships with customers.
a. Commitment selling
b. Relationship marketing
SECTION 1 POOL ITEMS
c. Transactional marketing
d. Market engineering
e. Organization-customer synergy
ANS: B
PTS: 1
REF: 8
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 01-3 TYPE: Def
71. Which of the following measures would be the best indicator of whether your organization's personnel
have a customer orientation?
a. Ask each employee's boss if that person is customer-oriented.
b. Assess each employee's impact on the profitability of the firm.
c. Survey customers on how oriented the organization's personnel are to customer needs and
desires.
d. Assess how well each employee has contributed to the marketing success of the firm by
examining every financial statement created by the organization.
e. Test employees on their knowledge of customer service techniques.
ANS: C
The key to assessing how customer-oriented a firm's personnel are is to ask the customer. Only the
customer can provide this type of information.
PTS: 1
REF: 8
OBJ: 01-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
73. Some market-oriented firms give employees expanded authority to solve customer problems on the
spot. This is known as:
a. training
b. deregulation
c. empowerment
d. commissioning
e. mediating
ANS: C
PTS: 1
REF: 9
TOP: AACSB Communication| TB&E Model Customer
OBJ: 01-3 TYPE: Def
76. _____ is the collaborative efforts of people to achieve common objectives.
a. Effort training
b. Teamwork
c. Empowerment
d. OJT training
e. Mediation
ANS: B
PTS: 1
REF: 9
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 01-3 TYPE: Def
77. Dofasco, Inc. is a Canadian steel manufacturer. According to its CEO, "People can make a
phenomenal difference if you stop telling them to come to work, put their brains in a box, and do
whatever the supervisor says. We let our employees work in teams." This quote implies that by using
teamwork, Dofasco:
a. operates successfully using a production orientation
b. provides its customer with a high level of satisfaction
SECTION 1 POOL ITEMS
c. has a high employee turnover rate
d. does not deliver superior customer service
e. has a sales orientation
ANS: B
Teamwork is one way a company with a market orientation creates customer satisfaction.
PTS: 1
REF: 9
OBJ: 01-3 TYPE: App
TOP: AACSB Analytic| TB&E Model Customer
78. Dofasco, Inc. is a Canadian steel manufacturer. According to its CEO, "People can make a
phenomenal difference if you stop telling them to come to work, put their brains in a box, and do
whatever the supervisor says. We let our employees work in teams." Teamwork would benefit Dofasco
by:
a. enhancing employee performance
b. doing away with the need for empowerment
c. creating managerial entropy
d. refining the definition of customer value
e. doing all of these
ANS: A
Enhanced employee performance leads to improved customer satisfaction.
PTS: 1
REF: 9
OBJ: 01-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Strategy
79. Redefining the business mission of a mattress manufacturer as "a good night's sleep," rather than
stating the mission as "the manufacture of high-quality mattresses," will:
a. not stimulate an awareness of changes in consumer desires
b. be too broad a statement to be of any real use in serving customers
c. stifle creativity in discovering opportunities to serve customers
d. help ensure the firm retains its focus on consumers and does not become preoccupied with
its products and internal needs
e. ensure the core products will be retained
ANS: D
The broader business mission of "a good night sleep" will stimulate innovation and creativity because
not all sleep aids are mattresses. It will lead the company to further growth.
PTS: 1
REF: 9
OBJ: 01-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
80. One of the reasons given for the decline of the passenger rail industry in the United States is that the
industry defined its mission as trains and not as transportation sources. The railroad industry failed to:
a. define its mission in terms of the benefits its customers seek
b. ignore the marketing concept of serving customer needs and wants
c. realize "customers only want what they know"
d. have a sales orientation
e. empower the consumer
ANS: A
A market-oriented firm defines its business in terms of the benefits its customers seek. Because of the
limited way the railroad industry defined its business, it missed an opportunity to define itself in terms
of the benefits customers were seeking.
SECTION 1 POOL ITEMS
PTS: 1
REF: 9-10
OBJ: 01-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
81. When light bulbs were first introduced, manufacturers offered one size for all light fixtures. Today you
can buy light bulbs in different shapes, different wattages, and different colors. They also differ as to
how much electricity they use and how many hours of illumination they will provide before failing.
Light bulb manufacturers:
a. miss sales by not concentrating on the average customer
b. recognize different customer groups have different needs and wants
c. are sales-oriented companies
d. are companies that would state they are in the business of selling bulbs
e. are aiming at a goal of profit through maximum sales volume
ANS: B
One way to implement the marketing concept is to concentrate on the needs of specific groups of
customers.
PTS: 1
REF: 5-6
OBJ: 01-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Product
82. One way to identify the orientation of a firm is to examine its primary goal. If a firm seeks to achieve
profitability through sales volume, it would probably be:
a. promotion-oriented
b. price-oriented
c. sales-oriented
d. production-oriented
e. retail-oriented
ANS: C
PTS: 1
REF: 5 | 11
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 01-3 TYPE: Comp
87. _____ is the primary tool used by a sales-oriented organization to achieve its corporate goals.
a. Price
b. Promotion
c. Product design
d. Place (distribution)
e. Production
ANS: B
A sales-oriented organization seeks to generate sales volume based upon intensive promotional
activities.
PTS: 1
REF: 10
OBJ: 01-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Promotion
88. For a market-oriented organization, the primary tool used to achieve its goals is:
a. a blend of product, place, promotion, and pricing decisions
b. price
c. product design
d. place (distribution)
e. promotion
ANS: A
SECTION 1 POOL ITEMS
A market-oriented organization seeks to generate sales volume based on serving customer needs and
wants, utilizing all of the elements of the marketing mix to do so.
PTS: 1
REF: 10
OBJ: 01-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Distribution| TB&E Model Pricing| TB&E Model
Product| TB&E Model Promotion
94. What is the fundamental objective of most businesses?
a. employee empowerment, teamwork, and relationship marketing
b. satisfied stakeholders
c. low costs and high quality
d. customer loyalty and retention
e. survival, profits, and growth
ANS: E
The use of marketing allows businesses to achieve this objective.
PTS: 1
REF: 11
OBJ: 01-4 TYPE: Comp
TOP: AACSB Analytic| TB&E Model Strategy
95. Which if the following is NOT a good reason to study marketing?
a. Marketing teaches businesses how to sell products that people do not need.
b. Marketing plays an important role in society, coordinating the huge numbers of
transactions needed to provide goods and services.
c. Marketing is a key function in business.
d. Marketing offers outstanding career opportunities.
e. Marketing affects your day-to-day life as a consumer.
ANS: A
That marketing enables companies to sell even bad and worthless goods is a myth.
PTS: 1
REF: 11-12
OBJ: 01-4 TYPE: Comp
TOP: AACSB Analytic| TB&E Model Strategy
96. Which of the following statements contains one good reason for studying marketing?
a. Marketing teaches businesses how to sell products that people do not need.
b. Marketing deals with transactions--not relationships.
c. Marketing has little impact on your day-to-day life.
d. Marketing offers outstanding career opportunities.
e. The study of marketing helps you to better understand why the job market is shrinking.
ANS: D
Marketing plays an important role in society, coordinating the huge numbers of transactions needed to
provide goods and services. Marketing affects your day-to-day life as a consumer.
PTS: 1
REF: 11-12
OBJ: 01-4 TYPE: Comp
TOP: AACSB Analytic| TB&E Model Strategy
SECTION 1 POOL ITEMS
Chapter 3
MULTIPLE CHOICE
1._____ is the concern of business for the long-range welfare of both the company and its relationships to the
society within which it operates.
a. Consumerism
b. Corporate social responsibility
c. Cultural sensitivity
d. Conventional morality
e. Environmental consideration
ANS: B
PTS: 1
REF: 29
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-1 TYPE: Def
3. Corporate social responsibility is defined as the:
a. belief that the legal system defines ethical behavior
b. development of inclusive codes of ethics
c. rules by which social rewards are attained
d. concern for social welfare by businesses
e. coordination of social programs for publicity purposes
ANS: D
PTS: 1
REF: 29
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-1 TYPE: Def
4. Corporate social responsibility:
a. is mandated by federal law
b. requires companies to sacrifice economic performance for the sake of their stakeholders
c. does not influence competition
d. may not always result in profit and growth
e. is unaffected by environmental changes
ANS: D
PTS: 1
REF: 29
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-1 TYPE: Comp
7. _____ is the idea that socially responsible companies will outperform their peers by focusing on the
world's social problems and viewing them as opportunities to build profit and help the world at the
same time.
a. Sustainability
b. Philanthropy
c. Cause marketing
d. Creative ethics
e. International ethics
ANS: A
PTS: 1
REF: 29
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-1 TYPE: Def
TOP: AACSB Ethics| TB&E Model Strategy
9. The pyramid of corporate social responsibilities contains all of the following components EXCEPT:
a. economic responsibilities
b. ethical responsibilities
SECTION 1 POOL ITEMS
c. cultural responsibilities
d. legal responsibilities
e. philanthropic responsibilities
ANS: C
See Review Learning Outcome 1.
PTS: 1
REF: 29-30
OBJ: 03-1 TYPE: Def
TOP: AACSB Ethics| TB&E Model Strategy
15. The four components of the pyramid of corporate social responsibility are:
a. sustainability, creativity, profit, and culture
b. organizational culture, creativity imagery, economic performance, and objectivity
c. organizational, financial, social, and cultural responsibilities
d. sustainability, legality, creativity, and competition
e. economic, legal, ethical, and philanthropic responsibilities
ANS: E
PTS: 1
REF: 29-30
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-1 TYPE: Def
16. Which of the following statements describes ethics?
a. Ethics are the moral principles or values that generally govern the conduct of an
individual.
b. Ethics is the standard of behavior by which conduct is judged.
c. Morals are a foundation for ethical behavior.
d. Ethical values are situation specific and time oriented.
e. All of the statements describe ethics.
ANS: E
PTS: 1
REF: 30
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-2 TYPE: Comp
17. Which of the following sayings best describes how people with conventional morality act?
a. Don't put all of your eggs in one basket.
b. When in Rome, do as the Romans do.
c. Be wary of strangers bearing gifts.
d. A rolling stone gathers no moss.
e. Don't count your chickens before they hatch.
ANS: B
PTS: 1
REF: 31
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-2 TYPE: Comp
20. The use of ethical decision making:
a. can be influenced by top managers
b. is influenced by the probability of harmful outcomes
c. depends on the number of people to be affected
d. depends on the magnitude of possible consequences
e. is accurately described by all of the choices
ANS: E
PTS: 1
REF: 31
TOP: AACSB Ethics| TB&E Model Strategy
OBJ: 03-2 TYPE: Comp
22. Which of the following factors does NOT tend to influence ethical decision making and judgments?
SECTION 1 POOL ITEMS
a.
b.
c.
d.
e.
probability of a harmful outcome
length of time between decision and the onset of consequences
level of multiculturalism
number of people to be affected
potential magnitude of the consequences
ANS: C
PTS: 1
REF: 31
OBJ: 03-2 TYPE: Comp
TOP: AACSB Ethics| AACSB Diversity| TB&E Model Strategy
24. A human resources manager is creating a code of ethics for the employees of the retirement home she
works for. Which of the following is NOT an ethics principle she should keep in mind as she creates
this code?
a. The principles should not upset current retirement home workers and future job applicants.
b. Any decisions should be fair to all concerned: retirement home nurses, cleaning personnel,
and administrative staff.
c. Input on the code should be gained from other knowledgeable individuals or groups.
d. Principles can deviate from common practices because of the prestigious nature of the
facility.
e. She should not have to pull rank or use coercion to implement her ethics code.
ANS: D
An unethical code would presume that the company is an exception to a common practice in the
industry.
PTS: 1
REF: 31-32
OBJ: 03-2 TYPE: Comp
TOP: AACSB Ethics| TB&E Model Strategy
25. A(n) _____ is a defined group that managers feel is most likely to buy a firm's product.
a. target market
b. buying center
c. aggregated unit
d. consumer cluster
e. demographic sample
ANS: A
PTS: 1
REF: 32
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-3 TYPE: Def
27. Which of the following statements best describes the typical target market?
a. A target market will remain stable over time, with the same group of consumers.
b. Target markets change over time as consumers drop in or out of the market, and as tastes
change.
c. Target markets are not strongly affected by changes in the external environment.
d. Target markets only change when the features and benefits of the product offering change.
e. Target markets cannot be specifically defined according to age, income, or location
because these factors are continually changing.
ANS: B
Target markets are defined and described, but they are always changing in response to environmental
changes.
