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MKTG 2, Second Canadian Edition Test Bank

MKTG 2, Second Canadian Edition Test Bank simplifies tough topics and provides all the necessary study resources for a stress-free exam.

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    NETA A SSESSMENT Test Bank to accompany Second Canadian Edition Test Bank prepared by Beth Pett Niagara College

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    iii Table of Contents PART 1 – Marketing —Let’ s Get Started 1. An Overview of Marketing .................................................................................................... 1-1 2. The Marketing Environment, Social Responsibility, and Ethics ........................................... 2-1 3. Strategic Planning for Competitive Advantage...................................................................... 3-1 PART 2 – Analyzing Marketing Opportunities 4. Decision Support Systems and Market Research .................................................................. 4-1 5. Consumer Decision Making .................................................................................................. 5-1 6. Business Marketing ............................................................................................................... 6-1 7. Segmenting, Targeting, and Positioning ............................................................................... 7-1 8. Customer Relationship Management (CRM)......................................................................... 8-1 PART 3 – Product Decisions 9. Product Concepts ................................................................................................................... 9-1 10. Developing and Managing Products .................................................................................. 10-1 11. Services and Nonprofit Organization Marketing ............................................................... 11-1 PART 4 – Distribution Decisions 12. Marketing Channels and Supply Chain Management ........................................................ 12-1 13. Retailing ............................................................................................................................. 13-1 PART 5 – Promotion Decisions 14. Integrated Marketing Communications ............................................................................. 14-1 15. Advertising, Public Relations, and Direct Response ......................................................... 15-1 16. Social Media and Marketing .............................................................................................. 16-1 17. Sales Promotion and Personal Selling ............................................................................... 17-1 PART 6 – Pricing Decisions 18. Pricing Concepts ................................................................................................................ 18-1 19. Setting the Right Price ...................................................................................................... 19-1 PART 7 – Global Marketing 20. Developing a Global Vision............................................................................................... 20-1

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    1-1 Chapter 1 — An Overview of Marketing MULTIPLE CHOICE 1. What does the term marketing refer to? a. new product concepts and improvements b. selling c. advertising and promotion activities d. a philosophy that stresses customer satisfaction ANS: D PTS: 1 REF: 3 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Remember 2. A business is concerned with many day-to-day activities. Some of the most important of these activities are the planning and development of a product, its pricing policy, and the distribution strategy. What are all these activities part of? a. a control system b. marketing c. accounting d. production ANS: B This description contains three of the four main activities included in the marketing function. (Many students may mistakenly believe that marketing is concerned only with promotion.) PTS: 1 REF: 3 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Pricing| TB&E Model Product| TB&E Model Distribution BLM: Higher Order 3. Which of the following is a philosophy, an attitude, a perspective, or a management orientation that stresses customer satisfaction? a. planning strategy b. customer management c. marketing d. reciprocity ANS: C PTS: 1 REF: 3 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Remember 4. Which of the following best characterizes marketing? a. promotional activities. b. personal selling. c. advertising. d. customer satisfaction. ANS: D PTS: 1 REF: 3 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Remember

