Question 1
Ideas about potential new products should:
A- be encouraged from any and all sources, since only a few ideas will develop into successful products.
B- not be eliminated from consideration until they have been tested in the commercialization stage.
C- come primarily from employees of the firm--so that time won't be wasted evaluating product ideas that are inconsistent with the firm's objectives and resources.
D- come from outside the firm, since studies show that really new ideas require a fresh perspective.
Question 2
As a product moves through its product life cycle:
A- a firm should change its target market--but not its marketing mix.
B- the competitive situation moves toward monopoly.
C- industry profits keep increasing along with industry sales.
D- customers' needs and attitudes may change.
Question 3
Josh Adams runs a large cattle farm in Texas. In order to take advantage of higher prices for beef in Europe compared to the United States, he has started selling cattle overseas by using an agent wholesaler who specializes in finding European customers for U.S. firms. He ships the cattle to Europe by water transport. Josh is involved in:
A- exporting.
B- management contracting.
C- licensing.
D- joint venturing.
Question 4
Traditional channels of distribution:
A- do not perform bulk-breaking activities.
B- are usually preferred to other distribution arrangements.
C- are easier to control than corporate channel systems.
D- may involve little or no cooperation among channel members.
Question 5
Ravi Singh is working his way through college as an independent distributor of the Rapier Knife Co. The Rapier product line includes kitchen knives, hunting knives, and special-purpose cutlery. Ravi makes sales presentations to potential customers in their homes. If a customer wants to make a purchase, Ravi buys the knives from Rapier and sells them to the customer at a markup. For example, Rapier's most popular knife is a chef's knife that Ravi buys for $25 and resells to the consumer for $50. Ravi:
A- is part of a direct-to-customer channel.
B- is engaged in direct marketing.
C- is engaged in indirect marketing.
D- is engaged in direct selling, but is part of an indirect channel.
Question 6
Which of the following BEST characterizes product liability?
A- Product liability is a consideration, but it is not important until the development stage of the new-product development process.
B- Relative to most other countries, U.S. courts enforce a very strict product liability standard.
C- Sellers are not usually held responsible for injuries related to their products especially when the items are well designed.
D- Product liability is not important in the sales decline stage of the product life-cycle.
Question 7
Jack Johnson uses a Pareto chart to identify the frequency of different complaints from his customers. After identifying the biggest problem, he may create a __________ to solve it.
A- demographic report
B- waterfall chart
C- competitor profile
D- fishbone diagram
Question 8
Seeking to stop declining sales for an established mouthwash, a sales manager suggests that new coloring be added to the product and a major promotion effort be started for the new product. The Federal Trade Commission would:
A- be concerned about the possibility of the firm getting a monopoly.
B- allow the company to call the product new for only six months.
C- probably not approve of this at all because the product doesn't meet the FTC's definition of new.
D- allow the promotion effort if it felt that consumers would think the coloring made it new.
Question 9
A computer manufacturer runs training programs for its cooperating retailers' salespeople, as well as providing newspaper advertising layouts, point-of-purchase materials, and sales manuals. This is an example of:
A- a contractual channel system.
B- an administered channel system.
C- a traditional channel system.
D- a vertically integrated corporate channel system.
Question 10
Managers who use the TQM approach think of quality improvement as a __________ process.
A- branching
B- netting
C- sorting
D- benchmarking