Chapter 6 Understand Consumer and Business Markets 1) The process that individuals or groups go through to select, purchase, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires is known as ________. A) the consumer decision-making process B) the family life cycle C) cognitive dissonance D) consumer behavior E) extended problem solving Answer: D 2) Consumer behavior is best described as a(n) ________ process. A) impersonal B) subliminal C) ongoing D) affective E) cognitive Answer: C 3) When using ________, a consumer exerts little effort in making a purchase decision. A) habitual decision making B) extended problem solving C) independent heuristic rating D) dependent heuristic rating E) limited problem solving Answer: A 4) A consumer purchase decision made with a great deal of consumer effort is a type of ________. A) habitual decision making B) extended problem solving C) independent heuristic rating D) dependent heuristic rating E) limited problem solving Answer: B 5) A purchase decision made with some but not extensive effort is classified as ________. A) habitual decision making B) extended problem solving C) independent heuristic rating D) dependent heuristic rating E) limited problem solving Answer: E 6) The consumer's ________ determines whether she will engage in habitual decision making, extended problem solving, or something in between the two. A) need for customization B) level of involvement C) need for cognitive dissonance D) ability to generalize stimuli E) personal marketing mix Answer: B 7) The greater the ________ of a purchase, the higher the consumer's level of involvement will be. A) perceived risk B) cognitive dissonance C) psychographics D) heuristics E) targeting Answer: A 8) A consumer who is considering purchasing a house would probably use ________. A) habitual decision making B) stimulus generalization C) operant decision making D) limited problem solving E) extended problem solving Answer: E 9) Which of the following accurately identifies a difference between habitual decision making and extended problem solving? A) Extended problem solving uses behavioral learning, while habitual decision making relies upon cognitive learning. B) Consumers engaged in extended problem solving perceive less risk than consumers involved in habitual decision making. C) The level of involvement for habitual decision making is lower than it is for extended problem solving. D) Habitual decision making involves significant cognitive dissonance, while extended problem solving rarely involves cognitive dissonance. E) Consumers who are seeking to develop their loyalty to a brand would be more likely to make habitual decisions than use extended problem solving. Answer: C 10) ________ occurs whenever a consumer sees a significant difference between his current state of affairs and some desired or ideal state. A) Perceived risk B) Problem recognition C) Problem solving D) Learning E) Lifestyle change Answer: B 11) ________ is the step of the decision-making process in which the consumer checks her memory and surveys the environment to identify what options might solve her problem. A) Product evaluation B) Behavioral targeting C) Problem recognition D) Problem screening E) Information search Answer: E 12) Marketers use ________ to identify which key words consumers use most in their searches and then edit their site's content to increase its relevance to those words. A) shop bots B) heuristics C) search engine optimization D) search engine marketing E) sponsored search ads Answer: C 13) Using ________, a search engine company charges marketers to display sponsored search ads. A) shop bots B) heuristics C) search engine optimization D) search engine marketing E) psychographics Answer: D 14) ________ are Web applications that can help online shoppers find what they are looking for at the lowest available price. A) Shopbots B) Heuristics C) Search engine optimizers D) Search engine marketers E) Behavioral targeters Answer: A 15) A consumer who is armed with information and is narrowing down his choices by comparing the pros and cons of each remaining option is in the ________ step of the consumer decision-making process. A) problem recognition B) information search C) evaluation of alternatives D) product choice E) post purchase evaluation Answer: C 16) A consumer identifies evaluative criteria during the ________ step of the consumer decision-making process. A) problem recognition B) information search C) evaluation of alternatives D) product choice E) post purchase evaluation Answer: C 17) Consumers often rely on decision guidelines, or mental rules of thumb, when weighing the merits of competing brands. These rules are referred to as ________. A) evaluative criteria B) attitudes C) affects D) heuristics E) cognitions Answer: D 18) Brand loyalty in the product choice step of the consumer decision-making process is an example of a ________. A) psychographic B) consumer expectation C) cognitive dissonance D) heuristic E) behavioral target Answer: D 