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    Chapter 1 – An Overview of Marketing 1-2 5. Which of the following is a key ingredient in the philosophy of marketing that occurs when people give up something in order to receive something that they would rather have? a. exchange b. synergy c. leverage d. reciprocity ANS: A PTS: 1 REF: 3-4 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Remember 6. What must happen in order for exchange to occur? a. Organized marketing activities must also take place. b. A profit-oriented organization must be involved in the process. c. Money or other legal tender is required. d. Each party must have something the other party considers to be valuable. ANS: D Exchange involves the trade of items of value, but does not necessarily involve formal organizations, profit, or money/legal tender. PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Higher Order 7. A problem facing the timber industry is the absence of any effective way to prove that rainforest timber was legally harvested. In places like Indonesia, as much as 80 percent of timber available for sale was illegally cut. Companies such as The Home Depot do not want to sell timber from illegally logged forests even though the demand is great for timber from rainforests. Which of the following conditions required for an exchange to occur is missing when a company tries to sell illegally acquired logs to The Home Depot? a. There are more than two parties involved. b. Each party has something of value to bring to the exchange. c. One party is free to accept the exchange offer. d. Each party believes it is appropriate to deal with the other party. ANS: D For an exchange to occur, two or more parties must be involved. Both parties are free to accept or reject the exchange. If The Home Depot believes the timber was illegally obtained, then it will not want to deal with the loggers. PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Ethics| TB&E Model Product BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-3 8. Why is the concept of exchange important to marketing? a. Money is the only medium of exchange for business marketers. b. Exchange provides money to marketers. c. Marketing activities help to create exchange. d. Marketing activities are a requirement for exchange to take place. ANS: C Marketing activities help the exchange to take place, but marketing can occur without an exchange. PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Higher Order 9. Domino’s Pizza is offering racing fans a chance to earn points toward NASCAR -branded merchandise via the NASCAR RacePoints loyalty program. Consumers who buy $20 worth of Domino’ s Pizza will receive 100 NASCAR RacePoints. NASCAR RacePoints will be credited to members’ accounts. Racing fans can collect points to earn NASCAR merchandise, including apparel and hats or one-of-a-kind experiences, such as driving a real race car. What will occur when a NASCAR fan trades in his or her points for a mug autographed by a favourite driver? a. synergy b. sublimation c. exchange d. reciprocity ANS: C For an exchange to occur, two or more parties must be involved. Both parties are free to accept or reject the exchange. Furthermore, each party must have something that is of value to the other party. In this case, the value for Domino’s is customer loyalty. PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Customer BLM: Higher Order 10. What must occur for an exchange to take place? a. There must be at least two parties involved. b. Money must be used in the transaction. c. Each party must feel obligated to accept the offer. d. At least one party must have something of value that the other party desires. ANS: A PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Customer BLM: Remember

