Deck 12: Organizational Behavior

Question 1

Which pricing objective occurs when a company uses pricing to increase market share?

A) match or beat the competition's pricing
B) create customer loyalty
C) make products more affordable to certain people
D) create prestige
E) make a profit and return on investment

Answer 1

match or beat the competition's pricing

Question 2

Marley usually goes to the local movie theatre because it offers discounts to seniors. Which pricing objective does this represent?

A) match or beat the competition's pricing
B) attract and build customer base
C) make products more affordable to certain people
D) create prestige
E) make a profit and return on investment

Answer 2

make products more affordable to certain people

Question 3

Rolex watches are priced much higher that most of its competitors, making the brand stand out from its competitors. Which pricing objective is being demonstrated by Rolex?

A) match or beat the competition's pricing
B) attract and build customer base
C) make products more affordable to certain people
D) create prestige
E) make a profit and return on investment

Answer 3

create prestige

Question 4

If Portia wants to know how many t-shirts she needs to sell to cover her costs of producing and selling them, she should

A) create a balance sheet.
B) run the accounting equation.
C) analyze her accounts receivable.
D) create an income statement.
E) run a break-even analysis.

Question 5

Chen uses part-time employees whose hours increase when she gets a big order and decrease during slow times. The hours her employees work are an example of a(n) ________ cost.

A) fixed
B) flexible
C) adjustable
D) variable
E) movable

Question 6

J&R decided to price its lawn equipment to cover the cost of the equipment plus a 20 percent profit. What pricing strategy is J&R using?

A) demand-based
B) profit-based
C) target
D) cost-based
E) competitive-based

Question 7

Grace wants to sell her custom jewelry at $25 per piece and needs to make a 15 percent profit. Demand-based pricing determines that her costs must not exceed

A) $21.74.
B) $3.75.
C) $21.25.
D) $28.75.
E) $24.00.

Question 8

Naveen did his homework. He researched pricing at all the local oil change service centers and decided to price his oil changes at a dollar less than anywhere else even though he would only make $1 per oil change. What pricing strategy is Naveen using?

A) demand-based
B) profit-based
C) target
D) cost-based
E) competitive-based

Question 9

When a company prices a product low to attract a lot of customers and to deter competitors, it is using

A) penetration pricing.
B) price skimming.
C) discounting.
D) bundling.
E) psychological pricing.

Question 10

When a company prices its products lower than its competitors and has no special sales, it is using

A) penetration pricing.
B) everyday low pricing.
C) discounting.
D) bundling.
E) psychological pricing.

Question 11

On the local coffee shop's anniversary, if you bought a bagel, you got a free cup of coffee. This is an example of

A) penetration pricing.
B) everyday low pricing.
C) discounting.
D) bundling.
E) psychological pricing.

Question 12

Columbia sells a men's t-shirt for $19.99 This demonstrates which pricing strategy?

A) penetration pricing
B) price skimming
C) discounting
D) bundling
E) psychological pricing

Question 13

Middlemen, who sell products to other businesses for resale to ultimate customers or to institutions and businesses for use in their operations are

A) advisors.
B) dealers.
C) brokers.
D) wholesalers.
E) retailers.

Question 14

When an intermediary helps customers acquire products, it is primarily adding ________ utility.

A) form
B) location
C) information
D) ownership
E) service

Question 15

What type of distribution channel is a direct channel?

A) B2B
B) two intermediaries
C) three intermediaries
D) consumer
E) one intermediary

Question 16

A(n) ________ wholesaler is owned and operated by the company that makes the products, allowing it to maintain control over the selling and distribution of its products.

A) full-service merchant
B) manufacturer-owned
C) owner-operated
D) limited-function merchant
E) drop shipper

Question 17

Beer distributors buy their products from the manufacturer and perform all sales and distribution of the product. As such, they are ________ wholesalers.

A) full-service merchant
B) manufacturer-owned
C) owner-operated
D) limited-function merchant
E) drop shipper

Question 18

Morris, Inc. provides products and the means to display them in retail stores and shares the profits with the retailers. Morris, Inc. is a(n)

A) full-service merchant.
B) rack jobber.
C) cash-and-carry wholesaler.
D) manufacturer-owned wholesaler.
E) drop shipper.

Question 19

Costco is an example of a(n) ________ because it is a limited-function wholesaler that sells mainly to small retailers who come to the wholesaler and pay cash for a product.

A) full-service merchant
B) rack jobber
C) cash-and-carry wholesaler
D) manufacturer-owned wholesaler
E) drop shipper

Question 20

What type of intermediary is a manufacturer's branch office or its sales office?

