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Marketing Management chapter 7 practice test

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created 4 years ago by business_gal
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Analyzing Business Markets

updated 4 years ago by business_gal

Grade levels:
11th grade, 12th grade, College: First year, College: Second year, College: Third year, College: Fourth year

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1

________ refers to the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers.
A) Marketing channels
B) Organizational buying
C) Corporate retailing
D) Brand auditing
E) Inventory control

Page: 183

B

2

The ________ consists of all the organizations that acquire goods and services used in the production of other products or services that are sold, rented, or supplied to others.
A) business market
B) consumer market
C) e-commerce market
D) global market
E) domestic market

Page: 183

A

3

How can a marketer overcome the negative effects of commoditization?
A) convince target consumers that the firm's products are as good as those of competitors
B) convince target consumers that price is irrelevant in determining quality
C) convince target consumers that the firm's products are different from those of competitors
D) convince target customers that buying the highest-priced product is no guarantee of quality
E) convince target customers that all the products in the market are equivalent

Page: 184

C

4

Which of the following is true for business marketers?
A) They deal with more and larger buyers than consumer marketers.
B) They deal with more and smaller buyers than consumer marketers.
C) They deal with fewer and larger buyers than consumer marketers.
D) They deal with fewer and smaller buyers than consumer marketers.
E) They deal with the same kind of buyers as consumer marketers.

Page: 184

C

5

Which of the following is a challenge in which business marketers differ from the consumer marketers?
A) understanding deep customer needs in new ways
B) identifying new opportunities for organic business growth
C) geographically concentrated buyers
D) calculating better marketing performance and accountability metrics
E) competing and growing in global markets, particularly China

Page: 184-185

C

6

Ultimately, the amount of steel sold to General Motors depends on the consumers' demand for GM cars and trucks. From the standpoint of the steel manufacturer, which of the following demand forms is most pertinent?
A) derived demand
B) inelastic demand
C) geographic demand
D) relational demand
E) static demand

Page: 185

A

7

The demand for business goods is ultimately derived from the demand for ________.
A) raw materials
B) consumer goods
C) services
D) business solutions
E) e-commerce

Page: 185

B

8

A given percentage increase in consumer demand can lead to a much larger percentage increase in the demand for plant and equipment necessary to produce the additional output. Economists refer to this as ________.
A) derived demand
B) inelastic demand
C) the acceleration effect
D) a straight rebuy
E) the sales cycle

Page: 185

C

9

The total demand for many business goods and services is not much affected by price changes. Thus, this demand is ________.
A) derived
B) fluctuating
C) accelerated
D) multiple
E) inelastic

Page: 185

E

10

The purchasing department buys office supplies on a routine basis from a pre-approved list of suppliers. This type of purchase is classified as a ________.
A) straight rebuy
B) modified rebuy
C) new task
D) secondary purchase
E) procure-to-pay

Page: 185

A

11

Sometimes a rise of only 10% in consumer demand can cause as much as a 200% rise in business demand for products for the next period. This is an example of ________.
A) inelastic demand
B) direct purchasing
C) fluctuating demand
D) derived demand
E) a straight rebuy

Page: 185

C

12

Shoe manufacturers are not going to buy much more leather if the price of leather falls, nor will they buy much less leather if the price rises, unless they can find satisfactory substitutes. This is an example of ________.
A) inelastic demand
B) direct purchasing
C) the acceleration effect
D) a modified rebuy
E) a straight rebuy

Page: 185

A

13

Kenilworth Inc. is shifting from its rented four-room office to a standalone office building owned by the company itself. This can be classified as a ________.
A) modified rebuy
B) regular buy
C) straight rebuy
D) new rebuy
E) new task

Page: 186

E

14

In a ________ purchasing situation, the buyer wants to make some change to existing product specifications, prices, delivery requirements, or other terms.
A) new rebuy
B) regular buy
C) straight rebuy
D) modified rebuy
E) new task

Page: 186

D

15

The business buyer has to make the fewest decisions when involved in a ________.
A) modified rebuy
B) regular buy
C) straight rebuy
D) new rebuy
E) new task