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    Chapter 1 – An Overview of Marketing 1-4 11. For many years, Procter & Gamble (P&G) viewed its Ivory soap as just plain old soap — and not as a cleansing product that could provide other benefits as well. When it came to Ivory soap, P&G focused on how well it made the soap and not on what customers wanted from a bar of soap. What type of orientation did the company have? a. sales b. production c. market d. customer ANS: B The production orientation forces a company to build whatever it builds best; that is, whatever it has the experience and expertise in doing. PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Distribution BLM: Higher Order 12. Andi Littleton has inherited a Featherlite brand horse trailer from her recently deceased grandfather. A preliminary investigation has shown many people would be interested in owning a Featherlite brand horse trailer. She is considering placing an advertisement in a newspaper targeted to horse owners. She has been told similar horse trailers are selling for about $14,000. Which of the following conditions is necessary for an exchange to occur between Littleton and a buyer? a. Her trailer should carry a low price. b. The trailer should be on display somewhere that people will see it. c. She needs to practise negotiating. d. Littleton and her buyer must be able to walk away from the deal if desired. ANS: D For an exchange to take place, each party must have something the other values; the parties must be able to communicate; each party must believe that it is appropriate to deal with the other; and each party must be free to accept or reject the exchange offer. PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Analytic| TB&E Model Product| TB&E Model Customer BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-5 13. To increase interest in rodeos, the local chapter of the National Rodeo Cowboys Association (NRCA) is offering free roping lessons to students in grades 6 and 7. Which of the following best describes an exchange? a. Students and their parents can decide for themselves if the lessons have any value. b. The students want to take the lessons but are unaware that they are being offered for free. c. The parents of the students are unsure whether the NRCA is a legitimate organization. d. Both the NRCA and the students taking the lessons will trade something of value. ANS: D If the course has no value, then an exchange cannot occur. Without communication, the exchange of knowledge for time and energy cannot occur. In an exchange, each participant has something of value to the other. For an exchange to occur, each party must believe it is desirable. PTS: 1 REF: 4 OBJ: 01-1 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Higher Order 14. Which of the following is a marketing management philosophy? a. sales promotion orientation b. societal change orientation c. market orientation d. profitability orientation ANS: C PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Remember 15. Indonesian logging companies harvest rainforests for timber and assume that a market exists for their products. Which type of orientation does the typical Indonesian logging company have? a. exchange b. environmental c. production d. sales ANS: C The logging companies do not focus on the needs and desires of the marketplace. PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Ethics| TB&E Model Product BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-6 16. What type of orientation do firms have when they focus on the internal capabilities of the firm, rather than on the desires and needs of the marketplace? a. sales b. production c. market d. customer ANS: B PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Remember 17. What type of orientation does a company have when it sets its goals and strategies based on what its current equipment can produce, what products engineering can design, and what the company itself can do best? a. marketplace b. sales c. production d. exchange ANS: C PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy| TB&E Model Product BLM: Remember 18. Researchers at PPG Industries spent considerable time, effort, and money developing a bluish windshield that would let in filtered sunlight but block out the heat. Little market research was done, but the scientists were convinced this new product would be significantly better than existing windshields, even though it was more expensive and of a different colour than the current models on the market. This scenario suggests PPG most likely has which type of orientation? a. exchange b. production c. sales d. customer ANS: B The questions researchers apparently asked before developing their windshield were, “What can we do best?” and “What can we make with the equipment we already own?” This is a production orientation. PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Research BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-7 19. When is a firm with a production orientation most likely to survive? a. if there are many small competitors in the marketplace b. if demand for the product it produces exceeds supply c. if the needs of the marketplace are constantly shifting d. if supply for the product it produces exceeds demand ANS: B The production orientation can survive in the short term under a variety of conditions; however, if market needs change, long-term survival is difficult. PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Higher Order 20. What type of orientation to marketing does a firm have if it fails to consider whether what the firm - manufactures most efficiently also meets the needs of the marketplace? a. customer b. product c. market d. production ANS: D The production orientation forces a company to build whatever it builds best; that is, whatever it has the experience and expertise in doing. PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Customer BLM: Higher Order 21. Mimi Couturier’s fashion designers use computer -assisted design software to create what it thinks women should wear. The company regularly hires industry experts to examine its factories to find waste and inefficiencies that can be eliminated. The company has expanded the number of products it offers for sale many times. However, for the last two years Mimi Couturier has lost money, and it has had to lay off some of its workforce. To avoid this occurrence in the future, what should the company do? a. hire more retail efficiency experts to trace down any production problems b. increase its sales force to find more potential customers for the firm c. have someone study its target market to see what needs and wants should be met by Mimi Couturier d. cut prices so that its prices will be at least 10 percent below those of its competitors ANS: C Mimi Couturier has been production oriented. It should develop a market orientation, which means the firm will produce only those items needed by its target market. PTS: 1 REF: 4-5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Product BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-8 22. Organizations that sell products that are often unsought (such as life insurance and retirement plans) may find themselves adopting which type of orientation? a. sales b. production c. marketing d. customer ANS: A Aggressive selling is sometimes used by companies that sell products their customers do not want to buy, or do not think they need. PTS: 1 REF: 5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Promotion BLM: Higher Order 23. For years, Richard Branson, founder of the Virgin Group has believed in customer service. He believes that good customer service stems from an environment that is founded on “a chain , one that is consistent from beginning to end? ” Which idea has - Virgin Group captured in this short phrase? a. the societal concept b. Maslow’s hierarchy of needs c. the marketing concept d. the sales orientation philosophy ANS: C The marketing concept justifies a company’s existence by its ability to satisfy customers. PTS: 1 REF: 8 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Promotion BLM: Higher Order 24. Which orientation assumes people will buy more if aggressive selling techniques are used? a. market b. sales c. customer d. production ANS: B The sales orientation assumes aggressive selling is needed to increase demand. PTS: 1 REF: 5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Pricing BLM: Remember