A) manufacturer-owned wholesaler
B) intermediary-operated wholesaler
C) limited-function wholesaler
D) full-service merchant wholesaler
E) manufacturer owned retail outlet

Question 21

What is true about brokers?

A) They tend to maintain long-term relationships with the people they represent.
B) They take title to the products they handle.
C) They carry inventory.
D) They provide credit.
E) They earn fees or commissions rather than profits.

Question 22

Tatiana does not work for, but has represented, an American manufacturer for years in Russia, helping it to negotiate transactions in her country. Her expertise and knowledge of the market has helped grow the company's sales. Tatiana is most likely a(n)

A) wholesaler.
B) broker.
C) retailer.
D) agent.
E) manager.

Question 23

Which retailer is a product-line retailer, as opposed to a bargain retailer?

A) discount stores
B) warehouse clubs
C) outlet stores
D) secondhand stores
E) convenience stores

Question 24

Walmart and Target are examples of ________ that sell a wide variety of unrelated products.

A) category killers
B) warehouse clubs
C) outlet stores
D) supercenters
E) convenience stores

Question 25

The gas station minimart at the corner is a good place to pick up some milk and a lottery ticket. This is an example of a(n)

A) category killer.
B) warehouse club.
C) specialty store.
D) neighborhood mart.
E) convenience store.

Question 26

Burlington is a manufacturer-owned store that sells discontinued products at a discount. As such, it is a(n)

A) outlet store.
B) warehouse club.
C) discount store.
D) supercenter.
E) secondhand store.

Question 27

One of the oldest forms of nonstore retailing, consisting of face-to-face selling directly to customers in their homes or where they work, is

A) direct selling.
B) direct marketing.
C) multilevel marketing.
D) video marketing.
E) online retailing.

Question 28

An outdoor retailer sends catalogs to customers twice a year. This is a form of

A) direct selling.
B) direct marketing.
C) multilevel marketing.
D) video marketing.
E) online retailing.

Question 29

________ is the movement of all products from manufacturer to final buyer and involves a supply-chain sequence of suppliers and logistics.

A) Logistics
B) Physical distribution
C) Transportation
D) Warehousing
E) Materials handling

Question 30

Sari's Bakery orders 60 pounds of flour and 40 pounds of sugar each week in addition to other ingredients. It also requires packaging for the finished baked goods. Bringing these materials to the bakery involves

A) inbound logistics.
B) materials handling.
C) product management.
D) physical distribution.
E) outbound logistics.

Question 31

Once Sari's Bakery finishes its baking in the back of the store, it moves everything to the cases in the front of the store for display. This movement within the store is

A) inbound logistics.
B) materials handling.
C) product management.
D) reverse logistics.
E) outbound logistics.

Question 32

Which mode of transportation handles about 40 percent of the volume of U.S. domestic goods, and is especially good for shipping bulky cargoes over long distances in an energy-efficient way?

A) rail
B) road
C) pipeline
D) water
E) air

Question 33

Which mode of transportation is one of the cheapest and is unaffected by weather or labor problems?

A) rail
B) road
C) pipeline
D) water
E) air

Question 34

Which mode of transportation is often used to transport materials to and from overseas locations and is one of the slowest and cheapest modes?

A) rail
B) road
C) pipeline
D) water
E) air

Question 35

Wildcard Fertilizer has set a premium price on its growing solutions. The company believes the price will help set it apart from the competition, which will lead to an increase in customers valuing its products. This example best illustrates which pricing objective?

A) making a profit and return on investment
B) ensuring break-even
C) matching or beating the competition
D) creating prestige
E) making products more affordable to certain people

Question 36

Berta enjoys traveling and often takes the train because it offers 10 percent off her tickets since she is a military veteran. Which pricing objective does this example best represent?

A) creating prestige
B) making products more affordable to certain people
C) attracting and building a customer base
D) making a profit and return on investment
E) matching or beating the competition and building market share

Question 37

Anders runs an online store housed on Amazon.com. He monitors competing stores and raises and lowers prices to match the competition. Which pricing objective does this example best represent?

A) skimming prices
B) matching or beating the competition and building market share
C) making a profit and return on investment
D) attracting and building customer base
E) adjusting target prices

Question 38

Double Jack Parts runs weekly advertisements for its "Double Jack Specials." Double Jack Specials are products that are marked well below cost. These products can best be classified as

A) fixed profits.
B) market penetrators.
C) price skimmers.
D) variable costs.
E) loss leaders.