19) Consumer satisfaction/dissatisfaction is part of the ________ step of the consumer decision-making process. A) problem recognition B) information search C) evaluation of alternatives D) product choice E) post purchase evaluation Answer: E 20) When a consumer is determining her overall feelings or attitudes about a product after purchasing it, she is involved in the ________ step of the consumer decision-making process. A) problem recognition B) information search C) evaluation of alternatives D) product choice E) post purchase evaluation Answer: E 21) Customer satisfaction with a purchase is based on which of the following? A) how the perceived risk of purchasing the product compares to the actual risk B) how the actual performance of the product compares to customer expectation of performance C) how the product's brand personality aligns with the customer's personality D) the service provided with the purchase E) the total cost of the purchase Answer: B 22) When a customer feels regret after purchasing a product, she is experiencing ________. A) psychography B) a heuristic C) an operant reaction D) cognitive dissonance E) a conditioned response Answer: D 23) The three main categories of influences that affect the consumer decision-making process are ________. A) physical, emotional, and behavioral B) internal, situational, and social C) environmental, familial, and sociocultural D) sociocultural, behavioral, and external E) environmental, personal, and sociocultural Answer: B 24) The invitation to go skiing for the weekend forced Donna to look at her current wardrobe. She decided she needed a much warmer coat. Donna was in which stage of the purchase decision? A) product evaluation B) situational analysis C) problem recognition D) problem screening E) information search Answer: C 25) When Tom wanted to buy a new gas grill, he searched for grills on the Internet. He was able to gather information on grills and learn what features were available. Tom used the Internet during the ________ stage of his purchase decision. A) product choice B) evaluation of alternatives C) problem recognition D) problem screening E) information search Answer: E 26) To determine the best price for a first edition copy of a Stephen King novel with a dust jacket in mint condition, Jason would most likely use a ________ to provide him with pricing information from all the bookstores that currently have the requested book in stock. A) shop bot B) behavioral targeter C) search engine optimizer D) sponsored search ad E) search engine marketer Answer: A 27) Robert has taken up bicycle riding as a hobby and as a way to maintain his physical stamina. He understands he will need to make sure he gets adequate water when he is bike riding, so he wants to buy a hydration system. Having gathered a great deal of information, he has decided to compare three systems: Waterbags for Roadies, Supertanker Hydropacks, and Fast Water. Robert is in the ________ stage of his purchase decision. A) problem recognition B) evaluation of alternatives C) product choice D) post purchase evaluation E) information choice Answer: B 28) Pat thought he had received the best deal on his new car. Shortly after the purchase, Pat started to notice certain disadvantages of his new car as he learned more about other cars. Pat was experiencing ________. A) perceived risk B) multitasking C) cognitive dissonance D) sensory marketing E) consumerism Answer: C 29) High-involvement purchase decisions likely involve extended problem solving. Answer: True 30) Purchase decision making usually begins with information search and then moves to evaluation of alternatives. Answer: False 31) Marketers can have little to no effect on the evaluative criteria consumers use. Answer: False 32) The belief that a high price for a product means high product quality is an example of a heuristic. Answer: True 33) Heuristics can be used to explain why Madelyn always buys a specific brand of deodorant and why Ralph always buys whatever brand he happens to see first. Answer: True 34) What is consumer behavior? Give examples of the types of questions about consumer behavior that marketers investigate. Answer: Consumer behavior is the process individuals or groups go through to select, purchase, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires. Consumers use a decision-making process involving a number of steps, and they are influenced by a variety of factors when selecting and using products. Consumer behavior is an ongoing process. Marketers are interested in understanding where consumers buy, what they buy, and when they buy. Marketers are also interested in knowing how and when consumers actually use their products. Marketers also need to understand the internal and external factors that influence each step in the consumer decision-making process. 