Page: 186

C

16

Jason Riggs' company is considered to be an in-supplier for a lawn mower manufacturer. However, recently the lawn mower company has put out a memo to in- and out-suppliers indicating that it would like to change product specifications and delivery schedules. Which of the following buying situations is most likely to be in operation given this data?
A) straight rebuy
B) single rebuy
C) rakeback rebuy
D) system buy
E) modified rebuy

Page: 186

E

17

Orica Inc. competes in the market for commercial explosives. The company recently changed its business model from just selling explosives to managing an entire blast in a quarry. This customer-solution-based approach to the sale of explosives is an example of ________.
A) systems selling
B) straight rebuying
C) customer referencing
D) derived demand
E) channel consolidation

Page: 187

A

18

If you decided to go into the systems contracting business, which of the following categories would constitute your main area of expertise, the service you provide for customers?
A) computer applications
B) database management
C) manufacturing
D) promotion management
E) MRO (maintenance, repair, operating) supplies

Page: 187

E

19

Many business buyers prefer to buy a total solution to a problem from one seller. This process is also known as ________.
A) channel consolidation
B) systems buying
C) vertical buying
D) horizontal buying
E) supply buying

Page: 187

B

20

Xerox offers a ________ approach to prospective clients when it offers a complete turnkey solution, including the operation and management of the client's information and communication need.
A) guided selling
B) fair trading
C) systems buying
D) cross-selling
E) local purchasing

Page: 187

C

21

If Ampex Support Systems is the single supplier for a local manufacturing company's MRO (maintenance, repair, operating) supplies and needs, Ampex Support Systems is considered as providing ________ for the manufacturer.
A) guided selling
B) purchasing support
C) turnkey logistics
D) decision support
E) systems contracting

Page: 187

E

22

________ is a key industrial marketing strategy in bidding to build large-scale industrial products such as dams, pipelines, etc.
A) Systems contracting
B) Systems buying
C) Systems selling
D) Solutions buying
E) Turnkey logistics

Page: 187

C

23

________ is composed of all parties who participate in the purchasing decision-making process and share common goals and risks associated with their decisions.
A) The buying center
B) The marketing sales team
C) Strategic management
D) Engineering support
E) The logistics center

Page: 188

A

24

In the purchasing decision process, the ________ are those who request that something be purchased. They may be users or others in the organization.
A) users
B) initiators
C) influencers
D) deciders
E) approvers

Page: 188

B

25

In the purchasing decision process, the ________ are those who have the power to prevent sellers or information from reaching members of the buying center.
A) approvers
B) buyers
C) initiators
D) gatekeepers
E) deciders

Page: 188

D

26

In the purchasing decision process, the major role of ________ is in selecting vendors and negotiating.
A) gatekeepers
B) buyers
C) initiators
D) approvers
E) deciders

Page: 188

B

27

If you performed the role of the ________ in a buying center, you would be the person that has the power to prevent sellers or information from reaching other members of the buying center.
A) initiator
B) influencer
C) decider
D) gatekeeper
E) approver

Page: 188

D

28

When purchasing disposable surgical gowns, Mercy Hospital's vice president of purchasing analyzes whether the hospital should buy disposable gowns or reusable gowns. If the findings favor disposable gowns, then the operating-room administrator compares various competitors' products and prices and makes a choice. Surgeons influence the decision retroactively by reporting their satisfaction with the particular brand. In this situation, the operating-room administrator performs the role of the ________.
A) gatekeeper
B) initiator
C) user
D) decider
E) influencer

Page: 188

D

29

When purchasing disposable surgical gowns, Mercy Hospital's vice president of purchasing analyzes whether the hospital should buy disposable gowns or reusable gowns. If the findings favor disposable gowns, then the operating-room administrator compares various competitors' products and prices and makes a choice. Surgeons influence the decision retroactively by reporting their satisfaction with the particular brand. In this situation, the surgeons perform the role of the ________.
A) decider
B) initiator
C) user
D) gatekeeper
E) buyer

Page: 188

C

30

In which of the following is a person performing the role of an influencer?
A) Dan decides on the product requirements and makes the final choice of suppliers.
B) Luke has the authority to pick out the supplier and negotiate the terms of purchase.
C) Liam heads the Tech team at LKG and provides information for evaluating the possible alternatives.
D) LKG gets many calls from potential suppliers, and it is Leah's job to weed out the good prospects and refer them to others in LKG.
E) Dana authorizes the actions of the deciders and buyers in LKG.