PTS: 1
REF: 32
OBJ: 03-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
SECTION 1 POOL ITEMS
29. The external environment:
a. can be controlled in much the same manner as the internal marketing mix
b. cannot be influenced by marketing managers
c. does not change over time
d. does not have an impact on Fortune 500 companies
e. must be continually monitored by marketing managers
ANS: E
PTS: 1
REF: 32
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 03-3 TYPE: Comp
30. The external environment is a strong influence on a target market and can be a source of _____ for the
marketing manager.
a. opportunities and threats
b. threats and strengths
c. environmental loopholes
d. opportunities and weaknesses
e. product myopia
ANS: A
The external environment can provide opportunities to serve new and changing needs, as well as
warnings about changes that could threaten the current position of the firm. Students will need to
remember what a SWOT analysis is to answer this question.
PTS: 1
REF: 32
OBJ: 03-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
31. Marketing managers cannot control _____, but they can at times influence it.
a. where advertising is placed
b. the external environment
c. the sales force
d. the distribution strategy
e. how products are priced
ANS: B
The external environment is basically uncontrollable, but the other four answers are part of the
marketing mix.
PTS: 1
REF: 32-33
OBJ: 03-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
33. What is apparently the most difficult external variable for marketing managers to forecast, influence,
or integrate into marketing plans?
a. technology
b. social factors
c. demography
d. competition
e. economic conditions
ANS: B
Social factors and changes are difficult to foresee, because they are usually slow and/or small changes.
Also, it is very difficult for one company to affect social factors in any appreciable manner.
PTS: 1
REF: 33
OBJ: 03-4 TYPE: Comp
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Marketing Plan
35. When a company engages in _____, it is implementing strategies that attempt to shape the external
environment in which it operates.
a. synergistic control
b. environmental management
c. transactional management
d. market control
e. reactive management
ANS: B
PTS: 1
REF: 33
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 03-3 TYPE: Def
38. _____ factors are the environmental factors concerned with the changes in people's values, lifestyles,
and family roles.
a. Social
b. Economic
c. Political
d. Competitive
e. Demographic
ANS: A
PTS: 1
REF: 33
OBJ: 03-4 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
43. Consumer preference for low-carb diets has greatly modified the way food is being marketed. This
concern with health issues is an example of a(n) _____ factor.
a. economic
b. political and legal
c. technological
d. demographic
e. social
ANS: E
PTS: 1
REF: 33
OBJ: 03-4 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Product| TB&E Model Customer
45. What do self-sufficiency, upward mobility, and conformity have in common?
a. These are no longer valued attitudes.
b. They are attitudes that can easily be changed.
c. These are three perceptions that Americans have of the Asian lifestyle.
d. These are three of the core values that have influenced lifestyles in the United States.
e. They are the determinants of a component lifestyle.
ANS: D
The fourth value is work ethic.
PTS: 1
REF: 33
OBJ: 03-4 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer
48. A(n) _____ is the practice of choosing goods and services that meet one's diverse needs and interests
rather than conforming to a single, traditional lifestyle.
SECTION 1 POOL ITEMS
a.
b.
c.
d.
e.
aggregated lifestyle
component lifestyle
psychographic mode of living
demographically defined lifestyle
targeted lifestyle
ANS: B
PTS: 1
REF: 33-34
TOP: AACSB Diversity| TB&E Model Product
OBJ: 03-4 TYPE: Def
55. The growth of dual-income families has resulted in:
a. burnout
b. a sense of entitlement
c. decreased discretionary income
d. decreased GNP
e. increased purchasing power
ANS: E
PTS: 1
REF: 34
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-4 TYPE: Def
56. Which of the following events has had a greater effect on marketing than any other social change?
a. the growing number of one-child families
b. the increasing number of immigrants from Northern Europe
c. the growing number of people on the Internet
d. the increasing number of working women
e. the growing number of people of retirement age who are continuing work
ANS: D
PTS: 1
REF: 34
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-4 TYPE: Comp
58. The study of people's vital statistics, such as their ages, births, deaths, and locations, is called:
a. cultural sociology
b. psychometrics
c. ecology
d. ethnography
e. demography
ANS: E
PTS: 1
REF: 34-35
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-5 TYPE: Def
59. Which of the following is NOT a demographic characteristic of a population?
a. income level
b. age
c. values
d. education
e. birthrate
ANS: C
Values are a social factor.
PTS: 1
REF: 34-35
OBJ: 03-5 TYPE: Comp
TOP: AACSB Diversity| TB&E Model Customer
69.A multicultural society is characterized by:
SECTION 1 POOL ITEMS
a.
b.
c.
d.
e.
a population of recent immigrants that are closely related by custom and tradition
a conglomeration of small and large ethnic groups that have little in common
even distribution of all ethnic groups in a geographic region
effective mass-marketing techniques
one large dominating racial or ethnic group in a geographic area
ANS: C
PTS: 1
REF: 39
OBJ: 03-6 TYPE: Def
TOP: AACSB Diversity| TB&E Model Distribution| TB&E Model Customer
71. A furniture retailer that specializes in selling entire rooms of furniture has hired you to identify 25
geographic target markets that can be described as multicultural societies. What types of locations
should you offer this firm?
a. cities that have historically had low immigration rates
b. traditional test markets
c. regions that are dominated by one ethnic group and that have multiple smaller ethnic
groups
d. unindustrialized areas
e. locations in which all major ethnic groups in the area are equally represented
ANS: E
Multicultural societies are not defined by geography, history, or products produced, but by the racial
and ethnic composition of the population.
PTS: 1
REF: 39
OBJ: 03-6 TYPE: App
TOP: AACSB Diversity| TB&E Model Customer
74. The higher your _____, the higher your purchasing power:
a. gross income
b. social class
c. disposable income
d. cost of living
e. inflation index
ANS: C
Purchasing power is measured by comparing income to the relative cost of a set standard of goods an
services. It is a aligned with net income, or income minus a standard set of expenses. Assuming a
constant income, the higher the cost of living (the expenses), the lower the purchasing power.
PTS: 1
REF: 39-40
OBJ: 03-7 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
76. Factors, such as interest rates, inflation, and consumer income that influence the marketing
environment, are called _____ factors.
a. economic
b. socio-demographic
c. political
d. government
e. consumption
ANS: A
PTS: 1
REF: 39
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-7 TYPE: Def
SECTION 1 POOL ITEMS
77. _____ is measured by comparing the relative cost of a standard of goods and services in different
geographic areas.
a. Gross individual profit
b. Purchasing power
c. Net profit
d. Relative pricing
e. Price escalation
ANS: B
PTS: 1
REF: 39-40
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-7 TYPE: Def
78. When income is high relative to the cost of living, consumers _____.
a. have more discretionary income
b. begin anticipating a period of price deceleration
c. stop buying luxury goods and services
d. have significantly less disposable income
e. anticipate price escalation by stockpiling
ANS: A
PTS: 1
REF: 39-40
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-7 TYPE: Comp
79. _____ is the primary determinant of a person's earnings.
a. Multiculturalism
b. Lifestyle
c. Education
d. The aging of the baby boomers
e. Global competition
ANS: C
PTS: 1
REF: 39
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 03-7 TYPE: Def
80. ____ is measure of the decrease in the value of money, expressed as the percentage reduction in value
since the previous year.
a. Inflation
b. Recession
c. Depression
d. Consumer break-even
e. Price escalation
ANS: A
PTS: 1
REF: 40
TOP: AACSB Reflective Thinking| TB&E Model Pricing
OBJ: 03-7 TYPE: Def
81. When planning marketing strategies during times of inflation, marketers must be aware inflation
causes consumers to:
a. purchase more goods and services to support their psychological selves, such as
counseling and stress management training
b. consume more meals away from home
c. buy in small quantities until inflation is over
d. decrease their brand loyalty to products they have traditionally used
e. put more money into savings accounts because prices are too high
ANS: D
In times of inflation, consumers are more price conscious and less brand-loyal.
PTS: 1
REF: 40
OBJ: 03-7 TYPE: Comp
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Pricing
82. A period of economic activity when income, production, and employment tend to fall, reducing overall
demand, is called:
a. stagnation
b. an inflation
c. a recession
d. price escalation
e. a depression
ANS: C
PTS: 1
REF: 40
TOP: AACSB Reflective Thinking| TB&E Model Pricing
OBJ: 03-7 TYPE: Def
85. Which of the following strategies is appropriate for a marketer to use during a time of economic
recession?
a. Promote product value.
b. Maintain and improve customer services.
c. Emphasize top-of-the-line products in promotions.
d. Offer products that are economical and efficient.
e. Do all of these.
ANS: E
PTS: 1
REF: 40-41
TOP: AACSB Technology| TB&E Model Pricing
OBJ: 03-7 TYPE: Comp
86. Which of the following is sometimes an effective weapon for fighting inflation and recession?
a. technology
b. line extensions
c. increased capital gains taxes
d. introducing product-line extensions
e. reducing R&D expenditures
ANS: A
PTS: 1
REF: 40-41
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 03-8 TYPE: Def
87. Research that attempts to expand the frontiers of knowledge rather than solving a specific, pragmatic
problem is called:
a. technical diversity
b. reactive research
c. applied research
d. experiential research
e. basic research
ANS: E
PTS: 1
REF: 41
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 03-8 TYPE: Def
100. Laws and regulations of various governments and their ongoing development and change are an
example of _____ factors and are part of all organizations' external environment.
a. economic investment
b. political and legal
c. research and development
d. competitive
e. demographic
SECTION 1 POOL ITEMS
ANS: B
PTS: 1
REF: 42
TOP: AACSB Technology| TB&E Model Strategy
OBJ: 03-9 TYPE: Def
101. The _____ Act strengthened the Clayton Act to prevent corporate acquisitions that reduce competition.
a. Hart-Scott-Rodino
b. Lanham-Scott
c. Celler-Kefauver Antimerger
d. Robinson-Patman
e. Sherman
ANS: C
See Exhibit 3.2. The Celler-Kefauver Act bolstered the Clayton Act's provision dealing with
interlocking directorates and closed another loophole that had allowed corporate takeovers.
PTS: 1
REF: 42
OBJ: 03-9 TYPE: Def
TOP: AACSB Analytic| TB&E Model Strategy
102.The _____ Act requires large companies to notify the government of their intent to merge.
a. Hart-Scott-Rodino
b. Sherman
c. Celler-Kefauver Antimerger
d. Robinson-Patman
e. Lanham
ANS: A
See Exhibit 3.2.
PTS: 1
REF: 42
OBJ: 03-9 TYPE: Def
TOP: AACSB Analytic| TB&E Model Strategy
103. The Gramm-Leach-Bliley Act and the Health Insurance Portability and Accountability Act are both
important laws designed to:
a. protect the channels of commerce
b. restrict alcohol and tobacco advertising
c. eliminate certain products from being advertised on children’s television programs
d. protect consumers from identity theft
e. penalize marketers selling merchandise with counterfeit brand names
ANS: D
PTS: 1
REF: 42
TOP: AACSB Analytic| TB&E Model Strategy
OBJ: 03-9 TYPE: Def
SECTION 1 POOL ITEMS
Chapter 2
3. Strategic plans require:
a. long-term resource commitments
b. a change in organizational structure
c. the addition of new personnel
d. new product development
e. changes in prices
ANS: A
Strategic plans are long-range plans that involve developing, organizing, and controlling marketing
activities.
PTS: 1
REF: 15
OBJ: 02-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
4. _____ is the managerial process of creating and maintaining a fit between the organization's objectives
and resources and evolving market opportunities.
a. Tactical management
b. The market audit
c. Functional planning
d. Environmental scanning
e. Strategic planning
ANS: E
PTS: 1
REF: 15
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-1 TYPE: Def
7. Which of the following statements about a marketing plan is true?
a. Marketing plans can exist as oral traditions.
b. The marketing plan should be viewed as a series of sequential steps.
c. All marketing plans have basically the same content.
d. A marketing plan is created so an organization can meet its marketing objectives.
e. All of the statements about a marketing plan are true.
ANS: D
By definition, marketing plans are written. Several steps of the marketing plan can be done at the same
time. The content of marketing plans varies.
PTS: 1
REF: 15
OBJ: 02-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Marketing Plan
8. _____ is the process of anticipating events and determining strategies to achieve organizational
objectives.
a. Planning
b. Portfolio evaluation
c. Forecasting
d. Implementation
e. Evaluation
ANS: A
PTS: 1
REF: 15
OBJ: 02-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Marketing Plan
SECTION 1 POOL ITEMS
10. Marketing plans should be written to do all of the following EXCEPT:
a. compare actual and expected performance
b. provide clearly stated activities
c. create common goals for employees to work toward
d. allow managers to enter the marketplace with an awareness of possibilities and problems
e. control the elements of the external marketing environment
ANS: E
Marketing environment variables cannot be controlled.
PTS: 1
REF: 16
OBJ: 02-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Marketing Plan
11. Which of the following is one of the elements of the marketing plan?
a. a business mission statement
b. a situation analysis
c. a target market strategy
d. the marketing mix
e. all of the choices
ANS: E
See Exhibit 2.1.
