Deck 5: Business Marketing

Question 1

Hensley Poultry is a wholesaler that buys poultry food and health products from Provini,Inc. ;feeding systems from Big Dutchman,Inc. ;and incubation systems from Copca Corp. ;which it then sells to poultry producers and farmers' cooperatives in Alberta.How is Hensley Poultry best classified?

A) as a reseller
B) as a producer
C) as an inventory carrier
D) as a distribution network

Answer 1

A

Question 2

What are businesses that buy finished goods and sell and distribute them for a profit?

A) business facilitators
B) resellers
C) inventory carriers
D) distribution networks

Answer 2

B

Question 3

A particular segment of the business market includes those individuals and organizations that purchase goods and services for the purpose of making a profit.They achieve this goal by using purchased goods and services to make other goods,to become part of other goods,or to facilitate the daily operations of the organization.In which segment of the business market is this group?

A) reseller
B) wholesaler
C) producer
D) institution

Answer 3

C

Question 4

A product is defined as a business product rather than consumer good on the basis of which of the following?

A) its tangible attributes
B) its intended use
C) its physical characteristics
D) its price

Question 5

Since GE began accepting bids via the Internet,the length of the bidding process in GE's lighting division has been reduced from 21 days to 10.Since requesting the bids is easier,purchasing agents approach more potential vendors.The ability to locate more vendors has lowered the cost of goods by 5 to 15 percent.What does GE's experience illustrate?

A) how the Internet increases efficiency in data exchange
B) how business marketing is using the Internet to become more efficient
C) how using the Internet increases competition
D) how the use of the Internet has influenced consumer markets to become larger and more powerful than business markets

Question 6

Which of the following is the best example of a sale that could take place only in the business market?

A) A university controller is ordering more computers for classroom labs.
B) A park ranger is purchasing an azalea bush for her garden.
C) A dentist is buying postage stamps to mail invitations to his son's birthday party.
D) A music store owner is ordering the newest Faith Hill CD for her mother.

Question 7

What percentage of the entire Canadian workforce is employed by the retail sector?

A) 52 percent
B) 72 percent
C) 32 percent
D) 12 percent

Question 8

What is an OEM?

A) an installer of original materials
B) an originator of electronic merchandise
C) a producer
D) an organizational system used for inventory control

Question 9

Ranjit works for the Government of Ontario as an advocate of provincial growth and development.He devises ways to encourage businesses to relocate to the province.In other words,Ranjit is involved in business marketing.He has compiled a list of potential businesses that might be willing to relocate to Ontario.Which of the following possible clients should he include in his list?

A) companies that have growing sales
B) any family that takes an annual vacation
C) newlyweds
D) families that enjoy hiking

Question 10

What does OEM stand for?

A) Original Equipment Manufacturers
B) Organization of Electronic Manufacturers
C) Organization of Environmental Monitoring
D) Organization of Equipment Manufacturers

Question 11

What is a cooperative agreement between business firms?

A) a joint contract
B) a strategic alliance
C) a co-marketing effort
D) a global partner development strategy

Question 12

Which of the following is a benefit businesses experience from buying and selling their goods and services on the Internet?

A) access to around-the-clock ordering
B) a smaller selection of products and vendors
C) higher prices due to increased competition
D) less customer service

Question 13

Rice Epicurean in London,Ontario,is an exclusive outlet for Honey Baked brand hams and See brand candies.In the spring,it markets Easter baskets and all the makings for personalized Easter baskets.How would Rice Epicurean best be classified?

A) as a producer
B) as an inventory carrier
C) as a distribution network
D) as a reseller

Question 14

What is a keiretsu?

A) a form of relationship marketing that is illegal in Canada
B) a type of strategic alliance commonly found in Japan
C) an Internet site that offers its customers access to various languages which they can use to conduct their business
D) a method of business e-commerce found in Asia

Question 15

Why do businesses typically enter into strategic alliances?

A) to gain access to global markets
B) to achieve economies of scale
C) to facilitate entry of new products to old markets
D) to share political risks

Question 16

Subaru and GM have been working together on the design for the new Chevy Borrego,a sporty combination of a truck and a car.Subaru allowed Chevy to use its all-wheel drive platform to build the vehicle,and the two car manufacturers worked together to develop the car's turbo-charged,four-cylinder engine.In this example,Subaru and GM's working together is an example of which of the following?