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    Chapter 1 – An Overview of Marketing 1-9 25. Innovative Silversmiths creates and markets silver and turquoise jewellery, which it sells to retailers. The company’s management believes its retail customers will stock more jewellery if its salespeople use aggressive marketing techniques. Which type of orientation does the company have? a. customer b. production c. sales d. market ANS: C Only the sales orientation assumes aggressive sales techniques will sell more product, regardless of customer desires and needs. PTS: 1 REF: 5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Customer BLM: Remember 26. If a company uses a sales orientation, what would consumer complaints most likely result in? a. a modification of the sales presentation b. product reinvention c. continuous market research d. attempts to cut production costs ANS: A The sales orientation relies on aggressive sales techniques to fuel business. PTS: 1 REF: 5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Higher Order 27. Which of the following is done by a company that has a market orientation and adheres to the marketing concept? a. integrates all the activities of the firm to satisfy customer wants b. focuses on company needs and wants c. differentiates the firm’ s products from its other products d. fuels sales growth through the application of aggressive sales techniques ANS: A Aggressive sales techniques are part of the sales orientation and are not needed if a company is meeting needs and wants of its customers. PTS: 1 REF: 5-6 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy| TB&E Model Product BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-10 28. Which of the following statements best describes a sales-oriented business? a. The company develops its products to meet the needs of specific groups of people. b. The company’s primary goal is profit through customer satisfaction. c. The company invests the majority of its resources in promoting its products and services. d. The company is in business to satisfy customers’ wants and needs and deliver superior value. ANS: C See Review Learning Outcome 3. PTS: 1 REF: 7 OBJ: 01-3 TOP: AACSB Analytic| TB&E Model Customer BLM: Higher Order 29. One way to identify the orientation of a firm is to examine its primary goal. What type of marketing management philosophy does a firm practice that seeks to achieve profitability through sales volume? a. societal marketing orientation b. market orientation c. sales orientation d. production orientation ANS: C PTS: 1 REF: 4-6 OBJ: 01-3 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Higher Order 30. Canon Computer Products has improved the efficiency and productivity of its plant, which manufactures printing technology. For the new fiscal year, the company projects a production increase of 25 percent, and has instructed its sales force to aggressively distribute the product. What type of marketing management philosophy is Canon practicing? a. sales orientation b. production orientation c. market orientation d. societal marketing orientation ANS: B Canon has a sales orientation. PTS: 1 REF: 4-6 OBJ: 01-3 TOP: AACSB Reflective Thinking| TB&E Model Promotion BLM: Higher Order Jacques Torres Chocolate is a factory and retail store. Its owner is willing to try to produce new products when his customers suggest them — such as chili-pepper-laced chocolate candy. His only condition is that when he adds new products, his customers have the final say on whether the product is of any value. According to Torres, “If something doesn’t move, that’s the last time you see it.”

