MAR 100/MECA  - MIDTERM  - Test Correction - Version A

Multiple Choice
Identify the choice that best completes the statement or answers the question.

____	1.	What does the 80/20 principle propose?
a.	Roughly 20 percent of a firm’s customers purchase 80 percent of the sales volume of the product.	
b.	Sales are equally divided among heavy, medium, and light users, but they all need slightly different products.	
c.	Roughly 50 percent of a firm’s customers purchase 80 percent of the sales volume of the product.	
d.	Roughly 80 percent of the profit comes from 20 percent of the sales.	
e.	Roughly 80 percent of a firm’s customers are repeat business.	

____	2.	Which step in the consumer decision-making process is a result of an imbalance between actual and desired states?
a.	Want recognition	
b.	Purchase	
c.	Postpurchase behavior	
d.	Need recognition	
e.	Evaluation of alternatives	

____	3.	The _____ is the unique blend of product, place, promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market.
a.	market portfolio	
b.	product mix	
c.	internal environmental mix	
d.	marketing mix	
e.	product line	

____	4.	Income, ethnic background, gender, and age are all examples of _____ segmentation bases.
a.	psychographic	
b.	demographic	
c.	socioeconomic	
d.	organizational	
e.	geodemographic	

____	5.	A group of brands resulting from an information search, from which a buyer can choose is referred to as the buyer’s:
a.	evoked set	
b.	complete set	
c.	primary set	
d.	justifiable set	
e.	inert set	

____	6.	The study of people’s vital statistics, such as age, race and ethnicity, and location, is called:
a.	ethnography	
b.	cultural sociology	
c.	ecology	
d.	psychometrics	
e.	demography	

____	7.	An external information search is especially important when:
a.	there is little risk of making an incorrect decision	
b.	buying frequently purchased, low-cost items	
c.	the cost of gathering information is high	
d.	there are high costs associated with making an incorrect decision	
e.	there is a great deal of past experience	

____	8.	When a firm serves two or more well-defined market segments with a distinct marketing mix for each, it is using a(n) _____ targeting strategy.
a.	pluralistic	
b.	multisegment	
c.	concentrated	
d.	undifferentiated	
e.	niche	

____	9.	A(n) _____ strategy entails selecting one segment of a market to target and focuses on understanding the needs, motives, and satisfactions of the members of that segment, as well as on developing a highly specialized marketing mix.
a.	market development	
b.	undifferentiated targeting	
c.	universal product	
d.	concentrated targeting	
e.	product development	

____	10.	An advantage that cannot be copied by the competition is called a(n) _____ competitive advantage.
a.	dominant	
b.	monopolistic	
c.	unique	
d.	primary	
e.	sustainable	

____	11.	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. This group is called the _____ segment of the business market.
a.	institution	
b.	government	
c.	reseller	
d.	producer	
e.	wholesaler	

____	12.	Which target marketing strategy views the market as one big market with no individual segments and thus uses a single marketing mix?
a.	Uniform	
b.	Niche	
c.	Concentrated	
d.	Undifferentiated	
e.	Multisegmented	

____	13.	Basketball is played nearly everywhere in the world and is an easily understood sport. The National Basketball Association (NBA) finals reached more than 600 million televisions in 195 countries. From this information, you should be able to infer that the NBA is:
a.	supplementing its foreign vision	
b.	implementing global marketing standardization	
c.	developing international selling schemes	
d.	implementing standard international marketing	
e.	practicing global marketing	

____	14.	Product positioning is the process of:
a.	creating the desired image of the firm’s product.	
b.	finding the right channel of distribution for a product.	
c.	competing with competitors’ products in the retailers’ stores for the best position on the shelf.	
d.	pricing the product to be at a competitive level with other brands on the market.	
e.	finding the correct location for retail outlets to sell a product category.	

____	15.	Which of the following is a type of strategic alternative that tries to increase market share among existing customers?
a.	Horizontal integration	
b.	Divestment	
c.	Vertical integration	
d.	Market penetration	
e.	Product penetration	

____	16.	When Procter & Gamble (P&G) introduced Liquid Tide to a new segment, consumers in the traditional powdered detergent segment switched to the liquid product. Rather than real sales growth, P&G simply experienced the shifting of existing customers to a new product. This exemplifies a drawback of multisegment targeting strategy called:
a.	cannibalization	
b.	selective perception	
c.	market repositioning	
d.	undifferentiation	
e.	demarketing	

____	17.	Which of the following is a means of displaying or graphing, in two or more dimensions, the location of products, brands, or groups of products in customers’ minds?
a.	Market segmentation	
b.	Product positioning	
c.	Product tracing	
d.	Perceptual mapping	
e.	Laddering	

____	18.	A(n) _____ is a group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges.
a.	target market	
b.	responsive segment	
c.	undifferentiated target	
d.	heterogeneous segment	
e.	aggregated market	

