Ch.'s 11-14 Test Review, Cont. Marketing
True/False
Indicate whether the sentence or statement is true or false.
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1. The service-producing industries are projected to be the fastest growing, in terms of job growth, in the United
States from 1998 through 2008.
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2. In the future, companies will use fewer people to produce their goods because of the increasing use of
technology.
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3. Like products, many services have a physical form.
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4. When marketing services, marketers should pay special attention to the distribution component of the
marketing mix.
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5. Heterogeneous means there are no differences between services.
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6. Development and marketing activities are virtually the same for all types of services.
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7. The marketing mix can be the same for a service, regardless of whether it's offered to a business or an
individual consumer.
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8. An amusement park is an example of a business that provides services to the public.
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9. Most businesses that provide services for which people pay are profit-making organizations.
____ 10. Location and distribution are not important when marketing equipment-based services.
____ 11. Quality is controlled by the provider of the service.
____ 12. Organizations must provide services that are at least equal in quality and lower in price to what their
competitors offer.
____ 13. A producer usually owns everything it needs to develop the products it sells.
____ 14. The purchasing function does not affect the success of a business.
____ 15. The basic marketing process is very different for business consumers than the marketing process used for
final consumers.
____ 16. Some service businesses purchase products that are used by final consumers.
____ 17. Businesses that produce or resell similar products and services usually purchase similar capital equipment,
operating equipment, raw materials, and other products.
____ 18. Businesses that produce products for sale to final consumers often have a lot of contact with the customer.
____ 19. Retailers use modified purchasing when they have had success with the basic product and want to offer
additional features and options to customers.
____ 20. Price is not an important factor in making repeat purchases of a product that's available from many
companies.
____ 21. Many businesses have departments and personnel that specialize in purchasing.
____ 22. Market conditions for products sold by retailers do not change rapidly.
____ 23. A basic stock list describes the complete assortment of products a store would like to offer to customers.
____ 24. Many manufacturers and wholesalers have salespeople who contact managers at local stores.
____ 25. Distribution is an important part of increasing customer satisfaction.
____ 26. When a marketer develops a marketing plan, many ways to distribute a product or service need to be
considered.
____ 27. A channel of distribution accumulates products from a number of manufacturers and makes them available in
one location.
____ 28. A manufacturer and the final consumer often meet to complete an exchange.
____ 29. In any exchange between producer and consumer, all of the marketing functions must be performed.
____ 30. If all exchanges of products and services occurred directly between producers and consumers, no marketing
would be required.
____ 31. When other businesses enter the channel of distribution, they take over many responsibilities, saving you both
time and money.
____ 32. Wholesalers sell primarily to final consumers.
____ 33. Indirect channels are typical in business-to-business marketing.
____ 34. Many manufacturers use multiple channels of distribution for the same product.
____ 35. Consumers can create a channel of distribution by locating a supplier for a product they want that is not
currently available in the market.
____ 36. Members of a channel of distribution do not always cooperate with each other.
____ 37. If a manufacturer does not have the space, it may use retailers who specialize in storage and inventory
management.
____ 38. Initially, wholesale clubs targeted final consumers.
____ 39. If sales increase, profits will always increase as well.
____ 40. If price changes are too great, the type of demand elasticity may change.
____ 41. In inelastic demand, a price decrease will increase total revenue.
____ 42. In elastic demand, a price decrease will decrease total revenue.
____ 43. In the United States, it is illegal for two companies to agree on how much they will charge for their products
or services.
____ 44. When governments are involved in the economy, they often affect prices.
____ 45. People who develop artistic works such as books, films, recordings, or artwork, can also be protected by
patents.
____ 46. Products sold by quantity must have a label listing the price for a basic unit of measurement so consumers can
make price comparisons.
____ 47. Companies that want to maximize profits usually select large target markets where unique products can be
developed.
