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2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 1 1. A legally binding contract comes into being A. when someone promises to give something to someone else. B. only if drawn up by a lawyer. C. whenever someone promises to do something in exchange for something. D. only when money is involved. 2. A supermarket customer wants to purchase an advertised product, but the product is not in stock. This is an example of a problem in the area of distribution known as A. warehousing. C. stock handling. B. inventory control. D. leasing. 3. Technological advancements have made it possible for some cereal manufacturers to communicate directly with customers, which reduces the need to use A. warehouse personnel. C. suppliers. B. intermediaries. D. freight carriers. 4. A snack-food distributor requires a supermarket to carry certain products in order to obtain the product that the supermarket really wants. This is an example of an illegal activity called A. intensive distribution. C. selective distribution. B. a tying agreement. D. an open agreement. 5. Moving a food product to market and making it available and accessible to customers are important activities that influence the rest of the A. merchandise plan. C. promotional plan. B. product mix. D. marketing mix. 6. Supermarket employees who are able to defend their ideas objectively usually are able to provide their coworkers with A. personal opinions. C. logical evidence. B. emotional information. D. unrelated statistics. 7. When a supermarket employee ask questions in an open-minded way, s/he avoids A. attacking someone else's idea. C. suggesting a better way to do something. B. stating his/her own opinion. D. mentioning the truth. 8. What should a food-marketing business include in a persuasive message? A. Logical evidence C. Graphic design B. Elaborate typeface D. Strong language 9. The owner of Bob's Bargain Supermarket has prepared a one-page report to inform the staff about current sales volume. This is an example of a(n) __________ report. A. activity B. complex C. informal D. analytical 10. Which of the following will help you to have a pleasant voice when speaking to supermarket customers: A. Speaking quickly C. Speaking at a comfortable volume B. Speaking very slowly D. Speaking in a monotone voice 11. The action taken by the salesperson in handling customer complaints should be based on the A. salesperson's opinion of the customer. C. amount of time required to solve the problem. B. customer's attitude toward the salesperson. D. solutions available within the business's policies. 12. Which of the following best describes an invoice: A. A contract between the shipper and the transportation company B. A packing list sent from the supplier to the merchant C. A duplicate of the purchase order sent by the vendor D. A bill from the supplier listing prices of goods shipped 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 2 13. Canned and boxed goods are often delivered as a unit on a pallet because A. the unit can be moved with a forklift. C. the pallet protects the shipment. B. each box is easily accessible. D. pallets weigh less than slip-sheets. 14. What do grocery stores often expect vendors to issue the store when vendors deliver damaged goods? A. Shipper's bill C. Credit voucher B. Packing slip D. Product rebate 15. Staple merchandise are products that A. should always be in stock. B. move slowly. C. should be sold at a discounted price. D. sell during certain seasons. 16. Eric's Supermarket wants to calculate the amount of ending inventory it has in nonfood merchandise. If the beginning inventory was $280,000, net purchases were $756,000, and net sales were $872,000, what is the amount of ending inventory? A. $164,000 C. $150,000 B. $154,000 D. $170,000 17. Which of the following is an economical shipping method for carload shipments of canned goods traveling a long distance: A. Mail C. Courier B. Air D. Rail 18. For which of the following foods do wholesalers need to inform buyers that the foods are produced without the use of chemicals or insecticides: A. Processed C. Organic B. Imported D. Convenience 19. Economics involves decision making because most individuals must determine A. how to get the most with the least. C. the cost of their noneconomic wants. B. what occupation appeals to them. D. which capital goods to buy for their use. 20. The market price is the actual price that prevails in a market A. at any particular moment. C. on the first of each month. B. at the beginning of each quarter. D. at the beginning of the fiscal year. 21. A grocery store customer prefers buying the individual serving-sized bags of chips but is concerned that the packaging creates a waste problem that is harmful to the environment. You could satisfy the customer's concern by pointing out that A. the customer has a responsibility to purchase larger bags. B. the packaging is approved by the government. C. convenience comes with a cost to the environment. D. more than 90% of the packaging is recyclable. 22. The basic role of the United States government is to A. protect U.S. citizens. B. maintain control of prices. C. increase production. D. limit business startups. 23. A technique that food marketers use to reduce the risk of losing money because of incompetent workers is to A. check credit references. C. provide effective training. B. install surveillance cameras. D. sign contractual agreements. 24. Why should a food-marketing business measure productivity? A. To see whether the food-marketing business's objectives are being met B. To find new ways to meet customer needs C. To determine the best ways to invest the food-marketing company's profits D. To locate new sources of inputs 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 3 25. When applying the law of diminishing returns, food producers know that there is a point at which production A. is too expensive to continue. C. equals the amount of revenue. B. reaches its maximum level. D. passes that of the competition. 26. In which of the following situations would consumers' purchasing power decrease: A. State income-tax rates decrease by 1/2%. B. Pay raise is 4% and inflation rate is 6%. C. Interest rates decrease from 9% to 8%. D. Employer matches contributions to retirement plan. 27. Food-marketing executives who respect the unique customs and habits of their foreign customers are exhibiting A. stereotypical behavior. C. communication skills. B. cultural sensitivity. D. language differences. 28. One of the most important functions of a leader is to A. schedule deadlines. B. assign tasks. C. develop projects. D. make decisions. 29. An important part of the coaching process involves A. expressing interest. B. being enthusiastic. C. agreeing on goals. D. having good skills. 30. Human relations can best be described as the study of the ways people A. form and express opinions. C. handle communication. B. form and conduct relationships. D. develop personal styles. 31. Patty is a grocery store owner who is thinking about retiring in a few years. Which of the following statements about retirement is true: A. Patty can depend on Social Security for basic living expenses. B. There is plenty of time for Patty to start saving for retirement. C. Saving even a little bit each month will help Patty. D. Patty will be in retirement only about 15 years. 32. Why is it important for individuals to periodically validate their credit histories? A. To protect themselves from bankruptcy C. To find out about different types of credit B. To understand credit laws D. To avoid being denied credit 33. A grocery store has inventory valued at $750,000. This amount would appear in the grocery store's balance sheet under A. liabilities. C. cash. B. current assets. D. income. 34. Why does a food-marketing company need a flow of money into the business? A. To sell C. To exist B. To borrow D. To invest 35. Interest a business earns from its bank accounts is included in which category of the income statement? A. Revenue C. Assets B. Net income D. Gross sales 36. What is a benefit to a supermarket of having written records of financial transactions? A. Expenses are reduced. C. Information is organized. B. Accounting is simplified. D. Investments are increased. 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 4 37. Which of the following statements is true about maintaining petty cash records: A. When a supermarket employee takes cash for business purposes, s/he should sign a voucher. B. Supermarkets usually have their petty cash records reviewed and notarized. C. Supermarket employees are not required to provide a sales receipt for purchases made with petty cash. D. If a supermarket keeps petty cash on hand, it should maintain a balance of $200. 38. Many supermarkets reduce the amount of time they spend completing lengthy bank-deposit slips by encouraging their customers to A. visit ATM machines. C. shop online. B. pay in cash. D. use debit cards. 39. Which of the following is an internal source of marketing information that a specialty food store uses: A. Employee handbooks C. Trade journals B. Government web sites D. Inventory records 40. Food distributors use the information from sales representatives to make decisions. One type of report that details a sales representative's planned sales calls and routes for an upcoming week or month is a(n) __________ report. A. activity C. call B. territory D. quota 41. What process might a food distributor use to enter marketing data into a computer for analysis? A. Editing C. Screening B. Keyboarding D. Tabulating 42. One of the reasons why many businesses use relational databases rather than sequential databases is because relational databases provide more A. flexibility. C. rigidity. B. limitations. D. restrictions. 43. What is the most frequently used method of collecting primary data? A. Experimental method C. Survey method B. Observation method D. Point-of-sale research 44. The general role of marketing in our private enterprise system is to coordinate A. production and pricing. C. government and business. B. selling and distribution. D. production and consumption. 45. Which of the following is an important aspect of merchandising food products: A. Using techniques to sell goods C. Advertising goods to customers B. Developing ways to improve goods D. Having goods available when needed 46. Which of the following would be likely to cause a supermarket chain to change its marketing strategies: A. Large market share C. An increase in sales B. Advancements in technology D. A stable economy 47. A market for food items and food-related services exists when there is a group of A. potential consumers. C. professionals. B. responsible homeowners. D. laborers. 