35) Briefly describe each step in the consumer decision-making process. Answer: The steps in the consumer decision-making process are problem recognition, information search, evaluation of alternatives, product choice, and post purchase evaluation. In the problem recognition step, a consumer realizes that there is a significant difference between her current state and a desired state. To solve this problem, she begins the process of deciding on a purchase to achieve that desired state. Once she has recognized a problem, the consumer will conduct an information search, checking her memory and the environment to identify options that might solve her problem. After gathering the product information, the consumer will identify the products that interest her and then narrow down her choices by evaluating the pros and cons of each remaining option. The next step is the actual product choice and purchase. After purchasing the product, the consumer will have some level of satisfaction or dissatisfaction with the product, which is her post purchase evaluation. 36) How do heuristics affect a consumer's decision-making process? Give two examples of heuristics you might use when shopping. Answer: Hueristics are decision guidelines, or mental rules of thumb, that help consumers evaluate the merits of competing brand claims. The more heuristics a consumer has, the easier the consumer decision-making process is. For example, if you know that a particular brand of jeans always fits just right, then you will not spend time looking at other brands. Brand loyalty is the most commonly used heuristic. Other common heuristics include country-of-origin preferences and "price = quality." 37) How does a television commercial about a company that will help a person lose weight attempt to influence the problem recognition phase of the consumer decision-making process? Explain your answer. Answer: Problem recognition occurs when a consumer recognizes that his current state is not his desired state. A television viewer may watch this commercial and decide that he wants to look more like the person in the commercial, thus recognizing there is a gap between his current state and his desired state. 38) Explain the role of marketers in the information search step of the consumer decision-making process. Give an example of how the marketer might execute this role. Answer: The role of marketers in the information search step of the consumer decision-making process is to make the information consumers want and need about their product easily accessible. Student examples will vary. 39) Discuss how marketers may be able to reduce post purchase cognitive dissonance. Answer: Marketers should try to improve after-sale communications, providing evidence and support to help consumers feel good about their purchases. 40) ________ is the process by which people select, organize, and interpret information from the outside world. A) Perception B) Learning C) Attention D) Motivation E) Cognition Answer: A 41) Which of the following statements about perception is true? A) Perception is a sociocultural influence on consumer purchase decisions. B) Perception is unrelated to any sense other than sight. C) If a marketer can reach a consumer with a message, then the marketer knows the consumer will interpret it correctly. D) There is no perception without exposure. E) Research shows that subliminal messages are just as likely to be perceived as any other type of message. Answer: D 42) Some consumers worry that they will be affected by marketing messages without even knowing it. They are concerned about ________ advertising. A) alternative evaluation B) subliminal C) perceptual D) innovative E) comparative Answer: B 43) Which of the following refers to the extent to which a person devotes mental-processing activity to a particular stimulus? A) cognition B) attention C) affect D) interpretation E) exposure Answer: B 44) Which of the following refers to the process of assigning meaning to a stimulus? A) cognition B) attention C) affect D) interpretation E) exposure Answer: D 45) ________ is an internal state that drives consumers to satisfy needs. A) Motivation B) Interpretation C) Learning D) Affect E) Conditioning Answer: A 46) Which of the following is the lowest level of needs on Maslow's hierarchy of needs? A) social needs B) ego needs C) physiological needs D) self-actualization needs E) belongingness needs Answer: C 47) Learning is ________. A) an internal state that drives us to satisfy needs B) the process by which people select, organize, and interpret information from the outside world C) a change in behavior caused by information or experience D) a lasting evaluation of a person, object, or issue E) the set of unique psychological characteristics that consistently influence the way a person responds to situations in the environment Answer: C 48) Through ________, a person repeatedly perceives two stimuli at the same time and eventually transfers his response from one stimulus to the other. A) classical conditioning B) operant conditioning C) cognitive conditioning D) information searching E) observational learning Answer: A 49) ________ occurs when people learn that their