Chapter 16
Marketing Ethics and Social Responsibility
GENERAL CONTENT: Multiple-Choice Questions
1. The marketing concept is a philosophy of customer satisfaction and _____.
a. mutual interest
b. mutual gain
c. innovation
d. needs met
e. none of the above
(Answer: b; p. 495; Moderate)
2. You have just read the latest survey about consumers’ attitudes toward current
marketing practices. It reveals that consumers in general hold _____ attitudes.
a. mixed
b. slightly unfavorable
c. moderate
d. A and B
e. belligerent
(Answer: d; p. 495; Easy)
3. Many critics charge that the American marketing system causes _____ to be higher
than they would be under more “sensible” systems.
a. distribution costs
b. advertising costs
c. prices
d. markups
e. employee morals
(Answer: c; p. 496; Moderate)
4. A long-standing charge against intermediaries is that they mark up prices beyond the
_____.
a. value of their services
b. delivery charges
c. going market price
d. range most Americans can afford to pay
e. C and D
(Answer: a; p. 496; Easy)
469
5. Critics charge that some companies mark up goods excessively. Marketers respond by
explaining that most consumer abuses are _____ and that most consumers do not
understand the _____ high markups.
a. rare; business concepts of
b. unintentional; reasons for
c. rare; reasons for
d. unintentional; business concepts of
e. none of the above
(Answer: b; p. 496; Easy)
6. Deceptive promotion differs from deceptive pricing in that deceptive promotion
overstates the product’s _____ or _____.
a. true price; performance
b. features; performance
c. packaging; costs
d. design; features
e. availability; performance
(Answer: b; p. 497; Moderate)
7. A major step in regulating unfair and deceptive business acts and practices was the
creation of the _____ in 1938.
a. Robinson-Patman Act
b. Wheeler-Lea Act
c. Interstate Commerce Commissions
d. Taft-Hartley Act
e. Stamp Act
(Answer: b; p. 497; Moderate)
8. Marketers argue that most companies avoid deceptive practices because such
practices _____.
a. deliver only short-term profits
b. create more competition
c. harm their business in the long run
d. are illegal
e. create long-term negative feelings among consumers
(Answer: c; p. 498; Moderate)
9. Theodore Levitt claims that some advertising puffery is bound to occur and that it
may even be desirable. People do not buy _____.
a. pure functionality
b. solely because of the situation presented in the ad
c. emotionally
d. features only
e. B or C
(Answer: a; p. 497; Challenging)
470
10. What is the third typical product criticism besides lack of quality and delivers little
benefit?
a. Priced too high.
b. Promotion is deceptive.
c. Lacks complete safety.
d. Lacks company backing of warranty.
e. Bad consumer connotations.
(Answer: c; p. 499; Easy)
11. Consumers Union, the nonprofit testing and information organization, has published
_____ to assist the consumer in choosing products to purchase.
a. Consumer Digest
b. Buyers Weekly
c. Home & Garden
d. Consumer Reports
e. Sports Illustrated
(Answer: d; p. 499; Easy)
12. Critics have charged that some companies follow a program of causing their products
to need to be replaced before they actually should need replacement. What is this
called?
a. Product failure.
b. Short-term planning.
c. Planned obsolescence.
d. Nonfunctional warranties.
e. Expressed satisfaction.
(Answer: c; p. 499; Easy)
13. Marketers explain that planned obsolescence is in general not a problem for all of the
following reasons except one. Which one?
a. Consumers like change.
b. No one is forced to buy the new product.
c. It will eventually wear out anyway.
d. For most technical products, customers want the latest innovations.
e. None of the above.
(Answer: c; p. 501; Moderate)
14. The _____ marketing system has been accused of poorly serving disadvantaged
consumers.
a. European Union
b. American
c. GATT
d. WTO
e. NAFTA
(Answer: b; p. 502; Easy)
471
15. A Consumers Union study found that the _____ pay more for inferior goods.
a. wealthy
b. uneducated
c. poor
d. Jews
e. Asian Americans
(Answer: c; p. 502; Moderate)
16. A Consumers Union study suggested that the presence of _____ in low-income
neighborhoods made a big difference in keeping prices down.
a. supermarkets
b. super centers
c. discount stores
d. large national chain stores
e. factory outlets
(Answer: d; p. 502; Moderate)
17. A type of economic discrimination in which major chain retailers avoid placing stores
in disadvantaged neighborhoods is called _____.
a. embargo
b. licensing
c. redlining
d. tariff
e. scrambled merchandise
(Answer: c; p. 502; Easy)
18. The American marketing system has been accused of adding to several “evils” in
American society at large. These untrue criticisms include _____.
a. creating false wants
b. creating excessive materialism
c. promoting too few social goods
d. creating cultural pollution
e. all of the above
(Answer: e; p. 503; Easy)
19. Critics have charged that the marketing system urges too much interest in _____.
a. material possessions
b. the push strategy
c. meeting a quota
d. new product invention
e. entering the global market arena
(Answer: a; p. 503; Easy)
472
20. Critics of the American economic marketing system have charged that people are
judged by what they _____.
a. are
b. own
c. do
d. eat
e. avoid
(Answer: b; p. 503; Easy)
21. A drive for wealth and possessions hit new highs in the _____, when phrases such as
“greed is good” and “shop till you drop” seemed to characterize the times.