48. In the food-marketing industry, an important aspect of marketing planning involves a(n) A. internal assessment. C. time measurement. B. sales forecast. D. creative process. 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 5 49. A convenience-food manufacturer that uses market-share analysis when preparing its sales forecast is basing the forecast on the A. total industry sales for a given period. B. market share of a company within the industry. C. sales of a specific company within the industry. D. conditions under which all businesses will be operating. 50. Purchasing history, buying preferences, names, and addresses are information that a specialty food store collects for its A. financial analysis. C. vendors' records. B. customer database. D. project plan. 51. Food-marketing businesses usually maintain customer sales records that contain information about the A. suppliers that provide the goods. C. cost of paying commissioned salespeople. B. discounts offered by manufacturers. D. types of products being purchased. 52. Supermarkets often maintain records about vendors' pricing, delivery terms, and credit policies and use the information in the records to A. award purchasing contracts. C. monitor inventory levels. B. negotiate higher discounts. D. follow safe shipping procedures. 53. Some food marketers are reluctant to use e-commerce because the number-one fear among consumers is A. credit-card information will be stolen. C. not many people use the Internet. B. the order will be lost in shipment. D. the food will be out-of-date when it arrives. 54. Why do many supermarkets have safety guidelines for workers to follow? A. To maintain control of workers' activities C. To encourage workers to do a good job B. To relieve workers of safety responsibility D. To protect workers from being injured 55. Requiring supermarket workers to enter and exit the store by established entrances and exits is an example of a security policy objective to control A. employee theft. C. payroll costs. B. shoplifting. D. supplier pilferage. 56. When creating project plans, what do food-marketing businesses often develop in the event of a crisis or unexpected situation? A. Escape mechanism C. Contingency plan B. Suggestion program D. Modified schedule 57. The production activity that obtains all the resources needed in order for production to take place is A. scheduling. C. routing. B. purchasing. D. dispatching. 58. The costs of operating a grocery store are often called __________ expenses. A. variable C. overhead B. fixed D. markdown 59. If a grocery store's sales register tape is less than the amount of money in the cash drawer, the cash is A. void. C. short. B. over. D. balanced. 60. The supermarket made decisions about the specific items that it needed for business operations, which is the first step in the A. sales promotion. C. purchasing process. B. price decision. D. credit system. 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 6 61. Jeff's current goals in life are to open his own grocery store, continue his exercise classes, and earn a high salary. What types of goals has Jeff identified? A. Educational, social, ethical C. Social, physical, educational B. Physical, emotional, career D. Career, physical, financial 62. One way of improving creativity that many people do on a regular basis involves A. telephoning friends. C. watching television. B. attending sports events. D. playing mind games. 63. Which of the following is a source of career information that is available to individuals at all times: A. School counselors C. Local libraries B. Employment agencies D. Internet web sites 64. Job applicants write letters of application to explain to prospective employers how their qualifications relate to the A. bonus plan. C. job requirements. B. company benefits. D. compensation program. 65. Victoria is new to the food-marketing industry and wants to meet other food-marketing professionals. What would be the best way for Victoria to meet other food-marketing professionals? A. Go to after-work activities at the local country club B. Wait until she is approached by others C. Join a local professional or trade organization D. Visit all businesses in the community 66. Which of the following is a tactic that some food retailers use that might be considered predatory pricing: A. Meeting with competitors to agree on prices B. Lowering prices to drive out competitors C. Developing complex pricing structures D. Offering discounts on some items to attract customers 67. If all the grocery stores in one community agree to carry the same goods, offer the same discounts, and accept only certain credit cards, they are involved in A. unit pricing. B. price fixing. C. price advertising. D. deceptive pricing. 68. In pure competition, most products are sold at market price, which is controlled by A. market share. B. supply and demand. C. producers. D. sellers. 69. The reason Pepsi has used Shaquille O'Neal in its commercials is to appeal to younger audiences. This is an example of product A. positioning. B. planning. C. screening. D. mix. 70. During which stage of the product life cycle do food marketers spend most of their money trying to fend off the competition? A. Decline B. Introductory C. Maturity D. Growth 71. When a food manufacturer uses its product wrapping to state its corporate views on controversial issues, such as use of growth hormones in animals, it is engaging in an ethical practice called A. political lobbying. C. cause packaging. B. environmental labeling. D. provocative branding. 72. Identifying new food-product opportunities usually requires a person to be A. emotional. B. aware. C. decisive. D. indifferent. 73. What exists when there is a want or need for a food item or food-related service, and there is a product idea to fulfill the want or need? A. Innovative market opportunity C. Potential competitive advantage B. Reasonable competitive advantage D. Real market opportunity 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 7 74. Feedback from grocery stores about problems with display products provides producers with the information needed to A. organize meetings. C. increase prices. B. hire employees. D. make improvements. 75. Why do food marketers use brand positioning? A. In order to use another firm's brand legally B. In order to satisfy identified consumer needs C. In order to launch new brands D. In order to find points of similarity to other brands 76. How can a supermarket maintain optimal freshness levels of the fruits and vegetables it stocks? A. Store produce in cool display containers that are filled with chipped ice B. Place produce in display and storage units that are appropriate for each item C. Keep produce under regulated heat lamps to encourage the ripening process D. Install misting units that regulate the moisture levels of all produce 77. Which of the following factors is the mostly likely reason for a food marketing business to reposition a product that is declining in popularity in the marketplace: A. High research and development costs C. Stage of the product's life cycle B. Few marketplace competitors D. Obsolete features and benefits 78. Campbell's chicken noodle, cream of mushroom, and tomato soups are examples of __________ branding. A. family B. licensed C. private D. individual 79. When preparing a merchandising plan, the supermarket manager takes into account employee discounts, markdowns, and shortages. The manager is calculating planned A. purchases. B. sales. C. inventory. D. reductions. 80. This year, a specialty market sold 1,350 cans of smoked oysters, which was a 10% increase over the previous year. If the market expects next year's sales to increase by 12%, what quantity of smoked oysters should the market buy? A. 1,647 B. 1,485 C. 1,512 D. 1,796 81. Linking buyers and sellers through communication is one of the main purposes of A. research. B. marketing. C. promotion. D. distribution. 82. A supermarket chain that needs to create a new company image or repair a damaged image will often use __________ promotions. A. patronage B. secondary C. primary D. public relations 83. Contests, samples, and coupons are all examples of A. sales promotion. B. personal selling. C. novelty items. D. premiums. 84. Food-marketing businesses seeking to target the teenage market often use A. broadcast media. C. newspapers. B. direct mail. D. specialty advertising. 85. A disadvantage to food-marketing businesses that use e-mail as a direct-mail strategy is that recipients may not get the message because many computers have A. spam filters. C. reply options. B. invalid home addresses. D. promotion controls. 86. "Hallmark...When you care enough to send the very best" is an example of a(n) A. tag line. B. tag line. C. headline. 87. What is one of the main reasons that grocery stores use visual merchandising? A. To buy for resale C. To attract employees B. To sell products D. To create decoration D. endorsement. 2008 DECA Ontario Regionals Test 981 FOOD MARKETING SERIES 8 88. Which of the following is an example of a procedure that supermarkets might establish for maintaining displays: A. Design simple settings. C. Organize new inventory. B. Create seasonal themes. D. Rearrange goods daily. 89. Why is it important for a food-marketing business that is planning a promotion to advise the purchasing department about the upcoming event? A. To ensure that there is sufficient product in stock B. So that the merchandising displays can be assembled C. So that newspaper advertisement inserts can be created D. To ensure that the sales personnel are aware of the event 90. How does selling benefit the private enterprise economic system? A. Eliminates competition C. Adds utility to products B. Contributes to unemployment D. Increases prices of products 91. Federal and state governments regulate food marketers and their sales policies in order to A. promote discrimination. C. control prices. B. prevent competition. D. protect consumers. 92. One way a food distributor can help its salespeople demonstrate ethical behavior in selling situations is by A. establishing gift-giving guidelines. C. making price deals. B. developing sales quotas. D. requiring reciprocity. 93. An advantage to food distributors of using mapping software to create sales territories is that the software allows the food distributors to A. view geographic characteristics. C. experiment based on various criteria. B. assign specific salespeople. D. develop travel routes. 94. In preparing for a sales presentation, a food distributor's new salesperson feels that s/he needs additional product information. An internal source of such information would be A. a customer. B. the library. C. the manufacturer. D. another salesperson. 