adms-2200-testbanks-midterm

7. Which of the following is NOT a reason for a growing global marketplace? a. internet technology b. trade agreements c. no single country can manufacture, supply, and consume all that it produces. d. changing climate patterns ANS: D PTS: 1 DIF: 2 REF: 7 8. Approximately how much trade crosses the Canada–U.S. border each day? a. $1.2 million b. $150 million c. $500 million d. $1.4 billion ANS: D PTS: 1 DIF: 2 REF: 8 9. When in marketing history did the production era end in North America? a. late 1800s—with the mass immigration of skilled workers to North America b. 1920s—with the improvement in production capabilities c. 1960s—with the establishment of overseas production facilities d. 21st century—with the introduction of robotics ANS: B PTS: 1 DIF: 2 REF: 9-10 10. What era of marketing history had a marketing philosophy that could be summarized by the phrase “a good product will sell itself”? a. production era b. sales era c. marketing era d. relationship era ANS: A PTS: 1 DIF: 2 REF: 8 11. A company produces a high-quality product, with a maximum monthly output of 10,000 units. Production levels are constant and the company relies on its marketing department to find customers. What era of marketing history is this approach consistent with? a. production era b. relationship era c. sales era d. marketing era ANS: C PTS: 1 DIF: 2 REF: 9 12. Which of the following factors contributed to the transition from the production era to the sales era? a. significantly increased consumer demand b. improved production techniques c. increased urbanization d. the Great Depression ANS: B PTS: 1 DIF: 1 REF: 9 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

26. What type of marketing is an example of traditional marketing, as opposed to non-traditional marketing ? a. political marketing b. cause marketing c. event marketing d. organization marketing ANS: A PTS: 1 DIF: 1 REF: 15 27. Melissa is managing the campaign of her friend for the presidency of the student council. What type of marketing is Melissa’s effort an example of? a. cause marketing b. person marketing c. place marketing d. organization marketing ANS: B PTS: 1 DIF: 1 REF: 15 28. You receive a flyer urging you to attend a rally for a local political candidate. You’re asked to bring a can of food for the local food bank as the “price of admission.” What two types of marketing is this a combination of? a. event and person marketing b. event and organization marketing c. organization and cause marketing d. cause and person marketing ANS: D PTS: 1 DIF: 3 REF: 15-16 29. A music star promotes her concerts, but also uses her concerts to promote a charitable cause. What two types of marketing is this example a combination of? a. event and person marketing b. cause and person marketing c. cause and event marketing d. person and organization marketing ANS: C PTS: 1 DIF: 3 REF: 15-16 30. What is the basic objective of place marketing? a. to attract visitors or new businesses to a particular area b. to influence others to accept the goals of the sponsoring organization c. to convince people to attend a sporting or cultural event d. to bring to the attention of the public some charitable issue ANS: A PTS: 1 DIF: 1 REF: 15-16 31. What type of marketing do federal and provincial departments of tourism typically engage in? a. organization marketing b. person marketing c. place marketing d. cause marketing ANS: C PTS: 1 DIF: 1 REF: 15-16 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

44. What function is financing a part of? a. exchange b. pricing c. commercial d. facilitating ANS: D PTS: 1 DIF: 2 REF: 21 45. General Motors Acceptance Corporation provides credit to GM dealers, as well as buyers. What function is this an example of? a. financing b. exchange c. distribution d. securing marketing information ANS: A PTS: 1 DIF: 2 REF: 21 46. What are the physical distribution functions of marketing? a. storing and transporting b. standardization and grading c. financing and risk taking d. buying and selling ANS: A PTS: 1 DIF: 1 REF: 21 47. Why do marketers apply quantity control standards? a. to engage in the process of exchange b. to reduce the need for purchasers to inspect each item they purchase c. to determine the amount an individual will be allowed to buy on credit d. to develop channels of distribution for a product ANS: B PTS: 1 DIF: 2 REF: 21 48. What are moral standards of behaviour expected by society called? a. social responsibilities b. marketing concepts c. facilitating functions of marketing d. ethics ANS: D PTS: 1 DIF: 1 REF: 22 49. Approximately what percentage of large companies offer some sort of ethics training for workers? a. less than one-quarter b. around one-third c. around one-half d. more than one-half ANS: D PTS: 1 DIF: 2 REF: 22 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

9. If Toyota was planning to introduce a sports car powered by a hydrogen-oxygen fuel cell when the price of gasoline in Canada reached $1.10 per litre, what type of plan does this BEST describe? a. an economic plan b. a strategic plan c. a technological plan d. a tactical plan ANS: B PTS: 1 DIF: 2 REF: 34 10. Sport Canada is determining where it should build its permanent training facility. The organization wants it near a populated centre but rural enough to provide ample room. What type of planning is the organization engaged in? a. strategic planning b. travel planning c. marketing planning d. economic planning ANS: A PTS: 1 DIF: 2 REF: 34 11. What type of plan does a company have when it focuses largely on current and near-future activities? a. a strategic plan b. a marketing plan c. an economic plan d. a tactical plan ANS: D PTS: 1 DIF: 1 REF: 34 12. Compared with other organization personnel, who devotes more time to long-range strategic planning? a. middle management b. manufacturing labour c. top management d. supervisory management ANS: C PTS: 1 DIF: 1 REF: 35 13. SuperSavers Market, a small grocery store chain, is working on its tactical plans. Who would be the personnel MOST involved in this operational planning process? a. top management b. middle management c. store managers d. supervisory management ANS: B PTS: 1 DIF: 2 REF: 35 14. What does the planning process begin with? a. writing the mission statement b. establishing organizational objectives c. formulating a marketing plan d. hiring a senior planner ANS: A PTS: 1 DIF: 1 REF: 36 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

28. In SWOT analysis, what are situations in which organizations are unable to capitalize on opportunities because of internal limitations referred to as? a. strategic windows b. strategic leverage c. constraints d. vulnerability ANS: C PTS: 1 DIF: 2 REF: 41 29. General Motors has difficulty competing with other car makers due to its lack of responsiveness to changing consumer preferences. In SWOT terms, what does this constitute? a. a strategic window b. a leveraged situation c. a productivity challenge d. a constraint on its activity ANS: D PTS: 1 DIF: 2 REF: 41 30.Assume a firm would like to expand its product line. A complete expansion would cost $100 million, but the firm can raise only $75 million in financing. What is this BEST classified as? a. a constraint b. an opportunity c. a threat d. a vulnerability ANS: A PTS: 1 DIF: 2 REF: 41 31. In a SWOT analysis, when is a constraint present? a. when internal organizational weaknesses prevent taking advantage of an opportunity b. when environmental threats attack organizational weaknesses c. when organizational weaknesses are effectively addressed d. when environmental threats are stronger than organizational strengths ANS: A PTS: 1 DIF: 1 REF: 41 32. In SWOT analysis, when does vulnerability occur? a. when internal organizational weaknesses prevent taking advantage of an opportunity b. when environmental threats attack organizational weaknesses c. when weaknesses are effectively addressed d. when environmental threats are stronger than organizational strengths ANS: D PTS: 1 DIF: 1 REF: 41 OBJ: 2-4 BLM: Remember NOT: AACSB Analytic | TB&E Model Marketing Plan 33. In a SWOT analysis, when does a problem exist? a. when internal organizational weaknesses prevent taking advantage of an opportunity b. when environmental threats attack organizational weaknesses c. when weaknesses are effectively addressed d. when environmental threats are stronger than organizational strengths ANS: B PTS: 1 DIF: 1 REF: 41 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

46. Which of the following is NOT a marketing mix variable? a. distribution b. product c. target market d. pricing ANS: C PTS: 1 DIF: 1 REF: 44 47. Which of the following describes the term marketing mix? a. a composite analysis of all environmental factors inside and outside the firm b. a series of business decisions that aid in selling a product c. the relationship between a firm’s marketing strengths and its business weaknesses d. a blending of four strategic elements to satisfy specific target markets ANS: D PTS: 1 DIF: 1 REF: 44 48. How is the term “product” BEST described? a. It refers only to tangible items that can be seen, tasted, or touched. b. It is a broad concept encompassing the satisfaction of consumer needs. c. It is limited to include goods, services, and ideas only. d. It never refers to such things as package design, brand name, or warranty. ANS: B PTS: 1 DIF: 1 REF: 44 49. Jenny has been appointed marketing manager for Sparkling Cleaning Products. Her job focuses on decisions involving customer service, package design, brand names, and warranties. What area of the marketing strategy will Jenny MOST likely work in? a. product strategy b. resource valuation and pricing c. retailing and distribution strategy d. target market development ANS: A PTS: 1 DIF: 2 REF: 44 50. What strategy do decisions involving transportation, warehousing, inventory control, and order processing relate to? a. pricing strategy b. competitive strategy c. product strategy d. distribution strategy ANS: D PTS: 1 DIF: 1 REF: 44 51. Miranda has been named to an upper-level management position at Bio Med Cosmetics. She will be working with transportation media, order processing, and development of marketing channels. What strategies would Miranda be involved in developing? a. product strategies b. distribution strategies c. promotional strategies d. marketing strategies ANS: B PTS: 1 DIF: 2 REF: 44 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