____ 48. Many customers believe that price and quality are related—higher prices mean better quality.
____ 49. Markups are usually stated as a dollar amount rather than a percentage.
____ 50. Markdowns are usually viewed as business mistakes because the product did not sell at the planned price.
Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.
____ 51. The service industry showing the most projected growth is
a. personal supplies services.
b. management and public relations.
c. health services.
d. computer and data processing services.
____ 52. Because people cannot see or handle a service, it is important for the marketer to focus on the
a. price of the service.
c. convenience of the service.
b. location of the service.
d. benefits customers will receive.
____ 53. Services are provided by a variety of organizations and businesses such as
a. hospitals.
c. movie theaters.
b. amusement parks.
d. all of the above.
____ 54. A marketing mix that is designed to reach business customers might stress
a. individualized attention.
c. a quantity price discount.
b. standardized prices.
d. advertising through broadcast media.
____ 55. The goals of a not-for-profit organization that delivers services may be
a. public service.
b. knowledge.
c. public awareness of a message or idea.
d. all of the above.
____ 56. The amount of human effort required to deliver a service is
a. labor intenseness.
c. standard.
b. physical assistance.
d. measured.
____ 57. Service performance standards should be set by
a. potential customers.
c. the target market.
b. the company.
d. the company’s competitors.
____ 58. One of the most important and useful indicators of customer satisfaction is
a. responses to surveys.
c. responses by the competitors.
b. repeat business.
d. the ability to increase price.
____ 59. Information spread by friends about a service is
a. personal selling.
c. customer contact.
b. advertising.
d. word-of-mouth promotion.
____ 60. Speech-recognition software now incorporates a feature that
a. automatically saves documents.
b. translates foreign languages.
c. trains the program to recognize what users are saying.
d. all of the above.
____ 61. Combining the price of several related services is
a. packaging.
c. boxing.
b. bundling.
d. grouping.
____ 62. The channels of distribution for a service are
a. short.
c. expensive for customers.
b. long.
d. composed of many individuals.
____ 63. A business purchases products to
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a. incorporate into their own products.
c. operate the business.
b. resell to other customers.
d. all of the above.
Wholesale businesses are considered to be
a. resellers.
c. service businesses.
b. nonprofit organizations.
d. retailers.
A business that rents major appliances to customers is a
a. wholesaler.
c. service business.
b. retailer.
d. reseller.
The types and quantities of products and services demanded by a business are based on
a. the quantity that it can store.
c. the level of demand of its customers.
b. the quantity that it can afford.
d. all of the above.
Business consumers tend to buy
a. more than final consumers.
c. the same amount as final consumers.
b. less than final consumers.
d. a different amount every time.
While the decisions of the individual consumers are often guided by emotion, business purchasing is usually
a. impulsive.
c. unplanned.
b. rational.
d. regulated.
The most difficult purchasing situation occurs when
a. a repeat purchase is made.
b. changes or improvements are needed to products purchased in the past.
c. the business could make the product.
d. a new product or service is purchased.
When a business purchase is technical or very expensive,
a. a lawyer will be involved in the transaction.
b. an engineer may test the product.
c. upper management will participate in the purchasing process.
d. all of the above.
With just-in-time purchasing, the company develops a relationship with its suppliers to
a. receive free delivery.
b. resupply inventory just as it is needed.
c. maintain more than enough inventory than it will ever need.
d. all of the above.
Inventory records should include
a. the purchase specifications for the item.
b. the source of the product.
c. a list of competitors that supply the same product.
d. all of the above.
The two types of inventory systems are the
a. just-in-time inventory and physical inventory.
b. TQM inventory and perpetual inventory.
c. physical inventory and perpetual inventory.
d. just-in-time inventory and perpetual inventory.
The document sent with the merchandise that identifies the products that are being shipped is a(n)
a. purchase order.
c. inventory record.
b. receiving record.
d. packing list.
Distribution as a part of the marketing mix is the
a. price of the product.
b. features of the product.
c. location and method used to make the product available to customers.