PTS: 1
REF: 17
OBJ: 02-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Marketing Plan
13. The _____ answers the question, "What business are we in, and where are we going?"
a. mission statement
b. financial statement
c. situation analysis
d. market strategy
e. strategic plan
ANS: A
PTS: 1
REF: 18
TOP: AACSB Analytic| TB&E Model Strategy
OBJ: 02-2 TYPE: Def
17. The focus of an organization's mission statement should be on:
a. the products it wishes to sell
b. the market it wishes to serve
c. its social responsibilities
d. the desires of government regulators
e. technologies it understands well
ANS: B
The choice of the market to serve determines the product and technology decisions.
PTS: 1
REF: 18
OBJ: 02-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
20. _____ occurs when a business is defined in terms of goods and services rather than by the benefits
customers seek from it.
SECTION 1 POOL ITEMS
a.
b.
c.
d.
e.
A circle trap
A market barrier entry
A reactive focus
Unempowerment
Marketing myopia
ANS: E
PTS: 1
REF: 18
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 02-2 TYPE: Def
21. A popular technique for managing a large organization with different technologies and markets is to
divide it into:
a. strategic business units
b. different technologies
c. strategic target markets
d. design matrices
e. tactical segments
ANS: A
PTS: 1
REF: 18
TOP: AACSB Analytic| TB&E Model Strategy
OBJ: 02-2 TYPE: Def
22. The acronym SBU refers to:
a. stock in business units
b. strategic business unit
c. standard business utilization
d. strategic barter units
e. samples by units
ANS: B
PTS: 1
REF: 18
TOP: AACSB Analytic| TB&E Model Strategy
OBJ: 02-2 TYPE: Def
25. An SBU:
a. competes with the same companies as the other SBUs in the parent organization
b. shares the same mission with all the other SBUs in the parent organization
c. controls its business independent of other SBUs in the organization
d. usually benefits from the combined corporate raw materials purchases
e. still has strategic planning performed back at corporate headquarters
ANS: C
SBUs have separate business functions from one another and have their own mission statements,
markets, and planning.
PTS: 1
REF: 18
OBJ: 02-2 TYPE: Def
TOP: AACSB Analytic| TB&E Model Strategy
27. After management agrees on a mission statement, it must set objectives. Which of the following is
NOT a characteristic of a good objective?
a. profitable
b. realistic
c. measurable
d. time-specific
e. consistent
ANS: A
SECTION 1 POOL ITEMS
Good objectives are not necessarily stated in terms of profit.
PTS: 1
REF: 18
OBJ: 02-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Pricing
28.A _____ is defined as a statement of what is to be accomplished through marketing activities.
a. mission statement
b. business plan
c. marketing objective
d. goal-driven directive
e. marketing criteria
ANS: C
PTS: 1
REF: 18
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-3 TYPE: Def
30. When an organization creates a mission statement that is too narrow, _____ results.
a. marketing synergy
b. marketing myopia
c. directional marketing
d. an internal threat
e. sustainable competitive advantage
ANS: B
Marketing myopia defines a business in terms of goods and services rather than in terms of benefits
customers seek. See Review Learning Outcome 2.
PTS: 1
REF: 18
OBJ: 02-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Product
35. For marketing objectives to be realized, they must meet all of the following criteria EXCEPT:
a. be consistent with organization objectives
b. be measurable
c. be attainable
d. be challenging
e. be set within a one-year time frame
ANS: E
There is no one-year time frame restriction for marketing objectives although specifying a particular
time frame makes an objective more clear and precise.
PTS: 1
REF: 18
OBJ: 02-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
37. A _____ is a formal study conducted by an organization to ascertain its current status and capabilities
and its future expectations.
a. situation analysis
b. marketing audit
c. trend analysis
d. strategic alternative selection
SECTION 1 POOL ITEMS
e. competitive advantage audit
ANS: A
PTS: 1
REF: 19
TOP: AACSB Analytic| TB&E Model Research
OBJ: 02-4 TYPE: Def
39. The SWOT acronym refers to a firm’s analysis of its:
a. sales, width of product mix, observations, and technology
b. situations, wealth, organizational strengths, and target markets
c. strengths, weaknesses, opportunities, and threats
d. service levels, willingness to spend, organizational culture, and total revenues
e. strategies, willingness to change, objectives, and trends
ANS: C
PTS: 1
REF: 19
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-4 TYPE: Def
43. _____ is defined as the collection and interpretation of information about forces, events, and
relationships that may affect the organization.
a. Market sampling
b. An internal audit
c. Opportunity analysis
d. Environmental scanning
e. Stakeholder analysis
ANS: D
PTS: 1
REF: 19
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 02-4 TYPE: Def
61. _____ show costs declining at a predictable rate as experience with a product increases.
a. Liquidity growth curves
b. EOQ graphs
c. Breakeven analyses
d. Experience curves
e. Supply/demand curves
ANS: D
PTS: 1
REF: 20
OBJ: 02-5 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Product| TB&E Model Pricing
62. Which of the following is NOT a source of a cost competitive advantage?
a. reengineering
b. experience curves
c. break-even analyses
d. efficient labor
e. production innovation
ANS: C
PTS: 1
REF: 20-21
TOP: AACSB Reflective Thinking| TB&E Model Pricing
OBJ: 02-5 TYPE: Comp
67. Which of the following is a type of strategic alternative that matches products and markets?
a. vertical integration
b. product penetration
c. divestment
d. horizontal integration
SECTION 1 POOL ITEMS
e. market penetration
ANS: E
PTS: 1
REF: 22
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-6 TYPE: Def
68. _____ is a strategy of increasing market share for present products in existing markets.
a. Market penetration
b. Product development
c. Market development
d. Diversification
e. Product penetration
ANS: A
PTS: 1
REF: 22
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-6 TYPE: Def
70. _____ is a strategy that attracts new customers to existing products.
a. Product development
b. Market development
c. Market penetration
d. Product penetration
e. Diversification
ANS: B
PTS: 1
REF: 22
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-6 TYPE: Def
75. _____ is a strategy that creates new products for present markets.
a. Product penetration
b. Market penetration
c. Product development
d. Market development
e. Diversification
ANS: C
PTS: 1
REF: 22
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-6 TYPE: Def
76. _____ is the strategy of increasing sales by introducing new products into new markets.
a. Product penetration
b. Product development
c. Market penetration
d. Market development
e. Diversification
ANS: E
PTS: 1
REF: 22
OBJ: 02-6 TYPE: Def
TOP: AACSB Diversity| TB&E Model Strategy| TB&E Model International Perspective
102. A(n) _____ describes and estimates the size and sales potential of market segments of interest to the
firm and assesses key competitors in these market segments.
a. marketing orientation
b. environmental scan
c. marketing mix audit
d. target market strategy
e. market opportunity analysis
SECTION 1 POOL ITEMS
ANS: E
PTS: 1
REF: 24
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-7 TYPE: Def
105. The _____ is the unique blend of product, distribution, promotion, and pricing strategies designed to
produce mutually satisfying exchanges with a target market.
a. internal environmental mix
b. marketing mix
c. product mix
d. product line
e. market portfolio
ANS: B
PTS: 1
REF: 25
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 02-8 TYPE: Def
106. The starting point of any firm's marketing mix is the:
a. analysis of what production equipment is available and owned by the company
b. design of the promotion campaign to be used for the product
c. selection of the places through which the good or service will be sold
d. determination of the product's price, enabling future revenues and budgets to be estimated
e. development of the good or service to be sold
ANS: E
The product is the starting point for any marketing mix. Without it, pricing, distribution, and
promotion are irrelevant. The production capacity can be changed to fit the proposed product.
PTS: 1
REF: 25
OBJ: 02-8 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
109. Making sure products are available when and where customers want them is the job of which element
of the marketing mix?
a. advertising strategies
b. production strategies
c. product strategies
d. promotion strategies
e. distribution strategies
ANS: E
Distribution strategies make products available when and where customers want them.
PTS: 1
REF: 25-26
OBJ: 02-8 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Distribution| TB&E Model Product
SECTION 1 POOL ITEMS
Chapter 4
MULTIPLE CHOICE
1.Individuals and organizations utilizing a global vision to effectively market goods and services across
national boundaries are engaged in:
a. developing international selling schemes
b. implementing standard international marketing
c. implementing global marketing standardization
d. supplementing their foreign vision
e. practicing global marketing
ANS: E
PTS: 1
REF: 47
OBJ: 04-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model International Perspective| TB&E Model Product
3. Which of the following statements about global marketing is true?
a. Marketing to target markets throughout the world has become an imperative for business.
b. Often a U.S. firm's toughest domestic competition comes from foreign companies.
c. Marketing managers must develop a global vision not only to recognize and react to
international marketing opportunities but also to remain competitive at home.
d. Adopting a global vision can be lucrative for a company, and global marketing can offset
weak domestic performance.
e. All of these statements about global marketing are true.
ANS: E
PTS: 1
REF: 47
OBJ: 04-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
6. Which of the following statements about multinational firms is true?
a. Multinationals typically do not change their methods of reaching their global markets if
they are successful with their initial strategy.
b. Multinationals are defined as companies heavily engaged in exporting and importing.
c. All multinationals must enter the fourth stage of globalization before they are fully
internationalized.
d. Multinationals often develop their global businesses in stages.
e. The five stages of globalization closely mirror the five stages of the product life cycle.
ANS: D
Multinationals can go through up to four stages in their quest to globalize their business. Generally,
only high-tech firms ever reach the fourth stage. Multinationals are companies that heavily engage in
international trade, beyond exporting and importing.
PTS: 1
REF: 49-50
OBJ: 04-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
7. A(n) _____ is a company that is heavily engaged in global trade and moves its resources, goods,
services, and skills across national boundaries.
a. international facilitator
b. global trader
c. multinational corporation
d. exporting company
e. international merchant
SECTION 1 POOL ITEMS
ANS: C
PTS: 1
REF: 49-50
OBJ: 04-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model International Perspective| TB&E Model
Distribution
10. Which of the following describes a common criticism of multinational companies?
a. the transference of the wrong kind of technology to a developing nation
b. excessive employment information
c. countertrading
d. the transference of labor-intensive technology
e. dumping
ANS: A
Typically, the technology needed to run operations in developing nations is capital-intensive and thus
does not substantially increase employment.
PTS: 1
REF: 50
OBJ: 04-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
11. A company that is capital-intensive:
a. has an altered fiscal strategy for overseas operations
b. spends more on equipment than on labor
c. makes better use of benchmarking than other types of business
d. creates employment monopolies
e. must engage in countertrading due to restrictive foreign legislature
ANS: B
PTS: 1
REF: 50
OBJ: 04-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
13. With a _____, a firm produces standardized products to be sold the same way all over the world.
a. traditional marketing strategy
b. global marketing standardization approach
c. product extension approach
d. culturally based marketing strategy
e. synergistic approach to marketing
ANS: B
PTS: 1
REF: 50
OBJ: 04-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model International Perspective| TB&E Model Product
14. Global marketing standardization:
a. is becoming less popular with the large multinationals
b. encourages product, packaging, and advertising variations for each nation or local market
c. actually raises production costs
d. presumes markets throughout the world are becoming more alike
e. is more popular with consumer products than with industrial goods
ANS: D
With a global marketing standardization approach, a firm produces standardized products to be sold
the same way worldwide. This approach assumes all customers have the same needs and wants.
PTS: 1
REF: 50
OBJ: 04-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
SECTION 1 POOL ITEMS
16. A business thinking of expanding into global markets needs to examine all of the following external
environments EXCEPT:
a. culture
b. political structure and actions
c. its marketing mix
d. natural resources
e. demographic makeup
ANS: C
The marketing mix is the keystone of a company's internal environment.
PTS: 1
REF: 50
OBJ: 04-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model International Perspective| TB&E Model Strategy
SECTION 1 POOL ITEMS
17.Central to any society is a common set of values shared by its citizens that determines what is socially
acceptable. Marketers refer to these values collectively as a country's:
a. ethical system
b. culture
c. ethnocentricity
d. national personality
e. socialization
ANS: B
PTS: 1
REF: 50-51
TOP: AACSB Diversity| TB&E Model Customer
OBJ: 04-3 TYPE: Def
24. Which of the following is an important cultural factor that should be considered by global marketers?
a. competitive synergy
b. language
c. natural resources
d. technology sensitivity
e. level of economic development
ANS: B
PTS: 1
REF: 51
TOP: AACSB Diversity| TB&E Model Strategy
OBJ: 04-3 TYPE: Comp
26. Which of the following statements about the political environment is true?
a. A recession is part of the political environment.
b. A country is either socialistic or capitalistic, but never both.
c. The countries with the least across-the-board regulations and political structures foster the
strongest economies.
d. The European Union is purely an economic arrangement and has no political impact on
marketing.
e. All of these statements about the political environment are true.
ANS: C
Recession is an economic factor. Countries are a combination of socialism and capitalism. The
European Union is a means for the member nations to pursue an economic, monetary, and political
union.