64. According to the market share/market growth matrix, how does a successful product typically begin? a. as a question mark, then a star, and eventually moves to the status of cash cow b. as a star, fades to a question mark, and finally becomes a dog and is dropped c. as a cash cow, moves to a question mark, and finally becomes a star d. as a cash cow and fades to a dog when it’s dropped ANS: A PTS: 1 DIF: 3 REF: 49 65. How does the market share/market growth matrix classify products with a low relative share of a high-growth rate market? a. as stars b. as question marks c. as cash cows d. as dogs ANS: B PTS: 1 DIF: 1 REF: 49 66. The product manager for a new mousetrap informs the board of directors at its annual meeting that the product has been classified as a dog . What does this mean about the product? a. It requires a “go/no go” decision within the next several years. b. It has low market share of a high-growth rate market. c. It should be withdrawn from the market. d. It needs heavy investment to make it a star. ANS: C PTS: 1 DIF: 3 REF: 49 67. A food chain has a promotion where each purchaser of a large, rather than a medium-sized beverage, gets a chance to win a prize. Which of the following BEST describes the strategic growth opportunity that is being used? a. Product development b. Diversification c. Market penetration d. Market development ANS: C PTS: 1 DIF: 3 REF: 49-50 68. A company notices that its customers enjoy the chicken burger with meals but often only purchase fries at mid- day for a snack. A decision is taken to provide a mini-chicken burger for the purpose of snacking to these customers. Which of the following BEST describes the strategic growth opportunity that is being used? a. Product development b. Diversification c. Market penetration d. Market development ANS: A PTS: 1 DIF: 3 REF: 49-50 69. Which of the following is the MOST risky growth strategy for a company to pursue? a. Product development b. Diversification c. Market penetration d. Market development ANS: B PTS: 1 DIF: 1 REF: 49-50 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

70. Initially, cellphones had no limiters as to the regions that could be dialed or the number of different phone numbers that could be dialed. Based on this, many parents would not purchase a phone for their younger children. Next, cellphone manufacturers created phones and plans that limited the number of phone numbers programmed into the phone and no other numbers could be dialed. Only local calling would be available. Which of the following BEST describes the strategic growth opportunity that is being used? a. Product development b. Diversification c. Market penetration d. Market development ANS: D PTS: 1 DIF: 2 REF: 49-50 Chapter 3—The Marketing Environment, Ethics, and Social Responsibility MULTIPLE CHOICE 1. What is the term for the process of collecting information about the external marketing environment? a. environmental management b. marketing research c. marketing management d. environmental scanning ANS: D PTS: 1 DIF: 1 REF: 72 2. What would monitoring local newspapers and television news shows for general information relating to a firm’s business be an example of? a. environmental scanning b. economic analysis c. social-political manipulation d. technological development ANS: A PTS: 1 DIF: 1 REF: 72 3. What is Kevin engaged in when he analyzes recent data from Statistics Canada to uncover new markets for his firm’s product? a. research and development b. environmental scanning c. environmental management d. marketing management ANS: B PTS: 1 DIF: 2 REF: 72 4. Why might a domestic business form a strategic alliance with a firm in a foreign market? a. to act socially responsible by giving jobs to local citizens b. to squeeze out the competition c. to acquire local expertise for company expansion abroad d. to avoid currency fluctuations when converting gross and net revenue ANS: C PTS: 1 DIF: 2 REF: 73 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

5. Which of the following is NOT an external environment that marketers must consider? a. the political-legal environment b. the social-cultural environment c. the competitive environment d. the creative environment ANS: D PTS: 1 DIF: 1 REF: 73 6. What is the term for organizational objectives that include predicting and influencing competitive, political-legal, economic, technological, and socio-cultural components? a. research and development b. environmental management c. marketing research d. environmental analysis ANS: B PTS: 1 DIF: 2 REF: 72 7. A firm is negotiating with the Canadian Radio-television Telecommunications Commission over new regulations that affect one of the firm’s products. What is the firm engaging in? a. research and development b. marketing management c. environmental management d. environmental analysis ANS: C PTS: 1 DIF: 2 REF: 72 8. Why must Canadian companies form strategic alliances with firms in China when doing business in that country? a. because such alliances are required by the laws of China b. because without such a relationship, the firm will not be trusted in either country c. because it is necessary to have employees who speak Chinese fluently d. because there are differences in engineering and technology between the two countries ANS: A PTS: 1 DIF: 1 REF: 73 9. What have many domestic firms found desirable when acquiring regional expertise and complying with local laws in the global market? a. forming political action committees b. forming strategic alliances with companies in foreign countries c. buying foreign products to beat tariff restrictions d. relocating manufacturing facilities to that market ANS: B PTS: 1 DIF: 1 REF: 73 10. What type of environment would be most significantly affected by a research and development project that results in a patent being granted? a. the competitive environment b. the economic environment c. the international environment d. the political environment ANS: A PTS: 1 DIF: 2 REF: 73 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

11. Pharmaceutical companies are often able to secure patents for new drugs. Which of the following best describes the outcome of these patents? a. non-exclusive rights to produce the drug for a contractually limited time period b. protection for marketing the product forever c. rewards for the money invested in research and development d. probably of little use due to the short timeline for protection ANS: C PTS: 1 DIF: 3 REF: 73 12. Over the past years, what change have most utilities experienced regarding total monopoly protection? a. They have slightly decreased. b. They have greatly increased. c. They have remained the same. d. They have ended. ANS: A PTS: 1 DIF: 2 REF: 73 13. What is the term for an industry with only a few competing firms? a. regulated monopoly b. pure monopoly c. perfect competition d. oligopoly ANS: D PTS: 1 DIF: 1 REF: 74 14. Which of the following describes the competition between Petro-Canada and Shell Canada? a. It is a form of oligopoly because they are the only companies to purchase from. b. It is monopolistic since the companies are selling in different markets and not competing. c. It is direct because both are targeting consumers who want to purchase gasoline products. d. It is substitution because of various gasoline formulations manufactured. ANS: C PTS: 1 DIF: 2 REF: 74 15. What does the decision about whether to have lunch at a fast-food restaurant, such as McDonald’s, Subway, or Wendy’s, illustrate? a. how direct competition affects consumer behaviour b. how some products and services are competitive substitutes c. how indirect competition works d. how competition has a universal nature ANS: B PTS: 1 DIF: 2 REF: 74 16. Last summer, the Thompson family had to decide whether to buy a new car to upgrade their one-year-old luxury car, go to Disney World, or put in a swimming pool. They chose the vacation. What does this decision best illustrate? a. how competition can be dissimilar products vying for discretionary income b. how each of these products are essential items c. how competition for essential items leaves limited discretionary funds for nonessentials d. how discretionary spending decisions are made ANS: A PTS: 1 DIF: 2 REF: 74 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

17. Why must marketers constantly monitor their competitors’ products, prices, distribution, and promotional efforts? a. because the competitors may be violating laws b. because the actions of competitors may threaten the firm’s monopoly position c. because the actions of competitors may create an oligopoly within a particular industry d. because new competitor product offerings may require a marketing mix adjustment ANS: D PTS: 1 DIF: 2 REF: 72 18. Kelly has the option of going to Cancun, Mexico, or Quebec City during spring break. In this context, what type of competition are Cancun and Quebec City in? a. direct competition b. indirect competition c. pure competition d. monopolistic competition ANS: B PTS: 1 DIF: 2 REF: 74 19. Lockheed Martin was successful in winning the largest U.S. Department of Defense contract by proving it could be the first company to develop and fly a new model plane in just four years. What does this illustrate? a. the importance of rapid prototyping of new products b. the importance of time-based competition c. the importance of demarketing d. the importance of the legal environment ANS: B PTS: 1 DIF: 2 REF: 75 20. What would a computer-chip company that follows the time-based competition strategy most likely do? a. imitate what its competitors do, only a little later b. develop a timely and uninterrupted flow of products for target markets c. work on several generations of technology simultaneously d. be reactive rather than proactive in the competitive arena ANS: C PTS: 1 DIF: 2 REF: 75 21. What act was passed in 1975 that has a mission to foster a growing, knowledge-based Canadian economy? a. the Competition Act b. the Consumer Packaging and Labelling Act c. the Broadcasting Act d. the Boards of Trade Act ANS: A PTS: 1 DIF: 1 REF: 76 22. Which of the following areas is NOT covered by the Competition Act? a. misleading advertising b. bait-and-switch selling c. exclusive dealing d. international marketing ANS: D PTS: 1 DIF: 2 REF: 77 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

23.What does the “cooling-off” period allow? a. pharmaceutical research companies to exclusively sell their drugs for a number of years b. telecommunications companies to be protected from bankruptcy for 365 days c. buyers to reconsider a purchase decision that was made under sales pressure d. business owners to dismiss employees within a probationary time period ANS: C PTS: 1 DIF: 2 REF: 77 24. Company ACME believes that another company, called Positioner, is selling a product well under cost in order to drive ACME and others out of the industry. What federal law could Positioner be guilty of violating? a. the North American Free Trade Agreement b. the Competition Act c. the Patent Act d. the Broadcasting Act ANS: B PTS: 1 DIF: 1 REF: 78 25. Which federal organization concerns itself with the regulation of mobile phones and cable? a. the Canadian Radio-television Telecommunications Commission b. the Consumer Products Safety Commission c. the Federal Power Commission d. the Environmental Protection Agency ANS: A PTS: 1 DIF: 1 REF: 78 26. Which of the following best describes the Canadian Marketing Association (CMA)? a. an association for the development of pharmaceutical advertisements b. a regulatory body that is responsible for overseeing the selling practices of the food and drug industr within Canada c. a self-regulatory group that represents industries’ attempts to set guidelines for responsible business practices d. an agency that protects competitors within the industry ANS: C PTS: 1 DIF: 1 REF: 79-80 27. What federal organizaton has the broadest powers of any organization to influence the assignment of patents and trademarks in Canada? a. the Canadian Radio-television Telecommunications Commission b. the Consumer Products Safety Commission c. Health Canada d. the Canadian Intellectual Property Office ANS: D PTS: 1 DIF: 1 REF: 79 28. Which of the following is NOT a business cycle stage? a. recovery b. recession c. depression d. inflation ANS: D PTS: 1 DIF: 2 REF: 80-81 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