a. 1950s
b. 1960s
c. 1980s
d. 1990s
e. C and D
(Answer: e; p. 503; Moderate)
22. In the new millennium, social scientists have noted a _____.
a. stronger infatuation with material things
b. strong need to buy
c. reaction against waste
d. A and B
e. none of the above
(Answer: c; p. 503; Moderate)
23. _____ products give high immediate satisfaction but may hurt consumers in the long
run.
a. Environmental
b. Deficient
c. Pleasing
d. Salutary
e. Desirable
(Answer: c; p. 516; Challenging)
24. _____ products have low appeal but may benefit consumerism in the long run.
a. Environmental
b. Deficient
c. Pleasing
d. Salutary
e. Desirable
(Answer: d; p. 516; Easy)
473
25. The critics do not view this interest in material things as _____.
a. a natural state of mind
b. hurting society
c. helping society
d. A and C
e. necessary
(Answer: d; p. 503; Easy)
26. _____ is hired to use mass media to create materialistic models of the good life.
a. Straight product extenders
b. Albertsons
c. Madison Avenue
d. Fifth Avenue
e. Michigan Avenue
(Answer: c; p. 503; Moderate)
27. When Madison Avenue steps in, critics say marketing is seen as benefiting _____
more than _____.
a. consumers; industry
b. industry; consumers
c. stores; manufacturers
d. managers; stores
e. children; adults
(Answer: b; p. 503; Easy)
28. Marketers are most effective when they appeal to _____ rather than when they _____.
a. exciting new inventions; use old ones
b. teenagers; target older people
c. existing wants; attempt to create new ones
d. emotions; appeal to actual needs
e. the mass market; appeal to market segments
(Answer: c; p. 504; Moderate)
29. People seek information when making important purchases and often _____.
a. do not rely on television ads
b. change their minds
c. rely on their relatives’ advice
d. do not rely on single sources
e. avoid their parents in doing so
(Answer: d; p. 504; Easy)
474
30. The high failure rate of new products shows that companies are not able to _____.
a. control demand
b. advertise enough
c. find manufacturers
d. find outlets
e. none of the above
(Answer: a; p. 504; Easy)
31. On a deeper level, our wants and values are influenced not only by marketers but also
by _____.
a. family
b. peer groups
c. ethnic background
d. religion
e. all of the above
(Answer: e; p. 504; Easy)
32. The overselling of private goods results in _____, such as cars causing traffic jams,
air pollution, injuries, and deaths.
a. waste
b. misdirected funding
c. social costs
d. materialism
e. opportunity costs
(Answer: c; p. 504; Easy)
33. A major way to reverse the cultural pollution caused by marketing is to adjust _____.
a. product selection
b. advertising
c. product positioning
d. consumer attitudes
e. the morale level
(Answer: b; p. 505; Moderate)
34. A practice that can be used to combat the criticism that competition is reduced and
firms are harmed when companies expand by acquiring competitors is to _____
instead.
a. expand into new markets
b. develop their own new products
c. export more
d. enter into foreign joint ventures
e. focus solely on a single product
(Answer: b; p. 506; Challenging)
475
35. The two major movements to keep business in line are environmentalism and _____.
a. consumerism
b. protectionism
c. antimonopoly legislation
d. regulating interstate commerce
e. none of the above
(Answer: a; p. 507; Easy)
36. The first organized consumer movement in the United States took place in the early
1900s. It was fueled by all of the following conditions except one. Which one?
a. Rising prices.
b. Conditions in the meat industry.
c. Unsafe products.
d. Scandals in the drug industry.
e. B and D
(Answer: c; p. 507; Moderate)
37. _____ is an organized movement of citizens and government agencies to improve the
rights and power of buyers in relation to sellers.
a. Environmentalism
b. The Bill of Rights
c. Grassroots politics
d. Consumerism
e. The Human Relations Movement
(Answer: d; p. 507; Easy)
38. Many people believe that the balance of power in consumerism lies on the seller’s
side. Critics believe that buyers have too little education, protection, and _____ to
make wise decisions when facing sophisticated sellers.
a. money
b. information
c. skills
d. bargaining power
e. credit
(Answer: b; p. 507; Moderate)
39. Consumer advocates call for which of the following additional consumer rights?
a. The right to be well informed about important product aspects.
b. The right to be protected against questionable products and marketing practices.
c. The right to influence products and marketing practices in ways that will improve
the quality of life.
d. All of the above.
e. None of the above.
(Answer: d; p. 507; Challenging)
476
40. _____ is a management approach that involves developing strategies that both sustain
the environment and produce profits for the company.
a. Consumerism
b. Environmentalism
c. Environmental sustainability
d. Social responsibility
e. Ethical decision making
(Answer: c; p. 509; Easy)
41. Environmentalists assert that the marketing system’s goal should be to maximize
_____.
a. consumer protection
b. protection of the environment
c. the quality of life
d. efficient use of our resources
e. the welcoming of diversity
(Answer: c; p. 507; Moderate)
42. The challenge of developing an economy that the planet is capable of supporting
indefinitely is referred to as _____.
a. sustainable global economy
b. long-term sustainability
c. new world order economy
d. environmental sustainability
e. green marketing
(Answer: a; p. 509; Easy)
43. Companies emphasizing prevention of pollution have developed “green marketing”
programs that develop _____.
a. ecologically safer products
b. recyclable and biodegradable packaging
c. more energy-efficient operations
d. a concern for nature
e. all of the above
(Answer: d; p. 509; Moderate)
44. Design for environment (DFE) involves thinking ahead in the design stage to create
products that are easier to reuse, recycle, or _____.
a. disintegrate
b. resell
c. recover
d. export
e. store
(Answer: c; p. 509; Easy)
477
45. What do most companies today focus on when it comes to protecting the
environment?
a. Investing heavily in pollution prevention.
b. Practicing product stewardship.
c. Developing a sustainable vision.
d. Investing heavily in environmental technology.
e. Biodegradability.
