Question 1

Which of the following illegal marketing practices are the retailers primarily involved in?
A)Price fixing
B)Price discrimination
C)Predatory pricing
D)Referral selling
E)Resale price maintenance

Accepted Answer

The answer of Which of the following illegal marketing practices...

Question 2

Two airline companies enter into a secret pact to simultaneously increase their fuel surcharges.As a result of the pact, fuel surcharges rose from $10 a ticket to more than $100 a fare.This is an example of:
A)price fixing.
B)price discrimination.
C)predatory pricing.
D)referral selling.
E)resale price maintenance.

Accepted Answer

This is an example of price fixing, which is an illegal collusion between two or more companies to set prices at a certain level. In this case, the two airline companies agreed to simultaneously increase their fuel surcharges, resulting in a significant price increase for consumers.

Question 3

Parties that work with the focal firm are its corporate partners.

Accepted Answer

Corporate partners are parties that work with the focal firm in various business activities such as joint ventures or strategic alliances.

Question 4

Kelly saw an advertisement of TV being sold half-price.When she visits a store to buy it, she is told that she needs to buy a projector, as well, for the offer.Kelly is a victim of:
A)bid rigging.
B)bait-and-switch.
C)predatory pricing.
D)referral selling.
E)pyramid selling.

Accepted Answer

Kelly is a victim of bait-and-switch, where the seller displays an attractive offer to lure customers into the store but then tries to upsell them to another product at a higher price. In this case, the TV being sold half-price was just a bait to get Kelly interested, and the seller then tried to sell her a projector, which was not part of the original offer.

Question 5

MediaTeq required its employees to send photocopies of a letter to 100 people.The letter contained a list of 10 names and addresses.People were required to send $1 to the first 10 names on the list to join the MediaTeq club.After that, they had to place their names and addresses at the bottom of the list, strike off the first 10 names, and send it to 100 other people.This is an example of:
A)bid rigging.
B)bait-and-switch.
C)predatory pricing.
D)referral selling.
E)pyramid selling.

Accepted Answer

This is an example of pyramid selling, a form of multi-level marketing where participants earn money by recruiting new members into the program and receive a commission on the sales made by those members. The requirement to send the letter to 100 people and add their names at the bottom of the list is a classic pyramid scheme tactic aimed at rapidly expanding the network and attracting new members to join.

Question 6

Teal Electronics Inc. resells DVD players to retail stores for $300. Teal requires the retailers to charge customers $350. Any retailer that charges less than $350 is in violation of its contract with Teal. Therefore, all the retailers come together and decide that the DVD player should not be sold below $350.
-Who is liable for seeking to influence the price at which a product is sold?
A)Teal Electronics
B)The retail stores
C)The consumers
D)The DVD player manufacturer
E)Ochre Corp., Teal's primary retail client

Accepted Answer

Teal Electronics is liable for seeking to influence the price at which the product is sold by requiring retailers to charge a minimum price, which is a form of resale price maintenance.

Question 7

Merge and Co. is a grocery chain designed to attract women. It finds that women constitute its biggest buyers, and since more and more women are working and earning good incomes, they are prone to indulging in a variety of foods. Also, to cater to the tastes of women belonging to different ethnic groups, Merge and Co. has positioned a prominent international foods aisle, which highlights Asian, West Indian, Middle Eastern, and Eastern European food products, before the customers reach the central grocery aisles. The food displayed is in keeping with the latest trend of promoting low-calorie, high-nutrition organic products.
-Which of the following has prodded the grocery chain to exclusively cater to the needs of women customers?
A)The government regulations that make it mandatory to do so
B)The pressure from groups fighting for women rights
C)The changing role of women in society
D)The social constraints that deter women from shopping in crowded areas
E)The pressure from male members of the community

Accepted Answer

Merge and Co. has designed itself to attract women because they have found that women constitute its biggest buyers. The reason behind this is the changing role of women in society, as more and more women are working and earning good incomes, they are prone to indulging in a variety of foods. There is no mention of government regulations, pressure from women rights groups, social constraints, or pressure from male members of the community as reasons for catering to the needs of women customers.