PTS: 1
REF: 51-52
OBJ: 04-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
31. A tax levied on the goods entering a country is called a(n):
a. license
b. quota
c. boycott
d. exchange control
e. tariff
ANS: E
PTS: 1
REF: 52
OBJ: 04-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Pricing| TB&E Model Product
33. A(n) _____ is a limit on the amount of a specific product that can enter a country.
a. quota
b. tariff
SECTION 1 POOL ITEMS
c. boycott
d. exchange control
e. transfer limit
ANS: A
PTS: 1
REF: 52
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 04-3 TYPE: Def
36. An exclusion of all products from certain countries or companies by a government or group is called
a(n):
a. expropriation
b. quota
c. tariff
d. exchange control
e. boycott
ANS: E
PTS: 1
REF: 52
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 04-3 TYPE: Def
39. A(n) _____ is a law that compels a company earning foreign currency from its exports to sell it to a
central bank rather than sending the money out of the country.
a. tariff
b. quota
c. fiscal prerequisite
d. exchange control
e. transfer barrier
ANS: D
PTS: 1
REF: 52
TOP: AACSB Reflective Thinking| TB&E Model Pricing
OBJ: 04-3 TYPE: Def
40. _____ are trade alliances in which several countries agree to work together to form a common trade
area that enhances trade opportunities among those countries.
a. Boycotts
b. Regional unifications
c. Market groupings
d. Free trade nations
e. Expropriation members
ANS: C
PTS: 1
REF: 52
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-3 TYPE: Def
41. Negotiations (such as GATT or the Uruguay Round) between countries that are made to stimulate
global exchange and remove barriers are called _____ agreements.
a. trade
b. joint venture
c. CRM
d. exchange
e. licensing
ANS: A
PTS: 1
REF: 52
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-3 TYPE: Def
42. _____ is a trade agreement that includes Argentina, Bolivia, Brazil, Chile, Columbia, Ecuador,
Paraguay, Peru, and Uruguay. This agreement eliminated the tariffs among these trading partners.
SECTION 1 POOL ITEMS
a.
b.
c.
d.
e.
NAFTA
Maastricht
WTO
GATT
Mercosur
ANS: E
PTS: 1
REF: 52
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-3 TYPE: Def
43. The latest round of World Trade Organization (WTO) talks has been contentious. A major goal of this
_____ is to bolster the developing economies of Africa, Asia, and Latin America where up to twothirds of the population works in agriculture.
a. Mercosur covenant
b. CAFTA Alliance
c. Doha Round
d. Uruguay Round
e. WTO Round
ANS: C
PTS: 1
REF: 52-53
OBJ: 04-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
44. The _____ of trade negotiations created the _____, which replaces GATT. This trade agreement
dramatically lowers trade barriers worldwide.
a. Uruguay Round; World Trade Organization
b. Doha Round; European Union
c. Doha Round; NAFTA
d. Paraguay Round; South American Free Trade Agreement
e. Mercosur; European Union
ANS: A
The Uruguay Round created the WTO.
PTS: 1
REF: 53
OBJ: 04-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Strategy
45. The _____ is the most ambitious global trade agreement ever negotiated; the agreement has reduced
tariffs by one-third worldwide.
a. Uruguay Round
b. Mercosur
c. GATT
d. NAFTA
e. Maastricht Treaty
ANS: A
PTS: 1
REF: 52-53
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-3 TYPE: Def
46. The North American Free Trade Agreement (NAFTA) did NOT:
a. create the world's largest free-trade zone including Canada, the United States, and Mexico
b. substantially reduce economic growth in Mexico
c. allow U.S. and Canadian financial-services companies to own subsidiaries in Mexico
d. remove many tariffs and duties so that Mexico, Canada, and the United States can trade
more freely
e. expand opportunities for U.S. businesses in Mexico
ANS: B
SECTION 1 POOL ITEMS
Over the years, Mexico has made economic gains due to NAFTA.
PTS: 1
REF: 53
OBJ: 04-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Distribution
48. The goal of the Central America Free Trade Agreement (CAFTA) is to:
a. create free-trade agreements between the United States and other industrialized nations
b. eliminate all protectionism
c. raise prosperity levels in all industrializing nations
d. establish a free trade agreement between the United States and certain Latin American
countries
e. make sure all nations achieve the economic and technological development of a takeover
economy or better
ANS: D
PTS: 1
REF: 53
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-3 TYPE: Def
SECTION 1 POOL ITEMS
49. Which of the following statements about the European Union (EU) is true?
a. The EU creates a single Europroduct for a generic Euroconsumer.
b. The EU removes all internal trade barriers and standardizes regulations in European
countries for easier trade.
c. The EU can correctly be called the "United States of Europe" because all European voters
have agreed to these changes.
d. The existence of the EU eliminates protectionist movements by United Europe against the
Japanese and the United States.
e. None of these statements about the EU is true.
ANS: E
Because of diverse languages and cultures, no "United States of Europe" or a generic Euroconsumer
results from United Europe. There exists the possibility of a protectionist movement and increased
competition. It does not eliminate all trade barriers.
PTS: 1
REF: 54
OBJ: 04-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
51. A multinational company that makes a labor-intensive product would be interested in the _____
makeup of countries. Factors such as median age, gender, and literacy rates would determine the
success of its global expansion.
a. demographic
b. lifestyle
c. natural
d. cultural
e. economic
ANS: A
Demographics include age and educational levels as well as ethnicity and gender.
PTS: 1
REF: 54-55
OBJ: 04-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
SECTION 1 POOL ITEMS
54. Vast differences in natural resources create all of the following EXCEPT:
a. potential for military intervention
b. shifts in wealth between nations
c. inflation and recession
d. global dependencies
e. export opportunities for countries with no natural resources
ANS: E
While differences do create shifts in wealth, dependencies, inflation, recession, and the potential for
conflict, they only hinder opportunities for the countries that do not have resources.
PTS: 1
REF: 55
OBJ: 04-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
55. Which method of entering the global marketplace would be LEAST risky?
a. exporting
b. licensing
c. contract manufacturing
d. joint ventures
e. direct investment
ANS: A
See Exhibit 4.1.
PTS: 1
REF: 55-56
OBJ: 04-4 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
63. A(n) _____ is a global intermediary that operates primarily in agriculture and raw materials by
bringing the buyer and seller together.
a. buyer for export
b. export agent
c. license agent
d. import agent
e. export broker
ANS: E
PTS: 1
REF: 55
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-4 TYPE: Def
64. A cooperative of egg producers believes a profitable market for eggs exists overseas where people are
not as concerned about cholesterol. If the cooperative decides to export, it will most likely use a(n):
a. commission merchant
b. drop shipper
c. export broker
d. import agent
e. export agent
ANS: C
Export brokers typically handle agriculture and raw materials.
PTS: 1
REF: 56
OBJ: 04-4 TYPE: App
TOP: AACSB Analytic| TB&E Model Product
SECTION 1 POOL ITEMS
65. _____ are foreign sales agents-distributors who live in a foreign country and represent a domestic
company in sales situations. They perform the same functions as domestic manufacturers' agents who
help with financing and shipping.
a. Export agents
b. Export brokers
c. Import broker
d. Buyers for export
e. Licensing agents
ANS: A
PTS: 1
REF: 56
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 04-4 TYPE: Def
66. The _____ is an intermediary in the global market who assumes all risks and sells globally for its own
account. The domestic manufacturer usually treats it like a domestic customer.
a. buyer for export
b. export agent
c. joint venturer
d. contract manufacturer
e. market group
ANS: A
PTS: 1
REF: 55
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 04-4 TYPE: Def
SECTION 1 POOL ITEMS
Chapter 8
MULTIPLE CHOICE
1. A(n) _____ is an interactive, flexible information system that enables managers to obtain and
manipulate information as they are making decisions.
a. expert system
b. marketing information system
c. artificial intelligence system
d. marketing decision support system
e. database marketing system
ANS: D
PTS: 1
REF: 113
TOP: AACSB Technology| TB&E Model Strategy
OBJ: 08-1 TYPE: Def
2. _____ is the creation of a large computerized file of customers' and potential customers' names,
profiles, and purchase patterns.
a. Electronic targeting
b. Sampling procedure specification
c. Database marketing
d. Competitive data mining
e. Consumer behavior marketing
ANS: C
PTS: 1
REF: 113
TOP: AACSB Technology| TB&E Model Strategy
OBJ: 08-1 TYPE: Def
3. A true marketing decision support systems (DSS) should be:
a. flexible
b. discovery-oriented
c. interactive
d. accessible
e. All of the choices describe true marketing decision support systems.
ANS: E
PTS: 1
REF: 113
TOP: AACSB Technology| TB&E Model Strategy
OBJ: 08-1 TYPE: Comp
4. According to the text, a true marketing decision support system should be:
a. reactive
b. customer-oriented
c. interactive
d. rigorous
e. descriptive
ANS: C
A true DSS should be flexible, interactive, discovery-oriented, and accessible.
PTS: 1
REF: 113
OBJ: 08-1 TYPE: Def
TOP: AACSB Technology| TB&E Model Strategy
5. To help understand why attendance at the team’s games was so poor, the Atlanta Falcons used
marketing research to gather factual information. The organization used in-game surveys and end-ofseason surveys of ticket holders. The gathering of factual statements is an example of marketing
research in its _____ role.
a. historical
b. descriptive
SECTION 1 POOL ITEMS
c. predictive
d. normative
e. objective
ANS: B
The data were gathered and presented as factual statements.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
6. Through marketing research, the Boston Symphony Orchestra (BSO) learned it has an older market
and is not attracting younger concertgoers. It next conducted marketing research to determine if an
integrated advertising campaign targeted to the younger market would be successful. In its second use
of research, BSO employed _____ marketing research.
a. historical
b. descriptive
c. predictive
d. normative
e. objective
ANS: C
The BSO used previously gathered data to predict the success of an advertising campaign.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
7. _____ is the process of planning, collecting, and analyzing data relevant to marketing decision making.
The results of this analysis are then communicated to management.
a. Data collection
b. Artificial intelligence
c. Decision support
d. Marketing research
e. Single-source research
ANS: D
PTS: 1
REF: 114
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-2 TYPE: Comp
8. A bowling alley operator could use _____ to determine why customers do not seem to like his bowling
alley's new location.
a. transactional marketing
b. public relations
c. an EDI system
d. market synergy
e. marketing research
ANS: E
Marketing research can be used by management to trace problems and their causes.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
9. Soon after the Harriet Tubman Museum expanded its hours and began charging a small fee to pay for
the extra help needed to keep it open longer, attendance decreased. To determine why this decrease in
attendance occurred, the museum staff could rely on:
a. a production audit
SECTION 1 POOL ITEMS
b.
c.
d.
e.
database marketing
marketing research
an internal marketing audit
secondary data
ANS: C
Marketing research could be used to find out why attendance declined.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
10. The publisher of a Canadian business magazine wanted to make several major changes in the
magazine's content and format. To determine what changes would be supported by its subscribers and
what changes would not be welcomed, the publisher should engage in:
a. advertising
b. database marketing
c. marketing research
d. a data retrieval system
e. secondary data
ANS: C
Marketing research would be appropriate to use to determine how the publisher could provide greater
customer satisfaction.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
11. Marketing managers can use marketing research to:
a. improve the quality of their decision making
b. find out why a marketing plan failed
c. learn how to more efficiently retain customers
d. understand the ever-changing marketplace
e. do all of these
ANS: E
PTS: 1
REF: 114-116
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-2 | 08-3 TYPE: Comp
12. Marketing managers would typically use marketing research to:
a. eliminate any guesswork in decision making
b. implement a sales promotion
c. handle an individual customer's complaint
d. determine why a new product failed
e. do all of these
ANS: D
Marketing research is used to determine why marketing plans failed.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Research
13. Marketing research has three functional roles. These roles are:
a. normative, descriptive, and explanatory
b. predictive, normative, and persuasive
c. descriptive, diagnostic, and predictive
d. flexible, interactive, and discovery-oriented
SECTION 1 POOL ITEMS
e. descriptive, explanatory, and predictive
ANS: C
PTS: 1
REF: 114
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-2 TYPE: Def
14. A manufacturer of an all-natural fruit and veggie bar targeted to people who want nutritious snacks has
asked for marketing research to explain the reasons for the recent failure of its Apple-Broccoli bar.
This type of research is described as:
a. descriptive
b. predictive
c. diagnostic
d. normative
e. historical
ANS: C
One of the roles of marketing research is to be diagnostic and to explain what happened.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
15. Volkswagen developed an 18-month-long project to gain a better understanding of the American
culture so it could develop cars more appealing to this market. The research project was called
Moonraker. Moonraker was intended to play a(n) _____ role in Volkswagen's marketing research.
a. diagnostic
b. descriptive
c. predictive
d. heuristical
e. demonstrative
ANS: B
One of the roles of marketing research is the gathering of descriptive data, which includes reporting
consumers’ attitude toward products.