(Answer: a; p. 512; Moderate)
46. As international trade barriers come down and global markets expand, environmental
issues are having _____ impact on international trade.
a. a neutral
b. the same
c. a lower
d. a greater
e. more impact on cultural differences among people and less
(Answer: d; p. 512; Moderate)
47. Uniform worldwide environmental standards are not expected to be put into place
soon because _____.
a. such strategies are too expensive
b. many countries do not recognize the importance of environmental standards
c. such policies currently vary too widely between countries
d. markets are too dissimilar
e. C and D
(Answer: e; p. 512; Easy)
48. Citizen concerns about marketing practices will usually lead to public attention and
_____.
a. debates
b. legislative proposals
c. workable laws
d. all of the above
e. none of the above
(Answer: d; p. 512; Easy)
49. The philosophy of _____ holds that a company’s marketing should support the best
long-run performance of the marketing system.
a. corporate social responsibility
b. marketing sustainability
c. enlightened marketing
d. the free enterprise system
e. NAFTA
(Answer: c; p. 513; Easy)
478
50. When an enlightened company makes marketing decisions by considering
consumers’ wants and interests, the company’s requirements, and _____ long-run
interests, it is practicing ______ marketing.
a. the federal government’s; value
b. society’s; societal
c. society’s; sense-of-mission
d. society’s; value
e. employees’; green
(Answer: b; p. 516; Easy)
51. What are deficient products?
a. Products that have neither immediate appeal nor long-run benefits.
b. Products that give high immediate satisfaction but only hurt consumers in the long
run.
c. Products that have low appeal but may benefit consumers in the long run.
d. Products that are either unsafe or inferior.
e. Any product in the decline stage of the product life cycle.
(Answer: a; p. 516; Challenging)
52. When a company makes products that give high immediate satisfaction but may hurt
consumers in the long run, they are called _____.
a. deficient
b. pleasing
c. salutary
d. desirable
e. threatening
(Answer: b; p. 516; Moderate)
53. The ideal goal for all companies to have for their products and society should be to
turn all of them into _____.
a. salutary ones
b. desirable ones
c. pleasing ones
d. durable ones
e. serviceable ones
(Answer: b; p. 516; Easy)
54. The challenge for their product is to add long-run benefits without reducing the
product’s pleasing qualities. What kind of product is it?
a. Salutary.
b. Desirable.
c. Pleasing.
d. Durable.
e. None of the above.
(Answer: c; p. 516; Easy)
479
55. The challenge for this product is to add some pleasing qualities so that it will become
more desirable in the consumers’ minds. What is it called?
a. Salutary.
b. Desirable.
c. Pleasing.
d. Durable.
e. Aesthetic.
(Answer: a; p. 516; Moderate)
56. Companies must decide upon what principle they should use as a guide on issues of
ethics and social responsibility. Which one of the following is not a common
philosophy to accomplish this end?
a. Let the free market decide.
b. Let the legal system decide.
c. Let society decide.
d. Let individual managers or companies decides.
e. A and B
(Answer: c; p. 517; Challenging)
57. It is important to make a commitment to a common set of shared standards worldwide
for the sake of _____.
a. customers
b. suppliers
c. employees
d. our posterity
e. all of the company’s stakeholders
(Answer: e; p. 519; Moderate)
58. The American Marketing Association (AMA) has created a code of ethics that
includes three of these four topics. Which on is incorrect?
a. Honesty.
b. Fairness.
c. Not knowingly doing harm.
d. Limit selling or fundraising during research.
e. None of the above.
(Answer: d; p. 519; Easy)
59. Ethics and social responsibility require a _____.
a. futuristic approach
b. total corporate commitment
c. separate budget
d. time commitment that most firms do not have
e. lot of money to implement
(Answer: b; p. 520; Easy)
480
60. Ethics and social responsibility must be a component of the _____.
a. mission statement
b. value statement
c. competencies statement
d. overall corporate culture
e. NAFTA agreement
(Answer: d; p. 502; Moderate)
61. Critics charge that _____.
a. there are not enough intermediaries
b. intermediaries are inefficient
c. intermediaries provide only necessary services
d. intermediaries underprice their services
e. C and D
(Answer: b; p. 496; Moderate)
62. Most businesses try to deal fairly with consumers because _____.
a. businesses want to build customer relationships
b. businesses want to justify their prices
c. businesses want repeat business
d. all of the above
e. A and C
(Answer: e; p. 496; Moderate)
63. Deceptive practices fall into three groups: deceptive _____, deceptive_____, and
deceptive _____.