Page: 188

C

31

In which of the following is a person performing the role of an approver?
A) Dan decides on the product requirements and makes the final choice of suppliers.
B) Luke has the authority to pick out the supplier and negotiate the terms of purchase.
C) Liam heads the Tech team at LKG and provides information for evaluating the possible alternatives.
D) LKG gets many calls from potential suppliers, and it is Leah's job to weed out the good prospects and refer them to others in LKG.
E) Dana authorizes the actions of the deciders and buyers in LKG.

Page: 188

E

32

In which of the following is a person performing the role of a gatekeeper?
A) Dan decides on the product requirements and makes the final choice of suppliers.
B) Luke has the authority to pick out the supplier and negotiate the terms of purchase.
C) Liam heads the Tech team at LKG and provides information for evaluating the possible alternatives.
D) LKG gets many calls from potential suppliers, and it is Leah's job to weed out the good prospects and refer them to others in LKG.
E) Dana authorizes the actions of the deciders and buyers in LKG.

Page: 188

D

33

Which of the following is true about the buying center?
A) In a buying center, one person cannot play more than one role.
B) A typical buying center has a maximum of five or six members.
C) A buying center consists of only mid-level managers and below.
D) It is the decision-making unit of a buying organization.
E) Gatekeepers in a buying center are people who authorize the proposed actions of deciders or buyers.

Page: 188-189

D

34

Small sellers should first concentrate their marketing efforts on reaching ________.
A) approvers
B) initiators
C) influencers
D) users
E) initiators

Page: 193

C

35

If you were an upper-level marketing executive of a large seller of trucks, which of the following strategies would be most appropriate in reaching buying center targets?
A) Concentrate on key buying influencers.
B) Use multilevel in-depth selling.
C) Use trade-based promotions.
D) Concentrate sales efforts on the support staff.
E) Move all operations to the Internet.

Page: 193

B

36

________ occurs when customers are given a perspective or point of view that allows the firm to "put its best foot forward."
A) Gatekeeping
B) Commoditization
C) Framing
D) Rebuying
E) Bartering

Page: 194

C

37

The new, more strategically oriented purchasing departments have a mission. Which of the following most accurately describes that mission?
A) Make the most profit possible and remain independent of entanglements.
B) Approach every purchasing opportunity as means to create interdependency.
C) Seek the best value from fewer and better suppliers.
D) Outsource the supply function.
E) Abandon all strategies except for systems selling and buying.

Page: 194

C

38

Patrick J. Robinson and his associates have identified eight stages in the business buying-decision process. This model is called the ________ framework.
A) buygrid
B) buying/selling
C) seller-centered
D) commercial
E) buy-analysis

Page: 195

A

39

According to Patrick J. Robinson, the eight stages in the business buying-decision process are known as ________.
A) buyphases
B) buybacks
C) buyouts
D) buyables
E) buyoffs

Page: 195

A

40

Which of the following is a step in the straight rebuy buyclass?
A) problem recognition
B) general need description
C) product specification
D) supplier search
E) proposal solicitation

Page: 195

C

41

A new-task buyclass decision begins with which of the following steps?
A) supplier search
B) general need description
C) product specification
D) problem recognition
E) proposal solicitation

Page: 195

D

42

In reordering office supplies, the only stages that the buyer passes through are the product specification stage and the ________ stage.
A) problem recognition
B) general need description
C) order-routine specification
D) supplier search
E) performance review

Page: 195

E

43

The approach to cost reduction that studies whether components can be redesigned or standardized or made by cheaper methods of production without adversely impacting product performance is termed as ________.
A) maintenance, repair, and operating (MRO)
B) product value analysis (PVA)
C) vendor managed inventories (VMI)
D) supplier performance management (SPM)
E) supplier added value effort (SAVE)

Page: 196

B

44

Business buyers may get new ideas at a trade show, see an ad, or receive a call from a sales representative who offers a better product or a lower price compared to the current in-supplier. These situations spur the ________ stage.
A) problem recognition
B) general need description
C) order-routine specification
D) supplier search
E) performance review