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    Chapter 1 – An Overview of Marketing 1-11 31. How does Jacques Torres Chocolate keep its customers coming back? a. directs its chocolates to the “average customer” b. seeks its goals primarily through the use of intensive promotion c. has an inward focus on the organization’s needs d. profits through customer satisfaction ANS: D Jacques Torres Chocolate has a market orientation. PTS: 1 REF: 8 OBJ: 01-3 TOP: AACSB Reflective Thinking| TB&E Model Customer BLM: Higher Order 32. The manufacturer of Country Kitchen Art bowls, spoons, and cutting boards knows marketing can make his company a success. He wants to rely solely on promotion as the technique for attracting customers. He advertises extensively in cooking magazines, offers coupons, and provides retailers who carry his product with attractive displays. From this information, what sort of orientation does Country Kitchen Art have? a. market b. societal c. production d. sales ANS: D A sales-oriented organization views promotions as the primary tool used to achieve its goals. PTS: 1 REF: 5 OBJ: 01-3 TOP: AACSB Reflective Thinking| TB&E Model Promotion BLM: Higher Order 33. Canon Computer Products has improved the efficiency and productivity of its plant, which manufactures printing technology. For the new fiscal year, the company projects a production increase of 25 percent. It has instructed its sales force to aggressively distribute and promote its printers. The CEO is sure the market will absorb more product if the sales force is determined and assertive. What sort of orientation does Canon appear to have? a. market b. production c. sales d. customer ANS: C A sales orientation is based on the belief that people will buy more goods and services if aggressive sales techniques are used. PTS: 1 REF: 5 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy| TB&E Model Product BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-12 34. When light bulbs were first introduced, manufacturers offered one size for all light fixtures. Today you can buy light bulbs in different shapes, wattages, and colours. Light bulbs also differ as to how much electricity they use and how many hours of illumination they will provide before failing. Which of the following demonstrates how light bulb manufacturers practice the marketing concept? a. They target only the largest customers. b. They recognize different customer groups have different needs and wants. c. They are sales-oriented companies instead of production-oriented companies. d. They are companies that would state they are in the business of selling all light bulbs. ANS: B One way to implement the marketing concept is to concentrate on the needs of specific groups of customers. PTS: 1 REF: 5-6 OBJ: 01-3 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Higher Order 35. Lululemon has become one of the nation’ s largest specialty retailers by focusing on the customer’s needs and wants. This philosophy is at the heart of which type of orientation? a. sales b. market c. retail d. production ANS: B A market- oriented philosophy is based on the consumer’ s wants and needs, and the organization will focus its activities on satisfying these customers by listening to them and revising strategies as necessary. PTS: 1 REF: 5-6 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Strategy BLM: Higher Order 36. As it evolves from a credit-card company to one with greater emphasis on electronic payments, Visa is launching its first major rebranding campaign in 20 years. The company’s new promotional slogan is “Life Takes Visa.” Through the use of this slogan, V isa shows how much it wants to become an integral part of its customers’ everyday lives. Which type of orientation is Visa using? a. market b. sales c. product d. societal ANS: A A market- oriented philosophy is based on consumers’ wants and needs, and the organization will focus its activities on satisfying these customers by listening to them and revising strategies as necessary. PTS: 1 REF: 5-6 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Promotion BLM: Higher Order

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    Chapter 1 – An Overview of Marketing 1-13 37. What do companies that rely on the marketing concept and that have implemented a market orientation strategy recognize? a. Price is the most important variable for customers. b. Sales depend predominantly on an aggressive sales force. c. What the customer thinks he or she is buying is what is important. d. Selling and marketing are essentially the same thing. ANS: C The perceived product and perceived value are what the customer is buying, and the marketing concept and market orientation have endeavoured to understand those perceptions. PTS: 1 REF: 5-6 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Customer BLM: Higher Order 38. The statement “Marketing should be introduced at the beginning rather than the e nd of the production cycle and integrated into each phase of the business,” is consistent with which type of orientation? a. production b. market c. retail d. sales ANS: B Understanding the competitive arena and competitors’ strengths and weaknesses is a critical component of market orientation. PTS: 1 REF: 5-6 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Product BLM: Higher Order 39. Minor League Baseball suffers from sluggish attendance. To attract more fans to their games, owners often resort to gimmicks — free hot dog nights, events designed to get into the Guinness Book of Records, and celebrity visits. Salesmen for the teams and sports store owners try to push the sales of tickets onto local softball teams, what type of marketing management philosophy are they practicing? a. sales orientation b. market orientation c. production orientation d. societal marketing orientation ANS: A The marketing concept and a market- oriented philosophy is based on the consumer’s wants and needs, and the organization will focus its activities on satisfying these customers by listening to them and revising strategies as necessary. They are not doing this rather they are pushing the tickets onto customers which is a sales orientation. PTS: 1 REF: 4-6 OBJ: 01-2 TOP: AACSB Reflective Thinking| TB&E Model Customer| TB&E Model Product BLM: Higher Order

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