95. What does a supermarket-supply salesperson need in order to be able to translate the features of goods and services into benefits? A. Industry research C. Customer assistance B. Product information D. Personal experience 96. Jason works at the Acme Fish Market. Jason always greets customers right away, asking what he can do to help. What is the next step that Jason should take in the selling process? A. Establish a relationship with the customer C. Prescribe solutions to customer needs B. Try to get the customer to buy D. Discover the needs of the customer 97. Questioning should be used throughout the __________ process. A. trading B. grading C. closing D. selling 98. A supermarket offering a free bottle of barbecue sauce with the purchase of 10 pounds or more of baby-back ribs is an example of a __________ close. A. narrative B. contingent C. bonus D. direct 99. When a supermarket customer requests that a bakery employee personalize a birthday cake, it is known as a(n)___________ order. A. certified B. certified C. exclusive D. special 100. What items do supermarket delicatessens price and sell by the pound? A. Cheese, ham, and bread C. Turkey, bread, and pasta salad B. Potato salad, cheese, and turkey D. Ham, pasta salad, and pastries Test 981 FOOD MARKETING—KEY 9 1. C Whenever someone promises to do something in exchange for something. This exchange of money, things, time, ideas, etc., is what distinguishes a contract from a gift. Promising to give something to someone else is not a contract because no exchange occurs. Contracts can be binding whether or not money is involved, or whether they are drawn up by a lawyer or private individuals. SOURCE: BL:002 SOURCE: Legal Information Institute, Cornell Law School. (n.d.). Contracts: An Overview. Retrieved August 18, 2008, from http://www.law.cornell.edu/topics/contracts.html 2. B Inventory control. Controlling inventory involves keeping track of how much stock is on hand, how much has been sold, and how much is on order. A benefit of inventory control is the prevention of stockouts—a situation in which there is no stock of an inventory item on hand. Leasing is contracting to use property that belongs to someone else for a specific period of time for a specific amount of rent. Warehousing involves placing goods in safe locations until they are needed or are ready to be sold. Stock handling includes the loading, unloading, and handling of goods. SOURCE: CM:001 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (p. 512). Woodland Hills, CA: Glencoe/McGraw-Hill. 3. B Intermediaries. Intermediaries are distribution channel members operating between the producer and the consumer or industrial users to help in the movement of goods and services. Technological advancements have not reduced the need for suppliers. Manufacturers still need raw materials to produce their goods. Technological advancements have not necessarily reduced the need to use warehouse personnel and freight carriers in relation to communicating with customers. SOURCE: CM:004 SOURCE: Coyle, J.J., Bardi, E.J., & Langley, C.J. (2003). The management of business logistics: A supply chain perspective (7th ed.) [p. 460]. Mason, OH: South-Western. 4. B A tying agreement. A tying agreement is an illegal agreement requiring a customer to buy other products in order to obtain desired goods and services. The snack-food distributor's goal is to increase sales by coercing supermarkets to carry and sell unwanted products. Intensive distribution and selective distribution are legal strategies for moving products. An open agreement may or may not be legal. SOURCE: CM:005 SOURCE: Boone, L.E., & Kurtz, D.L. (2004). Contemporary marketing (11th ed.) [pp. 442-443]. Mason, OH: Thomson/South-Western. 5. D Marketing mix. Although distribution decisions do not necessarily precede other marketing decisions, they must be acknowledged as an important influence on the marketing mix of a food product. Food products must be available and accessible in order for customers to be able to buy. Product mix, promotional plans, and merchandise plans are also considered in the marketing mix. SOURCE: CM:007 SOURCE: Pride, W.M., & Ferrell, O.C. (2000). Marketing: Concepts and strategies (2000e) [p. 351]. Boston: Houghton Mifflin. 6. C Logical evidence. Being prepared will help supermarket employees remain objective and able to offer logical evidence to back up their ideas. They should be prepared to explain supporting information because others may have questions or concerns about the ideas. Using logical evidence, such as related statistics or facts, will help supermarket employees defend their ideas because they are relying on valid evidence rather than personal opinions. Supermarket employees who defend their ideas objectively do not use emotional information, personal opinions, or unrelated statistics. SOURCE: CO:061 SOURCE: Adler, R.B., & Elmhorst, J.M. (1999). Communicating at work: Principles and practices for business and the professions (6th ed.) [p. 256]. Boston: McGraw-Hill College. Test 981 FOOD MARKETING—KEY 10 7. A Attacking someone else's idea. When a supermarket employee asks questions in an open-minded way, s/he avoids attacking someone else's idea. The employee evaluates what s/he says before saying it, which helps to avoid sarcasm. The goal is to phrase the question in a way that seeks helpful information. The supermarket employee does not avoid suggesting a better way to do something, stating his/her own opinion, or mentioning the truth. SOURCE: CO:053 SOURCE: QS LAP 29—Put In Your Two Cents 8. A Logical evidence. Messages usually are more persuasive if they are supported by logical evidence. Logical evidence is based on fact rather than on opinion. If a food-marketing business is writing a persuasive message to encourage customers to do something, such as buy a product, it should include logical evidence to make the message more convincing. A food-marketing business should avoid using strong language because it may offend readers. Typeface and graphic design are visual elements of the message rather than part of the content. SOURCE: CO:031 SOURCE: Hyden, J.S., Jordan, A.K., Steinauer, M.H., & Jones, M.J. (1999). Communicating for success (2nd ed.) [pp. 335-336]. Cincinnati: South-Western Educational. 9. C Informal. A short report that presents facts without analysis is considered an informal report. A formal report is more complex, has several different parts, and provides an analysis of the facts in the report. An activity report is an account of sales calls or other business activities carried out by supermarket staff. SOURCE: CO:094 SOURCE: Locker, K.O. (2000). Business and administrative communication (5th ed.) [pp. 366-367]. Boston: Irwin/McGraw-Hill. 10. C Speaking at a comfortable volume. To speak pleasantly with supermarket customers, you should speak at a comfortable volume—not too loudly or too softly. You also need to vary the tone of your voice and speak neither too quickly nor too slowly. SOURCE: CR:004 SOURCE: HR LAP 32—Customer-Service Mindset 11. D Solutions available within the business's policies. Salespeople handling complaints should take action based on their understanding of the complaint and the solutions that are possible within the business's policies. These policies should be explained to the customer. The salesperson should not permit his/her opinion of the customer to be a factor, whether the opinion is negative or positive. S/He should also not be influenced by the customer's attitude. The time required to solve the problem is not as important as finding a solution. SOURCE: CR:010 SOURCE: Levy, M., & Weitz, B. A. (2007). Retailing management (6th ed.) [pp. 251-252]. Boston: McGraw-Hill/Irwin. 12. D A bill from the supplier listing prices of goods shipped. An invoice may also include style number, description, quantity shipped, unit and extended cost, items on back order, shipping charges, terms, etc. A packing slip may be enclosed with a shipment to list the type and number of items shipped. A contract between a shipper and a transportation company is called a bill of lading. A purchase order comes from the buyer, not the vendor. SOURCE: DS:004 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 350-351). Woodland Hills, CA: Glencoe/McGraw-Hill. Test 981 FOOD MARKETING—KEY 11 13. A The unit can be moved with a forklift. A pallet is a sturdy wooden platform used as a base or foundation for stacking containers of goods. One forklift can move a large load at one time because the unit is usually strapped, roped, or fastened in some way to the pallet. This makes individual boxes difficult to remove. A slip-sheet is a thick piece of cardboard or plastic that is used instead of a traditional pallet. Slip-sheets tend to weigh less than pallets. A pallet does not protect the shipment. SOURCE: DS:085 SOURCE: Johnson, J.C., Wood, D.F., Wardlow, D.L., & Murphy, P.R. (1999). Contemporary logistics (7th ed.) [pp. 150-153]. Upper Saddle River, NJ: Prentice Hall. 14. C Credit voucher. On occasion, vendors deliver damaged goods that grocery stores will not accept. When this happens, grocery stores usually expect vendors to issue a credit voucher which deducts a certain amount from the store's bill. Grocery stores will not accept damaged goods because they will not be able to sell them to customers. They often use the credit voucher to pay for replacement goods. A packing slip is a shipper' s form that usually accompanies incoming merchandise which describes the type and number of each item in a shipment. An invoice is the shipper's bill for goods sent to the purchaser. A rebate is a return of part of the price a customer pays for a good or service, usually offered by the product's manufacturer. SOURCE: DS:009 SOURCE: Johnson, J.C., Wood, D.F., Wardlow, D.L., & Murphy, P.R. (1999). Contemporary logistics (7th ed.) [pp. 238-239]. Upper Saddle River, NJ: Prentice Hall. 15. A Should always be in stock. Staple goods are items that consumers always need and want. Seasonal merchandise is only sold during a specific time, such as Christmas, Easter, winter, summer, etc. Some staple merchandise may occasionally become slow-moving and need to be re-evaluated or replaced. SOURCE: DS:022 SOURCE: Levy, M., & Weitz, B. A. (2007). Retailing management (6th ed.) [pp. 325-326]. Boston: McGraw-Hill/Irwin. 