29.Which of the following factors is NOT studied by marketers analyzing the economic environment? a. unemployment b. inflation and deflation c. stock and bond markets d. resource availability ANS: C PTS: 1 DIF: 3 REF: 80 30. Camp Gear, Inc. introduces a new line of rough-terrain clothing. The company increases the number of advertisements in several outdoor magazines and establishes a new, updated website for online orders. What stage of the business cycle is most likely occurring at this time? a. low unemployment and low inflation b. depression and high inflation c. growing unemployment and recession d. recession and deflation ANS: A PTS: 1 DIF: 3 REF: 80 31. During recessionary periods, how is it still possible for a business to compete? a. by reducing promotional outlays to save money b. by raising prices to improve company and product image c. by curtailing customer service because people will accept such cuts d. by offering value-priced products to appeal to cost-conscious buyers ANS: D PTS: 1 DIF: 1 REF: 80 32. During what period does consumer spending reach its lowest level? a. recession b. recovery c. depression d. prosperity ANS: C PTS: 1 DIF: 1 REF: 80 33. What type of product category typically falls the LEAST in consumer demand during a recession? a. luxury products b. big-ticket items, such as new cars and homes c. discretionary purchases d. necessities ANS: D PTS: 1 DIF: 1 REF: 82 34. Which of the following is NOT a characteristic of a recovery period ? a. Businesses provide low-priced products and superior service. b. New product lines are introduced. c. Consumers are cautiously optimistic. d. Businesses hold down costs. ANS: B PTS: 1 DIF: 2 REF: 81 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

35. When prices rise due to excess demand and increasing cost of production, what is the resulting monetary condition known as? a. recession b. depression c. inflation d. recovery ANS: C PTS: 1 DIF: 1 REF: 81 36. What occurs during periods of inflation? a. prices increase and consumer demand decreases b. prices increase and consumer demand increases c. prices decrease and consumer demand increases d. prices decrease and consumer demand decreases ANS: B PTS: 1 DIF: 2 REF: 81 37. During recent recessions, how have consumers shifted their buying patterns? a. by borrowing money to buy goods b. by increasing spending across the board c. by buying now in the belief that prices will rise later d. by purchasing basic products with low price tags ANS: D PTS: 1 DIF: 2 REF: 80 38. Which of the following would NOT be a wise marketing strategy during a recession? a. Raise prices to make up for lost sales. b. Increase promotional outlays to create interest in the store or product. c. Improve customer service to attract more trade. d. Launch lower-priced products. ANS: A PTS: 1 DIF: 2 REF: 80 39. What type of consumer income are marketers most interested in? a. discretionary income b. deferred income c. inflationary income d. disposable income ANS: A PTS: 1 DIF: 1 REF: 82 40. During what economic period does unemployment begin to rise? a. economic recovery b. economic recession c. economic prosperity d. economic retrogression ANS: B PTS: 1 DIF: 1 REF: 82 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

41.When gasoline prices are high, many oil companies promote ways to save gas. What process can oil companies begin by providing tips on car maintenance, carpooling, and idling in traffic? a. supply control b. counter advertising c. brand promotion d. demarketing ANS: D PTS: 1 DIF: 2 REF: 82 42. What can new technology result in? a. lower quality of existing products b. lower availability of customer service c. reduced prices through new production methods d. return of products that were once considered obsolete ANS: C PTS: 1 DIF: 2 REF: 84 43. What is one major drawback that critics of radio-frequency identification tags argue? a. loss of jobs with the simplification of tracking capabilities b. cancer in laboratory animals who wear the radio-frequency identification tags c. replacement of the bar code as the standard data control method d. invasion of privacy and erosion of personal freedom ANS: D PTS: 1 DIF: 2 REF: 84 44. What is the introduction by Pfizer Pharmaceuticals of Lipitor, the cholesterol-lowering drug that ranks as the biggest-selling prescription drug in North America, an example of? a. how research and development by private industry represents a source of technological innovation b. the importance of research done for military purposes to the advancement of technology c. how colleges and universities play a critical role in technological progress d. how a product from a foreign country can be technologically adapted to the North American market ANS: A PTS: 1 DIF: 2 REF: 84 45. What are air bags and the development of the Internet examples of? a. research and development efforts in private industry b. military research finding applications in consumer products c. college and university research d. individuals making technological breakthroughs ANS: B PTS: 1 DIF: 2 REF: 84 46. Which of the following is NOT a current demographic trend in Canada? a. The population is getting older. b. The population is getting more diverse. c. The birthrate is rising. d. The population is becoming more affluent. ANS: C PTS: 1 DIF: 1 REF: 86 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

47.What is the birthrate trend in Canada at the present time? a. It’s increasing. b. It’s decreasing. c. It’s remaining about the same. d. It’s expected to increase dramatically during the next 10 years. ANS: B PTS: 1 DIF: 1 REF: 86 48. Overall, what is happening to the population of Canada? a. It’s becoming younger, better educated, and more homogeneous. b. It’s becoming older, poorer, and less educated. c. It’s becoming older, more diverse, and more affluent. d. It’s becoming younger, better educated, and less affluent. ANS: C PTS: 1 DIF: 1 REF: 86-87 49. Which of the following factors would NOT be included in a successful analysis of the social-cultural environment? a. shifts in demographics b. changing values c. lifestyle expectations d. political affiliations ANS: D PTS: 1 DIF: 1 REF: 86 50. Assume that Quaker Oats is offering a new product designed to meet the nutritional needs of women between the ages of 45 and 60. What trends is Quaker Oats responding to? a. demographic trends b. economic trends c. social trends d. political trends ANS: A PTS: 1 DIF: 1 REF: 86 51. Rogers Communications has gradually increased its level of multicultural programming in Canada and now offers more than 65 channels, broadcasting in over 20 languages. According to this example, what has increased in importance in the Canadian marketplace? a. competition b. consumerism c. cultural diversity d. political forces ANS: C PTS: 1 DIF: 1 REF: 87 52. What is the term for the social force within the environment that aids and protects the buyer by exerting legal, moral, and economic pressure on business? a. competition b. consumerism c. demographic diversity d. social-cultural influences ANS: B PTS: 1 DIF: 1 REF: 87 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

53. What consumer right indirectly results in parental ratings on movies, which indicate appropriate ages for viewing audiences? a. right to be informed b. right to be safe c. right to be heard d. right to choose freely ANS: A PTS: 1 DIF: 3 REF: 88 54. What has inspired technological products like Toyota’s Prius and Honda’s Civic Hybrid? a. style considerations in the automobile industry b. social pressure to develop fuel-efficient vehicles c. the desire of engineers to incorporate new technologies d. the realization that most people don’t need large, high-speed cars ANS: B PTS: 1 DIF: 2 REF: 84 55. Despite the pressures of consumerism, why do firms NOT always give in to consumer demands? a. because consumers seldom know what they are talking about b. because in order to survive, firms must achieve reasonable profit objectives c. because consumers represent only a small segment of the total market d. because the demands of individual consumers represent little power in the marketplace ANS: B PTS: 1 DIF: 3 REF: 88 56. What component of the marketing mix raises numerous ethical questions from the general public? a. product b. distribution c. price d. promotion ANS: D PTS: 1 DIF: 1 REF: 93 57. Which of the following has the critical ethical issue of invasion of personal privacy? a. product strategy b. promotional strategy c. marketing research d. pricing strategy ANS: C PTS: 1 DIF: 2 REF: 91 58. Company A manufactures bottles with concave bottoms, giving the impression that the container holds more liquid than it does. In what type of strategy would this raise issues of ethics? a. product strategy b. price strategy c. packaging strategy d. distribution strategy ANS: A PTS: 1 DIF: 2 REF: 92 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

59. After manufacturing and selling products, a company must determine how much of the aftermarket it wants to control and to what extent. In what type of strategy could exerting control over wholesalers and retailers become an ethical issue? a. product strategy b. packaging strategy c. distribution strategy d. price strategy ANS: C PTS: 1 DIF: 1 REF: 93 60. A television advertisement suggests consumers take a proactive role in family health care by requesting that their physician prescribe specific medications. What type of strategy is the advertisement using? a. promotional strategy b. price strategy c. distribution strategy d. product strategy ANS: A PTS: 1 DIF: 2 REF: 93 61. A manufacturer provides discounts to a large retailer in exchange for product advertising, special placement within the stores, and a guarantee that the retailer will purchase a certain volume of product over a three-month period. The manufacturer will not extend this offer to other retailers in the marketplace. Which of the following BEST describes the category that is affected by legal and ethical questions regarding this practice? a. promotion b. pricing c. personal privacy d. distribution ANS: B PTS: 1 DIF: 3 REF: 93 62. What is the most highly regulated aspect of the marketing strategy? a. promotion b. product c. pricing d. distribution ANS: C PTS: 1 DIF: 2 REF: 93 63. When marketers notify customers of impending changes in return policies, what type of strategy are they incorporating ethics into? a. promotional strategy b. pricing strategy c. product strategy d. distribution strategy ANS: B PTS: 1 DIF: 2 REF: 93 64. What must marketers give equal weight to in order to meet the obligations of social responsibility? a. demands of activists, government, and employees in product development b. morality, philosophy, and practicality in their conduct of marketing activities c. profits, customer satisfaction, and social well-being in evaluating their firm’s performance d. multiple boards of directors and executive committees in top levels of corporate management ANS: C PTS: 1 DIF: 2 REF: 94 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

65. Aside from government regulation, what can influence the social responsibility of an organization? a. labour unions b. consumerism c. suppliers d. trade associations ANS: B PTS: 1 DIF: 2 REF: 94 66. A firm’s philosophy when dealing with society as a whole is to “play by the rules” and no more. What level of corporate social responsibility is this firm exhibiting? a. legal b. economic c. ethical d. philanthropic ANS: A PTS: 1 DIF: 2 REF: 94 67. What is the HIGHEST level of corporate social responsibility? a. economic b. legal c. ethical d. philanthropic ANS: D PTS: 1 DIF: 2 REF: 94 68. A firm donates money and used office equipment to a local school. It also contributes money and labour to build a new park. What level of corporate social responsibility is this firm exhibiting? a. economic b. legal c. philanthropic d. ethical ANS: C PTS: 1 DIF: 2 REF: 94 69. Which of the following product offerings is an example of planned obsolescence? a. disposable diapers b. a low-technology product c. travel-size shampoo d. a hexagonal container ANS: A PTS: 1 DIF: 2 REF: 95 70. What is the production, promotion, and reclamation of environmentally sensitive products known as? a. pollution b. recycling c. planned obsolescence d. green marketing ANS: D PTS: 1 DIF: 1 REF: 97 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

