Question 1

Widely fluctuating demand for iron could cause its manufacturer to:

Accepted Answer

Widely fluctuating demand for iron can lead manufacturers to adopt various strategies to stabilize their business and maintain profitability. This includes modifying distribution strategies to better reach markets, cutting prices to remain competitive and attract customers, changing promotional strategies to better appeal to the current demand, and diversifying into other products to reduce dependency on the volatile iron market.

Question 2

Within the business market, demand for fabricating parts and materials is:

Accepted Answer

Derived demand in the business market is a demand for a commodity, service, etc., which is a consequence of the demand for something else. In this context, the demand for fabricating parts and materials is derived from the demand for the final products that require these parts and materials for their production.

Question 3

Ezekiel Adoni, a sales trainee, has been told by his supervisor that according to the North American Industry Classification System (NAICS), his company is classified by the federal government in sector 233411. This information allows anyone interested to know what industry the company is in. How is this information useful?

Accepted Answer

The NAICS code helps potential suppliers determine if a company is a good prospect by identifying the industry it operates in.

Question 4

Which of the following purchases does NOT involve a business user?

Accepted Answer

The interior designer buying a new tablecloth for her dining room table is a personal purchase, not a business-related one, unlike the other options which are all related to enhancing or maintaining a business operation.

Question 5

The three types of _____ are new-task buying, straight rebuy, and modified rebuy.

Accepted Answer

These are known as "buy classes" in marketing, which categorize the types of purchasing situations businesses encounter. New-task buying involves a purchase decision regarding a product or service for the first time. Straight rebuy is a routine purchase of items that a business has previously bought. Modified rebuy is when a business buys goods that have been purchased previously but changes either the supplier or some element of the previous order.

Question 6

Peninsula Iron Works rebuilds band saw wheels used to cut tree trunks into lumber at a fraction of the cost of buying a new system. Since the only companies that can use the services of Peninsula are those in the timber business, Peninsula can be said to have a(n) _____ business market.

Accepted Answer

Peninsula Iron Works serves a specific industry (the timber business), which is characteristic of a vertical market. A vertical market targets the needs of a particular industry or group rather than serving a broad spectrum of industries.

Question 7

When a university buys the initial equipment needed to set up two-way video transmissions for long-distance learning classrooms, a _____ purchase occurred.

Accepted Answer

This is a new-task buying situation because the university is purchasing the equipment for the first time to set up a new capability (two-way video transmissions for long-distance learning), which involves a decision-making process that the organization has not previously undertaken.

Question 8

By definition, bourbon cannot be aged in used oak barrels. Therefore, the number of new oak barrels purchased is based on how much bourbon is fermented annually. The demand for oak barrels for fermenting bourbon is:

Accepted Answer

The demand for oak barrels for fermenting bourbon is derived because it directly depends on the production needs of bourbon. Since bourbon must be aged in new oak barrels, the demand for these barrels is a direct result of how much bourbon is being produced and aged.

Question 9

What do Kestern Wholesale Company, Costco warehouse store, Kohl's, and Dillard's department store have in common?

Accepted Answer

These entities are part of the reseller market because they purchase goods to resell them to the final consumer without significantly altering their form.

Question 10

When a business organization makes a first-time purchase of a major product that will perform some new function, this purchase will most likely be a _____ purchase.

Accepted Answer

New-task buying occurs when a business organization makes a first-time purchase of a product to perform a new function. This involves a higher level of decision-making and information gathering compared to repeat purchases.

Question 11

Which of the following statements about agribusiness is True?

Accepted Answer

Many of today's farmers are indeed engaged in precision farming, which involves the use of technology such as GPS and data analytics to improve crop yields and reduce waste, reflecting the importance of technology in modern agriculture.

Question 12

The process of creating the supply chain and loyalty within the buyer-seller relationship is hasten by the use of:

Accepted Answer

Customer Relationship Management (CRM) systems are designed to manage and maintain customer relationships, track engagements and sales, and deliver actionable data—all in one place. This helps in creating a more efficient supply chain and fosters loyalty within the buyer-seller relationship by ensuring that customer needs are met in a timely and personalized manner.

Question 13

The supply chain approach:

Accepted Answer

The supply chain approach encompasses understanding the roles of all parties involved in bringing a product to market, views marketing activities as interconnected links, is a key aspect of buyer-seller relationships, and considers how each participant in the supply chain adds value to and benefits from the final product.

Question 14

When the owner of Deutsch Kennels boards dogs, she wants them to be as comfortable as possible. That is why she is considering buying an air conditioning system for the dogs' sleeping quarters. She is in the _____ stage of the buying-decision process.

Accepted Answer

The owner is recognizing a need for an air conditioning system to ensure the dogs' comfort, which is the first stage of the buying-decision process.

Question 15

Brose, a German manufacturer, is the world's biggest producer of the components that sit inside car doors and do the job of adjusting windows, locks, wing mirrors, and hi-fi systems. Brose sells primarily to European car manufacturers. The company's CEO says the success of the company is due to the close contact it keeps with its big customers. Brose relies on _____ CRM.

Accepted Answer

Collaborative CRM focuses on close interaction and communication with customers to improve services and products, which aligns with Brose's strategy of maintaining close contact with its big customers.

Question 16

If a product being sold by several competing firms is very standardized, the best method for differentiating your firm from the others would be to:

Accepted Answer

Offering excellent before and after sale service can create a competitive advantage by enhancing customer satisfaction and loyalty, which is crucial when the product itself is very standardized.

Question 17

Caterpillar sells earthmoving equipment to mining companies, construction companies, companies that build bridges and roads, and logging companies. Therefore, it has a _____ business market.

Accepted Answer

Caterpillar has a horizontal business market because it sells its products to a wide range of industries rather than focusing on a single industry or vertical market.

Question 18

The objective of _____ is to make routine marketing operations such as sales calls, service programs, and customer support activities more efficient.

Accepted Answer

Operational CRM focuses on automating and improving customer-facing and back-office processes to enhance efficiency in marketing operations, sales, and customer service.

Question 19

Marriott Resorts and Hotels, Royal Cruise Line, and Santa Fe Railway Company are part of the _____ market.

Accepted Answer

These companies operate in the services market, offering various services such as accommodation, travel, and transportation.

Question 20

Why are negotiation periods longer for many business sales than they are for consumer transactions?

Accepted Answer

Business sales often involve multiple stakeholders and decision-makers, leading to longer negotiation periods.

Quiz 5: Business Markets and Buying Behavior