a. product; pricing; promotion
b. pricing; promotion; placement
c. pricing; promotion; packaging
d. packaging; product; promotion
e. product; packaging; placement
(Answer: c; p. 497; Easy)
64. Planned obsolescence may involve _____.
a. producers’ continually changing consumer styles
b. the holding back of attractive functional features, then introducing them later to
make older models obsolete
c. the use of material that will rust sooner than they should
d. the use of components that will break soon after purchase
e. all of the above
(Answer: e; pp. 499–500; Easy)
481
65. For cars, “social costs” may include _____.
a. traffic congestion
b. air pollution
c. gasoline shortages
d. A and B
e. all of the above
(Answer: e; p. 504; Easy)
66. Cultural pollution could be referred to as _____.
a. commercial noise
b. air pollution
c. language barriers
d. a marketer’s inability to identify a target market
e. zipping or zapping
(Answer: a; p. 505; Easy)
67. Critics charge that a company’s marketing practices can harm other companies and
reduce competition among companies. Problems involved include all of the following
except _____.
a. acquisitions of competitors
b. marketing practices that create barriers to entry
c. marketing practices that confuse consumers
d. unfair competitive marketing practices
e. B and D
(Answer: c; p. 506; Moderate)
68. Two major grassroots movements that have arisen to keep business in line include
_____ and _____.
a. consumerism; ethnocentrism
b. consumerism; environmentalism
c. industrialization; environmentalism
d. perennialism; favoritism
e. consumerism; hooliganism
(Answer: b; p. 507; Easy)
69. Environmentalism is an organized movement of concerned _____ to protect people’s
living environment.
a. citizens
b. businesses
c. government agencies
d. all of the above
e. none of the above
(Answer: d; p. 508; Easy)
482
70. Environmental sustainability includes _____.
a. protecting the environment
b. extracting environmental materials to their lowest levels
c. producing profits
d. A and C
e. A, B, and C
(Answer: d; p. 509; Moderate)
71. Minimizing pollution from production and all environmental impacts throughout the
full product life cycle is called _____.
a. green marketing
b. design for environment (DFE)
c. product stewardship
d. environmental sustainability
e. pollution prevention
(Answer: c; p. 509; Challenging)
72. “Green marketing” includes _____.
a. making safer products
b. recycling
c. biodegradability
d. pollution controls
e. all of the above
(Answer: e; p. 509; Easy)
73. Innovative marketing is _____.
a. a principle of enlightened marketing
b. based on the consumer’s point of view
c. the attempt to continuously seek product and marketing improvements
d. A and C
e. A, B, and C
(Answer: e; p. 514; Moderate)
74. The best examples of pleasing products include _____.
a. cigarettes and junk food
b. dental services and medications
c. seat belts and air bags
d. fruits and vegetables
e. none of the above
(Answer: a; p. 516; Easy)
483
75. Desirable products may include _____.
a. healthy breakfast food
b. front-loading washing machines
c. compact fluorescent light bulbs
d. all of the above
e. none of the above
(Answer: d; p. 516; Moderate)
True/False
76. The major criticisms of marketing include harming consumers through high prices,
deceptive practices, high-pressure selling, shoddy or unsafe products, planned
obsolescence, and poor service to disadvantaged countries.
(True; p. 496; Moderate)
77. When responding to consumer complaints about high prices, marketers often explain
that consumers do not understand the costs involved that justify the prices.
(True; p. 496; Easy)
78. Marketers argue that most companies avoid deceptive practices because such
practices harm their business in the long run.
(True; p. 498; Easy)
79. Jones Toy Company has been accused of producing shoddy and unsafe children’s
toys. If Jones is typical of most companies, the complaints will center around
manufacturer indifference, increased production complexity, poorly trained labor, and
poor quality materials.
(False; p. 498; Challenging)
80. With customer-value marketing, the company should put most of its resources into
customer value-building marketing investments.
(True; p. 515; Easy)
81. There are two forms of product obsolescence. One results from a product becoming
obsolete before it needs replacement. The other results form a company holding back
attractive functional features of a product, then introducing them later to make older
products obsolete.
(True; p. 499; Moderate)
82. A recent Consumer Union study suggests that the poor pay more for superior goods.
(False; p. 502; Easy)
83. Two common accusations aimed at consumer advertising are that it is full of lies and
that it makes you buy things you don’t need.
(True; p. 503; Moderate)
484
84. Critics of marketing view consumer interest in material things as a natural state of
mind and a matter of false wants created by marketing.
(False; p. 503; Easy)
85. The major reason that marketers have been accused of overselling private goods at
the expense of public goods is because they require more public services that are
usually not forthcoming.
(True; p. 504; Moderate)
86. American industries do not promote but do protect their own interests. Therefore,
they cannot be accused of wielding too much political power.
(False; p. 505; Moderate)
87. Consumerism did not originate with Ralph Nader. Its early beginnings were fueled by
rising prices, conditions in the meat industry, and scandals in the drug industry
beginning in the early 1930s.
(True; p. 507; Easy)
88. Each basic consumer right has led to more specific proposals and laws fueled by
consumers.
(True; p. 507; Easy)
89. Environmentalism has led the way for developing the strategy of environmental
sustainability, resulting in new ways to sustain the environment and allowing
companies to make a profit at the same time.