71.A firm has decided to alter its pricing and promotional strategies in response to lower-than-forecasted job growth and declining personal incomes. What environment is the firm responding to changes in? a. its socio-cultural environment b. its political-legal environment c. its competitive environment d. its economic environment ANS: D PTS: 1 DIF: 2 REF: 62-63 72. Carmen is a marketer for a global consumer products company. She is working on a promotional campaign designed for a foreign market and is ensuring the promotional campaign is clearly understood by the nation’s consumers and doesn’t inadvertently offend anyone. What type of environment in the country is Carmen being influenced by? a. its socio-cultural environment b. its political-legal environment c. its competitive environment d. its economic environment ANS: A PTS: 1 DIF: 3 REF: 62-63 Chapter 4—Consumer Behaviour MULTIPLE CHOICE 1. What does consumer behaviour refer to? a. organizational purchase decision-making behaviour b. customer spending patterns c. post-purchase decision-making behaviour d. the ultimate buyer decision-making process ANS: D PTS: 1 DIF: 1 REF: 108 2. Which of the following circumstances is NOT an example of consumer behaviour? a. buying a new car b. buying a new home theatre system c. deciding on a college or university d. purchasing a new computer system for work ANS: D PTS: 1 DIF: 2 REF: 108 3. Which of the following is an interpersonal influence on consumer behaviour? a. one’s attitude b. one’s perception c. one’s family d. one’s self-concept ANS: C PTS: 1 DIF: 1 REF: 108 4. According to psychologist Kurt Lewin, what facilitates understanding consumer behaviour? a. individual learning levels and massive group power b. personal influences and the influences of others c. attitudes and perceptions d. reference groups and personal inferences ANS: B PTS: 1 DIF: 2 REF: 108 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

5. According to Kurt Lewin’s theory of consumer behaviour, what interacts with personal factors to create the function of consumer behaviour? a. perception b. learning c. attitudes d. interpersonal influences ANS: D PTS: 1 DIF: 2 REF: 108 6. Samir plans to buy a car and discusses the purchase with his parents. What is their influence on this buying decision considered? a. impersonal influence b. interpersonal influence c. personal influence d. institutional influence ANS: B PTS: 1 DIF: 2 REF: 109 7. Rachael, an advertising executive, shops for clothing at a trendy store in town. The sales associate shows her the latest styles in bright prints and bold colours. Despite the fact that these are the styles worn at her office, she rejects them and purchases a wardrobe in neutrals and black. What type of influence has MOST likely driven Rachael’s decision? a. impersonal b. interpersonal c. personal d. institutional ANS: C PTS: 1 DIF: 2 REF: 109 8. What are values, beliefs, and tastes handed down from one generation to the next called? a. role b. culture c. status d. psychometry ANS: B PTS: 1 DIF: 1 REF: 108 9. What is the broadest environmental determinant of consumer behaviour? a. folklore b. tradition c. culture d. status ANS: C PTS: 1 DIF: 1 REF: 108 10. Which of the following is an example of a core value in Canadian culture? a. peace and order b. importance of team spirit c. dignity of the elderly d. importance of personal achievement ANS: A PTS: 1 DIF: 2 REF: 109 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

11. Only by the 1980s and 1990s did the Canadian population accept interracial marriages. What is this an example of? a. how slowly cultural values change b. a lack of regard for other cultures c. a willingness to sacrifice individualism d. the desire for wealth accumulation ANS: A PTS: 1 DIF: 2 REF: 109 12. What type of market would experience problems by a shift in cultural values away from accumulating material possessions to spending time with family and friends? a. travel services b. luxury cars c. provincial parks and picnic areas d. children’s games and toys ANS: B PTS: 1 DIF: 2 REF: 109 13. What is a heightened appreciation for quality of life an example of in Canadian culture? a. considerations involved in the formation of family groups b. objectives not necessarily reached by even a minority of people c. buying activities related to and based in institutionalism d. core values in Canadian culture ANS: D PTS: 1 DIF: 1 REF: 109 14. Who are cultural differences particularly important to? a. firms marketing internationally b. not-for-profit organizations c. firms marketing to a specific target market in a single city d. firms marketing locally ANS: A PTS: 1 DIF: 1 REF: 108 15. Within the existing Canadian culture, what are Orthodox Jews who purchase and consume only kosher foods an example of? a. a status group b. a social influence c. a microculture d. a geographic community ANS: C PTS: 1 DIF: 1 REF: 110 16. According to Statistics Canada, roughly what portion of Canadians will belong to a group that classifies itself as a visible minority by 2031? a. 21-24% b. 29 - 32% c. 35 - 39% d. 16 - 19% ANS: B PTS: 1 DIF: 1 REF: 110 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

17. What theory suggested that marketing campaigns for French Canadians would be more successful if they were designed specifically for the Quebec market? a. the microculture theory b. the twin beds theory c. the social stratification theory d. the separatist theory ANS: B PTS: 1 DIF: 2 REF: 111-112 18. Which of the following statements best describes the South-Asian Canadian group? a. South Asians are the largest cultural group in Canada. b. The largest number lives in Vancouver. c. South Asians tend to associate more with their own sub-ethnic group. d. The majority of South Asians in Canada are elderly. ANS: C PTS: 1 DIF: 2 REF: 112 19. What is the second largest cultural group in Canada, which represents 4.0 percent of the population? a. South-Asian Canadians b. Hispanic Canadians c. Filipino Canadians d. Black Canadians ANS: A PTS: 1 DIF: 1 REF: 112 20. What are the values and behaviours that groups establish and deem appropriate for their members called? a. group rules b. group norms c. group ideals d. group behaviours ANS: B PTS: 1 DIF: 2 REF: 113 21. What is the relative position of an individual within a group called? a. cultural assimilation b. a role c. status d. the Asch phenomenon ANS: C PTS: 1 DIF: 1 REF: 113 22. What does the Asch phenomenon state about individuals? a. They will follow their personal influences much more closely than any other influence. b. They will follow the majority opinion even if it contradicts the individual’s beliefs. c. They will purchase products that maintain a positive looking-glass self. d. They will avoid extended problem-solving behaviour. ANS: B PTS: 1 DIF: 2 REF: 113 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

23. What purchasing behaviour concept is peer pressure closely related to? a. cognitive dissonance b. opinion leaders c. cultural influences d. Asch phenomenon ANS: D PTS: 1 DIF: 3 REF: 113 24. When do reference groups have a greater impact on the purchasing decision? a. when the consumer is already established as the opinion leader in the group b. when the purchase is hard to recognize or see by the group c. when the purchase is unique and conspicuous d. when the product is common ANS: C PTS: 1 DIF: 2 REF: 113 25. Which of the following product purchases would reference-group influences MOST likely have the greatest impact on? a. double mattress b. luxury car c. new dental floss d. black shoe polish ANS: B PTS: 1 DIF: 1 REF: 113 26.Which of the following are characteristics that determine social-class rankings? a. occupation and income b. cultural background and religious denomination c. geographic location and family size d. birth order and personal beliefs ANS: A PTS: 1 DIF: 3 REF: 114 27.What is the tendency of opinion leaders? a. to have basic core values that change b. to purchase products before other consumers c. to have above-average income d. to avoid extended problem-solving behaviour ANS: B PTS: 1 DIF: 2 REF: 115 28. What role are spouses taking when they independently make an equal number of decisions about product purchases? a. syncratic b. dominant fashion c. autonomic d. dependent ANS: C PTS: 1 DIF: 1 REF: 116 29. Which of the following is NOT categorized as a spouse’s role in purchasing decisions? a. the syncratic role b. the husband-dominated role c. the opinion leader role d. the autonomic role ANS: C PTS: 1 DIF: 2 REF: 116 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

30. A newly married modern couple is looking to rent an apartment. Both of them work in different cities and need to decide in which city they will start to look for the apartment. What kind of a decision is this likely to be? a. syncratic b. husband-dominant c. wife-dominant d. autonomic ANS: A PTS: 1 DIF: 2 REF: 116 31. What is the imbalance between a consumer’s actual and desired states called? a. a need b. an attitude c. a motive d. a self-concept ANS: A PTS: 1 DIF: 1 REF: 117 32. What is included in the personal determinants of consumer behaviour? a. the culture in which a person is raised b. the individual’s needs and motives c. the family to which one belongs d. the society from which one comes from ANS: B PTS: 1 DIF: 1 REF: 117 33. What is created by motives that are an inner state that directs a person? a. equilibrium between the actual and desired states b. excitement in attaining the need satisfaction c. equity between the cost and benefits of the need satisfaction d. energy to participate in the limited problem-solving process ANS: A PTS: 1 DIF: 2 REF: 117 34. Helene, an industrial sales representative, made sure her company car was equipped with OnStar in case she ever had car trouble or got lost while travelling between appointments. What level of Maslow’s hierarchy of needs is Helene addressing? a. physiological b. safety c. esteem d. self-actualization ANS: B PTS: 1 DIF: 2 REF: 118 35. According to Maslow, which of the following characteristics of a country provides marketers with the greatest opportunities to fill higher needs? a. a food shortage b. a limited police force c. a high standard of living d. a high need for clean water ANS: C PTS: 1 DIF: 3 REF: 118 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