____	19.	Redbook magazine targets what it calls “Redbook jugglers,” defined as 25- to 44-year-old women who must juggle family, husband, and job. According to a Redbook ad, “She’s the product of the ‘me generation,’ the thirty-something woman who balances home, family, and career—more than any generation before her, she refuses to put her pleasures aside. She’s old enough to know what she wants, and young enough to get it.” This is an example of _____ segmentation.
a.	benefit desired and usage rate	
b.	demographic and usage rate	
c.	demographic and psychographic	
d.	geodemographic and benefit desired	
e.	benefit desired and demographic	

____	20.	With a _____, a firm produces standardized products to be sold the same way all over the world.
a.	product extension approach	
b.	culturally based marketing strategy	
c.	traditional marketing strategy	
d.	synergistic approach to marketing	
e.	global marketing standardization approach	

____	21.	The purpose of market segmentation is to:
a.	divide the market into equal size and profit regions for sales territories	
b.	group a large number of markets together, enabling a company to serve them simultaneously	
c.	enable the marketer to tailor marketing mixes to meet the needs of one or more specific groups	
d.	develop a generalized definition of the market as a whole	
e.	reduce the market down to a size the firm can handle	

____	22.	_____ is the segmenting of markets based on the region of the country or the world, market size, market density (number of people within a certain unit of land), or climate.
a.	Geographic segmentation	
b.	PRIZM segmentation	
c.	Demonstrated regionalization	
d.	Community segmentation	
e.	Geodemographic segmentation	

____	23.	The processes consumers use when making purchase decisions are called:
a.	marketing.	
b.	consumer behavior.	
c.	perceptual mapping.	
d.	consumerism.	
e.	database mining.	

____	24.	A statement of the firm’s business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions is known as a(n):
a.	environmental focus	
b.	marketing plan	
c.	portfolio matrix	
d.	business audit	
e.	mission statement	

____	25.	Miller Lite’s long-running “Great Taste...Less Filling!” advertising campaign was ranked by Advertising Age magazine as the 8th-best advertising campaign in history. Miller Lite was using _____ segmentation in this ad campaign.
a.	benefit	
b.	usage rate	
c.	geographic	
d.	demographics	
e.	psychographics	

____	26.	How can marketers reduce consumers’ cognitive dissonance?
a.	Change the product	
b.	Offer guarantees	
c.	Offer sales promotions	
d.	Ignore it	
e.	Avoid contradictory information	

____	27.	Technol Medical Products makes specialty face masks to shield healthcare workers from infection. Because it focuses on this narrow market, it is able to outsell its primary competitors––3M and Johnson & Johnson. Technol has a(n):
a.	heterogeneous target marketing strategy	
b.	niche competitive advantage	
c.	cost competitive advantage	
d.	aggregated positioning strategy	
e.	demarketing focus	

____	28.	Business buyers use a variety of criteria to evaluate alternative products and suppliers. The three most important criteria, in order of importance, are:
a.	reputation, price, and capability.	
b.	quality, service, and price.	
c.	price, delivery time, and product reliability.	
d.	service, quality, and reputation.	
e.	price, sales support, and service.	

____	29.	When IKEA, the Swedish home furnishings retailer, first entered the Japanese market, it failed. It was more successful in its second try because it was aware of the need to adapt its furnishings to fit the smaller Japanese homes. It success on its second foray into Japan was based on its ability to give the Japanese consumer what he or she needed without abandoning its product strategy. IKEA had to adopt a _____ strategy.
a.	product adaptation	
b.	product invention	
c.	market differentiation	
d.	message adaptation	
e.	product substitution	

____	30.	Alanna is looking into purchasing a scooter as gas prices continue to rise. She needs a reasonably priced, comfortable, and safe scooter with room to store her books. She is not familiar with scooters, and this is a major purchase for her. The purchase will probably involve:
a.	low-involvement decision making	
b.	low-involvement problem solving	
c.	dedicated cognitive behavior	
d.	limited decision making	
e.	extensive decision making	

____	31.	Walmart realizes a _____ using its relationships with suppliers to give customers low prices and good customer service.
a.	marketing competitive advantage	
b.	synergistic competitive advantage	
c.	niche competitive advantage	
d.	cost competitive advantage	
e.	brand name strategy	

____	32.	The SWOT acronym refers to a firm’s analysis of its:
a.	strategies, willingness to change, objectives, and trends	
b.	situations, wealth, organizational strengths, and target markets	
c.	service levels, willingness to spend, organizational culture, and total revenues	
d.	strengths, weaknesses, opportunities, and threats	
e.	sales, width of product mix, observations, and technology	

____	33.	The Southern Company is the largest provider of utilities in the southeastern United States. It has also been accused of being the biggest source of industrial air pollution in the area. Southern is trying to change consumers’ perceptions of the company by sponsoring a series of television programs on how to preserve our environment. The Southern Company is hoping the programming will lead to:
a.	demarketing	
b.	undifferentiated targeting	
c.	one-to-one marketing	
d.	reengineering	
e.	repositioning	

____	34.	Kraft introduced Philadelphia Ready-To-Eat Cheesecake Filling for those who do not have time to make cheesecake in the traditional manner. This is an example of a _____ strategy.
a.	product penetration	
b.	diversification	
c.	divestment	
d.	market development	
e.	product development	

____	35.	The company that manufactures Molson beer, which is typically consumed by males, launched an alcoholic lemonade beverage to attract more females. This launch of a new product to attract a new market for Molson’s products is an illustration of a _____ strategy.
a.	market penetration	
b.	product development	
c.	product penetration	
d.	market development	
e.	diversification	

MAR 100/MECA  - MIDTERM  - Test Correction - Version A
Answer Section

MULTIPLE CHOICE

	1.	ANS:	A
The 80/20 principle proposes that a minority of a firm’s customers purchase a majority of the volume of the product.