16. A $164,000. Inventory records help businesses track sales and manage merchandise levels. After a physical inventory has been taken, an ending inventory is the result. The ending inventory figure then becomes the beginning inventory for the next fiscal period. To calculate then ending inventory for Eric's Supermarket, use the following formula: $280,000 (beginning inventory) + $756,000 (net purchases) = $1,036,000 – $872,000 (net sales) = $164,000 (ending inventory). SOURCE: DS:091 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 513-514). Woodland Hills, CA: Glencoe/McGraw-Hill. 17. D Rail. Rail is an economical shipping method for carload shipments that are traveling a long distance. Rail is often used to ship large quantities of many types of products, such as canned goods, from one major city to another. Air is an expensive shipping method. Couriers are used to transport small deliveries, often within a city. Mail is used to send smaller packages and letters rather than carload shipments. SOURCE: DS:127 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2006). Marketing essentials (p. 399). New York: Glencoe/McGraw-Hill. Test 981 FOOD MARKETING—KEY 12 18. C Organic. There is a growing market for organic foods, and the trend is expected to continue. As a result, wholesalers who sell organic foods must certify that these foods actually are organic. This means that they are produced without the use of chemicals, insecticides, etc. Wholesalers may not tell buyers that certain foods are organic unless they actually are. Imported foods are not necessarily produced without the use of chemicals or insecticides. Processed and convenience foods usually are not organic. SOURCE: DS:133 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2006). Marketing essentials (pp. 666-667). New York: Glencoe/McGraw-Hill. 19. A How to get the most with the least. Economics is the study of how to meet unlimited, competing wants with limited resources. It is the process of deciding how to get the most with the least or how to obtain the greatest satisfaction with limited resources. An individual's choice of occupation affects his/her economic decisions because it affects income level. Capital goods are materials used in the production of goods and services, not by individuals. Noneconomic wants are desires for items that can be obtained without money. SOURCE: EC:001 SOURCE: Sexton, R.L. (2002). Exploring economics (2nd ed.) [p. 3]. Mason, OH: South-Western. 20. A At any particular moment. The market price is the actual price that prevails in a market at any particular moment and may change whenever the seller desires to change it. The market price could change as frequently or infrequently as necessary and is not based on the price prevailing on a specific day or time of the year. SOURCE: EC:006 SOURCE: EC LAP 12—Price 21. D More than 90% of the packaging is recyclable. Pointing out that most of the packaging is recyclable will reassure the customer that buying small bags will not endanger the environment. Pointing out that convenience comes with a cost to the environment or that the packaging is approved by the government does not address the customer's concerns. Grocery store employees should not tell customers that they have a responsibility to purchase larger bags. SOURCE: EC:070 SOURCE: EC LAP 20—Business Connections (Business and Society) 22. A Protect U.S. citizens. In the United States, the government should step in only to protect citizens, and it should let them pursue their own goals. As life has become more complex, the role of government has gradually expanded. Government has been asked to solve such problems as inflation, pollution, and unemployment. It does not, however, try to increase production, limit business startups, or maintain control of prices except in what are considered emergency situations. SOURCE: EC:009 SOURCE: EC LAP 15—People Power (The Private Enterprise System) 23. C Provide effective training. Many risks can be prevented or controlled, and providing effective training is one way of reducing the risks associated with incompetent workers. Well-trained employees are more efficient and productive and, therefore, less of a risk to food-marketing businesses. Checking credit references, installing surveillance cameras, and signing contractual agreements are methods of reducing other kinds of business risk. SOURCE: EC:011 SOURCE: EC LAP 3—Lose, Win, or Draw (Business Risk) Test 981 FOOD MARKETING—KEY 13 24. A To see whether the food-marketing business's objectives are being met. Productivity may be measured to see whether a food-marketing business's goals and objectives are being reached. Productivity doesn't aid in the location of new sources of inputs. Members of the finance department are responsible for determining the best ways to invest company profits. Research and development may find new ways to meet customer needs. SOURCE: EC:013 SOURCE: EC LAP 18—Make the Most of It (Productivity) 25. B Reaches its maximum level. The law of diminishing returns states that, at some point, adding more resources does not proportionately increase productivity. For example, adding more employees when there is limited space and equipment will eventually have a negative effect on production because overcrowding will occur, and no one will be able to work efficiently. Businesses such as food producers apply this law when deciding whether to hire more employees or purchase more materials and equipment. All of the resources need to be compatible for production to reach its maximum level. Once maximum production occurs, adding more resources will begin to diminish the rate of productivity. The law of diminishing returns does not determine at which point production is too expensive to continue, equals the amount of revenue, or passes that of the competition. SOURCE: EC:023 SOURCE: McConnell, C.R., & Brue, S.L. (2005). Economics: Principles, problems, and policies (16th ed.) [pp. 395-397]. Boston: McGraw-Hill/Irwin. 26. B Pay raise is 4% and inflation rate is 6%. When the inflation rate is higher than the percent of raise that employees receive, the purchasing power of those employees decreases. This has a negative effect on the economy because the higher inflation rate means higher prices for goods and services. The pay raise that the employees received was less than the rate of inflation so employees lost purchasing power. They have less money to spend, and the goods and services they want cost more than their pay increase. When interest rates decrease, consumers' purchasing power usually increases. Consumers' purchasing power does not change if their employers match their contributions to a retirement plan. A decrease in state income-tax rates usually increases consumers' purchasing power. SOURCE: EC:081 SOURCE: Arnold, R.A. (2004). Economics (6th ed.) [p. 180]. Cincinnati: Thomson/South-Western. 27. B Cultural sensitivity. Culture is the customs, habits, and traditions of a particular group of people. The way that different people interact with each other is an expression of their culture. Food-marketing executives need to be sensitive to the fact that their foreign customers may have unique customs, such as bowing, when they greet each other rather than shaking hands. They should accept these customs and try to make their foreign customers feel comfortable. Food-marketing executives who behave in this manner are showing respect for other customs and habits and are exhibiting cultural sensitivity. Communication skills are abilities to express yourself clearly and simply. Stereotypical behavior involves acting in a manner that conforms to a set image. Language differences occur when people speak different languages. SOURCE: EI:033 SOURCE: Lehman, C.M., & DuFrene, D.D. (1999). Business communication (12th ed.) [pp. 22-23]. Cincinnati: South-Western College. 28. D Make decisions. Making decisions is a critical leadership activity. Usually, the difficulty of a decision increases with the level of uncertainty. People who become leaders are more comfortable with uncertainty. Some even like the excitement of not knowing for sure how things are going to turn out. If leaders are also managers, they often assign tasks, develop projects, and schedule deadlines. However, those are not the most important functions of a leader who is the individual with the ability to guide or direct the actions of others in a desired manner to achieve goals. SOURCE: EI:009 SOURCE: QS LAP 27—Follow Me! Test 981 FOOD MARKETING—KEY 14 29. C Agreeing on goals. The coaching process involves several steps. One of these steps is agreeing on goals. The coaching relationship hinges on collaboration between the coach and the coachee. The coach and the coachee must agree on the goal, or goals, so the coach can monitor progress accurately. It is also important to write down the goals. Being enthusiastic and expressing interest are coaching characteristics rather than part of the coaching process. Having goods skills is important, but that is not part of the coaching process. SOURCE: EI:041 SOURCE: QS LAP 7—Bring Out the Best 30. B Form and conduct relationships. When you study human relations, you examine the ways that people form and conduct relationships with one another. Relationships between people are often very complex and can be either effective or ineffective. They are affected by people's personal styles, their opinions, and their communication skills. SOURCE: EI:037 SOURCE: EI LAP 5—Can You Relate? (Positive Working Relationships) 31. C Saving even a little bit each month will help Patty. Even a small amount of money, invested from an early age over a long period of time, can make a significant contribution to retirement savings. People do not have plenty of time to save for retirement; beginning early allows more time for savings to grow. Social Security benefits are not likely to cover basic living expenses. Due to longer life spans, many people are in retirement longer than 15 years. SOURCE: FI:064 SOURCE: Kapoor, J., Dlabay, L., Hughes, R., & Hoyt, W. (2005). Business and personal finance (pp. 477-481). New York: Glencoe/McGraw-Hill. 32. D To avoid being denied credit. Individuals should periodically validate their credit histories to make sure that the information is correct. In some cases, inaccurate or false information may appear in a credit history, which will result in an individual being denied credit. To make sure this doesn't happen, individuals should review the information and contact the credit bureau to change or remove inaccurate information. Individuals do not validate their credit histories to understand credit laws, find out about different types of credit, or protect themselves from bankruptcy. SOURCE: FI:072 SOURCE: Kapoor, J.R., Dlabay, L.R., Hughes, R.J., & Hoyt, W.B. (2005). Business and personal finance (pp. 174-179). New York: Glencoe/McGraw-Hill. 33. B Current assets. Assets are anything of value the grocery store owns. Current assets would include cash on hand, accounts receivable, and inventory owned by the grocery store. Income is money received by the grocery store from an outside source. Liabilities are debts that the grocery store owes. SOURCE: FI:085 