A) a co-marketing effort
B) a global partner development strategy
C) a shared capital contract
D) a strategic alliance

Question 17

In Japan,reciprocity and personal relationships contribute to the development of which of the following?

A) an independent network of small retailers
B) agricola
C) amae
D) keiretsu

Question 18

Business marketing includes which goods and services?

A) those that are used for personal consumption
B) those that advertise to consumers
C) those that become part of another product
D) those that are used to target consumers

Question 19

What is another name for producers?

A) component networks
B) original equipment manufacturers
C) installers
D) product providers

Question 20

Layton Bay,Inc.sells playground equipment to private schools and daycare centres,provincial and city governments,and families with preteen children.Layton Bay's marketing task is to sell products that are classified as which of the following?

A) business products only
B) consumer goods only
C) supplies
D) both business and consumer goods

Question 21

When will an increase or decrease in the price of a product not significantly affect demand for the product?

A) when demand for a product is elastic
B) when demand for a product is responsive
C) when demand for a product is derived
D) when demand for a product is inelastic

Question 22

What would a Canadian company that manufactures the lighted signs used by various governmental departments of highways on the sides of roads,at outdoor sports arenas,for restaurant promotion,and in amusement parks use to facilitate its market segmentation and targeting if it wanted data that was readily available and usable?

A) the North American Industry Classification System
B) a large amount of marketing research,including scanner data and focus groups
C) other competing firms as a strategic alliance referral service
D) derived demand

Question 23

One segment of the business market has primary goals that differ from the ordinary business goals such as profit,market share,or return on investment.This segment includes many schools,religious institutions,and civic clubs.What is it called?

A) the service market
B) the reseller market
C) the institution market
D) the provider market

Question 24

Bábolina Tetra is a Hungarian company that has genetically created a chicken guaranteed to produce uniform brown eggs with strong shells.The company breeds and sells young chicks to farmers all over Europe who want to sell eggs in local markets.When consumers began to worry about cholesterol content and stopped eating as many eggs,the demand for the Tetra hen also declined.This is an example of what type of demand?

A) multiplying
B) inelastic
C) derived
D) elastic

Question 25

What is the largest single category in retail sales in Canada?

A) consumer electronics sales
B) sporting goods sales
C) food sales
D) apparel sales

Question 26

Which of the following is the BEST example of an institution market?

A) a company that does not trade its stock on an international stock exchange
B) Tau Kappa Epsilon fraternity
C) the Canadian Real Estate Association
D) a company that sells exclusively on the Internet

Question 27

The government uses a system called NAICS to classify North American business establishments.What does NAICS stand for?

A) Non-American Industrial Corporation System
B) North American Institution Code System
C) North and South American Institutional Coding Services
D) North American Industry Classification System

Question 28

Due to rapidly rising overhead costs and increases in raw material prices,Framarx Corporation was forced to raise the price of its waxed and coated paper by 35 percent.(The paper is used between frozen hamburger patties to keep the patties from freezing together. )Framarx is the leading manufacturer in this industry,and its competitors will follow suit.While the sales force for Framarx believes the price increase will result in a drop in sales,its marketing manager disagrees because the demand for the waxed and coated paper is more than likely which of the following?

A) derived
B) resistant
C) inelastic
D) elastic

Question 29

Although the price of a chemical added to paint to protect surfaces from mould and mildew has almost doubled,the price of paint only rose an average of 5 percent,and the demand for both paint and the chemical that eliminates mould and mildew remained stable.What is the demand for this chemical?

A) derived
B) elastic
C) change-resistant
D) inelastic

Question 30

NAICS data are helpful for analyzing,segmenting,and targeting markets.Who developed the system?

A) the North American Free Trade Association partners
B) large manufacturers in the United States and Canada that produce similar goods
C) the Canadian government
D) Brazil,Chile,Argentina,Canada,and the United States working together in a joint venture

Question 31

When the demand for packaged beer fell by 8 percent in one year,why did the demand for aluminum beer cans and glass beer bottles also fall?