PTS: 1
REF: 114
OBJ: 08-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research| TB&E Model Customer
16. The first step in the marketing research process is to:
a. specify the sampling plan
b. collect the data
c. analyze the marketplace
d. plan the research design
e. identify and formulate the problem/opportunity to be studied
ANS: E
PTS: 1
REF: 114
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Def
17. There are five Major League Baseball markets with more than one team. So far this season, the
average combined attendance for the Chicago Cubs and the Chicago White Sox ranks lowest. Before
conducting any marketing research to explain low attendance figures, the teams will need to:
a. determine who will be most likely to respond to a survey
b. select a market sample from everyone in the population
c. define the problem to be researched
d. develop a survey to find out exactly what's wrong
e. enumerate the decision factors
SECTION 1 POOL ITEMS
ANS: C
To respond to a symptom, one should find out what the underlying problem is. See Exhibit 8.1.
PTS: 1
REF: 114-115
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
18. A small confectionary company has noticed a 20 percent decrease in the sale of its milk chocolate
candy over the last three years. The company’s owner wants to determine why the decline has
occurred and how to reverse the trend. Once the owner has identified the problem as a consumer
perception that dark chocolate provides more health benefits, its next step in the marketing research
process should be to:
a. collect the data
b. recognize the marketing problem
c. analyze the marketplace
d. plan the research design
e. specify the sampling plan
ANS: D
See Exhibit 8.1.
PTS: 1
REF: 116
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
19. Volkswagen lost more than $1 billion in its U.S. operations in two recent years. In which step of the
marketing research project, would the Volkswagen engineers (who were raised in the no-nonsense
cockpits of German cars) realize the problem was that they were not designing cars for Americans who
use their cars like a second office?
a. the research design step
b. the data collection step
c. the data analysis step
d. the problem formulation step
e. none of the choices
ANS: D
Defining (or in this case realizing) the problem is the first step of the marketing research process. The
research will not produce usable results if this step is not done correctly. See Exhibit 8.1.
PTS: 1
REF: 115
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research| TB&E Model Customer
20. Research by Morgan Stanley revealed that 72 percent of the U.S. residents are willing to try flavored
colas. Since the cola industry is stagnant in most areas of the country, this is important information.
Marketing research on how best to use this information will begin with the:
a. collection of the data
b. specification of the sampling plan
c. implementation of employee empowerment
d. research design
e. recognition of the marketing opportunity
ANS: E
Marketing research can hone in and clarify where the best opportunities lie. See Exhibit 8.1.
PTS: 1
REF: 114 | 115
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
SECTION 1 POOL ITEMS
21. The marketing research problem:
a. is information oriented
b. involves determining what resources will be used in research efforts
c. is action driven
d. does not rely on managerial experience
e. is accurately described by none of these choices
ANS: A
PTS: 1
REF: 114
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Def
22. In contrast to marketing research problems, management decision problems are:
a. action oriented
b. pervasive
c. narrower in scope
d. synergistic
e. information oriented
ANS: A
PTS: 1
REF: 115
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Def
23. Managers must combine specific pieces of information needed to identify the marketing research
problem. Their _____ is to provide insightful decision-making information.
a. company-correlated goal
b. autonomous task
c. dichotomous goal
d. marketing research objective
e. field service objective
ANS: D
PTS: 1
REF: 114 | 115
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Def
24. Post Properties is a company that manages apartments in various communities. It is concerned with a
glut of apartments in Atlanta, Orlando, and Dallas Its market researcher begins by examining the rental
markets in the Southeast, the history of apartment buildings, local economies, competitive rents, and
ownership--all information that was on hand and did not require any new research to locate. The
market researcher looked at:
a. a closed study
b. secondary data
c. primary data
d. a statistical analysis
e. priority databases
ANS: B
PTS: 1
REF: 115
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: App
25. Data previously collected for purposes other than the one at hand are an important source of
information as the researcher defines the problem. These data are called _____ data.
a. single-source
b. secondary
c. primary
d. consensual
e. convenience
ANS: B
PTS: 1
REF: 115
OBJ: 08-3 TYPE: Def
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Research
26. Market research firms, commercial publications, and government data can be used as sources of:
a. secondary data
b. consensual information
c. primary data
d. artificial intelligence
e. marketing audits
ANS: A
Data previously collected for purposes other than the one at hand are an important source of
information known as secondary data.
PTS: 1
REF: 115
OBJ: 08-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Research
27. So far this season, the average combined attendance for the Washington Nationals and Baltimore
Orioles ranks fourth of the five major league markets with more than one team. Research done by the
Washington Post shows attendance in the Baltimore-Washington region trails Los Angeles, New York
and San Francisco-Oakland but is slightly ahead of Chicago. Major League Baseball would be using
_____ data if it used this research to determine how competition affects attendance figures.
a. convenience
b. primary
c. dichotomous
d. secondary
e. observation
ANS: D
Data previously collected for purposes other than the one at hand are an important source of
information known as secondary data.
PTS: 1
REF: 115
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
28. A few years ago, TNT cable channel began using the slogan "TNT knows drama" to reflect a change
in its programming focus. Now it wants to determine how its viewership has changed since it changed
its focus. It has decided to use secondary data to determine if its viewers' demographics have changed.
A potential disadvantage of this research plan is:
a. the difficulty of holding certain variables constant while varying one factor of interest
b. the high cost of collecting secondary data
c. the length of time it takes to collect secondary data
d. interviewer bias during the collection process
e. the information not fitting the needs of the research problem
ANS: E
Secondary data have been previously collected for some other purpose and may not fit the current
research problem.
PTS: 1
REF: 115
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research| TB&E Model Marketing Plan
29. When assessing the quality of secondary data, it is:
a. not necessary to know why the data were collected in the first place
b. important to be able to have easy access to the data
SECTION 1 POOL ITEMS
c. important to know the purpose for which the data were originally collected
d. not important to know when the data were collected
e. imperative to use the same methods and procedures when primary data are collected
ANS: C
To assess the quality of the data, it is important to know when, where, why, and how the data were
originally collected.
PTS: 1
REF: 115
OBJ: 08-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Research
30. Research done by Morgan Stanley revealed that 72 percent of the U.S. residents are willing to try
flavored colas. The research also showed which flavors were most desired. Cola producers using this
information provided to them by Morgan Stanley would be using _____ data.
a. primary
b. secondary
c. dichotomous
d. observation
e. convenience
ANS: B
It is secondary data, which have been previously collected for some other purpose and may not fit the
current research problem.
PTS: 1
REF: 115
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
31. A(n) _____ is a company that acquires, catalogs, reformats, segments, and resells reports already
published by marketing research firms.
a. information vendor
b. subject directory
c. market research aggregator
d. search engine
e. Internet directory
ANS: C
PTS: 1
REF: 116
TOP: AACSB Technology| TB&E Model Online/Computer
OBJ: 08-3 TYPE: Def
32. _____ specifies the research questions to be answered, how and when the data will be gathered, and
how the data will be analyzed.
a. A secondary data use plan
b. The research collaborative plan
c. An autonomous director
d. The research design
e. The sampling plan
ANS: D
PTS: 1
REF: 116
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Def
33. The research design specifies:
a. follow-up procedures for the research
b. the information that will be found
c. how the final report will be written
d. how the information gathered will be used to predict external environmental changes
e. the research questions to be answered
SECTION 1 POOL ITEMS
ANS: E
PTS: 1
REF: 116-117
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Comp
34. Pulte Homes, a national home builder, needs to control costs. Research done by Pulte Homes
determined that 80 percent of its homebuyers selected the same countertops, floors, carpets, and
toilets. Pulte Homes used these _____ data to cut its costs by reducing the variety of options offered
without having any effect on the majority of its buyers.
a. primary
b. secondary
c. dichotomous
d. convenience
e. ethnographic
ANS: A
Primary data are information that is gathered for the first time for solving a particular problem.
PTS: 1
REF: 116
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research| TB&E Model Customer
35. An engineer of Volkswagen America spent three and a half hours on a Greyhound bus to experience
the vast distances Americans travel in their automobiles and to try to understand why Americans treat
their automobiles as rolling extensions of their living rooms. What kind of data did the engineer
collect?
a. heuristic
b. primary
c. cohesive
d. random
e. secondary
ANS: B
Primary data are information that is gathered for the first time for solving a particular problem.
PTS: 1
REF: 116
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
36. Information collected for the first time for the purpose of solving a particular problem under
investigation is called _____ data.
a. primary
b. secondary
c. dichotomous
d. observation
e. convenience
ANS: A
PTS: 1
REF: 116
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: Def
37. To determine new product opportunities, British Colombia's Sun-Rype Products conducted focus
groups in which it learned Canadians are having trouble getting their required servings of fruits and
vegetables each day--especially the vegetables. It gathered _____ data.
a. heuristic
b. primary
c. consensual
d. random
e. collaborative
SECTION 1 POOL ITEMS
ANS: B
PTS: 1
REF: 117
TOP: AACSB Reflective Thinking| TB&E Model Research
OBJ: 08-3 TYPE: App
38. Stair Specialist, Inc. builds customized circular staircases for homes in southern California. Its sales
have plateaued. Nothing it does seems to change its sales picture. Its owner has asked you to advise the
company on what it should do to increase its sales. Which of the following is an example of primary
data that could be used for examining this marketing research problem?
a. data from a study of new home start-ups in southern California
b. an article in a construction trade journal predicting fewer housing starts during the next
decade
c. industry predictions that the number of new homes built in the Southwest will increase by
15 percent
d. information from the Los Angeles Yellow Pages showing the number of building
contractors has declined over the past five years
e. none of the choices
ANS: E
Information collected for the first time for the purpose of solving a particular problem under
investigation is called primary data. All of these data are examples of secondary data.
PTS: 1
REF: 116
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research
39. Mel and Mimi is the name of an upscale boutique that has outgrown the building it has been located in
for the last two decades. Its owners want to know how its customers will react to a move and if the
addition of new product lines will make the new location more attractive to its loyal customers. The
store's owners have surveyed several of their customers to gauge their reaction to various potential
locations and changes in product lines. The survey results are an example of _____ data.
a. primary
b. secondary
c. dichotomous
d. observation
e. collaborative
ANS: A
Information that is collected for the first time for the purpose of solving a particular problem under
investigation is called primary data.
PTS: 1
REF: 116
OBJ: 08-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Research| TB&E Model Customer
40. What is the chief advantage of primary data?
a. low cost compared to secondary data
b. relevance to the problem at hand
c. availability to any interested party for use
d. accessibility through computerized databases
e. avoiding interviewer biases
ANS: B
Primary data are information collected for the first time for the purpose of solving a particular problem
under investigation.
PTS: 1
REF: 116
OBJ: 08-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Research
SECTION 1 POOL ITEMS
Chapter 7
MULTIPLE CHOICE
1. A _____ is a group of people or organizations that has wants and needs that can be satisfied by
particular product categories, has the ability to purchase these products, and is willing to exchange
resources for the products.
a. firm
b. buyer
c. market
d. consumer
e. target
ANS: C
PTS: 1
REF: 97
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 07-1 TYPE: Def
2. A group of middle school students stop by a sporting goods store. The store has just received a new
shipment of high-end racing bicycles. The bicycles range in price from $1,200 to $3,000. All of the
students want one of these new bikes, but none has the means to buy one. Is this group of consumers a
potential market for the expensive bikes?
a. Yes, they are a potential market since they are all about the same age.
b. No, they do not have the ability to purchase at this time.
c. No, to qualify as a market, they must need the product.
d. Yes, they are a market because this product could satisfy their consumer wants and
desires.
e. Yes, they are a market because this group shares relatively similar product needs and
purchasing characteristics.
ANS: B
A market is a group of people or organizations that has wants and needs that can be satisfied by
particular product categories, has the ability to purchase these products, and is willing to exchange
resources for the products. There is no suggestion of ability in this case.
PTS: 1
REF: 97
OBJ: 07-1 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
3. A market is people or organizations that have:
a. the ability, willingness, and power to buy
b. a medium of exchange and products they desire
c. needs and wants and an ability and willingness to buy
d. unmet needs or wants and products or services that satisfy those unmet needs or wants
e. communication, financial, and capital resources
ANS: C
A market is defined as having four imperative characteristics: people or organizations, needs and
wants, ability, and willingness to buy.
