Question 1

A ________ is a large product line retailer characterized by organization into specialized departments.

Accepted Answer

A department store is a large retailer that organizes products into specialized departments, such as clothing, cosmetics, and home goods. Supermarkets typically focus on groceries, convenience stores are smaller and more limited in their product selection, and specialty stores focus on a narrow range of products.

Question 2

According to the text,what are the three major classifications of retailers in the United States?

Accepted Answer

The text states that the three major classifications of retailers in the United States are product line retailers, bargain retailers, and convenience stores.

Question 3

Prices like $999.99 and $9.99 reflect ________.

Accepted Answer

$999.99 and $9.99 are examples of odd-even pricing, which is a pricing strategy where prices end in odd numbers (such as 5, 7, or 9) to make the price appear lower than it actually is. This strategy is often used to appeal to price-sensitive consumers who are looking for deals and discounts.

Question 4

Companies use ________ to determine the quantity of a product that must be sold before the seller makes a profit.

Accepted Answer

Breakeven analysis is a financial tool that helps companies determine the point at which the total revenue generated from the sale of a product equals the total cost of producing that product. Once a company knows its breakeven point, it can calculate the quantity of a product that must be sold before the company begins to make a profit. This information is important for making pricing decisions and setting sales targets. Marginal analysis is a technique used to assess how a company's costs and revenues will change if it produces one more unit of a product, while markup and penetration pricing are pricing strategies used to set the initial price of a product.

Question 5

A distribution channel with no intermediaries is ________.

Accepted Answer

A direct channel is a distribution channel with no intermediaries between the manufacturer and the end customer. This type of channel can be used in situations where the manufacturer wants to maintain complete control over the marketing and sales of their products or services. It is not uncommon in business-to-business (B2B) markets, but is less common in consumer markets where intermediaries like retailers are often necessary to reach a wide customer base.

Question 6

A ________ is an independent intermediary who matches numerous sellers and buyers as needed,often without knowing in advance who they will be.

Accepted Answer

A broker is an independent intermediary who matches sellers and buyers without knowing in advance who they will be. Brokers are commonly used in real estate and stock markets to match buyers and sellers. The other choices do not accurately describe this type of intermediary. A producer representative typically represents one specific company and sells their products. A syndicated seller is someone who sells a product or service through multiple channels, such as online marketplaces or retail stores. A sales agent is a representative of a company who sells their products to customers.

Question 7

A ________ is an independent intermediary who generally deals in the related product lines of a few producers and forms long-term relationships to represent those producers and meet the needs of many customers.

Accepted Answer

A sales agent fits the description of an independent intermediary who represents a few producers' product lines and builds long-term relationships to meet the needs of many customers. A producer representative typically represents only one producer and may not work with other producers. A manufacturer's wholesaler typically buys products in bulk from manufacturers and sells them to retailers or other businesses. A broker typically brings buyers and sellers together but does not form long-term relationships with producers.

Question 8

The ________ is the combination of distribution channels that a firm selects to get a product to end users.

Accepted Answer

The distribution mix refers to the range of distribution channels that a company chooses for delivering its products to the end customers. It involves choosing the most effective and efficient way to reach customers through intermediaries such as wholesalers, retailers, agents, and sales teams. The transportation strategy, merchandising system, and channel plan are all components of the distribution mix.

Question 9

________ sell products to other businesses,which resell them to final consumers.

Accepted Answer

Wholesalers are intermediaries who purchase products in bulk from manufacturers and sell them to retailers or other business customers. These products are then resold to final consumers. Therefore, wholesalers sell products to other businesses who resell them to final consumers.

Question 10

Once called "middlemen," they are now known in marketing circles as ________.

Accepted Answer

The sentence suggests that the term "middlemen" has been replaced by a different term used in marketing circles. The most appropriate choice is "intermediaries," which is a common term used to describe entities that facilitate the distribution of goods or services between producers and consumers.

Question 11

The ________ is the path that a product follows from producer to end user.

Accepted Answer

Distribution channel refers to the path that a product takes from the producer or manufacturer to the end user or consumer. The distribution channel can include wholesalers, retailers, and other intermediaries. Market segmentation is the process of dividing a larger market into smaller groups based on specific criteria. Product line refers to a group of related products offered by a company. Communication line refers to the method or medium used to transmit information or messages.

Question 12

________ are small retail stores carrying only one product line or category of related products.

Accepted Answer

Specialty stores are defined as small retail stores that carry only one product line or category of related products. Department stores offer a wide variety of products across multiple categories, supermarkets mainly focus on groceries and household items, and hypermarkets offer a combination of supermarket and department store products.

Question 13

________ are intermediaries that sell products directly to consumers.

Accepted Answer

Retailers are intermediaries that sell products directly to consumers. Marketers and advertisers may work to promote or advertise products, but they do not directly sell them to consumers. Wholesalers typically sell products in bulk to retailers, rather than selling directly to consumers.

Question 14

________ involves taking advantage of the fact that consumers do not always respond rationally to stated prices.

Accepted Answer

Psychological pricing involves taking advantage of consumers' emotional responses to prices in order to influence their purchasing behavior. This can involve tactics such as setting prices slightly lower than a competitor's, using odd or charm prices (such as $9.99 instead of $10), or offering discounts or bundle deals. These strategies are designed to make consumers feel like they are getting a good deal or saving money, even if the actual price difference is small. Price differentiation refers to offering different prices to different groups of customers based on factors such as their willingness to pay or their purchasing history. Penetration pricing involves setting a low price initially in order to gain market share, while price skimming involves setting a high price initially and gradually lowering it over time.

Question 15

Which of the following is usually associated with odd-even pricing?

Accepted Answer

Odd-even pricing is a common type of psychological pricing where a product is priced as an odd number, such as $9.99, to create the perception of a lower price point than if it were priced at the next even number ($10). This tactic is often used to make a product appear more affordable or to create the perception of a discount.

Question 16

________ is frequently used to stimulate sales.

Accepted Answer

Price discounting is commonly used to stimulate sales by offering products at a lower price than usual, which can attract customers and drive demand. Price fixing is illegal, psychological pricing and price lining may also impact sales but to a lesser extent.

Question 17

"We can offer you a quality men's suit for under $200," the salesman says.The actual price is $199.99.This is an example of ________.

Accepted Answer

This is an example of psychological pricing, where the price is set just below a round number ($200), in order to create a perception that the price is significantly lower than it actually is.

Question 18

A ________ is a large product line retailer offering a variety of food and food-related items in specialized departments.

Accepted Answer

A supermarket is a large product line retailer offering a variety of food and food-related items in specialized departments. Department stores and specialty stores do not typically focus solely on selling food items, while convenience stores typically have a limited selection of food items.

Question 19

________ involves setting an initial high price to cover new product costs and generate a profit.

Accepted Answer

Price skimming involves setting a high initial price for a new product to cover the costs of development and generate a profit. As demand for the product increases, the price can be gradually lowered to attract more price-sensitive customers. This strategy is often used for innovative products with unique features or benefits that appeal to early adopters willing to pay a premium price.

Question 20

A ________ buys goods produced by a variety of manufacturers and then resells them to other businesses.

Accepted Answer

Wholesalers typically purchase goods in bulk from various manufacturers and then resell them to retailers or other businesses. The key role of a wholesaler is to help manufacturers reach a broader market by consolidating products from various suppliers to offer a one-stop-shop for businesses seeking to stock up on their inventory.

Quiz 12: Pricing, Distributing, and Promoting Products