Question 39

Crabapple Candies has fixed costs of $1,000, variable costs of $1 per candy, and price per unit of $4 per candy. How many candies does it need to sell to ensure it breaks even?

A) 333
B) 1,000
C) 250
D) 200
E) 334

Question 40

Xavier is opening a small engine repair shop in his hometown. He is working on calculating how much he will need to charge for repairs to ensure he can, at minimum, pay his building rent, supply costs, and marketing expenses. Xavier is most likely conducting a

A) penetration pricing evaluation.
B) break-even analysis.
C) targeting cost summary.
D) balance sheet review.
E) competitive price report.

Question 41

Jamillah runs an automobile repair shop. She thoroughly researches her competitors to analyze their price for oil changes and other simple repairs. She then charges 1 percent less than they do, even when it means lower profits. Jamillah is most likely using a ________ pricing strategy.

A) break-even based
B) target costing
C) competitive-based
D) psychological costing
E) demand-based

Question 42

Pharaoh sells custom baseball bats. He calculates prices by adding 10 percent over the cost of parts and labor to produce each bat. Pharaoh is most likely using a(n) ________ pricing strategy.

A) target costing
B) everyday low
C) competitive-based
D) cost-based
E) penetration-based

Question 43

Meti produces homemade candles and is preparing to open a small store to sell her creations. She has analyzed the market and her competitors and decides that she wants to sell her candles for $10.00. Based on her research, she knows she needs to make at least a 10 percent profit on each candle. Using demand-based pricing, we know that Meti's cost to produce the candles must not be greater than

A) $9.09.
B) $11.00.
C) $9.00.
D) $10.09.
E) $10.91.

Question 44

Charzone Grills is running a special sale this weekend where customers can buy a grill and either pay no interest for two years or make no payments for the first year. Charzone is most likely using which alternative pricing strategy?

A) bundling
B) price skimming
C) discounting
D) psychological pricing
E) credit terms

Question 45

Home and Barn is a large retailer specializing in products for the home and for farms. It typically prices its merchandise at a price that is slightly lower than its competition, but rarely offers special sales or discounts. Home and Barn is most likely using which alternative pricing strategy?

A) discounting
B) demand-based
C) penetration pricing
D) everyday low pricing
E) low-high pricing

Question 46

Grumble's Clothing Depot has been open for a few years and has always priced its clothing to prices that are on the dollar like $50, $100, and $150. The new president has suggested a new pricing approach to bolster sales. Department personnel spend the weekend changing prices on all items to odd numbers like $49.99, $99.99, and $149.99. Grumble's is most likely using which pricing strategy?

A) psychological pricing
B) price skimming
C) discounting
D) penetration pricing
E) high-low pricing

Question 47

Take a Seat Ergonomic Solutions has developed a new chair that is meant to help office workers avoid back issues. The marketing team decides to use a lower price point to attract more customers and to keep its competitors at bay. Take a Seat is most likely using which alternative pricing strategy?

A) price skimming
B) demand-based pricing
C) penetration pricing
D) discounting
E) psychological testing

Question 48

Sapphire Insurance offers Home, Auto, and Life insurance to customers. The price for each policy is calculated based on the specific customer's background. Sapphire offers a 5 percent discount to customers who purchase two policies and a 10 percent discount to those who purchase all three. Sapphire is most likely using which alternative pricing strategy?

A) bundling
B) competitive-based
C) credit terms
D) discounting
E) price skimming

Question 49

Flora runs a trucking company. Her fleet is responsible for picking up merchandise from a large manufacturer in Oregon and then transporting the merchandise to retailers across the country. This example best describes the concept of a

A) form utility.
B) distribution channel.
C) supply chain.
D) direct channel.
E) service utility.

Question 50

Taide works in the benefits industry. She is responsible for negotiating contracts with various benefits providers. She then locates businesses looking for benefits and connects them with the benefits providers. After making the connection, Taide helps negotiate a sale. Taide can best be described as a(n)

A) retailer.
B) intermediary.
C) advisory wholesaler.
D) broker.
E) information utility.

Question 51

Nature Creations takes wood from trees and turns it into home furnishings like dining room sets. Nature Creations is most likely adding ________ utility to the products it creates.

A) form
B) service
C) direct
D) time
E) location

Question 52

Reflections Window Supply has an online store where it sells custom-windows and window supplies to consumers and construction companies. This best represents an example of

A) single intermediary distribution.
B) drop shipping.
C) form utility.
D) agent wholesaling.
E) direct channel distribution.

Question 53

Gallo is an independent insurance agent. He created a helpful website for potential customers that details the different policies and their respective pricing. He also has brochures that detail the policies and pricing available to customers in his office. This example best demonstrates the concept of ________ utility.