A) because the demand for beer containers is an example of elastic demand
B) because the demand for beer containers is an example of fluctuating demand
C) because the demand for beer containers is an example of inelastic demand
D) because the demand for beer containers is an example of derived demand

Question 32

Lanover Manufacturing supplies windshield wiper blades to General Motors and Ford.A sudden jump in the price of rubber and its substitutes has forced Lanover and other wiper blades manufacturers to double the price of the wiper blades.Sales volume for wiper blades has not been affected by this increase in price.Why did the price not change?

A) because demand for windshield wiper blades is secure
B) because demand for windshield wiper blades is elastic
C) because demand for windshield wiper blades is resistant
D) because demand for windshield wiper blades is inelastic

Question 33

The demand for consumer goods often affects the demand for business products.What is this characteristic of business markets called?

A) inelastic demand
B) derived demand
C) elastic demand
D) fluctuating demand

Question 34

Organon Teknina sells inexpensive equipment to detect E.coli,listeria,or salmonella bacteria in food.The company serves not-for-profit institutions that need to regularly check food quality.Organon Teknina would be LEAST likely to sell to which of the following?

A) Montgomery municipality school system
B) a large paediatric hospital
C) a chain of Mexican restaurants
D) a chain of religious institution-sponsored retirement homes

Question 35

The demand for polyethylene film used to wrap meat ready for sale is dependent on consumers' demand for meat.This is an example of what type of demand?

A) derived
B) inelastic
C) elastic
D) joint

Question 36

During the first years of this century,the number of packages arriving at households has more than doubled.An increase in the price of the cardboard boxes in which these packages are shipped will have little effect on the amount of shipping done;the demand for the boxes will continue to increase.Therefore,what is the demand for the cardboard boxes?

A) bundled
B) elastic
C) derived
D) inelastic

Question 37

Which type of customer do business marketers serve?

A) teenagers
B) farmers' markets
C) private consumers
D) institutions and nonprofits

Question 38

Imagine you are the research director of a major industrial marketing firm.You
Need to select an NAICS code that defines the most homogenous group of companies in a particular group of highly competitive companies .Which of the following codes might you use?

A) 7
B) 532
C) 19
D) 7432

Question 39

What does MASH stand for?

A) Municipal Academic Social and Hospitals
B) Manufacturer and Stakeholder
C) Manufacturing Aggregate Services Holdings
D) Municipal Accreditation Services Handling

Question 40

What can managers use the NAICS data to do?

A) identify potential new customers
B) classify consumer behaviour
C) eliminate risk
D) determine purchase motives

Question 41

In the six months following the September 11,2001,terrorist attacks,consumer demand for large American flags saw a 200 percent increase,but the Eagle Manufacturing Company had a 500 percent increase in orders for the special machine that mass produces the larger flags.What is this dramatic increase due to?

A) the joint demand principle or division effect
B) the accelerator principle
C) the demand fluctuator principle
D) the inelastic demand effect

Question 42

A small increase or decrease in consumer demand can produce a much larger change in demand for the facilities and equipment needed to manufacture the consumer product.What is this a result of?

A) the demand fluctuation principle
B) the multiplier effect
C) the joint demand principle or division effect
D) the inelastic demand effect

Question 43

When two or more items are used in combination to produce a final product,they are said to have what type of demand?

A) inelastic
B) elastic
C) joint
D) derived

Question 44

When the owner of a security company decided he wanted to buy new office furniture,he checked his customer list first for office furniture retailers.He discovered that four companies that sold office furniture were regular customers.He chose to buy his furniture from the retailer that was his largest account.What is this purchase?

A) unethical by all standards
B) an example of an illegal influence
C) a normal business practice called circular buying
D) a normal business practice called reciprocity

Question 45

Compared to buyers in the consumer market,buyers in the business market tend to do which of the following?

A) be much more geographically concentrated
B) purchase in much smaller quantities
C) use reciprocity less
D) buy products that have a reduced probability of being affected by derived demand

Question 46

Ellis is trying to sell laser detection equipment to a large Brazilian mining company.Ellis discovered this prospect when he went looking for customers who use laser equipment similar to what his company manufactures.Which of the following questions would be the LEAST important to answer prior to visiting the mining company's headquarters?