PTS: 1
REF: 97
OBJ: 07-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer
4. A(n) _____ is a subgroup of individuals or organizations sharing one or more characteristics that cause
them to have relatively similar product needs.
a. market universe
b. market segment
c. aggregated market
SECTION 1 POOL ITEMS
d. segmentation base
e. population sample
ANS: B
PTS: 1
REF: 97
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 07-1 TYPE: Def
5. _____ is the process of dividing a market into meaningful groups that are relatively similar and
identifiable.
a. Perceptual mapping
b. Positioning
c. Micromarketing
d. Market sampling
e. Market segmentation
ANS: E
PTS: 1
REF: 97
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 07-1 TYPE: Def
6. E&V Bridal Studios is a wedding consulting business designed to appeal to East Asians. At one time it
used the same marketing mix for all of its customers, but it has discovered that it needs a different
marketing mix to appeal to its ethnic customers. For example, Chinese brides want elaborate red
gowns, and Vietnamese brides wear a brocaded gown with long sleeves and a Mandarin collar. E&V
Bridal Studios uses a procedure called _____ to divide its large market.
a. micromarketing
b. positioning
c. market segmentation
d. cannibalization
e. perceptual mapping
ANS: C
Dividing one large market into divisions based on a variable such as size is called market
segmentation.
PTS: 1
REF: 97
OBJ: 07-1 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Strategy
7. The purpose of market segmentation is to:
a. reduce the market down to a specific size that the firm can handle
b. divide the market into equal size and profit regions for sales territories
c. group a large number of markets together enabling a company to serve them
simultaneously
d. develop a generalized definition of the market as a whole
e. enable the marketer to tailor marketing mixes to meet the needs of one or more specific
groups
ANS: E
The purpose of segmentation is to group similar consumers and to serve their needs with a specialized
marketing mix.
PTS: 1
REF: 97-98
OBJ: 07-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
8. Hildy Webb and LaTishe Brown own Creative Catering and would like to improve customer
satisfaction and increase repeat business. When you ask them to describe a typical customer, they say
it is impossible and explain that with corporate functions, family affairs, and fund-raisers, they do not
have a typical customer. You suggest it is time for market segmentation because:
SECTION 1 POOL ITEMS
a. it will enable them to build an accurate description of customer needs by group and to
design a marketing mix to fit each segment
b. Creative Catering needs to reduce the size of the market it serves
c. Creative Catering needs to learn how to group these markets together into one market to
serve all of them adequately
d. it will help develop a generalized definition of the market as a whole and reveal the
optimal marketing mix for this market
e. this will position the company in the minds of its consumers as compared to its
competitors
ANS: A
The purpose of segmentation is to group similar consumers and to serve their needs with a specialized
marketing mix.
PTS: 1
REF: 97
OBJ: 07-1 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
9. Market segmentation can assist marketers to do all of the following EXCEPT:
a. develop more precise definitions of customer needs and wants
b. identify which variable base should be used for segmenting
c. more accurately define marketing objectives
d. improve resource allocation
e. evaluate performance
ANS: B
Market segmentation itself does not signal which base should be used, but it will define needs and
wants, and help marketers define marketing objectives, improve resource allocation, and evaluate
performance.
PTS: 1
REF: 97-98
OBJ: 07-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
10. The process of market segmentation involves breaking down a heterogeneous market into
homogeneous and identifiable segments. If this process is carried to its extreme, then one could say
that:
a. this is the reason segmentation cannot be used by small firms
b. all individuals have the same needs in spite of cultural differences
c. everyone belongs to the same segment
d. segmentation controls the demand for products
e. every individual in the world is a market segment
ANS: E
The ultimate segmentation would have each individual occupying his or her own segment, because
everyone has somewhat different needs.
PTS: 1
REF: 97-98
OBJ: 07-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
11. ProtecTV is a product that selectively mutes words and phrases some people find objectionable. It can
be connected to a television, VCR, DVD player, or a satellite TV system. The manufacturer of
ProtecTV targeted parents who did not want their children exposed to what they consider to be
offensive language. The primary market segment for ProtecTV is:
a. all parents
b. educators
SECTION 1 POOL ITEMS
c. children under the age of 12
d. parents with preteens in their households
e. all those interested in screening out offensive language
ANS: D
PTS: 1
REF: 97
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 07-1 TYPE: App
12. Market segmentation helps businesses to:
a. define customer needs and wants more precisely
b. more accurately define marketing objectives
c. more efficiently allocate resources
d. better evaluate their performances
e. do all of these things
ANS: E
PTS: 1
REF: 97-98
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 07-2 TYPE: Comp
13. Which of the following is NOT one of the four criteria identified in the text for successful market
segmentation?
a. substantiality
b. identifiability and measurability
c. accountability
d. accessibility
e. responsiveness
ANS: C
The four criteria are substantiality, identifiability and measurability, accessibility, and responsiveness.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Strategy
14. To be useful, a segmentation scheme must produce segments that meet four basic criteria. The criteria
are:
a. segmentable, targetable, reliable, and homogeneous
b. tangibility, flexibility, causality, and accessibility
c. substantiality, identifiability and measurability, accessibility, and responsiveness
d. reliability, flexibility, tangibility, and accessibility
e. responsiveness, reliability, homogeneity, and causality
ANS: C
PTS: 1
REF: 98
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 07-3 TYPE: Comp
15. A manufacturer of lenses used in microscopes, binoculars, and telescopes has segmented its market
into scientific equipment manufacturers, sporting equipment manufacturers, and retailers who sell
replacement lenses. In order for this segmentation scheme to be successful, all of the following criteria
must be met EXCEPT:
a. substantiality
b. accessibility
c. identifiability and measurability
d. complexity
e. responsiveness
ANS: D
Complexity is not a criterion; simplicity would be preferred.
SECTION 1 POOL ITEMS
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Strategy
16. According to the criterion of _____ a selected segment must be large enough to warrant developing
and maintaining a special marketing mix. Serving the specific needs of this segment must be
commercially viable, even if the number of potential customers is small.
a. causality
b. accountability
c. responsiveness
d. accessibility
e. substantiality
ANS: E
PTS: 1
REF: 98
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 07-3 TYPE: Def
17. The marketing researcher for Chickadee, a manufacturer of designer clothing for infants and toddlers,
has submitted a report on potential segments for expansion of its marketing efforts. She noted an
increase of professional women over the age of 35 who are leaving their jobs to have their first babies.
She described this segment as having substantiality. This means it:
a. has enough special stores, magazines, and other outlets that it will be possible to direct
advertisements at this group
b. is large enough to permit a profitable market effort toward its members
c. exhibits a response rate to marketing variables different from the rates of other segments
d. is too large and needs to be reduced to a more easily identifiable and measurable size
e. will be difficult to develop a product to match this group of buyers
ANS: B
Substantiality means the selected segment will be large enough to warrant developing and maintaining
a special marketing mix. Serving the specific needs of this segment must be commercially viable, even
if the number of potential customers is small.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
18. DCS Corporation makes barbecue grills. It has expanded into high-priced, multi-purpose grills for
people who want to be able to cook all their food outside. Facing little competition, DCS designed an
excellent line of specialty grills, had good distribution, used effective promotion with this market, and
within four years had a respectable market share. Yet financial losses every year have caused DCS to
decide to drop this line. The reason could be that this market segment, relative to the resources devoted
to it, lacked:
a. reliability
b. identifiability and measurability
c. substantiality
d. accessibility
e. causality
ANS: C
Substantiality means the selected segment is large enough to warrant developing and maintaining a
special marketing mix. Serving the specific needs of this segment must be commercially viable. Based
on four years of losses, this one apparently was not.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Product
SECTION 1 POOL ITEMS
19. United Social Service Agency wants to identify segments by their readiness to participate in a drug
and alcohol program or in prenatal care. The agency will need to gauge whether there are enough
people to justify setting up the service. The FIRST segmentation criterion problem that would greet
this proposal is:
a. responsiveness
b. identifiability and measurability
c. accessibility
d. substantiality
e. responsibility
ANS: B
Identifiability and measurability is the first problem: how many people who are willing, indifferent, or
unwilling to participate are there? The agency needs this number to gauge if there are enough of them.
If there were enough of them, they would probably be responsive to a special program.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
20. The city of Blossom Valley has a job training program for the homeless but has had a difficult time
reaching this group with information about the program even though radio and television stations have
provided public service advertisements free of charge. This illustrates a segmentation problem with:
a. substantiality
b. identifiability and measurability
c. responsiveness
d. accessibility
e. accountability
ANS: D
Accessibility is the ability to communicate information about the product offering to the segment.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| AACSB Communication| TB&E Model Promotion
21. Market researchers estimate thousands of Americans have high blood pressure and do not know it
because they do not have annual medical exams. A pharmaceutical company that has developed a
medicine to reduce blood pressure should not count on this group to be a good target market because
the group lacks:
a. both accessibility and responsiveness
b. accountability
c. both accessibility and substantiality
d. substantiality, identifiability, and measurability
e. reliability and responsiveness
ANS: A
Marketers cannot reach someone who does not know he or she has a problem and if he or she is
reached, there will be no response.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
SECTION 1 POOL ITEMS
22. SRD Research Firm has conducted marketing research on the market for concrete siding for homes.
The research firm has determined there are thousands of homeowners who want the security, safety,
warmth, and stability provided by concrete siding. These homeowners are generally married and
between 25 and 54 years of age. They tend to live in suburban neighborhoods and most subscribe to
lifestyle magazines. If you were interpreting these results, you might suggest that SRD:
a. conduct additional research because it has no idea about the measurability of its segments
b. examine the research report again to see if it can determine segment accessibility
c. conduct a follow-up analysis to determine if the segments it might choose would respond
differently from other segments to its marketing strategy
d. not segment the concrete siding market because the only market for siding is contractors
who build the homes
e. segment the concrete siding market based on the information provided and concentrate its
efforts on suburban homeowners between 25 and 54 who read lifestyle magazines
ANS: C
The only criterion SRD has not determined is market responsiveness.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Strategy
23. Every six months or so, some manufacturer introduces a new shape or color for the boxes that house
the hardware to run PCs. These companies contend beige is boring, and people are ready for
"something fun." These manufacturers ignore the fact most Americans like their technology in plain
wrappers. These bright colors and odd shapes have failed because the market segment to which they
are targeted lacks:
a. substantiality
b. identifiability and measurability
c. responsiveness
d. reliability
e. accessibility
ANS: C
It is not difficult to locate the large market for PCs—they are readily identifiable and accessible for
other computer products. They are just not responsive to the oddball designs and colors.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
24. The requirement for a market segment to be responsive means:
a. over half of the consumers in the identified segment will be actively interested in the
product
b. all the segments identified by a marketer should respond to the marketing mix
c. all the segments identified by a marketer should not respond to the marketing mix
d. the segments identified by a marketer should not differ in the level of their responsiveness
to the marketing mix
e. the segment identified by a marketer should differ in how it responds to the marketing mix
when compared to another segment confronted with the same mix
ANS: E
The target segment should respond differently to the market mix compared to other segments.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
SECTION 1 POOL ITEMS
25. If a market segment is especially motivated by coupons in newspapers, which segmentation success
criterion is most influential in the success of this program?
a. responsiveness
b. identifiability and measurability
c. substantiality
d. accessibility
e. functionality
ANS: A
Responsiveness is in force when a target segment responds differently (hopefully more positively) to
the marketing mix than other segments.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy| TB&E Model Promotion
26. The Middleton Health Club has a new fitness program for expectant mothers. After fliers were placed
at the offices of area obstetricians, Middleton's class filled up within two days. Which segmentation
success criterion was most influential in the success of this promotion?
a. substantiality
b. identifiability
c. measurability
d. causality
e. responsiveness
ANS: E
Responsiveness is in force when a target segment responds differently (hopefully more positively) to
the marketing mix than other segments.
PTS: 1
REF: 98
OBJ: 07-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Promotion
27. _____ are characteristics of individuals, groups, or organizations that marketers use to divide a total
market into segments.
a. Differentiation guides
b. Segmentation bases
c. Perceptual maps
d. Responsiveness quotients
e. Accessibility quotients
ANS: B
PTS: 1
REF: 98
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 07-4 TYPE: Def
28. E&V Bridal Studios is a wedding consulting business targeted to East Asians. It accommodates the
various cultures by providing services to appeal to Koreans, Vietnamese, Chinese, and Japanese
customers. E&V Bridal Studios markets its services to its customers by using ethnicity to divide its
customers into segments. Ethnicity is its primary:
a. perceived image
b. accessibility quotient
c. environmental control
d. segmentation base
e. differentiation guide
ANS: D
A segmentation base is the characteristic used to segment the market.
SECTION 1 POOL ITEMS
PTS: 1
REF: 98
OBJ: 07-4 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Promotion
29. Listerine Essential Care toothpaste is designed to reduce plaque and to prevent gingivitis. Its ads state,
"After age 35, 3 out of 4 adults have some form of gum disease." The toothpaste is targeted to the
market segment over the age of 35. This age variable that has been used to distinguish the market for
this toothpaste is an example of a(n):
a. perceived variable
b. accessibility quotient
c. mass market
d. segmentation base
e. differentiation guide
ANS: D
A segmentation base is the characteristic used to segment the market.