Page: 196

A

45

Business marketers can stimulate problem recognition by ________.
A) ensuring a presence in trade directories
B) direct mail, telemarketing, and calling on prospects
C) encouraging the Better Business Bureau to release statistics
D) using consumer advertising
E) conducting surveys of existing customers

Page: 196

B

46

With respect to e-procurement, Coca-Cola, Sara Lee, Kraft, PepsiCo, P&G, and several other companies joined forces to form a ________ called Transora to use their combined leverage to obtain lower prices for raw materials.
A) manufacturer's co-op
B) supplier's co-op
C) middleman group
D) buying alliance
E) buying cabal

Page: 197

D

47

Plastics.com allows plastics buyers to search the best prices among thousands of plastics sellers. Plastics.com is an example of a(n) ________.
A) buying alliance
B) barter market
C) systems seller
D) vertical market
E) auction site

Page: 197

D

48

On an online ________, prices change by the minute.
A) buying alliance
B) barter market
C) systems seller
D) spot market
E) catalog site

Page: 197

D

49

With respect to e-procurement, which of the two types of e-hubs are Web sites organized around?
A) vertical and horizontal hubs
B) vertical and functional hubs
C) functional hubs and organizational hubs
D) supplier and user hubs
E) manufacturer and supplier hubs

Page: 197

B

50

Which of the following is an example of a functional hub?
A) Plastics.com allows plastics buyers to search the best prices among thousands of plastics sellers.
B) ChemConnect.com is an online exchange for buyers and sellers of bulk chemicals.
C) SteelMart.com concentrates on steel buyers from the United States.
D) SupplyLink.com offers manufacturers information on ensuring workplace safety.
E) PaperTiger.com offers paper buyers a comprehensive look at the prices and quality in the paper market.

Page: 197

D

51

The ________ approach to consumer research asks customers to attach a monetary value to alternative levels of a given attribute. The value of a given configuration is determined by adding the average values of each of the given attributes.
A) benchmarking
B) compositional
C) importance rating
D) focus-group
E) conjoint analysis

Page: 199

B

52

In the ________ method for assessing customer value, customers are asked how costs of using a new product compare to those of using an incumbent.
A) direct survey
B) importance ratings
C) field value-in-use assessment
D) benchmarking
E) conjoint analysis

Page: 199

C

53

Robert Jennings consultants help farmers deliver an incremental animal weight gain of 8% to 12% over competitors. This is an example of ________.
A) solutions selling to enhance customer revenues
B) solutions selling to reduce customer costs
C) solutions selling to decrease customer risks
D) solutions selling to simplify customer purchasing
E) solutions to provide better partnership

Page: 200

A

54

A supplier signs an agreement with a customer that states that $350,000 in savings will be earned by the customer over the next 18 months in exchange for a tenfold increase in the customer's share of supplies ordered by the customer. If the supplier achieves less than this promised savings, it will make up the difference. If the supplier achieves substantially more than promised, it participates in the extra savings. This is an example of ________.
A) solution selling
B) price fixing
C) demand shifting
D) systems buying
E) risk and gain sharing

Page: 200

E

55

GM employees work at large customer facilities to reduce materials-management spending. This is an example of the ________ form of solution selling.
A) solutions to encourage partnerships
B) solutions to alter corporate culture
C) solutions to enhance customer revenues
D) solutions to decrease customer risks
E) solutions to reduce customer costs

Page: 200

E

56

Through its dedicated research team, CISCO Systems Inc. has developed new value-added business solutions which enable its variant class-II capacitors to provide incremental productivity of 10 to 20 percent over its competitors. This is an example of the ________ form of solution selling.
A) solutions to reduce customer costs
B) solutions to decrease customer risks
C) solutions to alter corporate culture
D) solutions to enhance customer revenues
E) solutions to partnerships

Page: 200

D

57

Praxair Limited is a supplier of synthetic graphite to a number of electrode manufacturers in the U.S. Its customers have shifted their ordering responsibilities to Praxair and the company regularly monitors its customer's inventory levels and has taken responsibility for replenishing the supplies automatically through continuous replenishment programs. Which of the following systems do Praxair and its customers follow with respect to order-routine specification?
A) Supplier Added Value Effort ($AVE)
B) Vendor Managed Inventory (VMI)
C) Direct Concentrated Buying (DCB)
D) Supplier Performance Management (SPM)
E) Product Value Analysis (PVA)