A) What are the buying objectives of the mining company?
B) What role does each member play in the mining company's buying centre?
C) Who are the major people involved in making the decision within the mining company?
D) What kind of reciprocity will be demanded by the mining company?

Question 47

Which of the following is an example of an advantage business marketers have because they usually have fewer customers than consumer marketers?

A) the fact the majority of sales can come from one customer
B) the ability to keep track of customers' satisfaction levels
C) ease of identifying prospective suppliers
D) the inability to monitor customers' needs

Question 48

Which of the following pairs of products BEST illustrates the concept of joint demand?

A) a grandfather clock pendulum and a grandfather clock case
B) chocolate and vanilla ice cream
C) a thermometer and a barometer
D) a pumpkin and the set of tools used to carve it

Question 49

A decline in the availability of bicycle handle bars will decrease Huffy Bicycle Company's production of bicycles.Why does decreased production in turn reduce Huffy's demand for bicycle seats?

A) because the products in this situation have derived demand
B) because the products in this situation have joint demand
C) because the products in this situation have inelastic demand
D) because the products in this situation have elastic demand

Question 50

Kate Lui developed bread mixes that she could use to make bread for her diabetic daughter.She initially sold the bread mixes to friends and friends of friends,but she has gradually changed her customer base.Her bread mixes are now sold to a catalogue retailer that markets her mixes nationwide.With this change in customers,what should Lui expect?

A) a greater reliance on advertising to gain new customers
B) derived demand issues to emerge
C) a smaller order size
D) a more formal purchase process

Question 51

A small change in consumer demand can produce a much larger change in demand for the facilities and equipment needed to make the consumer product.How do economists refer to this phenomenon?

A) as the multiplier effect
B) as latent demand
C) elastic demand
D) as joint demand

Question 52

If a business needs a particular good or service and decides to look among its own customers for a provider of that good or service,what is the business doing?

A) acting unethically
B) practising reciprocity
C) opening itself up to prosecution for illegal activities
D) working to create purchase arbitration

Question 53

What is the primary promotional method for the sale of all business products?

A) personal selling
B) advertising
C) trade promotions
D) direct mail

Question 54

Oscar sells printing presses ranging in price from $29,000 to $500,000 to sign manufacturers.He wants to stimulate business among some of his customers who cannot afford to buy his printing presses,but who would like to be able to use one of these printing presses in their sign businesses.Which of the following actions is most appropriate in this example?

A) Create full and complete reciprocity to ensure customer cash flow.
B) Set up a straight-rebuy ordering system.
C) Develop leasing options for business customers.
D) Manage derived demand to keep the customers' demand at the highest possible levels.

Question 55

Which of the following BEST describes the distribution structure in business marketing?

A) It typically uses retail distributors.
B) It typically includes at least one wholesaler.
C) It typically is complex and multistage.
D) It typically is direct.

Question 56

What occurs when a carpet cleaning service decides to buy its detergents and spot cleaners from a manufacturer that regularly uses its cleaning services?

A) derived demand
B) reciprocity
C) elastic demand
D) joint demand

Question 57

Eilene Tifinio is the marketing manager for a manufacturer of refrigeration equipment.She must develop a marketing strategy for the upcoming year.Which of the following marketing actions is Eilene LEAST likely to employ?

A) increase the size of her sales force so new companies will have a salesperson to call upon them
B) work closely in new product development with OEMs to be sure the components produced fit their needs
C) lower the prices of her equipment to keep competitors from entering the field
D) emphasize advertising in the company's promotion strategy to ensure that she persuades potential buyers of the superiority of her company and its products

Question 58

What is the bargaining between buyers and sellers on product specification,delivery dates,payment terms,and other pricing matters that is commonplace in business marketing?

A) purchase arbitration
B) customerization
C) disintermediation
D) negotiation

Question 59

Why is personal selling pervasive in organizational markets?

A) Most of the situations involve fairly low-cost items.
B) Organizational salespeople seldom speak the language of their customers.
C) Many organizational products are complex and require expertise on the salesperson's part.
D) There are few avenues for effective advertising of organizational goods.

Question 60

Business marketers usually have far fewer customers than consumer marketers.What is the chief disadvantage of this situation for business marketers?