PTS: 1
REF: 98
OBJ: 07-4 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Product
30. Military Spouses is the only publication in the world that targets readers who "are married to the
military." Its content reflects the unique set of challenges, hardships, and rewards to those whose
spouses are in the military. The marital status that has been used to distinguish the market for this
magazine is an example of a(n):
a. perceived variable
b. accessibility quotient
c. mass market
d. segmentation base
e. differentiation guide
ANS: D
A segmentation base is the characteristic used to segment the market.
PTS: 1
REF: 98
OBJ: 07-4 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Product
SECTION 1 POOL ITEMS
Chapter 5
MULTIPLE CHOICE
1. The processes individuals use when making a purchase decision are called _____. This is also the
reason individuals recognize and respond to the distinctive lettering used on Coca-Cola cans, the shape
of the Nike swoosh, and the color of a can of Campbell soup.
a. consumer behavior
b. marketing
c. consumerism
d. perceptual mapping
e. database mining
ANS: A
Consumer behavior describes how consumers make purchase decisions.
PTS: 1
REF: 63
OBJ: 05-1 TYPE: Def
TOP: AACSB Analytic| TB&E Model Customer
2. Marketers often study _____, the processes used and the factors that influence the consumer when
making purchase decisions.
a. psychographics
b. business buying behavior
c. consumerism
d. consumer behavior
e. perceptual mapping
ANS: D
PTS: 1
REF: 63
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 05-1 TYPE: Def
3. The steps of the consumer decision-making process in order are:
a. need recognition, alternative aggregation, reevaluation, purchase decision, postpurchase
behavior
b. need positioning, stimulus response reactions, evaluation of alternatives, purchase
decision, postpurchase behavior
c. need positioning, alternative aggregation and divestment, purchase decision, postpurchase
evaluation
d. information search, need positioning, evaluation of alternatives, product trial, purchase
decision, postpurchase satisfaction
e. need recognition, information search, evaluation of alternatives, purchase, and
postpurchase evaluation
ANS: E
PTS: 1
REF: 63
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 05-2 TYPE: Def
4. As a result of hearing the adventures of returning soldiers, Monroe decided to enlist in the U.S. Army.
These stories he heard from the soldiers acted as:
a. affective states
b. external stimuli
c. internal stimuli
d. purchase outcomes
e. a dissonance creator
ANS: B
The adventures he heard were stimuli that were not physiological.
SECTION 1 POOL ITEMS
PTS: 1
REF: 64
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model International Perspective
5. Hector loves cola and is always on a diet. He will only drink Diet Coke. When offered a Diet Pepsi
one afternoon as an alternative, he refused to even consider it as part of his evoked set even though he
generally drinks a soft drink about the time of day the offer was made. This illustrates that Hector:
a. is satisfying a want
b. is satisfying a need
c. is satisfying a belief
d. has a physiological drive
e. has a need motivator
ANS: A
A want is often brand specific, whereas a need is something an individual depends on to function
efficiently. A person may need food but wants specific brands.
PTS: 1
REF: 64
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Product
6. Which of the following is the BEST example of an internal stimulus that would create need
recognition?
a. a friend comments on how shabby your coat looks
b. a radio station runs an ad for a new video game rental store
c. a headache
d. an invitation to a graduation for which you need a gift
e. a billboard promoting a new national Internet service provider
ANS: C
Aches and pains are generated internally by your body without outside inputs from anything or
anyone.
PTS: 1
REF: 64
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
7. After a need or want is recognized, a consumer may be motivated to clarify the options available and
generate an evoked set of brands. This occurs during which part of the consumer decision-making
process?
a. evaluation of alternatives
b. information search
c. cognitive dissonance
d. consideration stage
e. product identification
ANS: B
PTS: 1
REF: 64
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 05-2 TYPE: Def
8. While Martin was looking at the DVDs at Wal-Mart, he was trying to remember the name of the
horror movie he saw that starred Bruce Campbell so he could buy the DVD. This is likely to occur
during which part of the consumer decision-making process?
a. antecedent state
b. need recognition
c. external information search
d. alternative evaluation
SECTION 1 POOL ITEMS
e. internal information search
ANS: E
After a need or want is recognized, a consumer may be motivated to search for information. In this
case, the information was already stored in his memory.
PTS: 1
REF: 64
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
9. The types of products people purchase using only an internal search are typically:
a. frequently purchased, low-cost items
b. frequently purchased, high-cost items
c. infrequently purchased, low-cost items
d. infrequently purchased, high-cost items
e. all types of items, regardless of price or frequency of purchase
ANS: A
Information about frequently purchased, low-cost items is stored in an individual's memory and is
sufficient knowledge for the purchase decision.
PTS: 1
REF: 64-65
OBJ: 05-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
10. Which of the following products would most likely require the purchaser to use only an internal
information search?
a. a veterinarian for a new puppy
b. a day-care facility for a two-month-old infant
c. a wedding gown
d. a tube of toothpaste
e. an anniversary gift
ANS: D
Internal information search is used with frequently purchased, low-cost items; the only item on the list
that meets this criterion is the toothpaste.
PTS: 1
REF: 64
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
11. An external information search is especially important when:
a. there is a great deal of past experience
b. there are high cost associated with making an incorrect decision
c. the cost of gathering information is high
d. buying frequently purchased, low-cost items
e. there is little risk of making an incorrect decision
ANS: B
If a consumer perceives a purchase to involve high risk (financial, social, etc.), an external search will
lower the risk by providing more information.
PTS: 1
REF: 64-65
OBJ: 05-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer
12. For which of the following products is the purchaser most likely to rely on an external information
source?
a. a toothbrush
SECTION 1 POOL ITEMS
b.
c.
d.
e.
a copy of People magazine
a Big Mac
a new prescription
a box of tissues
ANS: D
PTS: 1
REF: 64-65
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 05-2 TYPE: App
13. Pregnant Niceae has been shopping for a baby crib. She has visited several sites on the Internet that
provide information about cribs and has consulted a book on how to keep her baby safe by a consumer
group. Niceae has also asked several new mothers for recommendations. In her decision-making
process, Niceae has been using:
a. marketing-controlled information sources
b. demographic information sources
c. nonmarketing-controlled information sources
d. secondary data sources
e. internal search sources
ANS: C
Public sources of information, such as Web sites and consumer groups, are known as nonmarketingcontrolled information sources.
PTS: 1
REF: 64-65
OBJ: 05-2 TYPE: App
TOP: AACSB Technology| TB&E Model Product| TB&E Model Online/Computer
14. Which of the following is NOT an example of a marketing-controlled information system?
a. a television ad for Geico insurance
b. a NASCAR automobile sponsored by the U.S. Army
c. a $1-off coupon for Campbell’s soup
d. an article in Bicycling magazine about the newest Shimano brand shoes
e. a real estate agent
ANS: D
The article in Bicycling would NOT have originated with the Shimano organization.
PTS: 1
REF: 65
OBJ: 05-2 TYPE: App
TOP: AACSB Technology| TB&E Model Online/Computer
15. While Robinson was looking at the CDs at Wal-Mart, he was trying to remember the name of the
group that sang the song he liked on last night's episode of Smallville, so he could buy it. Since
recording companies pay to have their CDs promoted on television shows that air on the WB, the
source of information Robinson is trying to recall is:
a. a fortuitously evoked set
b. marketing-controlled
c. nonmarketing-controlled
d. unitary data
e. a credible consideration set
ANS: B
PTS: 1
REF: 65
TOP: AACSB Technology| TB&E Model Customer
OBJ: 05-2 TYPE: App
SECTION 1 POOL ITEMS
16. Warren loves to go to the beach on his vacation but hates to have to worry about the possibility of
hurricanes. As Warren looked for where he should go on vacation this summer, he consulted a
publication called Smart Money and learned the islands of Aruba, Bonaire and Curacao are not in the
hurricane belt. Now he will only consider these island resorts as possible vacation destinations. This
group of resort islands is called Warren’s:
a. involvement set
b. evaluative set
c. evolved set
d. evoked set
e. intuitive set
ANS: D
An evoked set is the set of brands a consumer recalls and would consider as possible purchase choices.
PTS: 1
REF: 65
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Product
17. Melyssa has been given a horse and needs to buy a new Western saddle. She has narrowed the brands
of saddles she is considering down to Dale Chavez, Abetta, and Big Horn. These three brands of
Western saddles represent Melyssa's:
a. evaluative criteria
b. dissonance suppressors
c. discretionary discriminators
d. discriminatory set
e. evoked set
ANS: E
PTS: 1
REF: 65
TOP: AACSB Reflective Thinking| TB&E Model Product
OBJ: 05-2 TYPE: App
18. Zoran wants to buy a pair of sunglasses he can wear when he is riding his bicycle in competitions. He
wants sunglasses with a rubberized nose piece, built-in anti-fogging technology, and the ability to
block light from all angles. The criteria for his decision appear to be based on:
a. marketing-controlled information sources
b. evoked set finalists
c. routine response behavior
d. attitudes of others
e. product attributes
ANS: E
Physical characteristics and traits used in decision making are called product attributes.
PTS: 1
REF: 65
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Product
19. Another name for evoked set is:
a. called array
b. reminder assortment
c. induced memory
d. consideration set
e. reminder induction
ANS: D
PTS: 1
REF: 65
TOP: AACSB Reflective Thinking| TB&E Model Customer
20. People tend to be more satisfied with a purchase if:
OBJ: 05-2 TYPE: Def
SECTION 1 POOL ITEMS
a.
b.
c.
d.
e.
they obtain additional information that reinforces their decision
they feel less competent in their daily lives
cognitive dissonance develops
there is inconsistency among opinions and values
there is no further contact with the seller
ANS: A
New information that reinforces positive ideas about the purchase tends to reduce cognitive dissonance
and increases satisfaction.
PTS: 1
REF: 66
OBJ: 05-2 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Product
21. Cecelia is a receptionist and just spent $347 on a new riding saddle for her boyfriend Claude, a
weekend cowboy. When she got home with the saddle, she experienced a high level of anxiety about
whether she has made the right purchase decision. Cecelia experienced:
a. selective dissatisfaction
b. temporal distortion
c. perceptual disharmony
d. cognitive dissonance
e. self-actualization involvement
ANS: D
Cognitive dissonance is the term for postpurchase tension and anxiety.
PTS: 1
REF: 66
OBJ: 05-2 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Pricing| TB&E Model Product
22. Miller has just purchased a new Allez A1 Specialized bicycle for $1,000. Miller realizes that the Allez
A1 costs more than most bikes, and even at that price it doesn't come with a set of pedals. Even though
other brands of bicycles cost much less than the Allez A1, Miller tells himself that the Allez A1 is
more comfortable and has greater durability than most road bikes. As Miller wonders if he made the
right purchase decision, he is experiencing:
a. attribute remorse
b. cognitive dissonance
c. evaluation distortion
d. consumer cognition
e. perceptual disharmony
ANS: B
Cognitive dissonance involves the realization of the advantages and disadvantages of the purchased
product.
PTS: 1
REF: 66
OBJ: 05-2 TYPE: App
TOP: AACSB Analytic| TB&E Model Product
23. _____ is the amount of time and effort a buyer invests in the search, evaluation, and decision processes
of consumer behavior.
a. Economic value
b. Involvement
c. Opportunity cost
d. Temporal cost
e. Perceived level of personal risk
ANS: B
PTS: 1
REF: 67
OBJ: 05-3 TYPE: Def
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Strategy
24. When the secretary restocks office supplies each month, he places an order for paper, pens, folders,
and printer cartridges. Each month the order is the same. This type of buying behavior is called:
a. buyer's harmony
b. situational convenience
c. routine response behavior
d. limited decision making
e. consistent decision making
ANS: C
The buying of frequently purchased, low-cost goods is typically routine response behavior.
PTS: 1
REF: 67
OBJ: 05-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
25. Which of the following activities is most likely to be an example of routine response behavior?
a. the purchase of a three-week vacation cruise
b. a homeowner’s purchase of a new grill for $6,000
c. the first-time purchase of a copy machine for your home office
d. the purchase of toilet paper
e. the purchase of a infant car seat
ANS: D
Only the toilet paper is an example of a low-involvement purchase.
PTS: 1
REF: 67
OBJ: 05-3 TYPE: App
TOP: AACSB Reflective Thinking| TB&E Model Customer
26. _____ is characterized by low involvement, a short time frame, an internal-only information search,
and low costs.
a. Limited decision making
b. Routine response behavior
c. Emotional buying
d. Intensive decision making
e. Temporally-limited behavior
ANS: B
See Exhibit 5.2.
PTS: 1
REF: 67
OBJ: 05-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer
27. Jackson has moved to a new community and can no longer attend his old church. He is currently
visiting churches to make a decision about which one best serves his needs. In making his decision,
Jackson will engage in _____ consumer decision making.
a. limited
b. extended
c. habitual
d. classical
e. routine
ANS: A
Jackson is familiar with churches and the services they provide, but he is unfamiliar with the ones in
his new community.