(True; p. 509; Moderate)
90. In the progress toward environmental sustainability, a company strives for the first
level of pollution prevention followed by product stewardship.
(True; p. 509; Moderate)
91. Environmentalism creates some special challenges for global marketers. The problem
with doing business with countries such as Denmark and Germany is that they are
only in the beginning stages of policy formulation.
(False; p. 512; Challenging)
92. Citizen concerns about marketing practices will usually lead to public attention and
legislative proposals, such as debating over new bills that will be defeated, modified,
or made into law.
(True; p. 512; Moderate)
93. Enlightened marketing consists of five principles: consumer-oriented, innovative,
value, sense-of-mission, and societal marketing.
(True; p. 513; Moderate)
485
94. When a company views and organizes its marketing activities from only the
consumer’s point of view, it is practicing societal marketing.
(False; p. 516; Easy)
95. New World Food Supplements continuously seeks real product and marketing
improvements. Obviously, New World is involved in consumer-oriented marketing.
(False; p. 514; Moderate)
96. You are listening to the 10 o’ clock news. The newscaster is telling about a company
that makes marketing decisions by considering consumers’ wants and long-run
interests, the company’s requirements, and society’s long-run interest. The company
must be practicing consumer-oriented marketing.
(False; p. 514; Challenging)
97. Sunset Lawn Service puts most of its resources into value-building marketing
investments. The management at Sunset is practicing customer-value marketing.
(True; p. 514; Easy)
98. A societally oriented marketer wants to develop products that are not only pleasing
but also beneficial to consumers. Marketers produce pleasing products when they
have low appeal but may benefit consumers in the long run.
(False; p. 516; Moderate)
99. Seatbelts are considered to be salutary products.
(True; p. 516; Moderate)
100. Xorbate Blue is a relatively new food supplement that has given both high immediate
satisfaction and high long-run benefits. Its industry identifies it as a pleasing product.
(False; p. 516; Challenging)
101. Conscientious marketers face many moral dilemmas. After gathering the data, the
best thing to do is often unclear rather than obvious.
(True; p. 517; Easy)
102. Two common philosophies that guide a company in choosing what principle to follow
on issues of ethics and social responsibility include let the free market and legal
system decide, and secondly, let individual mangers and companies choose.
(True; p. 517; Challenging)
103. The finest guidelines can generally be relied upon to resolve all the difficult ethical
situations that marketers face.
(False; p. 517; Easy)
104. It is important for an international marketer to develop a common set of shared
standards worldwide for use in all of its markets.
(True; pp. 518–519; Easy)
486
105. In sense-of-mission marketing, a company defines its mission in broad social terms
rather than narrow product terms.
(True; p. 514; Easy)
Essay
106. What are the ways marketing is accused of harming the consumer?
Marketers are charged with causing prices to be higher than they need to be. They are
sometimes accused of deceptive practices that lead consumers to believe they will get
more value than they actually do. Sometimes salespeople pressure consumers to
purchase products they neither want nor can afford. Others are accused of selling
shoddy or unsafe products. Others are blamed for developing products that become
obsolete before they actually need replacement. Last, marketers are accused of
delivering poor service to disadvantaged consumers or not making products available
to them.
(p. 496; Moderate)
107. Identify the major social criticisms of marketing.
Marketing’s impact on society has been criticized for creating false wants and too
much materialism, too few social goods, cultural pollution, and too much political
power. Critics have also criticized marketing’s impact on other business for harming
competitors and reducing competition through acquisitions, practices that create
barriers to entry, and unfair competitive marketing practices.
(p. 503; Challenging)
108. How do consumerism and environmentalism affect marketing strategies?
Alert marketers view consumerism as an opportunity to serve consumers better by
providing more consumer information, education, and protection. Environmental
groups have improved conditions in many industries, including the meat and drug
industries, and have helped pass legislation to protect the environment. The latest
move is for companies to be proactive and take the responsibility for not doing
environmental harm. They are practicing environmental sustainability by developing
strategies that both sustain the environment and produce profits for the company.
(pp. 507–508; Moderate)
487
109. Compare and contrast the five forms of enlightened marketing.
Consumer-oriented marketing acts from the consumers’ point of view. Innovative
marketing seeks real product and marketing improvements. Consumer-value
marketing exists when a firm puts most of its resources into value-building
investments. When a company defines its mission in broad social terms rather than
narrow product terms, it is practicing sense-of-mission marketing. Lastly, the
pinnacle, or societal marketing, exists when the company makes its decisions by
considering consumers, itself, and society’s long-run interests.
(pp. 513;–516 Challenging)
110. How do the four types of products in the societal classification of products stack up
against each other?
Deficient products are at the bottom because they have neither immediate appeal nor
long-run benefits. Desirable products are at the top because they give both high
immediate satisfaction and high long-run benefits. In between are pleasing products
that give high immediate satisfaction but may hurt consumers in the long run. And we
also find salutary products that have low appeal but may benefit consumers in the
long run.
(p. 516; Moderate)
111. What can conscientious marketers do to act ethically when faced by ethical
dilemmas?
Companies can develop corporate marketing ethics policies to provide broad
guidelines for everyone in the organization to follow. They should cover distributor
relations, advertising standards, customer service, pricing product development, and
general ethical standards. They must develop a set of principles that will help them
figure out the moral importance and implications of each situation and decide how far
they can go in good conscience.