36.What type of need includes the need for fulfillment, realizing one’s own potential, and fully using one’s talents and capabilities? a. self-actualization b. physiological c. social d. esteem ANS: A PTS: 1 DIF: 1 REF: 118 37. What level of Maslow’s hierarchy of needs is a person who is satisfying the MOST basic level of needs operating at? a. self-actualization b. esteem c. physiological d. belongingness ANS: C PTS: 1 DIF: 1 REF: 118 38. A marketing campaign, featuring celebrity Lance Armstrong, promotes the campaign slogan “Together We Can Prevail.” What category in Maslow’s hierarchy of needs is addressed by the use of the celebrity? a. esteem b. belongingness c. safety d. physiological ANS: B PTS: 1 DIF: 2 REF: 118 39. According to Maslow, what need is attempting to be met by joining a local bowling league for social interaction? a. self-actualization b. belongingness c. esteem d. safety ANS: B PTS: 1 DIF: 2 REF: 118 40. According to Maslow, what need fulfillment do not-for-profit organizations target when looking for donors? a. physiological b. self-esteem c. belongingness d. self-actualization ANS: D PTS: 1 DIF: 2 REF: 119 41. What is the meaning that a person attributes to incoming stimuli gathered through the five senses called? a. self-concept b. attitude c. perception d. culture ANS: C PTS: 1 DIF: 1 REF: 119 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

42. Which of the following is NOT a stimulus factor? a. a motivation of an individual b. a large house c. a heavy car d. a spherical decoration ANS: A PTS: 1 DIF: 1 REF: 119 43. What does the invention of digital video recording (DVR) technology make it easier for consumers to use? a. their subliminal perception b. their perceptual screens c. their learning processes d. their cognitive dissonance ANS: B PTS: 1 DIF: 2 REF: 119 44. Which of the following wouldMOST likely break through a person’s perceptual screen? a. newspaper ad featuring white type on a black background b. black-and-white classified ad c. reducing the size of an ad d. using fewer colours in an ad ANS: A PTS: 1 DIF: 2 REF: 119 45. John quickly mutes his television every time a commercial comes on. What is this an example of? a. closure b. subliminal advertising c. a perceptual screen d. cognitive dissonance ANS: C PTS: 1 DIF: 1 REF: 119 46. Which of the following best characterizes virtual reality? a. the transmission of marketing information in a three-dimensional fashion b. the least effective method for advertising high-priced products c. the only way that automobile dealerships can sell cars online d. the perception that consumers can be better satisfied by purchasing products online ANS: A PTS: 1 DIF: 2 REF: 120 47. What does the cognitive component of attitude refer to? a. the measure of an emotional reaction to a concept b. the fact that an individual will tend to behave in a particular manner towards a concept c. the individual’s knowledge and information about an object or concept d. the speed with which one learns information about an object ANS: C PTS: 1 DIF: 2 REF: 120 48. Food manufacturers often set up tables in grocery stores where customers can sample featured products. What component of attitude does this type of promotion try to influence? a. behavioural b. rational c. cognitive d. affective ANS: A PTS: 1 DIF: 2 REF: 120 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

49. What component of attitude is being altered by an advertisement that creates warm feelings of goodwill toward the advertiser and its products? a. cognitive b. behavioural c. traditional d. affective ANS: D PTS: 1 DIF: 2 REF: 120 50. A business sends one coupon to consumers that have purchased in the past. What is this an example of? a. a marketer trying to revive a failing product b. shaping c. subliminal advertising d. reinforcement ANS: D PTS: 1 DIF: 2 REF: 122 51. In the learning process, what is reinforcement? a. the immediate expected change in behaviour as a result of experience b. the reduction in drive that results from a proper response c. an individual’s reaction to a set of cues d. any strong stimulus that impels action ANS: B PTS: 1 DIF: 1 REF: 122 52. Which of the following describes the situation that people are likely to buy products they believe will move them towards their desired image? a. their real self b. their looking-glass self c. their model self d. their ideal self ANS: D PTS: 1 DIF: 1 REF: 123 53. In the area of self-concept theory, what is the real self? a. the way the individual views himself or herself b. the way the individual thinks other people see him or her c. the individual’s personal set of objectives to which he or she aspires d. an objective view of the total person ANS: D PTS: 1 DIF: 2 REF: 123 54. Which of the following describes the looking-glass self? a. It is an objective view of oneself. b. It often differs from self-image because people may choose to project a different image to others. c. It is usually the same as the ideal self because most people want others to perceive them as successfu d. It is a personal view of how a person wants to be. ANS: B PTS: 1 DIF: 2 REF: 123 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

55. What products typically require high-involvement decisions? a. inexpensive and rarely purchased products b. inexpensive and frequently purchased products c. expensive and relatively simple products d. expensive and complicated products ANS: D PTS: 1 DIF: 2 REF: 124 56. What are purchase decisions that have a potentially high level of social or economic consequences known as? a. low time and effort involvement b. low-involvement. c. high-involvement d. single-person involvement ANS: C PTS: 1 DIF: 3 REF: 124 57. What happens to the consumer during the search step of the consumer decision process? a. The consumer realizes it’s time to make a change from the present situation. b. The consumer develops a set of evaluative criteria to guide the purchase decision. c. The consumer notices favourable, word-of-mouth communication about the product. d. The consumer gathers information about the attainment of a desired state of affairs. ANS: D PTS: 1 DIF: 2 REF: 125 58. Which of the following is a characteristic of the evaluative criteria used by consumers in the decision-making process? a. It is set aside if the consumer finds a better means of making the purchase decision. b. It identifies alternative brands for consideration and possible purchase. c. It occurs during the first stage of the decision process. d. It includes objective facts or subjective opinions about the alternatives. ANS: D PTS: 1 DIF: 3 REF: 126 59. What is one of the ways in which marketers can attempt to affect the outcome of the alternative evaluation stage of the consumer decision-making process? a. trying to get consumers to expand their evoked sets to include their product b. attempting to convince consumers that a competing brand does not meet their criteria c. providing persuasive evidence about their products in a useful format d. helping consumers to identify potential problems or needs ANS: A PTS: 1 DIF: 3 REF: 126 60. What is term for the number of alternatives a consumer actually considers in making a purchase decision? a. the evoked set b. customer options c. evaluative criteria d. cognitive choices ANS: A PTS: 1 DIF: 1 REF: 126 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

61. What is the term for product features a consumer considers when choosing among alternatives? a. appraisal standards b. evaluative criteria c. assessment parameters d. selection rules ANS: B PTS: 1 DIF: 1 REF: 126 62. What is the anxiety that consumers begin to feel when they are dissatisfied with a product or service recently purchased called? a. cognitive dissonance b. post-purchase regret c. product re-evaluation d. purchase rejection ANS: A PTS: 1 DIF: 1 REF: 126-127 63. At which stage of the consumer decision-making process might cognitive dissonance occur? a. search b. evaluation c. purchase decision and purchase act d. post-purchase evaluation ANS: D PTS: 1 DIF: 2 REF: 126 64. What does the post-purchase evaluation of the consumer decision process attempt to measure? a. the selling success experienced by the vendor b. the follow-up effectiveness of the firm c. the consumer satisfaction with the purchase d. the advertising influence on the purchase ANS: C PTS: 1 DIF: 2 REF: 126 - 127 65. When is cognitive dissonance MOST likely to occur? a. during the pre-purchase stage b. decreases if the product does not have the desired features c. when there is a balance between attitudes, beliefs, and knowledge d. as the cost and complexity of the purchase increases ANS: D PTS: 1 DIF: 2 REF: 127 66. How can marketers attempt to shape the outcome of the post-purchase evaluation? a. by helping consumers to identify potential problems or needs b. by offering personal assistance with any problem experienced with the product c. by attempting to convince consumers that a competing brand does not meet their criteria d. by trying to get consumers to expand their evoked sets to include their product ANS: B PTS: 1 DIF: 2 REF: 127 67. Which of the following consumer problem-solving behaviours requires the LEAST effort? a. extended problem solving b. limited problem solving c. routinized response behaviour d. impulsive buying ANS: C PTS: 1 DIF: 1 REF: 128 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

68. A new brand is introduced into an array of familiar brands for which a consumer has previously set evaluative criteria. What might be the result of this introduction? a. limited problem solving b. extended problem solving c. a routinized response d. brand evaluation ANS: A PTS: 1 DIF: 2 REF: 128 69. When a product is unique or difficult to categorize, what is the thought process involved in a purchase decision known as? a. research analysis b. extensive analysis buying c. limited problem solving d. extended problem solving ANS: D PTS: 1 DIF: 2 REF: 128 70. How can marketers influence the outcome of the evaluation stage of the consumer purchase decision process? a. by attempting to convince consumers that certain attributes are more important than others in decidin which product to buy from among an array of them b. by identifying which evaluative criteria are important to the individual and pointing out which brand best meets those criteria c. by trying to get the customer to reduce the size of the evoked set to exclude many of the choices d. by attempting to convince the consumer to spend more than was budgeted for the purchase to acquir more features he or she might prefer ANS: B PTS: 1 DIF: 3 REF: 126 71. A hurricane has destroyed a small town and now the inhabitants have nothing. According to Maslow, what are the inhabitants MOST likely to seek next? a. a tent b. medicine c. a working automobile d. a blowdryer ANS: A PTS: 1 DIF: 1 REF: 118 72. Which of the following is the easiest for a marketer to accomplish regarding a product? a. Change an unfavourable to a favourable attitude b. Maintain a positive attitude c. Change a positive to a more positive attitude d. Maintain a need ANS: B PTS: 1 DIF: 1 REF: 121 Chapter 5—Business-to-Business (B2B) Marketing MULTIPLE CHOICE 1. How does the purchasing process for business products differ from the purchasing process for consumer products? a. distribution channels for business products are significantly longer b. customer relationships for business products tend to be short term and transaction based c. personal selling plays a much larger role in business product markets d. customer service plays a smaller role in the distribution of business products ANS: C PTS: 1 DIF: 2 REF: 138 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

