Question 1 Companies should first think about the target market and then design the supply chain backward from that point. This strategy is called ________ planning.
A) external channel
B) materials
C) resource
D) demand chain
E) strategic business
Question 2 An administered VMS coordinates successive stages of production and distribution through ________.
A) single ownership
B) the combined efforts of all its members
C) the size and power of one of the members
D) the establishment of contractual obligations
E) an automated central control unit
Question 3 Selective distribution severely limits the number of intermediaries and is appropriate when the producer wants to maintain control over the service level and outputs offered by the resellers.
True
False
Question 4 Exxon Consulting works as an agent on behalf of business consumers to collect information on various industrial products. When faced with buying decisions, businesses can approach Exxon to obtain detailed information on the various options available to them. The company earns revenue by selling such information to various customers. Exxon Consulting can be called a(n) ________.
A) customer community
B) market maker
C) infomediary
D) third party arbitrator
E) informant
Question 5 Early buyers might be willing to pay for high-value-added channels, but later buyers will switch to lower-cost channels.
True
False
Question 6 Which of the following is the most complete and accurate description of a pure-click company?
A) These are established companies that have an online site for selling products.
B) These companies sell online space to other Web sites and are paid for the service.
C) These are companies that launch a Web site without any previous existence as a firm.
D) These companies get paid every time a user visits their Web site.
E) These firms' business models are based on advertising revenue.
Question 7
Lot size refers to the total number of units a channel can transmit from the manufacturer's place to the service outlet.
True
False
Question 8
A new firm typically starts as a local operation selling in a fairly circumscribed market by ________.
A) finding and developing new intermediaries
B) using a few existing intermediaries
C) forming partnerships with the market leader
D) forming partnerships with other firms
E) creating a special channel
Question 9
All functions in a marketing channel use up scarce resources and can be shifted among channel members.
True
False
Question 10
Which of the following channel conflict resolution techniques is used only if everything else proves ineffective?
A) arbitration
B) mediation
C) co-optation
D) legal recourse
E) superordinate goals
Question 11
Which marketing channel is associated with the highest value added per sale?
A) distributors
B) Internet
C) telemarketing
D) sales force
E) retail stores
Question 12
Manufacturers can obtain greater control over the selling process by using a sales agency.
True
False
Question 13
Who will most likely be willing to pay for high-value-added channels?
A) internal customers of a company
B) early buyers of a product
C) consumers of low involvement products
D) repeat customers of a product
E) small and matured buyers of an industry
Question 14
The order-processing cost per unit increases with the number of units ordered because the order costs are spread over more units.
True
False
Question 15
An example of a restaurant with a narrow and deep assortment is a ________.
A) casual dining restaurant chain
B) delicatessen
C) cafeteria
D) large restaurant
E) small lunch counter
Question 16
American businessman King Gillette pioneered the sales model in which razor handles were given away for free or sold at a loss, but sales of disposable razor blades were very profitable. This is known as the ________ model.
A) product churning
B) cross selling
C) loss leading
D) two-tiered pricing
E) predatory pricing
Question 17
Companies who want to carry near-zero inventories should build for order, not for stock.
True
False
Question 18
Supercenters retail grocery items as well as a huge selection of nonfood merchandise.
True
False
Question 19
Which of the following is an example of a category killer?
A) Walmart
B) Tesco
C) PETCO
D) The Limited
E) Kohl's
Question 20
As discount retailers improve their quality and image, consumers have been willing to trade down.
True
False
Question 21
In ________, a salesperson goes to the home of a host who has invited friends, demonstrates the products, and takes orders.
A) franchising
B) network marketing
C) catalog marketing
D) direct marketing
E) direct-response selling
Question 22
Discount stores usually stock leftover goods, overruns, and irregular merchandise, sold at less than retail.
True
False
Question 23
Reynold's is a grocery chain that has always catered to mid-market customers. However, the owner, Mal, has noticed that an influx of new residents are buying mostly the lower-cost and discounted products. To attract customers, Mal decides to make a gradual switch to the discount store format, but to do this, he will have to cut costs wherever possible. Which of the following types of services should Mal avoid in order to lower costs?
A) self-service
B) self-selection
C) limited service
D) limited-selection
E) full-service
Question 24
Avon, Tupperware, and Southwestern Company of Nashville are among companies in the multibillion-dollar ________ industry, which involves selling door-to-door or at home sales parties.
A) buying services
B) direct marketing
C) catalog showroom
D) automatic vending
E) direct selling
Question 25
Stores are using ________ to measure a product's handling costs from the time it reaches the warehouse until a customer buys it in the retail store.
A) electronic data interchange (EDI)
B) direct product profitability (DPP)
C) global positioning systems (GPS)
D) compounded annual grown rate (CAGR)
E) radio-frequency identification (RFID)