(p. 517; Challenging)
112. Explain some basics that international marketers can follow to act ethically?
It is important to make a commitment to a common set of shared standards
worldwide. Management must decide what to do about bribery and kickbacks. All
stakeholders must be considered in all designs. Management must decide if its
standards should be lowered in countries with existing low standards in order to
compete effectively. In general, it is better to act more ethically than less ethically.
(p. 519; Easy)
488
113. Define consumerism and environmentalism strategies.
Consumerism is an organized social movement intended to strengthen the rights and
power of consumers relative to sellers. Alert marketers view it as an opportunity to
serve consumers better by providing more consumer information, education, and
protection. Environmentalism is an organized social movement seeking to minimize
the harm done to the environment and quality of life by marketing practices.
(pp. 507–508; Easy)
114. Describe the principles of socially responsible marketing.
Many companies originally opposed these social movements and laws, but most of
them now recognize a need for positive consumer information, education, and
protection. Some companies have followed a policy of enlightened marketing, which
holds that a company’s marketing should support the best long-run performance of
the marketing system. Enlightened marketing consists of five principles: consumeroriented marketing, innovative marketing, customer-value marketing, sense-ofmission marketing, and societal marketing.
(p. 513; Moderate)
115. Explain the role of ethics in marketing.
Increasingly, companies are responding to the need to provide company policies and
guidelines to help their managers deal with questions of marketing ethics. Of course
even the best guidelines cannot resolve all the difficult ethical decisions that
individuals and firms must make. But there are some principles that marketers can
choose among. One principle states that such issues should be decided by the free
market and legal system. A second, and more enlightened principle, puts
responsibility not in the system but in the hands of individual companies and
managers. Each firm and marketing manager must work out a philosophy of socially
responsible and ethical behavior. Under the societal marketing concept, managers
must look beyond what is legal and allowable and develop standards based on
personal integrity, corporate conscience, and long-term consumer welfare.
(p. 517; Moderate)
APPLICATION CONTENT: Multiple-Choice Questions
116. If Jolene Cosmetics is typical of consumer attacks, it will be accused of pushing up
prices to finance _____.
a. rising employee benefits
b. heavy advertising and sales promotion costs
c. rising gasoline prices that affect distribution
d. inflationary costs of doing business
e. none of the above
(Answer: b; p. 496; Challenging)
489
117. A heavily promoted brand of flu medicine sells for much more than a virtually
identical nonbranded or store-branded product. Critics charge that promotion adds
only _____ to the products rather than functional value.
a. costs
b. strength
c. psychological value
d. popularity
e. market image
(Answer: c; p. 496; Moderate)
118. The sales force at Tom Dennis Ford dealership knows that using high-pressure selling
does not work if the firm wants to _____.
a. survive
b. stay competitive
c. obey local and federal law
d. build long-term relationships with customers
e. maintain a database
(Answer: d; p. 498; Moderate)
119. At this point in your career, you work for a major tobacco company. Recently, your
company has received numerous critical letters stating that it wields too much _____
power.
a. economic
b. political
c. social
d. legal
e. all of the above
(Answer: e; p. 505; Challenging)
120. Critics charge that a company’s marketing practices can harm other companies and
reduce competition. Which of the following list the one item that is not a problem
regarding this?
a. Acquisition of competitors.
b. Marketing practices that create barriers to entry.
c. Unfair competitive marketing practices.
d. Offering more value for less price.
e. None of the above.
(Answer: d; p. 506; Moderate)
490
121. At the second level of sustaining the environment, companies can minimize not just
pollution from production, but all environmental impacts throughout the full product
life cycle. What is this practice called?
a. Design for environment.
b. Product stewardship.
c. Corporate accountability.
d. Social responsibility.
e. Green marketing.
(Answer: b; p. 509; Challenging)
122. Xavier Rentals, Inc., is now looking into the future and working on the third level of
environmental sustainability called _____.
a. sustainable vision
b. new environmental technologies
c. corporate citizenship
d. computer-enhanced environmental control
e. none of the above
(Answer: b; p. 511; Challenging)
123. This form of enlightened marketing requires that a company seek real product and
marketing improvements.
a. Consumer oriented.
b. Innovative.
c. Value.
d. Sense-of-mission.
e. Market oriented.
(Answer: b; p. 514; Easy)
124. Jacob Engineering Group views and organizes its marketing activities from the
viewpoint of its buyers. Management works hard to sense, serve, and satisfy the needs
of its well-defined group of buyers. What do they practice?
a. Consumer-oriented marketing.
b. Societal marketing.
c. Sense-of-mission marketing.
d. Value marketing.
e. Marketing intelligence.
(Answer: a; p. 513; Moderate)
125. Some firms define their purpose in narrow product terms. Others that define their
company’s purpose in broad social terms follow _____.
a. societal marketing
b. sense-of-mission marketing
c. consumer-oriented marketing
d. value marketing
e. none of the above
(Answer: b; p. 514; Moderate)
491
126. When Hancock & Dunberry developed new simplified wills for the elderly and less
educated markets, less expensive home visits, and a free statewide legal referral
service, the law firm began practicing _____ marketing.
a. consumer-oriented
b. innovative
c. value
d. societal
e. home-based
(Answer: b; p. 514; Challenging)
127. In recent years, Colgate Company’s new product sales in the United States are 58
percent of total sales, while in foreign markets they account or 35 percent of sales.