Question 8

Teal Electronics Inc. resells DVD players to retail stores for $300. Teal requires the retailers to charge customers $350. Any retailer that charges less than $350 is in violation of its contract with Teal. Therefore, all the retailers come together and decide that the DVD player should not be sold below $350.
-Which of the following is the marketing practice in which a company seeks to influence the price at which a product is sold?
A)Price fixing
B)Price discrimination
C)Predatory pricing
D)Referral selling
E)Resale price maintenance

Accepted Answer

The practice described is resale price maintenance, where the manufacturer (Teal Electronics Inc.) sets the minimum price at which the retailers can sell the product to the end customers. This prevents retailers from selling the product below a certain price point, ensuring a standard pricing across all retail outlets.

Question 9

A coffee shop chain opens across the street from a locally owned coffee shop.The base expenses for coffee and pastries are similar.However, the chain has corporate backing for support and therefore makes a decision to radically lower prices.Thus, it succeeds in attracting customers to its facility and eventually drives the local competitor out of business.This is an example of:
A)price fixing.
B)price discrimination.
C)predatory pricing.
D)referral selling.
E)resale price maintenance.

Accepted Answer

This scenario is an example of predatory pricing, where a large company with more resources and financial backing lowers prices to drive out competition and gain market share. This unfair pricing strategy can result in a monopoly and ultimately harm consumers in the long run.

Question 10

The presence of food products from different parts of the world in a grocery chain symbolizes:
A)that culture is the same in all parts of the world.
B)the attempt to shut out smaller grocery stores.
C)environmental concern.
D)the growing trend of eating high-calorie, low-nutrition products.
E)variance in the ethnic composition of society.

Accepted Answer

The presence of food products from different parts of the world in a grocery chain represents the ethnic diversity of society, as people from various cultural backgrounds have different dietary preferences.

Question 11

A restaurant has two menus, one printed in English, and the other printed in the local language.The prices on the English menu are double those on the other menu.The restaurant owners believe that if a customer cannot read the local language, he must be a tourist and will pay more.This is an example of:
A)price fixing.
B)price discrimination.
C)predatory pricing.
D)referral selling.
E)resale price maintenance.

Accepted Answer

The practice of charging different prices for the same product or service is called price discrimination. In this scenario, the restaurant is charging double the price to customers who can only read the English menu, assuming that they are tourists and will be willing to pay more. This is a clear example of price discrimination based on language proficiency.

Question 12

A company manufacturing mouthwash declared that the mouthwash could cure common ailments such as colds, sore throats, and coughs. It also promised that it was a hair revitalizer and an antiseptic cream for cuts, bruises, wounds, and stings. Tests by independent agencies found that the product was as effective as warm water in treating colds.
-The marketing practice being followed by the company is called:
A)bait-and-switch.
B)exclusive dealing.
C)pyramid selling.
D)referral selling.
E)misleading advertising.

Accepted Answer

The company is making false and exaggerated claims about their product's abilities, which is misleading advertising. They are also potentially putting consumers at risk by promoting it as a cure for illnesses when it has been shown to be ineffective.

Question 13

While Maria is dining at her favourite Mexican restaurant, she is offered a discount voucher of $20 if she will provide the names and addresses of five friends who might also be interested in Mexican food.This is an example of:
A)bid rigging.
B)bait-and-switch.
C)predatory pricing.
D)referral selling.
E)pyramid selling.

Accepted Answer

This marketing strategy is known as referral selling, where a customer is offered a discount or reward for referring friends or family to the business. It is a common practice used to attract new customers and increase sales. The other options do not fit the scenario described, as bid rigging involves colluding with competitors to manipulate bids, bait-and-switch involves enticing customers with a low-priced item and then offering a higher-priced item, predatory pricing involves setting prices so low that competitors can't compete, and pyramid selling involves recruiting participants to sell products to others in a hierarchical structure.

Question 14

Amir owns a fine Steak House Restaurant in north of Toronto with the average meal of $65 per person.What would be the two most influential macroenvironmental factors that Amir has to monitor for his business?
A)Corporate partners and political environment
B)Economic situation and competition
C)Culture and Legal environment
D)Economic situation and social trends
E)Customers and corporate partners

Accepted Answer

The economic situation can greatly affect the spending power of consumers, which could impact the number of people dining at Amir's restaurant. Social trends, such as shifts in dietary preferences or attitudes towards eating out, can also have a significant impact on the success of the restaurant. While all of the other factors listed may be important, economic situations and social trends are likely to be the most influential on a steakhouse restaurant's success.

