Deck 5: Business Buying Behaviour

Question 1

The four major types of business markets are:

A) producer markets, consumer markets, government markets, institutional markets.
B) producer markets, government markets, reseller markets, institutional markets.
C) reseller markets, international markets, goods markets, services markets.
D) reseller markets, operations markets, producer markets, institutional markets.
E) institutional markets, producer markets, operations markets, consumer markets.

Answer 1

producer markets, government markets, reseller markets, institutional markets.

Question 2

Individuals or organisations that purchase products for resale, for use in the production of other products, or for use in their daily business operations, comprise which market?

A) Labour.
B) Secondary.
C) Personal.
D) Business.

Answer 2

Business.

Question 3

When a wholesaler purchases a good from a producer and then sells it to a retailer, the transactions have taken place in:

A) institutional markets.
B) producer markets.
C) consumer markets.
D) retail markets.
E) reseller markets.

Answer 3

reseller markets.

Question 4

The annual "HBF Run for a Reason" is to aid the funding of more than 190 WA health institutions, such as Lifeline, Heart Foundation and Diabetes WA. This event is supported by commercial partners such as HBF, Commonwealth Bank and government partners such as The City of Perth. This is an example of:

A) co-branding.
B) charity markets.
C) institutional markets.
D) government markets.

Question 5

Retailers' own brands:

A) compete with the brands of the retailers' suppliers.
B) are used by retailers when they cannot obtain other branded products to stock.
C) are a rapidly growing part of retailers' overall offerings.
D) Options a and c only.
E) Options a, b and c.

Question 6

As the operator of a small business, you regularly purchase office supplies such as stationary, tea and coffee, and computer software. Which of the following markets are you participating in when buying these products?

A) Producer markets.
B) Reseller markets.
C) Institutional markets.
D) Government markets.

Question 7

Jolly Juicy JellyBeans buys sugar from a local mill and sells its lollies to department stores and supermarkets. Which two markets do these transactions take place in?

A) Producer markets and consumer markets.
B) Producer markets and retail markets.
C) Producer markets and reseller markets.
D) Reseller markets and retail markets.
E) Wholesale markets and retail markets.

Question 8

Non-public, not-for-profit organisations face many of the same marketing challenges confronting businesses, including:

A) recruiting members.
B) recruiting members and publicising their activities and achievements.
C) publicising their activities.
D) publicising their achievements.

Question 9

The processes required to sell products to government buyers can be complicated by:

A) the high levels of accountability that apply to government purchasing decisions.
B) the tendency of governments to change suppliers often.
C) the use of e-commerce.
D) Both a and c.
E) Both b and c.

Question 10

In Australia and New Zealand, which business markets are dominated by familiar large retail chains such as Woolworths and Harvey Norman?

A) Institutional.
B) Producer.
C) Retail.
D) Reseller.

Question 11

The markets for non-public, not-for-profit organisations are:

A) producer markets.
B) institutional markets.
C) reseller markets.
D) government markets
E) charitable markets.

Question 12

Upon completing your marketing degree, you are offered a job working as a business buyer for a company that operates in the institutional market. Your company can be distinguished from businesses operating in other markets by:

A) the not-for-profit nature of their activities.
B) their non-public nature.
C) the fact they do not sell goods or services.
D) Options a and b only.
E) Options a, b and c.

Question 13

Which of the following statements is false?

A) Not-for-profit organisations do not participate in marketing.
B) Reseller markets in Australia and New Zealand are dominated by a small number of major retail chains.
C) Wholesalers and industrial distributors operate in the reseller markets.
D) Governments have been at the forefront of e-commerce to enable potential suppliers efficient access to government market opportunities.
E) Transactions in producer markets may be for raw materials, components or daily operational supplies.

Question 14

One of the key differences between marketing to business customers compared to consumers is:

A) there are more buyers and sellers.
B) price and other conditions of the sale not open to negotiation.
C) business-to-business purchases involve high volumes and regular repeat purchases.
D) transactions are for lower-value purchases.

Question 15

____________, just-in-time delivery, ___________, repairs, technical help desk support, dedicated account and relationship managers are examples of 'after-sales' service in the _____________ market.