SECTION 1 POOL ITEMS
PTS: 1
REF: 67
OBJ: 05-3 TYPE: App
TOP: AACSB Analytic| TB&E Model Customer
28. The electricity for lighting outdoor billboards is powered by transformers. The operator of a company
that installs and manages billboards has purchased many such transformers. Today he plans to buy a
replacement for one that was destroyed by a recent hurricane. Before making this purchase, he will
look at cost and also see if he can find one that is more weatherproof. He wants to make sure he buys
the best transformer for the job and that he does not pay more money than he should. In other words,
he will engage in _____ decision making.
a. limited
b. extended
c. habitual
d. classical
e. routine
ANS: A
The billboard operator is familiar with the product, but he is not immediately knowledgeable about the
products currently on the market.
PTS: 1
REF: 67
OBJ: 05-3 TYPE: App
TOP: AACSB Analytic| TB&E Model Customer
29. When a consumer is purchasing an unfamiliar or expensive product, the consumer often uses the
_____ process.
a. extensive decision making
b. cognitive harmonizing
c. limited problem solving
d. strategic behavior
e. stimulus discrimination
ANS: A
PTS: 1
REF: 67-68
OBJ: 05-3 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Product
SECTION 1 POOL ITEMS
Chapter 19
MULTIPLE CHOICE
1._____ is a company-wide business strategy designed to optimize profitability, revenue, and customer
satisfaction by focusing on highly defined and precise customer segments.
a. Organizational optimization
b. Consumer relationship marketing (CRM)
c. Total quality management (TQM)
d. Customer relationship management (CRM)
e. Market aggregation
ANS: D
PTS: 1
REF: 293
OBJ: 19-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
5. Customer relationship management:
a. is often described as a closed-loop system
b. only involves personnel in marketing and management departments
c. organizes the company around functional departments
d. is a very simplistic method of encouraging customer satisfaction
e. is only a theory and has not been proven successful in any practical way
ANS: A
CRM is a company-wide business strategy designed to optimize profitability, revenue, and customer
satisfaction by focusing on highly defined and precise customer segments.
PTS: 1
REF: 293
OBJ: 19-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
6. To initiate the CRM cycle, a company must first:
a. establish marketing objectives
b. decide on a segmentation strategy
c. establish customer relationships with the organization
d. determine the level of interaction customers have with the organization
e. acquire and capture customer data for product categories
ANS: C
PTS: 1
REF: 293
OBJ: 19-1 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
8. Which of the following statements about the CRM cycle is true?
a. The letters CRM are an acronym for consumer relationship marketing.
b. The CRM cycle does not affect employees outside the marketing and management
functional areas.
c. The CRM cycle is continuous and circular with no predefined start or end point.
d. The CRM cycle takes a simplistic perspective on customers.
e. All of these statements about the CRM cycle are true.
ANS: C
CRM stands for customer relationship management.
PTS: 1
REF: 293
OBJ: 19-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
SECTION 1 POOL ITEMS
9. A company that has a(n) _____ customizes its product offerings based on data generated through
interaction between the customer and the company.
a. ethnocentric perspective
b. supply-based focus
c. sales orientation
d. supply-based focus
e. customer-centric focus
ANS: E
A customer-centric focus is represented by adherence to the marketing concept.
PTS: 1
REF: 295
OBJ: 19-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer
12. Customer-centric is an internal management philosophy similar to:
a. utilitarianism
b. Herzberg's theory of motivation
c. the equity theory
d. the marketing concept
e. consumerism
ANS: D
PTS: 1
REF: 295
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-2 TYPE: Def
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Product
14. In a CRM environment, _____ is defined as the informal process of collecting customer information
through customer contacts and feedback on product performance.
a. corporate modification
b. attitude adjustment
c. organizational perception
d. stimulus/response research
e. learning
ANS: E
PTS: 1
REF: 295-296
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-2 TYPE: Def
15. _____ is the process by which learned information from customers is centralized and shared in order to
enhance the relationship between customers and the organization.
a. Knowledge management
b. Learning
c. Database marketing
d. Interactive marketing
e. Information marketing
ANS: A
PTS: 1
REF: 295
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-2 TYPE: Def
17. _____ refers to the latitude organizations bestow on their representatives to negotiate mutually
satisfying commitments with customers.
a. Consumer learning
b. Customerization
c. Empowerment
d. Autonomy
SECTION 1 POOL ITEMS
e. Interaction
ANS: C
PTS: 1
REF: 296
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-2 TYPE: App
19. A(n) _____ is the point at which a customer and a company representative exchange information and
develop learning relationships.
a. social contact
b. interaction
c. empowering moment
d. equilibrium point
e. transactional dyad
ANS: B
PTS: 1
REF: 296
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-2 TYPE: App
23. Which of the following statements about touch points is true?
a. Data gathered at external touch points, once interpreted, provide information that affects
internal touch points.
b. A customer applying for a credit card is an example of a touch point.
c. Companies are publicizing their Web sites as the first touch point for customer
interactions.
d. A customer complaint is an example of an external touch point.
e. All of these statements about touch points are true.
ANS: E
PTS: 1
REF: 297
OBJ: 19-3 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
24. In a CRM system, _____ are all areas of the business where customers have contact with the company
and data may be gathered and used to guide and direct the decision making within that business unit.
a. touch points
b. focus areas
c. data mining
d. information search periods
e. observational points
ANS: A
PTS: 1
REF: 297
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 19-3 TYPE: Def
TOP: AACSB Technology| AACSB Reflective Thinking| TB&E Model Online/Computer| TB&E
Model Customer
28. _____ interactions occur when customers buy products in a store.
a. Point-of-sale
b. Relationship-based
c. Cost-based
d. Retail-centric
e. Distribution-focused
ANS: A
PTS: 1
REF: 297
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-3 TYPE: Def
SECTION 1 POOL ITEMS
29. Which of the following is a guideline for a successful CRM system?
a. Customer information is not retained past the initial contact with the customer.
b. Intuition and experience must define the products provided by the organization.
c. The product takes center stage in the organization.
d. Customer information is kept in a centralized repository.
e. All of these are guidelines for a successful CRM system.
ANS: D
Customer information is retained past the initial contact with the customer. Customer data should be
accumulated over the customer's entire life span with the organization.Customers must define the
products provided by the organization. The customer takes center stage in the organization.
PTS: 1
REF: 298-299
OBJ: 19-5 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
30. The traditional approach for acquiring data from customers is through:
a. encoding devices
b. media
c. feedback mechanisms
d. channel interactions
e. public relations
ANS: D
PTS: 1
REF: 298
TOP: AACSB Reflective Thinking| TB&E Model Strategy
OBJ: 19-4 TYPE: Comp
31. Which of the following is an example of a channel through which customer data are traditionally
gathered?
a. store visits
b. conversations with salespeople
c. interactions via the Web
d. phone conversations
e. all of these
ANS: E
PTS: 1
REF: 298
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-4 TYPE: Comp
32. An organization should view every transaction as:
a. simply a financial exchange
b. deleterious to customer relationship management
c. the opportunity to collect vast amounts of data about the customer
d. the creation of customer-organization multiplicity
e. the closing of a channel
ANS: C
PTS: 1
REF: 298
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-4 TYPE: Comp
33. When viewed as an interaction between the organization and the customer, a transaction can produce
all of the following customer data EXCEPT:
a. name, address, and phone number
b. information about the customer's relationship with other customers
c. past purchase history
d. information about the customer's relationship with the organization
e. average amount spent on purchases
ANS: B
PTS: 1
REF: 298
OBJ: 19-4 TYPE: Comp
SECTION 1 POOL ITEMS
TOP: AACSB Reflective Thinking| TB&E Model Customer
34. A(n) _____ is a central repository for data from various functional areas of the organization. These
data can be shared by all of the organization's departments.
a. information mine
b. knowledge distribution center
c. information extraction unit
d. information intermediary
e. data warehouse
ANS: E
PTS: 1
REF: 298-299
TOP: AACSB Technology| TB&E Model Online/Computer
OBJ: 19-5 TYPE: Def
37. The core of the data warehouse is:
a. empowered employees
b. transaction channels of communication
c. point-of-sale interactions
d. the database
e. a compiled list
ANS: D
PTS: 1
REF: 298
TOP: AACSB Technology| TB&E Model Online/Computer
OBJ: 19-5 TYPE: Def
40. A _____ is essentially a very large, corporate-wide database, culled from a number of separate
systems, such as billing, accounting, order fulfillment, distribution, customer service, and marketing
and sales, already in place within an organization.
a. data mart
b. customer information system
c. data warehouse
d. decision support system
e. data cluster
ANS: C
PTS: 1
REF: 298-299
TOP: AACSB Technology| TB&E Model Online/Computer
OBJ: 19-5 TYPE: Def
45. A(n) _____ list generally includes names and addresses gleaned from directories or membership
rosters.
a. predictive
b. compiled
c. response
d. actionable
e. disintegrated
ANS: B
PTS: 1
REF: 299
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-5 TYPE: Def
47. _____ is the addition of information to customer or prospect records for the purpose of better
describing or better determining the responsiveness of customers or prospects.
a. Information formatting
b. Database enhancement
c. Data mining
SECTION 1 POOL ITEMS
d. Data shading
e. Predictive modeling
ANS: B
PTS: 1
REF: 299
TOP: AACSB Technology|| TB&E Model Online/Computer
OBJ: 19-5 TYPE: Def
SECTION 1 POOL ITEMS
49.Which of the following statements about a CRM system is true?
a. A critical component of a CRM system is the use of the appropriate technology to store
and integrate customer data.
b. A CRM system operates on the theory that all customers are equally important.
c. Due to privacy laws, a CRM system only disseminates customer information to those who
are actually in day-to-day contact with customers.
d. A company using a CRM system must view its customers as bits of data.
e. All of these statements about a CRM system are true.
ANS: A
The CRM system allows companies to make use of the 80/20 rule. Customers should be viewed
comprehensively.
PTS: 1
REF: 300
OBJ: 19-1 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Strategy
50. _____ is the process of finding hidden patterns and relationships in the customer data stored in the data
warehouse.
a. Customer information management (CIS)
b. Data feedback
c. Information retrieval
d. Information extraction
e. Data mining
ANS: E
PTS: 1
REF: 300
TOP: AACSB Technology| TB&E Model Online/Computer
OBJ: 19-6 TYPE: Def
57. Which of the following techniques used to analyze marketing databases considers whether a customer
has made a purchase recently as well as how often that customer makes a purchase?
a. recency-frequency-monetary analysis (RFM)
b. predictive modeling
c. customer valuation
d. data mining
e. lifetime value analysis
ANS: A
PTS: 1
REF: 300
TOP: AACSB Technology| TB&E Model Customer
OBJ: 19-6 TYPE: Def
58. The basic assumption of _____ is that marketing to repeat customers is more profitable than marketing
to first-time buyers.
a. customer segmentation
b. predictive modeling
c. customer valuation
d. data manipulation
e. lifetime value analysis
ANS: E
Lifetime value analysis is a data manipulation technique that projects the future value of the customer
over a period of years using the assumption that marketing to repeat customers is more profitable than
marketing to first-time buyers.
PTS: 1
REF: 300
OBJ: 19-6 TYPE: Comp
TOP: AACSB Reflective Thinking| TB&E Model Strategy
SECTION 1 POOL ITEMS
59. Designer Linens Outlet uses CRM to track visitors to its Web site. This tracking allows the retailer to
confidently project the value of its repeat customers through its application of:
a. customer segmentation
b. predictive modeling
c. customer valuation
d. data manipulation
e. lifetime value analysis
ANS: E
Lifetime value analysis is a data manipulation technique that projects the future value of the customer
over a period of years using the assumption that marketing to repeat customers is more profitable than
marketing to first-time buyers.
PTS: 1
REF: 300
OBJ: 19-6 TYPE: App
TOP: AACSB Technology| TB&E Model Customer| TB&E Model Online/Computer
SECTION 1 POOL ITEMS
60._____ uses a past set of occurrences to predict the likelihood that some other occurrence, such as a
response or purchase, will take place in the future.
a. Customer manipulation
b. Predictive modeling
c. Data mining
d. Lifetime value analysis
e. Causal research
ANS: B
PTS: 1
REF: 301
TOP: AACSB Technology| TB&E Model Strategy
OBJ: 19-6 TYPE: Def
65. _____ involves developing product offerings customized for the appropriate customer segment and
then pricing and communicating these offerings for the purpose of enhancing customer relationships.
a. Transaction management
b. Campaign management
c. Data mining
d. Consumerism
e. Knowledge management
ANS: B
PTS: 1
REF: 302
TOP: AACSB Reflective Thinking| TB&E Model Customer
OBJ: 19-7 TYPE: Def