SOURCE: FI LAP 5—Show Me the Money (Nature of Accounting) 34. C To exist. Money must flow into a business before it can ever exist. An entrepreneur starting a foodmarketing company usually borrows money from a bank or obtains financing from investors in order to go into business. This initial flow of money is used to purchase the goods and services needed to start the food-marketing company. A food-marketing company receives money from the sale of goods and services. An entrepreneur often obtains start-up money by borrowing it from investors. SOURCE: FI:091 SOURCE: FI LAP 6—Count the Cash (Cash Flow) Test 981 FOOD MARKETING—KEY 15 35. A Revenue. The revenue category of the income statement includes the total amount of money earned by a business. It includes interest earned from bank accounts, returns on investments, sale of assets, and sales of the business's goods and services. Assets are anything of value that the business owns. Net income is the money remaining after operating expenses are subtracted from gross profit. Gross sales are the total value of goods or services sold in a period of time. SOURCE: FI:094 SOURCE: FI LAP 4—Watch Your Bottom Line (Income Statements) 36. C Information is organized. Budgets create physical records. With a budget, a supermarket is able to keep financial information organized and accurate because it provides a written record of financial transactions. The budget records help supermarkets organize and track all of the financial information involved in operating a business. Having written budget records does not necessarily simplify the accounting process, reduce expenses, or increase investments. SOURCE: FI:106 SOURCE: FI LAP 3—Money Tracks (Nature of Budgets) 37. A When a supermarket employee takes cash for business purposes, s/he should sign a voucher. Petty cash is a small amount of money kept on hand by a supermarket for business purposes. Petty cash is often used to buy emergency office supplies or to pay for a delivery. Supermarkets keep records of their petty cash transactions to control and monitor these types of purchases. Most supermarkets track petty cash outflows by having the employee sign a voucher that indicates who is requesting the money and why the money is needed. Once the sales transaction is complete, the supermarket employee submits the sales receipt and change (leftover currency and coins) to the supermarket's cashier. Supermarkets may want to review petty cash records but they do not need to notarize them. Because each supermarket varies by type, size, and needs, they maintain different amounts of petty cash. SOURCE: FI:088 SOURCE: Vallen, G.K., & Vallen, J.J. (2005). Check-in: Check-out (7th ed.) [pp. 438-439]. Upper Saddle River, NJ: Prentice Hall. 38. D Use debit cards. Debit cards are a type of electronic funds transfer (EFT) process which makes it easy to move money from one bank to another through the use of computers. Debit cards access a customer's checking or savings account and automatically transfer funds from the account to the supermarket's account. The use of debit cards reduces the amount of time supermarket employees spend completing bank-deposit slips because there are fewer personal checks to record and tabulate. A lot of supermarket customers do not pay in cash. However, when supermarkets receive cash, they must count it and complete deposit slips for the amount. Most customers prefer to buy their groceries in person rather than online. Supermarkets do not encourage their customers to visit ATM machines. SOURCE: FI:298 SOURCE: Kapoor, J.R., Dlabay, L.R., Hughes, R.J., & Hoyt, W.B. (2005). Business and personal finance (pp. 126-127). New York: Glencoe/McGraw-Hill. 39. D Inventory records. Internal information sources come from within the specialty food store itself. Invoices, operating budgets, and inventory records are internal sources of information that a specialty food store compiles itself. Government web sites and trade journals are examples of external sources of marketing information. Employee handbooks are a type of internal information but they do not contain marketing information. SOURCE: IM:001 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 594-595). Woodland Hills, CA: Glencoe/McGraw-Hill. Test 981 FOOD MARKETING—KEY 16 40. A Activity. An activity report describes a sales representative's intended sales calls and routes and is submitted to management a week or month in advance. Food distributors often use the information in these reports to make marketing decisions. A call report is a write-up of completed sales activities. Territory and quota reports do not include planned activities of individual sales representatives. SOURCE: IM:184 SOURCE: Kotler, P. (2000). Marketing management (10th ed.) [pp. 633-634]. Upper Saddle River, NJ: Prentice Hall. 41. B Keyboarding. The most popular technique for entering marketing data into a computer for analysis is keyboarding. The keyboarding technique involves the use of a keyboard that is connected to a computer. An individual types in the information via the keyboard and then saves it to the computer for future use and analysis. Before the data are entered into a computer, they are edited for mistakes. Screening is a method of validating the accuracy of the data. After the data are entered into a computer, researchers are able to tabulate and analyze the information. SOURCE: IM:062 SOURCE: Hair, J.F., Jr., Bush, R.P., & Ortinau, D.J. (2000). Marketing research: A practical approach for the new millennium (pp. 491-499). Boston: Irwin/McGraw-Hill. 42. A Flexibility. The use of relational databases provides businesses with more flexibility in examining many variables and analyzing the relationships of those variables. Relational databases allow businesses to examine all the variables at one time. For example, a relational database allows a business the flexibility to examine how well all of its products are selling in each part of the country and compare one product with another or compare one region with another. A sequential database organizes information in a simple path from one factor to the next and does not provide the flexibility to compare many variables. Sequential databases are more limiting, rigid, and restrictive than relational databases. SOURCE: IM:063 SOURCE: Hair, J.F., Jr., Bush, R.P., & Ortinau, D.J. (2000). Marketing research: A practical approach for the new millennium (pp. 160-165). Boston: Irwin/McGraw-Hill. 43. C Survey method. Conducting surveys is the most frequently used method of collecting primary data. Surveys may be conducted in person or in the form of questionnaires. Observation and experimental are other methods of collecting primary data, but they are not used as often as the survey method. Point-ofsale research combines the survey and observations methods, but it is not the most frequently used. SOURCE: IM:187 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.) [p. 527]. Woodland Hills, CA: Glencoe/McGraw-Hill. 44. D Production and consumption. In effect, marketing serves as the connecting link, or "bridge", between producers and consumers. Selling, distribution, and pricing are marketing functions. The relationship between government and business is monitored by the legal system. SOURCE: MK:001 SOURCE: BA LAP 11—Have It Your Way (Marketing) Test 981 FOOD MARKETING—KEY 17 45. D Having goods available when needed. Merchandising is the process of having the right goods in the right place at the right time in order to make a profit. Having goods available when customers want or need to buy them is an aspect of having the right goods to sell at the right time. If grocery stores do not have the goods on hand when customers want to buy, customers might decide to shop elsewhere and the store will lose sales. Developing ways to improve goods is an aspect of product/service management. Advertising goods to customers is an aspect of promotion. Selling involves understanding the techniques to use to influence purchase decisions. SOURCE: MK:009 SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.) [pp. 339-340]. Upper Saddle River, NJ: Prentice Hall. 46. B Advancements in technology. These advancements may cause changes in the goods or services that the supermarket chain sells and, thus, require new marketing strategies. Other factors that can make it necessary to change marketing strategies include changes in the economic climate, actions of competitors, number of competitors, market size, loss of market share, and a reduction in sales. SOURCE: MP:001 SOURCE: IM LAP 7—Pick the Mix (Marketing Strategies) 47. A Potential consumers. A market is composed of individuals who have unfulfilled desires and are willing and able to spend money in order to satisfy those desires. Without knowing the needs of professionals, homeowners, or laborers, it cannot be determined if they are potential consumers. SOURCE: MP:003 SOURCE: IM LAP 9—Have We Met? (Market Identification) 48. A Internal assessment. In the food-marketing industry, an important aspect of marketing planning involves an internal assessment of the food-marketing business. A food-marketing business needs to understand its strengths and weaknesses before it can develop an effective marketing plan. Therefore, the planning must come first and should include a thorough assessment of the food-marketing business's current condition. An internal assessment might include reviewing previous sales goals rather than forecasting future sales. Time measurement and a creative process are not important aspects of marketing planning. SOURCE: MP:006 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2006). Marketing essentials (pp. 26-28). New York: Glencoe/McGraw-Hill. 49. A Total industry sales for a given period. Market-share analysis evaluates the convenience-food manufacturer's share of the market. The manufacturer forecasts its sales with the assumption that its share of the market will not change. The total industry sales are used, rather than the sales or market share of any specific company. An economic forecast projects the conditions under which all businesses will be operating. SOURCE: MP:013 SOURCE: Burrow, J.L. (2006). Marketing: Instructor's wraparound edition (2nd ed.) [pp. 538-539]. Mason, OH: Thomson/South-Western. Test 981 FOOD MARKETING—KEY 18 50. B Customer database. A database is a collection of information that a specialty food store keeps in a central location. Specialty food stores usually keep information about their customers in a computer or filing cabinet. The database can hold many types of information including purchasing history, customer buying preferences, contact names, and addresses. This information helps a specialty food store to develop promotional activities (e.g., advertisements) that appeal to its target market. The specialty food store does not consider its financial analysis, its vendors' records, or a general project plan when developing promotional activities, such as advertising. SOURCE: NF:115 SOURCE: Semenik, R.J. (2002). Promotion and integrated marketing communications (pp. 351-353). Mason, OH: South-Western. 