What type of marketing has Colgate been using recently?
a. Consumer-oriented.
b. Value.
c. Innovative.
d. Societal.
e. Home-based,
(Answer: c; p. 514; Moderate)
128. Baker Enterprises produces several new products that have low appeal but may
benefit consumers in the long run. How would you classify these products?
a. Deficient.
b. Pleasing.
c. Salutary.
d. Desirable.
e. Unpleasing.
(Answer: c; p. 516; Moderate)
129. Monica Carey is a conscientious marketing manager. Sometimes it is unclear what
decisions to make when she and her staff are faced with moral dilemmas. Monica
could create broad guidelines that everyone in the organization could follow to
develop moral sensitivity in the form of _____.
a. a company value statement
b. a company mission statement
c. a company vision statement
d. corporate marketing ethics policies
e. a financial statement
(Answer: d; p. 517; Challenging)
492
130. One major issue in foreign trade is bribery. The most flagrant bribe-paying firms
found in one recent study are located in all of these countries except _____.
a. Russia
b. China
c. South Korea
d. Austria
e. none of the above
(Answer: d; p. 519; Easy)
131. Albatross Enterprises was accused of deceptive pricing. Which of the following
explains what might have happened?
a. Albatross refused to advertise sale prices in the local paper.
b. Albatross lured customers to the store for a bargain that is out of stock.
c. Albatross advertised a large price reduction from a phony high retail list price.
d. Albatross misrepresented a product’s features in an ad.
e. Any of the above.
(Answer: c; p. 497; Moderate)
132. Hart’s Department Store was accused of deceptive promotion. Which of the following
explains what might have happened?
a. Hart’s refused to advertise sale prices in the local paper.
b. Hart’s lured customers to the store for a bargain that is out of stock.
c. Hart’s advertised a large price reduction from a phony high retail list price.
d. Hart’s misrepresented a product’s features in an advertisement.
e. B and D
(Answer: e; p. 497; Moderate)
133. Which of the following situations might be considered “puffery”?
a. Mr. Clean coming to a housewife’s rescue.
b. Toned thighs and legs as a result of using the Thigh Master for only 15 minutes
each day.
c. Children growing into attractive adults as a result of drinking milk.
d. None of the above.
e. A, B, or C
(Answer: e; p. 497; Challenging)
134. When ABC, Inc., worked to design products that are easier to reuse or recycle, ABC
was adopting _____.
a. pollution prevention
b. green marketing
c. product stewardship
d. design for environment (DFE) practices
e. new environmental technologies
(Answer: d; p. 509; Easy)
493
135. Maytag’s front-loading Neptune washer provides superior cleaning and energy
efficiency. The Neptune washer is an example of a _____ product.
a. deficient
b. pleasing
c. salutary
d. desirable
e. satisfying
(Answer: d; p. 516; Moderate)
Short Answer
136. Define deceptive pricing.
Deceptive pricing includes practices such as falsely advertising factory or wholesale
prices or a large price reduction from a phony high retail list price.
(p. 497; Easy)
137. Define deceptive promotion.
Deceptive promotion includes practices such as misrepresenting the product’s
features or performance or luring customers to the store for a bargain that is out of
stock.
(p. 497; Easy)
138. Define deceptive packaging.
Deceptive packaging includes exaggerating package contents through subtle design,
using misleading labeling, or describing size in misleading terms.
(p. 497; Easy)
139. What is meant by redlining?
Redlining is a type of economic discrimination in which major chain retailers avoid
placing stores in disadvantaged neighborhoods.
(p. 502; Moderate)
140. What is meant by cultural pollution?
Cultural pollution is “commercial noise,” in which our senses are constantly being
assaulted by advertising. Examples include: commercials that interrupt serious
programs, pages of ads that obscure magazine, and billboards that mar beautiful
scenery.
(p. 505; Moderate)
494
141. Define consumerism.
Consumerism is an organized movement of citizens and government agencies to
improve the rights and power of buyers in relation to sellers.
(p. 507; Easy)
142. Define environmentalism.
Environmentalism is an organized movement of concerned citizens, businesses, and
government agencies to protect and improve people’s living environment.
(p. 508; Easy)
143. How does environmentalism contribute to “life quality”?
“Life quality” means not only the quantity and quality of consumer goods and
services, but also the quality of the environment; environmentalists want environmental costs included in both producer and consumer decision making.
(p. 508; Challenging)
144. Is environmental sustainability possible? Explain.
Environmental sustainability involves the development of strategies that both sustain
the environment and produce profits for the firm. In some cases, environmental
sustainability may not be totally achievable but it is something worth striving for.
(p. 509; Challenging)
145. What is involved in pollution prevention?
Pollution prevention means more than pollution control—or the cleaning up of waste
after it has been created. It involves the elimination or minimization of waste before it
is created.
(p. 509; Moderate)
146. Define green marketing.
Green marketing programs involve the development of ecologically safer products,
recyclable and biodegradable packaging, and better pollution-control standards.
(p. 509; Easy)
147. How do design for environment (DFE) practices relate to product stewardship?
DFE practices involve thinking ahead to design products that are easier to recover,
reuse, or recycle; these practices are a part of product stewardship.