A) Transport, advertising, consumer
B) Transport, returns, consumer
C) Trade-ins, refunds, secondary
D) Transport, returns, business

Question 16

Businesses tend not to adjust their consumption of products in relation to price changes. Rather, they:

A) operate with lower profit margins.
B) seek to identify substitute products.
C) pass the cost on to their customers.
D) initially pass the cost on to their customers, while they seek to identify substitute products.

Question 17

High-value purchases are relatively common in which business market/s?

A) Consumer and reseller.
B) Consumer.
C) Producer, government and institutional.
D) Online and consumer.
E) Online.

Question 18

There are far fewer ________ and _________sellers in business markets than in consumer markets.

A) goods, services
B) buyers, sellers
C) customers, competitors
D) retailers, resellers

Question 19

Public transport networks, council sanitation and local infrastructure upgrades are all examples of:

A) consumer market.
B) business market.
C) market segments
D) target markets
E) government markets.

Question 20

Platforms like Etsy, and farmers markets and cellar doors are examples of:

A) Reseller markets.
B) Direct to consumer markets.
C) Institutional markets.
D) Government markets.
E) None of the options listed.

Question 21

Which of the following statements about business-to-business transactions in general is most likely to be false?

A) The relationships between buyers and sellers tend to be short term.
B) They can be for high volume purchases.
C) They can be for high value purchases.
D) They can involve regular repeat purchases.
E) Price and other conditions of sale can be open to negotiation.

Question 22

It is more common for discussions and negotiations between buyers and sellers to take place over an extended period of time and to involve considerable marketing effort in:

A) consumer markets.
B) business markets.
C) online markets.
D) both a and c.
E) both a and b.

Question 23

By definition, interdependent demand for products that are used together in the production of another product is:

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

Question 24

You choose to switch to buying 'fair-trade' coffee as part of a global trend to decrease worker exploitation in developing countries. This decision is helping to drive a change in demand, known as:

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

Question 25

____________ is an economic concept that describes demand that is relatively independent of price. In other words, a large change in price will result in only a small change in demand.

A) Joint demand
B) Derived demand
C) Inelastic demand
D) Elastic demand

Question 26

With Australian government banning single use plastic, there is a shift in preference by consumers for more environmentally- friendly alternatives. Therefore, there is an increase in variety of canvas bags, cotton fresh produce bags, coffee cups and metal straws offered by many retailers. This is an example of:

A) Joint demand.
B) Derived demand.
C) Inelastic demand.
D) Elastic demand.

Question 27

Which of the following statements is false?

A) Industry demand tends to be price inelastic in business markets.
B) Demand in business markets fluctuates much more than demand in consumer markets.
C) Demand in business markets is independent of demand in consumer markets.
D) Joint demand exists when two components are used together in the production of another product.
E) Demand in business markets is derived from demand in consumer markets.

Question 28

Demand tends to be inelastic for which of the following products?

A) Chocolate.
B) Soft drink.
C) Premium beer.
D) Concrete.

Question 29

'Inelastic demand' describes demand that is:

A) relatively dependent on price.
B) derived from consumer demand.
C) for multiple products.
D) relatively independent of price.
E) None of the options listed.

Question 30

After completing your marketing degree, you successfully apply for a job as a business buyer for an electrical goods manufacturer. On your first day, your boss explains some of the characteristics of the market in which you will be buying. Which of the following statements made by your boss is false?

A) Demand for components in business markets tends to be price inelastic.
B) Equipment suppliers can take advantage of joint demand by offering ongoing supply of maintenance and consumables.
C) A just-in-time approach to taking delivery of components reduces inventory costs, but increases the risk that the production process will be brought to a halt by the shortage of any component.
D) While industry demand tends to be inelastic, demand for the business products of any particular company can be elastic.
E) None of the options listed - they are all true.

Question 31

Which of the following statements is false?

A) Demand for components in business markets tends to be price inelastic.
B) Equipment suppliers can take advantage of joint demand by offering ongoing supply of maintenance and consumables.
C) A just-in-time approach to taking delivery of components reduces inventory costs, but increases the risk that the production process will be brought to a halt by the shortage of any component.
D) While industry demand tends to be inelastic, demand for the business products of any particular company can be elastic.
E) None of the options listed - they are all true.

Question 32

In B2B markets, the demand for coffee beans is related to the demand for coffee machines. This example reflects which aspect of demand for business products?

A) Knock-on demand.
B) Derived demand.
C) Inelastic demand.
D) Elastic demand.
E) Joint demand.

Question 33

Company A buys glue for use in manufacturing its products from Companies B, C and D. Which of the following is/are unlikely to decrease the amount of glue that Company A demands?

A) Company B begins selling glue to consumers.
B) Company C increases its glue prices.
C) Company D stops producing glue.
D) Company E begins buying glue from Companies B, C and D.
E) None of the options listed are likely to decrease Company A's demand for glue.

Question 34

Retailers buy products in the B2B market to resell to consumers. The demand for the products in B2B markets is therefore:

A) derived.
B) unpredictable.
C) elastic.
D) determined by supply.
E) the same as consumer demand.

Question 35

When it comes time for a business to replace its photocopier, the office manager will usually evaluate a small range of alternative products from the current and other suppliers. This action is a:

A) straight re-buy.
B) new task purchase.
C) modified re-buy.
D) repeat purchase.

Question 36

Typically, business purchasing decisions involve:

A) negotiation, description, inspection, and consumers.
B) consumers, inspection, and sampling.
C) negotiation, time, inspection, and testing.
D) negotiation, description, inspection, and sampling.

Question 37

You are a technical expert, responsible for developing product specifications and evaluating alternatives. Within the buying centre, you are a(n):

A) influencer.
B) user.
C) initiator.
D) decider.

Question 38

____________ are those who control information relevant to a purchasing decision. They can be very powerful in purchasing decisions and in organisations generally.

A) Buyers
B) Gatekeepers
C) Deciders
D) Influencers

Question 39

In the internal environment, 'the nature of the organisation' refers to:

A) how responsibilities and authorities are arranged within the organisation.
B) those personal characteristics of members of the buying centre that may affect their decisions.
C) its size, location, industry, objectives and resources.
D) the action of the organisation's competitors.

Question 40

You work for a retailer, ordering stock to re-fill the shelves. The products don't change, just the quantities you need to order. These business purchases take the form of a:

A) straight re-buy.
B) new task purchase.
C) modified re-buy.
D) repeat purchase.

Question 41

Auckland Realty's contract with its mobile phone provider is up for renewal. The business has grown considerably since the contract was last renewed and the director decides to talk with the provider about better pricing and more services, as well as approach alternative mobile phone providers. This is an example of a:

A) modified rebuy.
B) straight rebuy.
C) new-task purchase.
D) buying centre.
E) low-engagement purchase.

Question 42

Courteous Couriers have an arrangement that automatically tops up their e-toll account when it falls to a threshold level. This is an example of a:

A) modified rebuy.
B) straight rebuy.
C) new-task purchase.
D) buying centre.
E) high-involvement purchase.

Question 43

Each week the company administration manager purchases a few packets of sweet biscuits for the businesses tea room. The administration manager generally buys the brand of biscuits that are on special at the local supermarket, evaluating the small range of alternatives. The decision that the administration manager makes is an example of a:

A) straight rebuy.
B) modified rebuy.
C) new task purchase.
D) negotiation.
E) inspection.

Question 44

Woolworths Ltd. decides to update its fleet of company cars. Which purchase decision method would best suit this example of an infrequent purchase of a large volume of high-value products (cars)?

A) Negotiation.
B) Description.
C) Inspection.
D) Sampling.
E) None of the options listed.

Question 45

John is a business buyer for a small chain of retail stores. His job involves making a range of different types of purchases, from 'new task purchases' of new product lines which the stores will sell; re-buys of existing product lines, to fleet-cars for managers. For many of these purchases and inspection is not required, however, which of the following business purchases made by John is he most likely to inspect before making his final decision?

A) Purchasing office stationery.
B) Contracting for security services.
C) Obtaining finance.
D) Buying safety boots.
E) Leasing a warehouse.

Question 46

Shining Lights Pty Ltd purchases several thousand light bulbs each year to install in its light fittings. Which approach is Shining Lights likely to take to ensure the light bulbs are satisfactory?

A) Inspection.
B) Sampling.
C) Institutional purchasing.
D) Competitive tendering.
E) Straight rebuys.

Question 47

A major marketing agency has decided to add 3D physical prototyping to their suite of services offered to clients. The agency decides to engage various suppliers of 3D printers to find the best option to suit their business needs. This is an example of a:

A) modified rebuy
B) straight rebuy
C) new task purchase
D) business purchase

Question 48

Which of the following is false?

A) The information technology manager is likely to be a gatekeeper in the buying centre for a new e-commerce system.
B) New task purchases are likely to involve extensive evaluation of options.
C) Buyers have the final authority to make business purchasing decisions.
D) Many businesses use multiple suppliers so they are not overly reliant on any one other business.
E) Business purchasing decisions often involve development of a formal product requirement specification.

Question 49

Most buying centres comprise a group of people who play different roles in the buying process. These roles include gatekeepers, new task buyers and re-buyers (buyers). Thinking about these roles, which of the following is false?

A) The information technology manager is likely to be a gatekeeper in the buying centre for a new e-commerce system.
B) New task purchases are likely to involve extensive evaluation of options.
C) Buyers have the final authority to make business purchasing decisions.
D) Many businesses use multiple suppliers so they are not overly reliant on any one other business.
E) Business purchasing decisions often involve development of a formal product requirement specification.

Question 50

The steps common to most business buying decisions are:

A) problem/need recognition, information search and specification development, evaluation of options, purchase.
B) development of product specifications, information search and specification development, evaluation of options, purchase, post-purchase evaluation.
C) problem/need recognition, evaluation of options, purchase, post-purchase evaluation.
D) problem/need recognition, information search and specification development, evaluation of options, purchase, post-purchase dissonance.
E) problem/need recognition, information search and specification development, evaluation of options, purchase, post-purchase evaluation.

Question 51

Choose the best answer. In a business, a buying centre may consist of:

A) initiators, users, influencers, deciders, buyers, gatekeepers.
B) users, influencers, deciders, gatekeepers.
C) initiators, users, suppliers, buyers, influencers.
D) initiators, users, influencers, spoilers, buyers, gatekeepers.
E) users, managers.

Question 52

Which of the following statements is false?

A) Successful marketing depends on gaining access to all members of the buying centre.
B) Influencers are those in the buying centre who are responsible for formally evaluating the purchase options.
C) Gatekeepers are often very powerful in business buying decision because they control information.
D) An individual in a buying centre may undertake multiple buying centre roles.
E) None of the options listed.

Question 53

Which of the following is not an internal environmental factor that could affect business buying decisions?

A) The size of the buying organisation.
B) The relative power of members of the buying organisation.
C) The individual motives of members of the buying organisation.
D) The actions of the competitors of the buying organisation.
E) The objectives of the buying organisation.

Question 54

The boss of Myer is writing a list of all the internal environmental factors which could have an effect on the buying decisions of his business buyers. Which of the following statements should not be on his list of internal environmental factors that could affect business buying decisions?

A) The size of the buying organisation.
B) The relative power of members of the buying organisation.
C) The individual motives of members of the buying organisation.
D) The actions of the competitors of the buying organisation.
E) The objectives of the buying organisation.

Question 55

The boss of Billabong is writing a list of all the external environmental factors which could have an effect on the buying decisions made by his business buyers. Which of the following statements should not be on her list of external environmental factors that could affect business buying decisions?

A) The size of the clients they deal with.
B) The relative power of members of the buying organisation.
C) The individual motives of customers.
D) The actions of the competitors of the buying organisation.
E) The objectives of the companies' partners.

Question 56

The recent decision for many major Australian universities to reduce their staff, in order to reduce their costs by millions of dollars, is an example of:

A) political forces.
B) economic forces.
C) sociocultural forces.
D) technological forces.
E) legal forces.