Page: 201

B

58

Which of the following methods is most likely to be used by buyers to review the performance of chosen suppliers?
A) the buyer may contact different suppliers and ask for their evaluations
B) the buyers may rate the end-users on several criteria using a weighted-score method
C) the buyer might aggregate the cost of poor performance to come up with adjusted costs of purchase, including price
D) the buyers may aggregate the opinions of various competitors and come up with the adjusted cost of supply
E) the buyers might adopt the Supplier Added Value Effort technique to calculate supplier efficiency

Page: 201

C

59

A ________ establishes a long-term relationship in which the supplier promises to resupply the buyer as needed, at agreed-upon prices, over a specified period of time.
A) stockless purchase plan
B) direct stock purchase plan
C) defined contribution plan
D) stock purchase plan
E) share purchase plan

Page: 201

A

60

In the ________ category of buyer-supplier relationships, competition rather than cooperation is the dominant form of governance.
A) basic buying and selling
B) bare bones
C) contractual transaction
D) customer supply
E) collaborative

Page: 202

D

61

Which of the following relationships is characterized by much trust and commitment leading to a true partnership?
A) mutually adaptive
B) collaborative
C) basic buying and selling
D) customer supply
E) cooperative systems

Page: 202

B

62

The partners in ________ systems are united in operational ways, but neither demonstrates structural commitment through legal means or adaptation.
A) mutually adaptive
B) collaborative
C) basic buying and selling
D) customer supply
E) cooperative

Page: 202

B

63

Value Central has a partnership of high trust and commitment with certain suppliers and gives them access to its sophisticated and detailed daily, individual store-based sales data. In exchange, those suppliers are responsible for managing Value Central's inventory of their products. This relationship is best described as ________.
A) basic buying and selling
B) contractual transaction
C) collaborative
D) customer supply
E) customer is king

Page: 202

C

64

The relationship between a company and its office supplies vendor where competition rather than cooperation is the dominant form of governance is probably best described as ________.
A) basic buying and selling
B) contractual transaction
C) collaborative
D) customer supply
E) customer is king

Page: 202

D

65

In the ________ category of buyer-supplier relationship, although bonded by a close, cooperative relationship, the seller adapts to meet the customer's needs without expecting much adaptation or change on the part of the customer in exchange.
A) contractual transaction
B) cooperative system
C) collaborative
D) mutually adaptive
E) customer is king

Page: 203

E

66

According to research studies, the closest relationships between customers and suppliers arise when ________.
A) supply is important to the customer and there were procurement obstacles
B) procurement is simple
C) there are many undifferentiated vendors in the marketplace
D) the customer is highly price sensitive
E) the suppliers charge a premium for their products

Page: 203

A

67

The type of buyer-supplier relationship in which buyers and sellers make many relationship-specific adaptations, but without necessarily achieving strong trust or cooperation is termed as ________.
A) customer is king
B) mutually adaptive
C) collaborative
D) contractual transaction
E) customer supply

Page: 203

B

68

________ investments are those expenditures tailored to a particular company and value chain partner.
A) Diversified
B) Pooled
C) Specific
D) Umbrella
E) General

Page: 203-204

C

69

Which of the following is a form of cheating or undersupply relative to an implicit or explicit contract which usually takes place when buyers cannot easily monitor supplier performance?
A) Institutional sale
B) Business buying
C) Opportunism
D) Vertical integration
E) Contractual transactionism

Page: 204

C

70

The ________ market consists of schools, hospitals, nursing homes, prisons, and other institutions that must provide goods and services to people in their care.
A) vertical
B) nonprofit
C) spot
D) secondary business
E) institutional

Page: 205

E

71

In most countries, ________ are the major buyers of goods and services. They typically require suppliers to submit bids and often award the contract to the lowest bidder.
A) consumer packaged-goods companies
B) government organizations
C) health services vendors
D) educational institutions
E) households

Page: 206

B

72

Organizational buying is the decision-making process by which formal organizations establish the need for purchased products and services and identify, evaluate, and choose among alternative brands and suppliers.