51. D Types of products being purchased. Food-marketing businesses maintain a variety of records about the quantities and types of products that customers are purchasing. These records are usually known as sales records. By analyzing past sales records, food-marketing businesses can determine what customers are buying, when they are buying, and how much they are buying. This helps a foodmarketing business forecast future sales so it can be prepared to offer the products that customers want. Food-marketing businesses do not maintain customer sales records that contain information about the discounts offered by manufacturers, the cost of paying commissioned salespeople, or the suppliers that provide the goods. SOURCE: NF:002 SOURCE: Burrow, J.L. (2006). Marketing (2nd ed.) [pp. 120-121]. Mason, OH: South-Western. 52. A Award purchasing contracts. Supermarkets maintain records about their vendors and use the information in the records to award contracts to the most appropriate vendor. When selecting a vendor, a supermarket usually wants to buy from the vendor that offers the best price for the value, has reasonable delivery terms, and favorable credit policies. By comparing the information about each vendor, a supermarket can make an informed decision about the best vendor. This type of information does not help a supermarket to negotiate higher discounts, monitor inventory levels, or follow safe shipping procedures. SOURCE: NF:014 SOURCE: Burrow, J.L. (2006). Marketing (2nd ed.) [pp. 120-121]. Mason, OH: South-Western. 53. A Credit-card information will be stolen. Identity theft is on the increase, and hackers have become more adept at breaking into web sites. Not all food is perishable. The Internet actually makes it easier to track shipment. Internet use is growing rapidly every month. SOURCE: NF:057 SOURCE: BA LAP 3—Internet's Impact on Marketing 54. D To protect workers from being injured. Safety education should be part of the employee training program. Supermarket employees who understand and follow safety guidelines are much less likely to get hurt on the job. While supermarkets may provide safety guidelines, workers are also responsible for behaving in a safe manner. Encouraging workers to do a good job and maintaining control of workers' activities are not purposes of safety guidelines. SOURCE: OP:007 SOURCE: Ninemeier, J.D. (2000). Management of food and beverage operations (3rd ed.) [pp. 268-272]. Weimar, TX: Culinary and Hospitality Industry Publications Services. Test 981 FOOD MARKETING—KEY 19 55. A Employee theft. Employee theft may be controlled by developing a secure environment, using security personnel, and establishing security policies. Employee security policies would not control shoplifting, which is customer theft of goods from the business. Supplier pilferage occurs when a store's vendors are dishonest. Payroll costs are the expenses involved in paying workers their wages. SOURCE: OP:013 SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.) [pp. 383-385]. Upper Saddle River, NJ: Prentice Hall. 56. C Contingency plan. A contingency plan is often known as "Plan B," or the backup in the event that the original plan will not work for some reason. Food-marketing businesses often develop contingency plans along with original project plans in order to be prepared for the unexpected. There's no way to know when a crisis will occur, and having a contingency plan often helps a food-marketing business to be successful even under adverse conditions. Food-marketing businesses do not develop an escape mechanism, which is a way out of a situation. Suggestion programs are usually intended to encourage employees to share ideas. A modified schedule might be a part of a contingency plan. SOURCE: OP:001 SOURCE: DuBrin, A. J. (2003). Essentials of management (6th ed.) [pp. 116-117]. Mason, OH: SouthWestern. 57. B Purchasing. Purchasing is the buying of resources needed for production. These may include raw materials, parts, equipment, supplies, machinery, and labor. Scheduling establishes the timetable to be followed in production. Routing determines the sequence for the steps in the production process. Dispatching is issuing orders for production to start. SOURCE: OP:017 SOURCE: BA LAP 1—Nature of Production 58. C Overhead. Operating expenses such as rent, maintenance, and managers' salaries are often referred to as overhead. Markdown is a reduction in the retail price of an item. Variable expenses are business expenses that vary in response to changes in sales volume. Fixed expenses are expenses that do not vary in response to changes in sales volume. SOURCE: OP:024 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2006). Marketing essentials (pp. 767-769). New York: Glencoe/McGraw-Hill. 59. B Over. For example, if the sales register tape is $35.00, and the cash drawer is $50.00, the cash is $15.00 over ($50 - $35 = $15). The cash would be short if it were less than the amount on the sales register tape. When both figures are the same, the cash drawer is balanced. A void is a sale that has been canceled. SOURCE: OP:195 SOURCE: Stull, W.A. (1999). Marketing and essential math skills: Teacher's edition (pp. 153-153). Cincinnati: South-Western Educational. 60. C Purchasing process. Businesses (e.g., supermarkets) decide what items they need as the first step in the purchasing process. The price decision is the decision a customer reaches on the price s/he is willing to pay for a good or service. Sales promotion is the promotional activities other than advertising, personal selling, and publicity that are used to stimulate customer purchases. Credit system is the variety of credit plans available to companies to pay for purchases over a period of time. SOURCE: OP:117 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 490-493). Woodland Hills, CA: Glencoe/McGraw-Hill. Test 981 FOOD MARKETING—KEY 20 61. D Career, physical, financial. A career goal is an objective for your work life, such as opening his own grocery store. Physical goals are objectives for your health and well-being, such as exercising. Financial goals are measured in terms of money. Emotional and ethical are not types of goals. Educational goals deal with education, and social goals are objectives for interactions with other people. SOURCE: PD:018 SOURCE: Settingyourgoals.com. (n.d.). Achieve your maximum potential. Retrieved August 18, 2008, from http://www.settingyourgoals.com/Types_of_Goals.html 62. D Playing mind games. Most puzzles and mind games encourage people to think in new ways, thereby improving their creativity. Playing mind games helps to keep people alert and is an excellent way of sharpening thinking skills. Watching television, attending sports events, and telephoning friends do not encourage creative thinking. SOURCE: PD:012 SOURCE: PD LAP 2—Creativity 63. D Internet web sites. Today, Internet web sites are a valuable source of career information that is available to individuals at all times. Many professional organizations maintain web sites that provide career information. Also, many businesses post career and employment information on their web sites. Some sites are designed specifically to allow job seekers access to potential employers, as well as information about careers in various industries. Employment agencies, local libraries, and school counselors are sources of career information, but they are not available to individuals at all times. SOURCE: PD:022 SOURCE: Kimbrell, G., & Vineyard, B.S. (2006). Succeeding in the world of work (p. 117). New York: Glencoe/McGraw-Hill. 64. C Job requirements. Job applicants write letters of application to create interest in themselves by explaining how their qualifications might benefit the company. Writing letters of application that explain what the applicants can do will encourage the company to interview them. Benefits, compensation, and bonuses are not included in letters of application but are discussed during the interview process. SOURCE: PD:030 SOURCE: Kimbrell, G., & Vineyard, B.S. (2006). Succeeding in the world of work (pp. 125-126). New York: Glencoe/McGraw-Hill. 65. C Join a local professional or trade organization. People who are members of a professional or trade organization have a common need and have gained strength through pooling their talents and resources. Visiting every business is ambitious but too time consuming and may not produce the desired results. Attending after-work activities is a possibility, but it is too limiting, and she has no control over who will be at those activities. Victoria could wait until approached by others, but the process would be slow. She would only meet those who took the time to approach her. SOURCE: PD:036 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 789-790). Woodland Hills, CA: Glencoe/McGraw-Hill. Test 981 FOOD MARKETING—KEY 21 66. B Lowering prices to drive out competitors. Predatory pricing involves setting very low prices on certain goods or services in order to hurt competitors and try to drive them out of business. Predatory pricing is unethical because its only purpose is to drive out the competition. Food retailers that engage in predatory pricing usually do so for only the amount of time it takes to drive out competitors, and then they raise the prices. Meeting with competitors to agree on prices is price fixing. Developing complex pricing structures may be unethical because customers are unable to understand the prices. However, this practice is not considered predatory pricing. Offering discounts on some items to attract customers is a type of promotional pricing rather than predatory pricing. SOURCE: PI:015 SOURCE: Kotler, P., & Armstrong, G. (1999). Principles of marketing (8th ed.) [p. 344]. Upper Saddle River, NJ: Prentice Hall. 67. B Price fixing. Price fixing is an illegal agreement between businesses (e.g., grocery stores) as to a price or price range for products. Price fixing extends beyond merely agreeing on prices; it also includes coordinating the amount of discounts and credit terms. When competitors agree to carry the same goods, set prices, and control the market, they are fixing prices. This exchange of information prevents customers from having a choice about what they buy and what they pay. Unit pricing is a pricing technique in which consumers are given the price per unit for products. Price advertising involves promoting special prices, such as