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d. promotional materials created for the product.
Bar codes are used to identify products because
a. they can receive and store new information after they’ve been put in place.
b. they are inexpensive.
c. they are easily removed.
d. all of the above.
To operate more efficiently, most manufacturers
a. only produce products when they’re wanted.
b. operate year-round.
c. produce many different kinds of products.
d. all of the above.
If the producer does not want to perform all of the marketing functions, some functions may be performed by
a. the consumer.
c. another individual.
b. another business.
d. all of the above.
An indirect channel of distribution is most often selected when
a. there are a large number of consumers.
b. the product requires a great deal of service.
c. consumers are located in a limited geographic area.
d. all of the above.
Manufacturers usually make their profits from the sale of products and services to
a. final consumers.
c. wholesalers.
b. transportation companies.
d. marketers.
The traditional indirect channel of distribution involves a
a. wholesaler, a retailer, and the final consumers.
b. producer, a wholesaler, and the final consumers.
c. producer, a wholesaler, and a retailer.
d. producer, a retailer, and the final consumers.
In a wholesale club, the variety of products and the choice of brands are
a. limited.
c. extensive.
b. high quality.
d. expensive.
Some retailers refuse to work with wholesalers because they believe
a. they can get better service and prices if they deal directly with manufacturers.
b. wholesalers do not follow the marketing concept.
c. wholesalers are not aware of the needs of the retailers’ customers.
d. all of the above.
Export and import organizations are very important in building
a. legal requirements.
c. new wholesalers.
b. international business.
d. all of the above.
Today, wholesalers are providing additional services to their customers such as
a. marketing and promotional planning.
c. specialized storage facilities.
b. emergency delivery.
d. all of the above.
The final business organization in an indirect channel of distribution for consumer products is
a. the wholesaler.
c. the retailer.
b. the producer.
d. a transportation company.
Retailers provide services to their customers such as
a. alterations.
c. repairs.
b. delivery.
d. all of the above.
A limited-line store
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a. offers products from several different categories.
b. offers products from one category of merchandise.
c. is a very large store that offers a wide choices of products.
d. is always located in a standalone location.
It is likely that a product will be grouped into large units for
a. transportation.
c. selling.
b. display.
d. consumption.
Price is an important tool for marketers because
a. the location where a product is sold can’t be easily changed.
b. advertisements take time to write and produce.
c. the price sticker can simply be replaced.
d. all of the above.
Marketers can use price elasticity only for price changes that consumers believe
a. are reasonable.
c. are much higher.
b. result in less profit for the business.
d. are much lower.
The government wants to encourage the development of new products and services so
a. businesses will pay more taxes.
b. the government can grant more patents.
c. consumers have additional choices to satisfy their needs.
d. technological advances continue.
Companies using a sales-based objective will sell their products
a. to small target markets.
b. to markets with a large number of available customers.
c. to customers who value the image of a product.
d. for the highest possible price.
The highest possible price that can be charged is determined by the
a. marketer.
c. distributor.
b. target market.
d. desired profit.
The quantity where total costs equal total revenue is the
a. total fixed costs.
c. break-even point.
b. profit threshold.
d. maximum price.
The lowest possible price in the price range is determined by the
a. the costs of the seller.
c. distributor.
b. target market.
d. maximum price.
An amount added to the cost of a product to determine the selling price is the
a. gross margin.
c. net profit.
b. total expense.
d. markup.
A flexible pricing policy means that
a. businesses can change their prices frequently.
b. all customers pay the same price.
c. customers can negotiate the price within a price range.
d. the difference between the high price and low price is very small.
The distinct categories within which products are organized based on differences in price, quality, and
features, are
a. FOB pricing.
c. flexible pricing.
b. price lines.
d. zone pricing.
Credit offered by one business to another business is
a. trade credit.
c. an allowance.
b. retail credit.
d. incentive credit.
Ch.'s 11-14 Test Review, Cont. Marketing
Answer Section
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