A) the effort required to service existing customers
B) each customer becomes crucial
C) identification of prospective buyers
D) the effort required to monitor current customer needs

Question 61

Which of the following is the best example of accessory equipment?

A) a desktop computer
B) sheet metal
C) pencils
D) spark plugs

Question 62

What are capital goods?

A) finished items ready for assembly
B) unprocessed extractive or agricultural products
C) portable tools and office equipment
D) large expensive machines

Question 63

Parrish Farms provides organic grocers with fruits and vegetables that have been grown without the use of pesticides or chemical fertilizers.What is Parrish Farms a supplier of?

A) raw materials
B) accessory parts
C) supplies
D) processed materials

Question 64

Manufacturers of computer storage media such as 3M or Sony sell their products to software developers,such as Microsoft,to be used to store software programs.What would Microsoft be considered?

A) a processed materials market
B) an OEM market
C) an accessory equipment market
D) a provision market

Question 65

Which of the following is the BEST example of accessory equipment?

A) car batteries
B) light bulbs
C) a parking lot
D) a store display rack

Question 66

What is another name for business supplies such as pens,paper,and computer diskettes?

A) accessories
B) MRO items
C) OEM parts
D) components

Question 67

One brand of tomato sauce advertises that the tomatoes it uses are processed within 24 hours of being picked to ensure product freshness.The fresh tomatoes it buys from growers are examples of which of the following?

A) supplies
B) OEM parts
C) processed materials
D) raw materials

Question 68

Which of the following is the BEST example of an installation?

A) original artwork
B) a display cabinet
C) a parking garage
D) accounting software

Question 69

Because they are not expensive,have short useful lives,and are frequently purchased from local distributors,store mannequins,notebook computers,fax machines,and grocery carts are typically classified as which of the following?

A) component parts
B) accessory equipment
C) processed materials
D) mobile equipment

Question 70

A company that installs and maintains signs along the highways has a truck that has a 50-metre crane on it that is capable of lifting up to 15 tonnes.The company's accountant depreciated the value of the vehicle over several years.What type of business product is the truck with crane?

A) fabricating item
B) component part
C) accessory equipment
D) major equipment

Question 71

What are consumable,inexpensive,and often standardized items that do not become part of the final product?

A) accessory equipment
B) supplies
C) processed materials
D) replacement parts

Question 72

Why is it important that marketers understand the classification of the business product they are selling?

A) Distribution channels are almost always direct for all business selling.
B) OEM markets often act just like the consumer markets.
C) Personal selling is the most important promotional strategy for all business marketing classifications.
D) Promotion and distribution strategies tend to vary depending upon the classification.

Question 73

What are products that have had some processing,are used directly in the production of other products,and do not retain their identity in the final product?

A) raw materials
B) processed materials
C) component parts
D) supplies

Question 74

Because they are shown as expenses on the yearly accounting statements,for a police department,revolvers,computers,printers,fax machines,and patrol vehicles are all examples of which of the following?

A) component parts
B) accessory equipment
C) supplies
D) mobile installations

Question 75

At Garbino Metalware Welding,the shop foreman orders cutting oil,special hand cleaner,and sanding paper almost every month.How are these items classified?

A) as replacement parts
B) as accessory equipment
C) as supplies
D) as OEM parts

Question 76

A baker purchases pre-sifted flour that she then bakes into cakes and pastries.Flour made from wheat is an example of which of the following?

A) a component part
B) a processed material
C) an OEM product
D) raw material

Question 77

Parking garages,$500,000 printing presses,privately owned warehouses,and oil-well drilling platforms are depreciated over time rather than expensed in the year they are purchased.How are they classified?

A) as component parts
B) as installations
C) as accessory equipment
D) as processed materials

Question 78

What are finished items ready for assembly or products that need very little processing before they become a part of some other product?

A) processed materials
B) supplies
C) accessory equipment
D) component parts

Question 79

Products such as diamonds,iron ore,peaches,and beef that become part of finished products are examples of which of the following?

A) supplies
B) processed materials
C) raw materials
D) component parts

Question 80

Within the business market,handlebars purchased by bicycle manufacturers are examples of which of the following?

A) processed materials
B) supplies
C) accessory equipment
D) component parts