Page: 183

true

73

The business market consists of all the organizations that acquire goods and services used in the production of other products or services that are sold, rented, or supplied to others.

Page: 183

true

74

Commoditization strengthens customer loyalty.

Page: 184

false

75

The business market is essentially the same market as the consumer market.

Page: 184

false

76

Business buyers often select suppliers who also buy from them.

Page: 184

true

77

The business marketer normally deals with far fewer, much larger buyers than the consumer marketer does.

Page: 184

true

78

An increase in the demand for plant and equipment can lead to a much larger increase in consumer demand. This is known as the acceleration effect.

Page: 185

false

79

The demand for business goods is ultimately derived from the demand for raw materials.

Page: 185

false

80

The total demand for many business goods and services is inelasticthat is, not much affected by price changes.

Page: 185

true

81

In the straight rebuy, "out-suppliers" try to get a small order and then enlarge their purchase share over time.

Page: 185

true

82

The buyer in a straight rebuy usually changes product specifications, prices, delivery requirements, or other terms.

Page: 186

false

83

The business buyer makes the fewest decisions in the straight rebuy situation and the most in
the new-task situation.

Page: 186

true

84

Most business buyers reject what is called systems buying from one seller.

Page: 187

false

85

Systems selling is a key industrial marketing strategy in bidding to build large-scale industrial projects such as dams or pipelines.

Page: 187

true

86

Sellers benefit from systems contracting through lower operating costs as a result of steady demand and reduced paperwork.

Page: 187

true

87

The buying center is where consumers go to purchase their goods and services.

Page: 188

false

88

With respect to the buying center, approvers are people who have the power to prevent sellers or information from reaching members of the buying center.

Page: 188

false

89

Initiators are those who authorize the proposed action of deciders or buyers.

Page: 188

false

90

Influencers influence the buying decision by helping define specifications and providing information for evaluating alternatives.

Page: 188

true

91

In the buying center, several people can occupy a given role such as user or influencer, and one person may play multiple roles.

Page: 188

true

92

Small sellers concentrate on multilevel in-depth selling instead of reaching the key buying influencers.

Page: 193

false

93

In the business market, small sellers concentrate on reaching as many participants as possible because their chances of success are slim.

Page: 193

false

94

Framing occurs when customers are given a perspective or point of view that allows the firm to "put its best foot forward."

Page: 194

true

95

A performance review is the first step in the buygrid framework.

Page: 195

false

96

The buying process begins when someone places an order with a sales representative.

Page: 196

false

97

Product value analysis is an approach to efficiency that studies whether components can be redesigned or made by more efficient methods of production without adversely impacting product performance.

Page: 196

false

98

On spot electronic markets, prices of products or commodities change by the minute.

Page: 197

true

99

In buying alliances, participants offer to trade goods or services.

Page: 197

false

100

With respect to assessing customer value, in conjoint analysis customers are asked to rank their preference for alternative market offerings or concepts.

Page: 199

true

101

One of the forms of solution selling is to provide solutions to enhance customer revenues.

Page: 200

true

102

Risk and gain sharing can offset price reductions that customers request.

Page: 200

true

103

Companies are increasingly reducing the number of suppliers they utilize, and there is a trend toward single sourcing.

Page: 201

true

104

Most performance reviews are conducted by outside auditing agencies to avoid bias and internal discrepancies.

Page: 201

false

105

In buyer-seller relationships, the contractual transaction generally shows low levels of trust, cooperation, and interaction.

Page: 202

true

106

Corporate credibility depends on corporate expertise, corporate trustworthiness, and corporate likability.

Page: 203

true

107

One of the problems facing B2B on the Web is that many firms often impose more stringent requirements on their online business partners than they do on non-online partners.

Page: 203

true

108

The "customer is king" category of buyer-seller relationship is relatively simple, and one in which routine exchanges with moderately high levels of cooperation and information exchange occur.

Page: 203

false

109

Contracts are always sufficient to govern supplier transactions and prevent supplier opportunism.

Page: 204

false

110

A good illustration of a member of the institutional market would be Boeing because it is a member of the aviation institution structure.

Page: 205

false

111

The U.S. government is the largest customer in the world.

Page: 206

true


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