2. Why do marketing strategies designed to reach consumers differ from strategies designed to reach businesses? a. consumers expect a higher level of customer service than do businesses b. businesses respond better to advertising than do consumers c. consumers act in groups but business buyers act alone d. business buying often involves more technical issues ANS: D PTS: 1 DIF: 2 REF: 139 3. What do MOST businesses expect when they enter the marketplace to buy goods and services? a. to enjoy a high level of customer service b. to locate vendors through the Yellow Pages c. to find standard items that will fill their needs d. to make quick purchasing decisions ANS: A PTS: 1 DIF: 2 REF: 138 4. Which of the following statements best describes the business market compared to the consumer market ? a. Customization tends to be less. b. Negotiations are shorter. c. Distribution channels are shorter. d. Customer relations are less enduring. ANS: C PTS: 1 DIF: 3 REF: 138 5. Which of the following is NOT included in the four segments of the B2B marketplace? a. the entertainment industry b. government c. the commercial market d. trade industries ANS: A PTS: 1 DIF: 1 REF: 138 6. What is the largest segment of the business market? a. trade industries b. institutions c. government organizations d. commercial markets ANS: D PTS: 1 DIF: 2 REF: 140 7. What is the name of the component of the business market that consists of individuals and firms that acquire goods and services to be used, directly or indirectly, in producing other goods and services? a. wholesaling and retailing b. government c. the commercial market d. an institution ANS: C PTS: 1 DIF: 1 REF: 140 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

8. What do the trade industries consist of? a. manufacturers b. wholesalers and retailers c. farmers d. transportation ANS: B PTS: 1 DIF: 1 REF: 140 9. Which of the following characteristics best describes the institution segment of a B2B market? a. It may have rigid purchasing procedures. b. It provides business services to the other members of the market. c. It tends to have greater financial resources than industrial customers. d. It is accountable to their clients and shareholders. ANS: A PTS: 1 DIF: 2 REF: 141 10. Why does the government segment of the B2B market MOST commonly buy products? a. to resell to the public b. to provide public benefits c. to acquire customized items d. to use domestic sources only ANS: B PTS: 1 DIF: 2 REF: 140 11. What market has the primary motivation of providing some form of public benefit when making a purchase? a. the industrial market b. the global market c. the government market d. the trade industries ANS: C PTS: 1 DIF: 2 REF: 140 12. Which of the following is NOT found in e-commerce serving the business market? a. private portals that allow customers access to products and vendors b. service pages accessed using passwords provided by B2B marketers c. online auctions where business goods may be purchased d. chat rooms dedicated to opinions of new products ANS: D PTS: 1 DIF: 1 REF: 141 13. Which of the following is NOT a commonly used basis for segmenting the business market? a. educational attainments of buyers b. customer type c. demographics using the size of the firm d. product end-use application ANS: A PTS: 1 DIF: 3 REF: 143 14. When the B2B market is segmented on the basis of product specifications issued by organizational buyers, what type of segmentation is it known as? a. customer-based segmentation b. profit-generating segmentation c. benefits segmentation d. engineering and design segmentation ANS: A PTS: 1 DIF: 2 REF: 143 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

15. Zardo Inc. divides its customers into the following categories: small business, large business, government, and not-for-profit institutions. Which type of segmentation is Zardo practising? a. end use b. customer type c. demographic d. purchase category ANS: B PTS: 1 DIF: 2 REF: 143 16. What is the system for grouping businesses that grew out of the North American Free Trade Agreement known as? a. the Standard Industrial Classification System b. the Industrial Data Recording System c. the Standard Industrial Census System d. the North American Industry Classification System ANS: D PTS: 1 DIF: 3 REF: 144 17. What type of segmentation are customer relationship management systems MOST useful in? a. end use b. demographic c. customer type d. purchase category ANS: D PTS: 1 DIF: 2 REF: 145 18. In the B2B marketplace, what type of segmentation is based on the precise way in which the business will use the product? a. segmentation by purchasing situation b. segmentation by customer type c. segmentation by end-use application d. segmentation by demographic characteristics ANS: C PTS: 1 DIF: 2 REF: 144 19. What is the basis for market segmentation for a manufacturer that produces glass for microwave-oven doors, shower enclosures, and patio tabletops? a. cost-plus considerations b. end-use application c. benefits offered d. design factors ANS: B PTS: 1 DIF: 2 REF: 144 20. Which of the following is NOT a characteristic that distinguishes B2B markets from consumer markets? a. Organizational markets are more geographically concentrated. b. More people exert influence on the organizational buying decision. c. The organizational market tends to have a greater number of buyers. d. Organizations often engage in multiple sourcing and vendor analysis. ANS: C PTS: 1 DIF: 2 REF: 145 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

21. Which of the following will generally NOT be affected by the location of a business supplier compared to its customers? a. end-use applications of products b. ability of the supplier to render better service c. supplier costs d. supplier parts inventories ANS: A PTS: 1 DIF: 2 REF: 145 22. Dell Computer purchases parts and resources for its computers from suppliers worldwide. What is this practice known as? a. outsourcing b. global sourcing c. joint demand d. derived demand ANS: B PTS: 1 DIF: 1 REF: 148 23. The demand for computer microprocessor chips is based on the demand for personal computers. What is this an example of? a. joint demand b. derived demand c. volatile demand d. demand variability ANS: B PTS: 1 DIF: 2 REF: 149 24. Cotton and polyester are used in the production of permanent press clothing. If the supply of cotton is reduced, there will be an immediate effect on the demand for polyester. What does this relationship represent? a. derived demand b. demand variability c. inventory adjustments d. joint demand ANS: D PTS: 1 DIF: 2 REF: 149 25. If the demand for product A stays constant regardless of the increase or decrease in demand for product B, what kind of demand is product A experiencing? a. derived b. joint c. volatile d. inelastic ANS: D PTS: 1 DIF: 3 REF: 149 26. What type of delivery reduces inventories to absolute minimum levels and requires vendors to deliver the items as they are needed in the production process? a. in-real-time (IRT) delivery b. just-in-time (JIT) delivery c. on-time (OT) delivery d. next-time-in (NTI) delivery ANS: B PTS: 1 DIF: 2 REF: 150 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

27. Which of the following questions would NOT likely be considered when deciding whether to manufacture needed parts and equipment in-house? a. Do we have the needed capability to manufacture this equipment? b. Can someone else do this job better than we can? c. Can someone else do this work cheaper than we can? d. Do we create new distribution systems by manufacturing this equipment? ANS: D PTS: 1 DIF: 3 REF: 152 28. Why is outsourcing often chosen as an alternative to making goods in-house or providing in-house services? a. outsourcing solves customer pressure for firms to diversify production b. outsourcing guarantees that the highest-quality product will be produced c. outsourcing solves security problems when proprietary technology is involved d. outsourcing allows firms to concentrate their resources on their core businesses ANS: D PTS: 1 DIF: 3 REF: 152 29. What is turning to outsiders to provide goods and services that were formerly produced or handled internally known as? a. outsourcing b. supplier sourcing c. supply-chain management d. external buying ANS: A PTS: 1 DIF: 1 REF: 152 30. Which of the following is NOT a drawback of outsourcing ? a. lower-than-anticipated cost savings b. concerns over proprietary technology c. poor customer service d. higher risk of losing touch with customers ANS: C PTS: 1 DIF: 2 REF: 152 31. How do unions generally view outsourcing? a. as a threat to union jobs b. as a bargaining tool for higher wages c. as a good idea to stay competitive and preserve jobs d. as a means of saving money and putting the savings into wages and benefits ANS: A PTS: 1 DIF: 1 REF: 153 32. Which of the following is NOT an important product factor in the buying decision? a. replacement cost b. purchase price c. operating and maintenance costs d. vendor service ANS: A PTS: 1 DIF: 2 REF: 153 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

33. The Fairchild Company decides to defer purchasing new production equipment for its factory due to slowing economic activity. What type of factor has influenced the company’s buying decision? a. a product-specific factor b. an environmental factor c. an organizational factor d. an interpersonal factor ANS: B PTS: 1 DIF: 2 REF: 153 34. When a firm undertakes systems integration and designates a major trade industry supplier as the systems integrator, what is that supplier known as? a. the category captain b. the purchasing coordinator c. the division leader d. the supply-chain manager ANS: A PTS: 1 DIF: 2 REF: 154 35. What is an employee participating in when he/she recognizes that the use of a new product can potentially improve the company’s market performance? a. need or opportunity recognition b. identification of suppliers c. word-of-mouth exploration d. information search ANS: A PTS: 1 DIF: 2 REF: 155 36. What contributes to the need for more steps in the organizational buying process than the consumer buying process? a. the limited number of suppliers in the B2B marketplace b. the importance of integrating the responsibilities of the wholesalers or retailers c. interpersonal and environmental influences not seen in consumer buying decisions d. business purchasing introduces new complexities that do not affect consumers ANS: D PTS: 1 DIF: 3 REF: 155 37. What is the price negotiation process commonly experienced by government and institutional entities known as? a. competitive bidding b. decentralized buying c. collective bargaining d. systems integration ANS: A PTS: 1 DIF: 2 REF: 156 38. Once a search for suppliers is completed and the company makes the suppliers aware of its needs, what will the company do next? a. evaluate proposals b. notify the distribution channels of the new product introduction c. acquire and analyze proposals d. select an order routine ANS: C PTS: 1 DIF: 2 REF: 156 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