(p. 509; Moderate)
495
148. What types of firms adopt sustainability visions?
Such firms use this vision as a guide to the future; a sustainability vision shows how
the company’s products and services, processes, and policies must evolve and what
new technologies must be developed to get there.
(p. 512; Challenging)
149. Why is environmentalism especially challenging for global marketers?
As international barriers come down and global marketers expand, environmental
issues are having an even greater impact on international trade; different environmental standards between and among various countries make environmentalism
especially challenging.
(p. 512; Moderate)
150. Define enlightened marketing.
Enlightened marketing holds that a company’s marketing should support the best
long-run performance of the marketing system. Enlightened marketing consists of
consumer-oriented marketing, innovative marketing, value marketing, sense-ofmission marketing, and societal marketing.
(p. 513; Challenging)
151. Define consumer-oriented marketing.
Consumer-oriented marketing means that the company should view and organize its
marketing activities from the consumer’s point of view. The company should work to
sense, serve, and satisfy the needs of a defined group of consumers.
(p. 513; Challenging)
152. How does a firm benefit from innovative marketing?
Innovative marketing requires that the company continuously seek real product and
marketing improvements. This is an extremely proactive approach in which the
marketer attempts to stay ahead of competitors.
(p. 514; Challenging)
153. Explain the role of sense-of-mission marketing.
Sense-of-mission marketing means that the company should define its mission in
broad social terms rather than narrow product terms; when a company defines a
social mission, employees feel better about their work and have a clearer sense of
direction.
(p. 514; Challenging)
496
154. What is the difference between deficient products and pleasing products?
Deficient products have neither immediate appeal nor long-run benefits; pleasing
products, on the other hand, give high immediate satisfaction but may hurt consumers
in the long run.
(p. 516; Easy)
155. What is the difference between salutary products and desirable products?
Salutary products have low appeal but may benefit consumers in the long run;
whereas, desirable products give both high immediate satisfaction and high long-run
benefits.
(p. 516; Easy)
Scenario
Donald Eagle acquired Benning’s at a low point. The distributor of automotive
parts and accessories had been criticized for a number of wrongdoings. Without fully
realizing the extent of Benning’s problems, Mr. Eagle purchased the distributorship in
hopes of turning it around. “But the harder I work,” Mr. Eagle admitted, “the more
Benning’s earlier problems seem to unfold.”
Donald Eagle began to rethink his strategy, trying to put a sound plan in place that
would allow Benning’s to move forward.
156. According to various possibilities highlighted in the textbook, in what ways might
this marketer have previously “harmed” consumers?
Benning’s could have charged exorbitantly high prices, engaged in deceptive
practices or high-pressure selling, sold shoddy or unsafe products, or provided poor
service to disadvantaged consumers.
(pp. 495–496; Easy)
157. Assume that Benning’s previously engaged in deceptive promotion. How could this
marketer have avoided deceptive promotion?
For example, Benning’s could have represented their products’ features as honestly as
possible and avoided luring customers to the store for a bargain that was out of stock
or may not have existed.
(p. 497; Moderate)
497
158. How could have obsolescence strategies carried out by this distributor’s suppliers
have harmed Benning’s?
Benning’s could have been left with excess inventory in the event that Benning’s was
not made aware of the obsolescence plan. In addition, Benning’s could have suffered
from an image standpoint; disgruntled customers may have blamed Benning’s merely
because the firm is a player in the supply chain.
(p. 499; Challenging)
159. What possible “social costs” may have previously been associated with Benning’s?
Benning’s may have oversold “private goods” with a lack of public services to
accommodate the sales. For example, Benning’s automotive parts sales may not have
focused on safety features, efficient engines, or pollution control.
(p. 504; Challenging)
160. If this marketer were to adopt a policy of environmental sustainability, on what would
its focus be?
Benning’s could focus on pollution prevention, green marketing, product stewardship,
DFE practices, and new environmental technologies.
(p. 509; Moderate)
161. Might product stewardship be a major focus for Benning’s? Explain.
Yes, contrary to any costs involved, Benning’s could work to minimize not just
pollution from production, for example, but all environmental impacts throughout the
full product life cycle.
(p. 509; Easy)
162. With a consumer-oriented marketing plan, what would be Benning’s primary focus?
Consumer-oriented marketing would allow Benning’s to view and organize its
marketing activities from the consumers’ points of view; Benning’s can work to
deliver superior value to carefully chosen customers.
(p. 513; Moderate)
163. Explain how this marketer’s mission may change under a sense-of-mission marketing
approach.
Sense-of-mission marketing would allow Benning’s to define its mission in broad
social terms instead of narrow product terms; based on the negative image of
Benning’s in the marketplace, such a strategy will take time.
(p. 514; Challenging)
498
164. Describe any deficient or pleasing product types likely associated with this marketer.
Deficient products are those that have neither immediate appeal nor long-run benefits;
pleasing products give high immediate satisfaction but may hurt consumers in the
long run.
(p. 516; Easy)
165. Describe any salutary or desirable product types likely associated with this marketer.
Salutary products have low appeal but may benefit consumers in the long run;
desirable products give high immediate satisfaction and high long-run benefits.
(p. 516; Easy)
499