Question 15

The marketing practice used by the mouthwash company will be checked by the:
A)Competition Act.
B)Access to Information Act.
C)Canada Agricultural Product Standards Act.
D)Copyright Act.
E)Food and Drugs Act.

Accepted Answer

The Competition Act is designed to prevent deceptive marketing practices and ensure fair competition in Canada.

Question 16

Culture is defined as the shared meanings, beliefs, morals, values, and customs of a group of people.

Accepted Answer

Culture is commonly defined as the shared meanings, beliefs, morals, values, and customs of a group of people.

Question 17

The latest trend of promoting low-calorie, high-nutrition organic products is a(n):
A)social trend.
B)legal trend.
C)political trend.
D)cultural trend.
E)economic trend.

Accepted Answer

This trend reflects changing consumer preferences and societal values towards healthier and more sustainable food options, which is a social trend.

Question 18

Brian devised a scheme and instructed his partner to submit sham price quotations from dormant companies for a bulletproof-vest contract.The sham price quotations were submitted with intentionally increased prices so that one company, a Kuwaiti general trading firm, would win the contract at a lower price.The owner of the Kuwaiti general trading firm then authorized Brian to negotiate and receive all funds related to the contract.This is an example of:
A)bid rigging.
B)bait-and-switch.
C)predatory pricing.
D)referral scheme.
E)pyramid selling.

Accepted Answer

This scenario describes bid rigging, which involves conspiring with others to manipulate the bidding process by submitting sham bids or by agreeing to make only one bid to ensure that a predetermined bidder wins the contract.

Question 19

Demographics provide an easily understood "snapshot" of the typical consumer in a specific target market.

Accepted Answer

Demographics provide information about the characteristics of the population in a specific target market, such as age, gender, income, education level, and ethnicity. This information can help marketers understand the needs, preferences, and behaviors of their target audience and develop more effective marketing strategies. Demographics, therefore, provide a snapshot of the typical consumer in a particular market.

Question 20

A retail store enters into an agreement to buy cheese from a large supplier.The retail store is bound by this agreement and cannot buy cheese from local dairy farms although its prices are lower.This is an example of:
A)exclusive dealing.
B)refusal to deal.
C)predatory pricing.
D)referral selling.
E)pyramid selling.

Accepted Answer

This is an example of exclusive dealing, where the retail store agrees to purchase all or most of its supplies from a single supplier, thereby limiting competition from other suppliers. The retail store is bound by the agreement and cannot buy cheese from local dairy farms, even if their prices are lower.

Quiz 3: Analyzing the Marketing Environment

Which of the following illegal marketing practices are the retailers primarily involved in?

Two airline companies enter into a secret pact to simultaneously increase their fuel surcharges.As a result of the pact, fuel surcharges rose from $10 a ticket to more than $100 a fare.This is an example of:

Parties that work with the focal firm are its corporate partners.

Kelly saw an advertisement of TV being sold half-price.When she visits a store to buy it, she is told that she needs to buy a projector, as well, for the offer.Kelly is a victim of:

The presence of food products from different parts of the world in a grocery chain symbolizes:

While Maria is dining at her favourite Mexican restaurant, she is offered a discount voucher of $20 if she will provide the names and addresses of five friends who might also be interested in Mexican food.This is an example of:

Amir owns a fine Steak House Restaurant in north of Toronto with the average meal of $65 per person.What would be the two most influential macroenvironmental factors that Amir has to monitor for his business?

The marketing practice used by the mouthwash company will be checked by the:

Culture is defined as the shared meanings, beliefs, morals, values, and customs of a group of people.

The latest trend of promoting low-calorie, high-nutrition organic products is a(n) :

Demographics provide an easily understood "snapshot" of the typical consumer in a specific target market.

A retail store enters into an agreement to buy cheese from a large supplier.The retail store is bound by this agreement and cannot buy cheese from local dairy farms although its prices are lower.This is an example of: