Question 1

The main difference between agents and brokers is that agents perform a wide array of marketing functions while brokers only negotiate exchanges between buyers and sellers.

Accepted Answer

The statement is incorrect. Brokers are also involved in marketing functions such as advertising, showing properties, and providing market analysis. Both agents and brokers can negotiate exchanges between buyers and sellers.

Question 2

Rack jobbers furnish racks or shelves full of merchandise to retailers and keep title to these goods until they are sold.

Accepted Answer

Rack jobbers provide inventory to retailers and retain ownership until the goods are sold.

Question 3

A retail sale is a sale to a consumer of products for his or her own use.

Accepted Answer

A retail sale is specifically made to an individual or end-user for their personal use or consumption.

Question 4

Merchant wholesalers do not take title to the goods they handle.

Accepted Answer

The answer of Merchant wholesalers do not take title to...

Question 5

Drop shippers are limited function wholesalers that typically put together many small shipments to form a single larger shipment.

Accepted Answer

The answer of Drop shippers are limited function wholesalers that...

Question 6

Limited-function wholesalers are a type of merchant wholesaler.

Accepted Answer

Limited-function wholesalers are a type of merchant wholesaler. They specialize in only one or a few functions of the marketing process, such as storage or transportation, rather than providing the full range of wholesaling services.

Question 7

The two main types of merchant wholesalers are storage wholesalers and distribution wholesalers.

Accepted Answer

The answer of The two main types of merchant wholesalers...

Question 8

The sale of goods to a business purchasing the items for resale is a wholesale transaction.

Accepted Answer

Wholesale transactions involve the sale of goods to businesses that purchase items for resale to their own customers.

Question 9

Rack jobbers sell goods on consignment, splitting the profits from their sales with a retailer.

Accepted Answer

Rack jobbers typically provide goods to a retailer on consignment, meaning the retailer only pays for the goods after they are sold. The profits from those sales are then split between the rack jobber and the retailer.

Question 10

Some marketing intermediaries make both wholesale and retail sales.

Accepted Answer

Some marketing intermediaries, such as wholesalers who operate cash and carry stores, make both wholesale and retail sales.

Question 11

A firm that makes wholesale sales cannot also legally make retail sales.

Accepted Answer

A firm that makes wholesale sales can legally make retail sales.

Question 12

Drop shippers are wholesalers that stock heavy or bulky items and transport them to retail stores.

Accepted Answer

Drop shippers are wholesalers that do not stock heavy or bulky items but instead transfer customer orders and shipment details to the manufacturer, another retailer, or a wholesaler who then ships the goods directly to the customer.

Question 13

Although drop shippers own merchandise they have shipped to buyers, they do not actually handle, stock, or deliver this merchandise themselves.

Accepted Answer

Drop shippers act as intermediaries between the buyer and a third-party supplier, who handles the stock and delivery of the merchandise. The drop shipper simply forwards the buyer's order to the supplier, who then fulfills it and ships it directly to the buyer.

Question 14

As long as they do not represent competing products, manufacturer's agents can represent more than one manufacturer in a given sales territory.

Accepted Answer

Manufacturer's agents can represent multiple non-competing manufacturers in their sales territory.

Question 15

Cash-and-carry wholesalers and drop shippers are both classified as limited-function wholesalers.

Accepted Answer

Both cash-and-carry wholesalers and drop shippers are limited-function wholesalers which means they perform a specific and limited set of functions in the distribution chain. Cash-and-carry wholesalers typically sell to small retailers and require them to pay in cash and carry the goods away themselves while drop shippers take orders from retailers and ship the goods directly to their clients.

Question 16

About 80 percent of all wholesalers are classified as merchant wholesalers.

Accepted Answer

According to the U.S. Bureau of Labor Statistics, about 80 percent of all wholesalers in the United States are classified as merchant wholesalers.

Question 17

A key distinction between agents and brokers is that agents tend to maintain long-term relationships with the people they represent whereas brokers are hired on a temporary basis.

Accepted Answer

Agents typically have ongoing relationships with their clients and work to build trust and understanding over time, while brokers are often hired for specific transactions or projects and then move on to the next job.

Question 18

Cash-and-carry wholesalers are limited-function wholesalers that serve mostly smaller retailers with a limited assortment of products.

Accepted Answer

Cash-and-carry wholesalers typically offer a limited assortment of products and cater to smaller retailers. They often require customers to pay in cash and take the products with them at the time of purchase, hence the name "cash-and-carry."

Question 19

Frank Crimmins was driving on Interstate 85 in eastern Alabama when he noticed he was running low on gas. Frank was relieved when he found a gas station open at the next exit just 2 miles ahead. This is an example of the value place utility provides to a consumer.

Accepted Answer

Place utility refers to the convenience or ease of access to a product or service at a particular location. In this case, the gas station's location provided value or utility to Frank by being nearby and accessible when he needed it.

Question 20

A sales agent is an agent who represents the interests of the consumer in a particular territory when negotiating terms of purchases made directly from a producer.

Accepted Answer

A sales agent represents the interests of the producer, not the consumer.

Quiz 15: Distributing Products