39. What step in the business buying process involves establishing specifications for a required product? a. recognizing a need b. describing product characteristics c. qualifying potential vendors d. selecting an order routine ANS: B PTS: 1 DIF: 2 REF: 156 40. Adam, a purchasing agent for the American Heart Association, has made a list of suppliers that may be considered for payroll services. What step in the organizational buying process is Adam currently at? a. recognizing a problem or opportunity b. determining the characteristics and quantity of the needed product c. describing the characteristics of the needed product d. searching for and qualifying potential sources ANS: D PTS: 1 DIF: 2 REF: 156 41. What step in the organizational buying process would involve procedures that measure characteristics such as a supplier’s reliability, price, and order accuracy? a. searching for potential sources b. analyzing proposals c. recognizing a need d. evaluating proposals and selecting suppliers ANS: D PTS: 1 DIF: 2 REF: 155 42. What is the final step in the business buying process? a. selecting an order routine b. obtaining feedback and evaluating performance c. evaluating proposals and selecting suppliers d. acquiring and analyzing proposals ANS: B PTS: 1 DIF: 2 REF: 156 43. What is a unique purchase situation in the business market called that requires considerable effort on the decision maker’s part? a. a straight rebuy b. a modified rebuy c. new-task buying d. a selective rebuy ANS: C PTS: 1 DIF: 1 REF: 158 44. What kind of buying situation is it when a business purchaser accepts the terms of sale of an item that has performed satisfactorily in the past and requires no new information to decide to purchase it again? a. straight rebuy b. service purchase c. contract purchase d. modified rebuy ANS: A PTS: 1 DIF: 1 REF: 157 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

45.What is often the cause when business purchasers shift from straight rebuy to modified rebuy behaviour? a. a change in the accelerator principle b. the routine buying format being outdated c. corporate expansion d. a deterioration in supplier service or delivery ANS: D PTS: 1 DIF: 2 REF: 158 46. What is a buying situation in which business purchasers are willing to re-evaluate their available options known as? a. a straight rebuy b. a modified rebuy c. new-task buying d. routinized response behaviour ANS: B PTS: 1 DIF: 2 REF: 158 47. What term refers to the business buying situation in which a company buys component parts never before purchased? a. complex rebuying b. new-task buying c. technical buying d. modified rebuying ANS: B PTS: 1 DIF: 2 REF: 158 48. What is the practice of buying from suppliers that are also customers known as? a. a modified rebuy b. a straight rebuy c. vendor analysis d. reciprocity ANS: D PTS: 1 DIF: 1 REF: 158 49. What is the ongoing evaluation of a supplier’s performance in categories such as price, Electronic Data Interchange capability, delivery times, and attention to special requests known as? a. product-substitution analysis b. component redesign c. vendor analysis d. costs-benefits analysis ANS: C PTS: 1 DIF: 2 REF: 159 50. Reciprocity has been MOST common in industries featuring what type of products? a. homogeneous products with different prices b. diverse products with different prices c. diverse products with similar prices d. homogeneous products with similar prices ANS: D PTS: 1 DIF: 2 REF: 158 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

51. What does a company’s buying centre encompass? a. a representative from each department within an organization b. a gatekeeper and a buyer c. everyone who is involved in any aspect of the buying process d. a top-notch buying department ANS: C PTS: 1 DIF: 2 REF: 159 52. In a business buying centre situation, who are the people that sometimes initially request the product, utilize the purchased product, and may assist in developing the product specifications? a. users b. consumers c. influencers d. gatekeepers ANS: A PTS: 1 DIF: 2 REF: 159 53. What is the function performed by the gatekeeper in the company buying centre? a. to supply information to guide evaluation of alternatives b. to select a supplier and implement the procedures for securing the goods and services c. to choose which goods and services will actually be bought d. to control the information that all buying centre members will review ANS: D PTS: 1 DIF: 2 REF: 159 54. Who controls the information that enters the company’s buying centre? a. the buyer b. the influencer c. the gatekeeper d. the user ANS: C PTS: 1 DIF: 2 REF: 159 55. Which of the following is one type of buying centre role? a. the influencer, who supplies information to guide evaluation of alternatives b. the contractor, who has the formal authority to select a supplier c. the distributor, who controls the information that all buying centre members will review d. the technician, who presents technical requirements ANS: A PTS: 1 DIF: 2 REF: 159 56. The buying centre concept explains how groups of people participate informally in business purchase decisions. What else does the buying centre concept explain? a. the methods to break through group perceptions b. the roles group members play in making the decisions c. the formation dynamics of new groups of decision makers d. the way family units operate as buying centres ANS: B PTS: 1 DIF: 3 REF: 159 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

57. Janet works in distribution management at a winery and has formal authority to select a bottle supplier, although many people have provided her with input regarding the decision. What role does Janet play in the buying centre? a. the influencer b. the gatekeeper c. the buyer d. the user ANS: C PTS: 1 DIF: 2 REF: 160 58. Which of the following is NOT a challenge ordinarily encountered in marketing to government entities? a. handling retail sales contracts using credit cards b. fixed-price contracts based on a bid process c. cost-reimbursement contracts providing for allowable costs and profits d. a standing offer ANS: A PTS: 1 DIF: 2 REF: 161 59. Who does much of the purchasing for the federal government of Canada? a. the City of Toronto b. Public Works and Government Services Canada c. MERX d. independent merchandisers ANS: B PTS: 1 DIF: 1 REF: 161 60. How are institutional markets characterized? a. by similar buying practices b. by widely diverse buying practices c. by few group purchasing arrangements d. by little negotiation to secure volume discounts ANS: B PTS: 1 DIF: 2 REF: 162 61. Which of the following types of organizations would NOT ordinarily be considered a part of the institutional market? a. public libraries b. department stores c. educational foundations d. churches ANS: B PTS: 1 DIF: 1 REF: 162 62. What do many institutions choose to do in order to receive quantity discounts on needed purchases? a. purchase products they do not need b. put off purchases for as long as possible c. join cooperative associations to pool purchases d. rely on their independence and future growth ANS: C PTS: 1 DIF: 2 REF: 162 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

63. A car tire supplier is noticing an 5% increase in sales in tires it sells to car manufacturers. What is this an example of? a. joint demand b. derived demand c. volatile demand d. demand variability ANS: B PTS: 1 DIF: 3 REF: 149 64. A rail service company has a special “2 for 1 seat sale” and requires an additional 100 railcars to meet the forecasted demand in the next 10 months. After the 10 months, demand is anticipated to fall to previous levels. Which of the following is the MOST LIKELY option for the company to choose? a. Manufacturing the product in-house b. Purchasing the product from an outside vendor c. Leasing the product d. Outsourcing ANS: C PTS: 1 DIF: 3 REF: 151-152 65. ACME Inc., a small and growing computer animation business, requires laptops for 10 new employees. Which of the following is the MOST LIKELY option for the company to choose? a. Manufacturing the product in-house b. Purchasing the product from an outside vendor c. Leasing the product d. Outsourcing ANS: C PTS: 1 DIF: 2 REF: 151 66. Which of the following BEST describes the challenge of identifying participants in international buying centres, compared to domestic buying centres? a. Quite easier to identify b. Slightly easier to identify c. Same level of difficulty to identify d. More difficult to identify ANS: D PTS: 1 DIF: 2 REF: 160 Chapter 6—Serving Global Markets MULTIPLE CHOICE 1. What two categories can international trade be divided into? a. exporting and importing b. national and international c. general and foreign d. direct and indirect ANS: A PTS: 1 DIF: 1 REF: 172 2. Which of the following is NOT a reason why global trade is vital to a nation and its marketers? a. market expansion b. increased dependence on domestic economic conditions c. production and distribution economies d. growth opportunities ANS: B PTS: 1 DIF: 2 REF: 172 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

3. What is a characteristic that many North American economies have for products that result in increased importance of global trade? a. a growing market b. a technologically advanced market c. an advanced market d. a mature market ANS: D PTS: 1 DIF: 2 REF: 172 4. In addition to natural resources, what exports are equally as important to Canada’s economy? a. processed and packaged foods b. machinery and automotive products c. low-technology trade goods d. melons and other wet fruits ANS: B PTS: 1 DIF: 1 REF: 172-173 5. Following the United States, who is Canada’s second largest trading partner? a. the European Union b. Japan c. China d. United Kingdom ANS: A PTS: 1 DIF: 1 REF: 173 6. Who is the largest private employer in the world? a. General Motors Corporation b. McDonalds c. Microsoft d. Walmart ANS: D PTS: 1 DIF: 1 REF: 173 7. What accounts for 70 percent of Canada’s gross domestic product? a. agriculture b. manufacturing c. retail d. services ANS: D PTS: 1 DIF: 1 REF: 174 8. Procter & Gamble successfully introduced a lower-priced version of its popular Tide laundry detergent to the rural Chinese market, and a higher-priced version to city-dwellers in China. What does this illustrate about succeeding in a foreign market? a. Marketers must look for alternative distribution channels. b. Marketers must partner with a local marketing firm. c. Marketers must adapt a product to local preferences and culture. d. Marketers must maintain the exact product characteristics that were successful in the domestic mark ANS: C PTS: 1 DIF: 2 REF: 175 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

9. Before entering a country, what is the underlying foundation marketers need to determine it has? a. a moral code b. a legal system c. an infrastructure d. a trade organization ANS: C PTS: 1 DIF: 1 REF: 176 10. Which of the following is NOT considered a part of a nation’s infrastructure ? a. wholesale networks b. transportation networks c. communications systems d. energy facilities ANS: A PTS: 1 DIF: 1 REF: 176 11. Which of the following markets are strong for a nation with low per-capita incomes? a. automobiles and electronics b. industrial machinery c. agricultural hand tools d. technical services ANS: C PTS: 1 DIF: 2 REF: 176 12. In order for a marketer to operate efficiently in a foreign country, what must be in place and stable to facilitate trade? a. a free trade agreement b. infrastructure c. tariffs d. a labour force ANS: B PTS: 1 DIF: 1 REF: 176 13. What idea is the basis for the European Union currency, the euro ? a. Tying other European currencies to the euro will stabilize exchange rates. b. The presence of the euro will eliminate soft currencies from the marketplace. c. Having a single currency will strengthen Europe’s global competitiveness. d. The euro will eventually be used in Eastern Europe. ANS: C PTS: 1 DIF: 2 REF: 176 14. When entering a foreign market, care must be taken to ensure that product names and advertising slogans are translated correctly and do not cause misunderstandings among foreign consumers. What element of the international environment does this illustrate? a. social-cultural b. political-legal c. economic d. technological ANS: A PTS: 1 DIF: 2 REF: 176 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