discounts or two-for-one offers. Deceptive pricing involves misleading customers about the actual price of an item. SOURCE: PI:017 SOURCE: Soloman, M. R., Marshall, G. W., & Stuart, E. W. (2008). Marketing: Real people, real choices (5th ed.) [p. 364]. Upper Saddle River, NJ: Pearson Prentice Hall. 68. B Supply and demand. Pure competition is a market in which there are a great many buyers and sellers of nearly identical products, and marketers have very little control over pricing. Producers and sellers must accept the market price, the actual price that prevails in a market at a given time. They cannot raise or lower prices because buyers are already buying as much as they want of the product at the current price. Market share is an organization's share of the total industry's sales in a specific market. SOURCE: PI:002 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 544, 546-547). Woodland Hills, CA: Glencoe/McGraw-Hill. 69. A Positioning. Product positioning is the consumer's image or impression of a product as compared to that of competitive products. Product positioning directs products toward the particular segment of the market to which they would have the most appeal. Product mix is the particular assortment of products that a business offers in order to meet the needs of its markets and its company's goals. Product planning is the process of developing the product/service mix in response to market opportunities. Product screening is the process of considering each idea for a new product and discarding those that seem unworkable. SOURCE: PM:001 SOURCE: Soloman, M. R., Marshall, G. W., & Stuart, E. W. (2008). Marketing: Real people, real choices (5th ed.) [p. 220]. Upper Saddle River, NJ: Pearson Prentice Hall. 70. C Maturity. During this stage, the product has asserted itself in the market and attracted competitors who wish to take away or gain back market share. In the introductory stage, advertising is focused on awareness. During the growth stage, advertising is focused on consumer satisfaction. During the decline stage, advertising may cease completely. SOURCE: PM:024 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.) [pp. 557-558]. Woodland Hills, CA: Glencoe/McGraw-Hill. Test 981 FOOD MARKETING—KEY 22 71. C Cause packaging. Cause packaging is using a product to promote a political or social issue. Environmental labeling and provocative branding are not terms commonly associated with packaging. Political lobbying is the act of trying to influence the attitudes and actions of legislative groups. SOURCE: PM:040 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.) [p. 578]. Woodland Hills, CA: Glencoe/McGraw-Hill. 72. B Aware. A product opportunity is a favorable circumstance that presents itself to provide a good or service that consumers are willing to buy. People identify food-product opportunities by being attentive to their surroundings, by being aware. Many food-product opportunities are realized by observing people in various situations. While people are often emotional, decisive, or indifferent, these qualities do not always help them identify new food-product opportunities. SOURCE: PM:134 SOURCE: Meyer, E.C., & Allen, K.R. (2006). Entrepreneurship and small business management (p. 51). New York: Glencoe/McGraw-Hill. 73. D Real market opportunity. An opportunity is a circumstance that presents itself as a favorable means to meet an objective. Real market opportunity requires two circumstances: there must be unmet need or want, and there must be a product idea that will fulfill the unmet want or need. It would not be feasible to come up with a product idea, produce the good or service, and not have anyone interested in purchasing the good or service. In other words, there would not be a "real market" to purchase the product. The competitive advantage is the edge achieved by a business that offers something better than its competitors. If a business has an edge or competitive advantage over its competitors, it is not merely potential or reasonable. Innovative market opportunity is a fictitious term. SOURCE: PM:127 SOURCE: PM LAP 11—Unleash Your Oh! Zone (Product Idea Generation) 74. D Make improvements. Businesses receive benefits from offering warranties and guarantees. One benefit is getting feedback from grocery stores about unsatisfactory display products. Without this feedback, the company would not be able to make corrections and improvements in its products. Companies do not use information about problems with products to increase prices, hire employees, or organize meetings. SOURCE: PM:020 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 324-327). Woodland Hills, CA: Glencoe/McGraw-Hill. 75. B In order to satisfy identified consumer needs. Food marketers research competitive brands, define the unique characteristics of their own brands, and use this information to position their products to meet consumer needs. Food marketers want to find the point of difference that separates their brand from the competition, not the way in which the brands are alike. Brand extension is used in the launching of new brands. Brand licensing allows a firm to lease another firm's brand for a fee. SOURCE: PM:003 SOURCE: PM LAP 3—Mix and Match (Product Mix) Test 981 FOOD MARKETING—KEY 23 76. B Place produce in display and storage units that are appropriate for each item. Fruits and vegetables have different needs to ensure optimal freshness for the consumer. Some vegetables, such as potatoes and onions, do not need to be refrigerated. Potatoes are often kept in cool, dry holding units and do not generally need misting or ice to stay fresh. Other vegetables, such as asparagus, stay freshest when placed in refrigerated or ice-packed display units that are lightly misted with cool water throughout the day. Supermarkets do not store fruits and vegetables under heat lamps. SOURCE: PM:053 SOURCE: U.S. Dept. of Agriculture. (2004). Agricultural handbook number 66: The commercial storage of fruits, vegetables, florist, and nursery stocks (draft). Retrieved August 20, 2008, from http://www.ba.ars.usda.gov/hb66/contents.html 77. C Stage of the product's life cycle. During the decline stage of a product's life cycle, sales and profits fall rapidly. To keep the product on the market, the food marketing business may reposition it to appeal to a different market segment. For example, the business might position the product by reducing the price in order to attract value-conscious customers. By positioning the product in this way, the business has the opportunity to generate some profit by keeping the product alive. If the demand is consistent or high and there are few competitors, the business would probably not need to reposition the product. High research and development costs are associated with products in the introductory stage. If features or benefits become obsolete, the product would most likely be taken off the market. SOURCE: PM:042 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2006). Marketing essentials (pp. 644-645). New York: Glencoe/McGraw-Hill. 78. A Family. Family branding is using one brand name for a group of related products in a product line. A private brand is owned by the middleman. An individual brand is a brand in which different brand names are used for products owned by one company. Licensed branding occurs when a brand owner allows another company to use the brand for a fee. SOURCE: PM:021 SOURCE: PM LAP 6—It's a Brand, Brand, Brand World! (The Nature of Branding) 79. D Reductions. Calculating reductions, such as employee discounts, markdowns, and shortages, is important because they impact how much money can be used for purchases. To calculate planned sales, one takes the amount sold last year and makes adjustments depending on the current economy and the store's competition. To calculate planned inventory, one can use last year's information if economic and competitive conditions are similar. One uses all of the above information to calculate planned purchases. SOURCE: PM:061 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (p. 487). Woodland Hills, CA: Glencoe/McGraw-Hill. 80. C 1,512. When determining the quantity of smoked oysters to purchase, a specialty market would consider this year's sales as well as the expected amount of increase. If sales have been increasing and the market expects a continued increase, the market would plan to purchase additional quantities next year. In this example, sales are expected to increase 12% over this year's level. To calculate the increase, first multiply the number of cans sold this year by the expected percent of increase (1,350 x 12% or .12 = 162). Then, add that figure to the number of cans sold this year to determine the quantity to buy for next year (1,350 + 162 = 1,512). SOURCE: PM:261 SOURCE: Dunne, P., Lusch, R., & Griffith, D. (2002). Retailing (4th ed.) [pp. 328-329]. Mason, OH: South-Western. Test 981 FOOD MARKETING—KEY 24 81. C Promotion. Promotion is the communication of information about goods, services, images, and/or ideas. One of the purposes of promotion is to link buyers and sellers. Promotion informs consumers about the goods and services offered by sellers and encourages buying. Research is gathering, analyzing and interpreting information about a specific question or problem. Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. Distribution is all the activities involved in moving or transferring the ownership of goods or services from producers to consumers. SOURCE: PR:001 SOURCE: PR LAP 2—Promotion 82. D Public relations. Public relations promotions are institutional promotions created to deal with controversial public issues that are related to a supermarket chain or its products. Patronage promotions are designed to promote a firm's prestige, or its features. Primary promotion is intended to stimulate demand for an entire class of goods or services. Secondary promotion is intended to stimulate demand for a particular brand of product. SOURCE: PR:002 SOURCE: PR LAP 4—Know Your Options (Types of Promotion) 83. A Sales promotion. Sales promotion is promotional activities other than advertising, personal selling, and publicity which stimulate customer purchases. Other examples are prizes, premiums, and novelty items. Personal selling is the form of promotion that uses planned, personalized communication in order to influence purchase decisions and enhance future business opportunities. SOURCE: PR:003 SOURCE: PR LAP 1—Promotional Mix 84. A Broadcast media. Broadcast media, such as radio and television, are especially effective at reaching teenage audiences. Print media, such as newspapers and magazines, are most effective in reaching adult audiences. Most direct mail, such as letters and catalogs, generally target adults. Specialty advertising, categorized as "other media," are "giveaway items", such as pens, matchbooks, calendars, or key rings embossed with a company's name, logo, or promotional message. SOURCE: PR:007 SOURCE: PR LAP 3—Types of Promotional Media 85. A Spam filters. Direct mail is a promotional medium that comes to consumers' homes and businesses. Email is a form of direct mail that food-marketing businesses send by computer. Spam is junk e-mail that the recipient does not request and does not allow the recipient to request removal from the subscriber list. To reduce the amount of spam recipients receive, businesses and consumers are installing software programs that filter the spam, which keeps it from reaching the intended recipients. Invalid e-mail addresses, rather than home addresses, would prevent e-mail recipients from receiving e-mail. Reply options do not keep e-mail from reaching the intended message recipients. Promotion control is a fictitious term. SOURCE: PR:089 SOURCE: Arens, W.F. (2004). Contemporary advertising (9th ed.) [p. 574]. Boston: Irwin/McGraw Hill. 86. A Tag line. A tag line is a slogan used in an advertisement. Another example would be "You can be sure...if it's Westinghouse." A headline is text set in large type and usually positioned at the top of an advertisement. A testimonial is a statement by an identified user of a product, proclaiming the benefits received from the use of the product. An endorsement is approval by a reputable outside source. SOURCE: PR:014 SOURCE: Arens, W.F. (2004). Contemporary advertising (9th ed.) [p. 422]. Boston: Irwin/McGraw Hill. Test 981 FOOD MARKETING—KEY 25 87. B To sell products. One of the main reasons for using visual merchandising is to sell. Grocery stores design displays and arrange merchandise is such ways that consumers are motivated to make purchases. Selling goods is the goal of all grocery stores, and the use of visual merchandising is one way of achieving that goal. Grocery stores do not use visual merchandising for the purpose of buying for resale, attracting employees, or creating decoration. SOURCE: PR:023 SOURCE: Pegler, M.M. (2006).Visual merchandising and display (5th ed.) [p. 3]. New York: Fairchild Publications, Inc. 88. D Rearrange goods daily. Many displays are designed to encourage customers to handle and examine the goods. In order to maintain these displays in a neat and attractive condition, it usually is necessary to straighten and rearrange the goods on a daily basis. Customers handling and removing the goods to purchase make it necessary to routinely rearrange the display goods. Creating seasonal themes, organizing new inventory, and designing simple settings are not procedures for maintaining displays. SOURCE: PR:052 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (p. 393). Woodland Hills, CA: Glencoe/McGraw-Hill. 89. A To ensure that there is sufficient product in stock. For example, suppose a snack-food distributor wants to promote a specific snack item. As part of the promotion, the distributor provides customers with deep discounts for a limited time. Therefore, the distributor must make sure there is enough of the snack item on-hand for the customers. In most companies, the purchasing department orders the product. Therefore, the promotions coordinator needs to advise the buyers in the purchasing department to increase snack item purchases to meet the anticipated rise in demand. The merchandising department coordinates displays. The advertising department coordinates advertising activities. Although sales personnel need to know about promotional events, they do not generally purchase inventory. SOURCE: PR:076 SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.) [pp. 302-304]. Woodland Hills, CA: Glencoe/McGraw-Hill. 90. C Adds utility to products. Selling adds utility, or usefulness, to products. Through selling, products can be in the right place, at the right time. This makes it easy for customers to buy which, in turn, keeps the economy growing. In a private enterprise system, selling usually helps to reduce unemployment, promote competition, and keep prices from increasing. SOURCE: SE:017 SOURCE: SE LAP 117—Sell Away (The Nature and Scope of Selling) 91. D Protect consumers. Federal and state governments, along with the regulatory agencies they have created, pass legislation that affects businesses (e.g., food marketers) and their sales policies. Regulatory factors include consumer protection regulations intended to protect individuals when making purchases. The federal and state regulations are intended to encourage competition among businesses, eliminate the possibility of price-fixing, and prevent discrimination in the prices or services that businesses offer customers. SOURCE: SE:932 SOURCE: Levy, M., & Weitz, B. A. (2007). Retailing management (6th ed.) [pp. 251-252]. Boston: McGraw-Hill/Irwin. Test 981 FOOD MARKETING—KEY 26 92. A Establishing gift-giving guidelines. Giving gifts to customers often presents an ethical dilemma because situations and peoples' perspectives differ. One food distributor may view any gift (e.g., inexpensive holiday gifts) as a form of bribery while another food distributor does not. A food distributor can help salespeople by establishing specific gift-giving policies for its sales personnel. If a salesperson does not know if it is appropriate to give a gift in a certain situation, s/he can refer to the food distributor's written guidelines about acceptable and unacceptable behavior. Sales quotas are specific selling goals set for members of a food distributor's sales force and do not necessarily guide a salesperson's ethical behavior on the job. Making price deals and requiring reciprocity are illegal selling activities and are generally considered unethical. SOURCE: SE:106 SOURCE: SE LAP 129—Keep It Real—In Sales (Selling Ethics) 93. C Experiment based on various criteria. An advantage of using mapping software to create sales territories is that food distributors can experiment based on various criteria, such as travel time and estimated sales. Before establishing territories, a food distributor can input certain criteria and view a territory based on that information. If the food distributor is not satisfied with the results, it can enter new criteria and continue to experiment to find the territories that will be the most effective. Once territories have been created, food distributors assign salespeople to cover the territories. Mapping software does not allow the food distributors to view geographic characteristics or develop travel routes. SOURCE: SE:107 SOURCE: Futrell, C.M. (2001). Sales management: Teamwork, leadership, and technology (6th ed.) [pp. 133-134]. Mason, OH: South-Western. 94. D Another salesperson. Experienced salespeople within the business can be an invaluable source of product information and are usually willing to share their experience with a new employee. A customer, the library, and the manufacturer are sources external to the business. SOURCE: SE:062 SOURCE: Anderson, R.E., & Dubinsky, A.J. (2004). Personal selling: Achieving customer satisfaction and loyalty (p. 311). Boston: Houghton Mifflin. 95. B Product information. Supermarket-supply salespeople must be thoroughly familiar with the features of their products and be prepared to translate those features into benefits for individual customers. In order to do this, salespeople need product information. They need information, such as how products are made and used, in order to explain to customers how these features will benefit them. Salespeople can obtain product information from industry research and reports, by talking to customers, and from personal experience using the products. SOURCE: SE:109 SOURCE: SE LAP 113—Find Features, Boost Benefits (Feature-Benefit Selling) 96. D Discover the needs of the customer. The second step in the selling process is discovering the needs of the customer. The first step is establishing a relationship, which Jason does when he greets customers. The third step in the selling process is to prescribe solutions to customer needs. The fourth step in the selling process is to reach closure and try to get the customer to buy. SOURCE: SE:048 SOURCE: SE LAP 126—The Selling Process Test 981 FOOD MARKETING—KEY 27 97. D Selling. Questioning should be used throughout the selling process to help salespeople better understand their customers. By asking questions throughout the selling process, salespeople can find out what their customers really need and then try to satisfy those needs. Grading is the process of rating products according to certain established standards or characteristics. Closing is the point in a sales presentation at which the customer makes a favorable buying decision. Trading is exchanging one item for another. SOURCE: SE:111 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (pp. 285-286). Woodland Hills, CA: Glencoe/McGraw-Hill. 98. C Bonus. The bonus close gets its name from the extra gift or bonus a salesperson offers with the purchase of the product being presented. A narrative close involves telling a story about people who have solved similar problems by purchasing the good or service. A contingent close depends upon a salesperson's proving a point to the customer to remove obstacles to the sale. A direct close is a closing technique used in personal selling that involves asking the customer to buy the product. SOURCE: SE:895 SOURCE: Farese, L. S., Kimbrell, G., & Woloszyk, C.A. (2009). Marketing essentials (p. 318). Woodland Hills, CA: Glencoe/McGraw-Hill. 99. D Special. A special order is a request for an item that is not usually carried in stock. The cake might be a regularly stocked item, but personalized cakes (e.g., Happy Birthday, Pete) are not. An open order is an order that is placed by buyers who select the supplier that can best meet the needs or criteria (e.g., price) for a particular item or order. Exclusive and certified are not common terms used in the food-marketing industry to describe specific types of orders. SOURCE: SE:009 SOURCE: Levy, M., & Weitz, B. A. (2007). Retailing management (6th ed.) [pp. 306-307]. Boston: McGraw-Hill/Irwin. 100. B Potato salad, cheese, and turkey. Supermarket delicatessen employees sell products such as potato salad, cheese, turkey, ham, and pasta salad to customers. The customer tells the delicatessen employee how much of an item s/he wants, and the employee slices or packages the food to the customer's weight specifications. The price of the item depends on its weight. The supermarket bakery sells bread and pastries. SOURCE: SE:161 SOURCE: John's Grocery. (n.d.). Deli/Catering features. Retrieved August 20, 2008, from http://www.johnsgrocery.com/departments/deli/pricelist/index.cfm