OBJ:	08-4

	2.	ANS:	D
Need recognition is the result of an imbalance between actual and desired states.

OBJ:	06-2

	3.	ANS:	D
This is the definition of a marketing mix.

REF:	25	OBJ:	02-9

	4.	ANS:	B
These are demographic characteristics of consumers.

OBJ:	08-4

	5.	ANS:	A
A buyer’s evoked set is the set of alternatives from which a buyer can choose; also called consideration set.

OBJ:	06-2

	6.	ANS:	E
This is the definition of demography.

OBJ:	04-3

	7.	ANS:	D
If a consumer perceives a purchase to involve high risk (financial, social, etc.), an external search will lower the risk by providing more information.

OBJ:	06-2

	8.	ANS:	B
A firm that chooses to serve two or more well-defined market segments and develops a distinct marketing mix for each has a multisegment targeting strategy.

OBJ:	08-7

	9.	ANS:	D
Concentrated targeting strategy selects one segment of a market for targeting marketing efforts.

OBJ:	08-7

	10.	ANS:	E
This is the definition of a sustainable competitive advantage.

OBJ:	02-6

	11.	ANS:	D
This describes the producer segment of business customers.

OBJ:	07-4

	12.	ANS:	D
A firm using an undifferentiated targeting strategy essentially adopts a mass-market philosophy, viewing the market as one big market with no individual segments.

OBJ:	08-7

	13.	ANS:	E
Global marketing targets markets throughout the world.

OBJ:	05-1

	14.	ANS:	A
Positioning is developing a specific marketing mix to influence potential customers’ overall perception of a brand, product line, or organization in general.

OBJ:	08-9

	15.	ANS:	D	OBJ:	02-3

	16.	ANS:	A
Cannibalization occurs when sales of a new product cut into sales of a firm’s existing products.

OBJ:	08-7

	17.	ANS:	D
This is the definition of perceptual mapping.

REF:	143	OBJ:	08-9

	18.	ANS:	A
This is the definition of a target market.

OBJ:	08-7

	19.	ANS:	C
Thirty-something women indicate demographic segmentation. The juggling act describes her lifestyle, which would represent psychographic segmentation.

OBJ:	08-4

	20.	ANS:	E
Global marketing standardization is the production of uniform products that can be sold the same way all over the world.

OBJ:	05-2

	21.	ANS:	C
The purpose of segmentation is to group similar consumers and to serve their needs with a specialized marketing mix.

OBJ:	08-1

	22.	ANS:	A
This is the definition of geographic segmentation.

OBJ:	08-4

	23.	ANS:	B
Consumer behavior describes how consumers make purchase decisions.

OBJ:	06-1

	24.	ANS:	E
This is the definition of a mission statement, which answers the question, “What business are we in?”

OBJ:	02-4

	25.	ANS:	A
Benefit segmentation groups customers into market segments according to the benefits they seek from the product.

OBJ:	08-4

	26.	ANS:	B
Cognitive dissonance is an inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions, and marketers can reduce it by sending a postpurchase thank you or letter, displaying product superiority in ads, or offering guarantees.

OBJ:	06-3

	27.	ANS:	B
A niche competitive advantage is the advantage achieved when a firm seeks to target and effectively serve a small segment of the market.

OBJ:	02-6

	28.	ANS:	B
The three criteria, in order of importance, are quality, service, and price.

OBJ:	07-8

	29.	ANS:	A
Product adaptation is the slight alteration of the basic product (in this case, making it smaller.)

OBJ:	05-5

	30.	ANS:	E
Customers practice extensive decision making when purchasing an unfamiliar and expensive or infrequently used product.

OBJ:	06-4

	31.	ANS:	D
Having a cost competitive advantage means being the low-cost competitor in an industry while maintaining satisfactory profit margins.

OBJ:	02-6

	32.	ANS:	D
SWOT stands for strengths, weaknesses, opportunities, and threats.

OBJ:	02-5

	33.	ANS:	E
Repositioning means changing the customers’ perception of a brand in relation to competing brands.

OBJ:	08-9

	34.	ANS:	E
A product development strategy entails the creation of a new product for existing markets.

OBJ:	02-3

	35.	ANS:	E
Diversification is a strategy of increasing sales by introducing new products into new markets.

OBJ:	02-3