A) consumer
B) ownership
C) information
D) distribution
E) location

Question 54

Jitendra works in a large box store. He is always there to greet customers with a smile and ensure that they find exactly what they are looking for. He also believes it is important to answer any questions that the customer might have about the products they are considering. Jitendra is most likely adding ________ utility.

A) retail
B) time
C) form
D) service
E) location

Question 55

Paragon Art Studio sells statues, sculptures, and paintings to consumers and businesses. It sells its products direct to consumers in retail stores and art galleries and through its own online store. It also sells to businesses through art brokers working for the company across the country. Together, these methods for getting art to its customers can best be described as Paragon's

A) intermediary channel.
B) distribution mix.
C) form utility.
D) wholesale strategy.
E) product supply chain.

Question 56

Healthy Living purchases fruits and vegetables from farms across the country. The stock is maintained at Healthy Living warehouses around the country. Healthy Living then sells and ships the fruits and vegetables to grocery stores and restaurants around the country. Healthy Living can be best described as a ________ wholesaler.

A) cash-and-carry
B) full-service merchant
C) manufacturer-owned
D) limited-function merchant
E) drop shipper

Question 57

Quanta Office sells office supplies from large box stores. Its primary customers are small businesses who visit Quanta Office stores and pay for and pick up their office supplies. Quanta Office can be best described as a

A) manufacturer-owned wholesaler.
B) drop shipper.
C) broker.
D) rack jobber.
E) cash-and-carry wholesaler.

Question 58

Petur works in the real estate industry. He represents one of the largest realty firms in the United States but does not work for them. Every sale that Petur makes earns him a commission and provides income to the realty firm. Petur is most likely a(n)

A) distributor.
B) wholesaler.
C) retailer.
D) agent.
E) broker.

Question 59

Callahan Automotive sells different brands of automobile brake and exhaust parts to consumers from small stores across the country. Callahan can be best described as a(n)

A) category killer.
B) convenience store.
C) merchant wholesaler.
D) specialty store.
E) outlet store.

Question 60

The Plus+ Store sells a wide variety of clothing, home décor, electronics, and even groceries. Plus+ can be best described as a(n)

A) supercenter.
B) department store.
C) specialty store.
D) outlet store.
E) warehouse club.

Question 61

Cord is taking his son and daughter shopping for school clothing. He stops by the boy's clothing area and grabs a few outfits before doing the same for his daughter in the girl's clothing area. On the way out of the store, he stops to pick up a bottle of his favorite cologne. Cord is most likely shopping at a(n) ________ store.

A) warehouse
B) department
C) specialty
D) outlet
E) discount

Question 62

Second Life sells discontinued and flawed luxury products through its stores, often at steep discounts. Second Life can be best described as a(n) ________ store.

A) secondhand
B) discount
C) outlet
D) department
E) specialty

Question 63

Akachi creates his own jewelry and sells it through his virtual store on Amazon. This can be best described as an example of

A) online retailing.
B) drop shipping.
C) catalog marketing.
D) specialty selling.
E) limited wholesaling.

Question 64

The Obelo Company builds bicycles for consumers. Once a bike is complete, it is moved from Obelo's production facility to a storage warehouse and then to one of its brick-and-mortar stores. This example can be best described as a form of

A) supply distribution.
B) reverse logistics.
C) inventory management.
D) outbound logistics.
E) materials handling.

Question 65

Tasty Prep is a new food preparation company that ships meal kits direct to consumers. The kits include all the ingredients and instructions needed to cook a meal from scratch. The meals come packed in ice, so they need to get to the consumer as quickly as possible. Which means of transportation would be most effective in a situation like this?

A) road
B) air
C) intermodal
D) water
E) rail

Question 66

FamJam is a retail store that is considering alternative pricing strategies. Help the owners out by listing three potential alternative pricing strategies and provide an example of what they might accomplish with each one.

Question 67

Provide an example that illustrates how a product gets from the producer to the consumer using each of the four consumer distribution channels (zero to three intermediaries).

Question 68

Your uncle runs a limited-function wholesaler business. You are telling your friend about your uncle and she asks you to tell her a little bit more about limited-function wholesaler businesses. Provide her with a definition and give examples of the three different types of limited-function merchant wholesalers.

Question 69

List each of the four types of logistics and provide a brief explanation and an example for each one.

Question 70

Redman Enterprises is a global supplier of widgets and sprockets. The CEO has asked you to provide a brief overview of the five modes of transportation that are available to the company.

Question 71

Break-even analysis will provide you with a profit.