15. What are many Western firms utilizing in order to stay abreast of changing political and legal environments that exist in various foreign countries? a. the Internet b. political risk assessment units c. the World Trade Organization d. consumer research groups ANS: B PTS: 1 DIF: 2 REF: 178 16. What do ISO 9000 standards set requirements for? a. quality in goods and services b. prices c. worker compensation d. environmental protection ANS: A PTS: 1 DIF: 2 REF: 178 17. What do ISO 14000 standards set requirements for? a. product quality b. prices c. worker compensation d. environmental protection ANS: D PTS: 1 DIF: 2 REF: 179 18. Who provides advice and assistance to Canadian businesses that want to enter foreign markets? a. the World Trade Organization b. the Trade Commissioner Service c. the Canadian Tourism Commission d. the International Monetary Fund ANS: B PTS: 1 DIF: 1 REF: 179 19. Which of the following is NOT considered a trade barrier to an exporter? a. tariffs b. import quotas c. subsidies d. related-party trade ANS: D PTS: 1 DIF: 3 REF: 180-181 20. What is the basic purpose of revenue tariffs? a. to raise money for the country into which the products are being imported b. to raise the retail prices of imported products to match or exceed those of similar domestic products c. to counter the effects of protective tariffs on the domestic market d. to stabilize the prices of imported goods ANS: A PTS: 1 DIF: 1 REF: 180 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

21. The Republic of Eastern Africa imposes a duty on imported goods to pay for government services. What is this BEST described as? a. a protective tariff b. a revenue tariff c. an import quota d. a subsidy ANS: B PTS: 1 DIF: 2 REF: 180 22.What is the basic purpose of protective tariffs? a. to raise money for the country into which the products are being imported b. to raise the retail prices of imported products to match or exceed those of similar domestic products c. to counter the effects of tariffs on the domestic market d. to stabilize the prices of imported goods ANS: B PTS: 1 DIF: 1 REF: 180 23. What is a complete ban on the import of a product known as? a. an import quota b. an embargo c. a revenue tariff d. a protective tariff ANS: B PTS: 1 DIF: 1 REF: 180 24. Which of the following is one requirement for companies regarding exchange control? a. Companies that export need to sell foreign currencies to a foreign agency or the central bank. b. Companies need to support domestic industry through grants of money or research support. c. Companies need a complete ban on the importation of a product. d. Companies that sell products in a foreign market price the products cheaper than they are sold domestically. ANS: A PTS: 1 DIF: 2 REF: 181 25. What is the ideal way for a nation to stop a foreign company from dumping? a. pay the exporter with soft currency b. impose protective tariffs c. cite international law d. appeal to the International Monetary Fund ANS: B PTS: 1 DIF: 2 REF: 182 26. A company sells products to a foreign market at a price lower than it sells within its own country. What is this practice known as? a. dumping b. inventory reduction c. open-market theory d. competitive counterstrategy ANS: A PTS: 1 DIF: 1 REF: 182 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

27. What have a group of nations created when they agree to the exchange of goods among themselves by abolishing tariffs and trade restrictions? a. a common market b. a customs union c. a trading block d. a free trade area ANS: D PTS: 1 DIF: 2 REF: 182 28. What type of multinational organization features the no tariff exchange of goods among its members and a uniform tariff for trade with nonmember nations? a. common market b. administration common c. customs union d. free trade area ANS: C PTS: 1 DIF: 2 REF: 182 29. What organization was established as a result of the General Agreement on Tariffs and Trade? a. North American Free Trade Agreement b. European Union c. World Trade Organization d. Free Trade Area of the Americas ANS: C PTS: 1 DIF: 1 REF: 184 30. What type of progress has the World Trade Organization made toward its goals of liberalizing world financial services, telecommunications, and maritime markets? a. slow—its activities have focused on complaint resolution, not trade barriers b. rapid—several major new treaties have been ratified in the last two years c. about as expected—there have been the usual victories and the usual defeats d. relatively fast—some authorities claim a new world order by the year 2016 ANS: A PTS: 1 DIF: 3 REF: 184 31. Which of the following is one of the major policy initiatives of the World Trade Organization? a. increasing the average level of education worldwide b. liberalizing world financial services c. promoting and protecting the environment d. regulating automobile production by less-advanced nations ANS: B PTS: 1 DIF: 2 REF: 184 32. Assume China and Canada are involved in a trade dispute. Which organization will attempt to resolve the dispute? a. United Nations b. World Trade Organization c. European Union d. General Agreement on Tariffs and Trade ANS: B PTS: 1 DIF: 2 REF: 184 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

33. What would be included in the Free Trade Area of the Americas when goals are completed? a. Existing nations will become members of the World Trade Organization. b. The World Trade Organization would be the largest free-trade zone in the world. c. It would include nations from Central, North and South America. d. More intensive customs procedures via General agreement on Trades and Tariffs. ANS: C PTS: 1 DIF: 2 REF: 184 34. What is the goal of the EU? a. to establish manufacturing standards b. to expand globally c. to remove all barriers to free trade among its members d. to completely absorb the former Eastern bloc of nations ANS: C PTS: 1 DIF: 1 REF: 185 35. What is a company’s first step toward successful global marketing? a. to prepare an international business plan b. to seek to license a foreign company c. to enter into a joint venture with a foreign company d. to establish marketing operations in a foreign country ANS: A PTS: 1 DIF: 2 REF: 207 36. What is an organization called that provides first-time exporters with expertise in locating foreign buyers, handling paperwork, and conforming to local labelling and testing laws? a. an export facilitator b. an export title company c. a trade assistance corporation d. an export management company ANS: D PTS: 1 DIF: 2 REF: 187 37. What is the term for an arrangement in which a small firm teams with, and serves as a subcontractor for, a larger international company on a foreign project? a. international trade mentorship b. trade facilitation c. an offset agreement d. a mutual trade agreement ANS: C PTS: 1 DIF: 2 REF: 187 38. What is the term for a contractual arrangement in which a wholesaler or retailer agrees to meet the operating requirements of a manufacturer? a. foreign licensing b. franchising c. joint licensing d. offset licensing ANS: B PTS: 1 DIF: 1 REF: 188 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

39. Which of the following is an advantage of foreign licensing over exporting ? a. access to the local partners’ pricing b. use of the local partner’s distribution channels c. capital investment in foreign country d. slow entry into a foreign market ANS: B PTS: 1 DIF: 2 REF: 188 40. What is the term for a contractual agreement by which a domestic firm grants foreign marketers the right to distribute a firm’s merchandise or use its trademark, patent, or process in a specified geographic area? a. subcontracting b. franchising c. reciprocal partnership d. foreign licensing ANS: D PTS: 1 DIF: 1 REF: 188 41. Toyota, a Japanese firm, builds a factory in Ontario to make vehicles to be marketed to Canadians. How is this strategy BEST described? a. as a joint venture between Toyota and the Ontario provincial government seeking to increase employment opportunities b. as foreign marketing by Toyota c. as international direct investment by Toyota in Canada d. as indirect exporting ANS: C PTS: 1 DIF: 2 REF: 189 42. What is the international market-entry strategy that involves high levels of involvement and risk potential and also offers a competitive advantage over other alternatives? a. franchising b. offset agreement c. foreign licensing d. international direct investment ANS: D PTS: 1 DIF: 2 REF: 189 43. Which of the following is NOT an example of international direct investment by a firm? a. a foreign sales office b. overseas marketing subsidiaries c. acquisition of an existing foreign company d. an export management company ANS: D PTS: 1 DIF: 2 REF: 189 44. What is a firm with significant operations and marketing activities outside its home country called? a. a monopoly b. an active exporter c. a multinational corporation d. an overseas marketer ANS: C PTS: 1 DIF: 2 REF: 189 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128

45. Which of the following BEST describes IBM and General Electric? a. global exporters b. multinational corporations c. domestic corporations d. global importers ANS: B PTS: 1 DIF: 2 REF: 189 46. What does a multi-domestic marketing strategy indicate about a firm? a. that it customizes its marketing decisions to effectively reach individual marketplaces b. that it disregards the principles of market segmentation c. that it considers all foreign countries to have equally competitive situations d. that it employs universal promotional messages ANS: A PTS: 1 DIF: 3 REF: 190 47. What type of standard marketing strategy modifies only minimally for use in each of the firm’s foreign markets? a. a single-space marketing strategy b. a monolithic marketing strategy c. a global marketing strategy d. a multi-domestic marketing strategy ANS: C PTS: 1 DIF: 1 REF: 190 48. Dell is famous for its build-to-order computers; however, the company decided to sell prebuilt computers in China’s retail stores. What is this a result of? a. a global marketing strategy b. a multinational marketing strategy c. a countertrade policy d. a multi-domestic marketing strategy ANS: D PTS: 1 DIF: 2 REF: 190 49. Which of the following advantages does NOT ordinarily arise out of customizing marketing strategies for different international markets? a. lower production costs per unit b. attention to local preferences c. products tailored to target market needs d. promotions that appeal to local tastes ANS: A PTS: 1 DIF: 2 REF: 191 50. Which of the following are alternative strategies from which international marketers can choose when selecting an appropriate product/promotion strategy? a. product adaptation and dual adaptation b. promotion adaptation and direct exporting c. countertrading and product invention d. global marketing and multinational marketing ANS: A PTS: 1 DIF: 2 REF: 191 Downloaded by sungjoon kim (sungjoonkim38@gmail.com) lOMoARcPSD|11651128