actions result in rewards or punishments. A) Classical conditioning B) Operant conditioning C) Cognitive conditioning D) Information searching E) Observational learning Answer: B 50) Cognitive learning theories assume that ________. A) learning occurs when people realize their actions result in rewards or punishments B) learning takes place as the result of connections we form between events C) the most important component of learning is directed by cognition D) people are problem solvers who do more than passively react to associations between stimuli E) the individual takes a passive role during the learning process Answer: D 51) An attitude is ________. A) an internal state that drives us to satisfy needs B) the process by which people select, organize, and interpret information from the outside world C) a change in behavior caused by information or experience D) a lasting evaluation of a person, object, or issue E) the set of unique psychological characteristics that consistently influence the way a person responds to situations in the environment Answer: D 52) A person's attitude has three components: ________. A) affect, cognition, and behavior B) psychological, physiological, and situational C) situation, emotion, and environment D) cognitive, operant, and situational E) ritual, cultural, and referential Answer: A 53) ________ is the feeling component of attitudes. A) Affect B) Cognition C) Behavior D) Motivation E) Personality Answer: A 54) ________ is the knowing component of attitudes. It is the beliefs or knowledge a person has about a product and its important characteristics. A) Affect B) Cognition C) Behavior D) Motivation E) Personality Answer: B 55) Personality is ________. A) an internal state that drives us to satisfy needs B) the process by which people select, organize, and interpret information from the outside world C) a change in behavior caused by information or experience D) a lasting evaluation of a person, object, or issue E) the set of unique psychological characteristics that consistently influence the way a person responds to situations in the environment Answer: E 56) A person's ________ is composed of a mixture of his beliefs about his abilities and observations of his own behavior and feelings (both positive and negative). A) personality B) self-concept C) lifestyle D) attitude E) cognition Answer: B 57) ________ refers to how positive a person's ________ is. A) Personality; psychography B) Affect; attitude C) Attitude; affect D) Self-concept; self-esteem E) Self-esteem; self concept Answer: E 58) AIO stands for ________. A) activities, interests, and opinions B) abilities, interests, and opinions C) activities, interests, and organization memberships D) abilities, income, and opinions E) activities, income, and opinions Answer: A 59) Juana looked at her September issue of O magazine and did not see anything of interest. However, after her mother was diagnosed with bipolar disorder, Juana found the issue extremely interesting because it offered advice on how to help people who are suffering from this problem. The fact that the boring issue became quite interesting is most directly due to a change in Juana's ________. A) exposure B) cultural values C) attention D) personality E) self-concept Answer: C 60) McDonald's placement of a small toy in each Happy Meal as a reward for coming to the fast-food restaurant and ordering its food is based on which theory of learning? A) operant conditioning B) cognitive dissonance C) cognitive learning D) classical conditioning E) observational learning Answer: A 61) Beautiful actresses appear in ads testifying to the quality of a brand of hair coloring products. This is an application of which learning theory? A) operant conditioning B) cognitive dissonance C) hierarchy of needs D) classical conditioning E) observational learning Answer: E 62) A marketer of hair care products targeted at African American women created an advertising message that told the women their hair could be worn any way they wanted, not just straight. The message suggested the women did not need to conform to the mainstream media definition of beauty. It is most accurate to say that this ad was based on an understanding of ________. A) social class B) the family life cycle C) self-concept D) lifestyle E) sensory marketing Answer: C 63) There is a trend in the United States toward rediscovering the flavor of regional cooking and the use of locally grown ingredients. People are choosing to spend hours in the kitchen using only the freshest ingredients to recreate culinary traditions. This change in ________ is one of the reasons the number of farmers markets in the United States has increased by 70 percent in the last eight years. A) the family life cycle B) lifestyles C) demographics D) personality E) social class Answer: B 64) Perception is an example of an internal influence on the consumer decision-making process. Answer: True 65) Because there is substantial evidence that subliminal advertising is effective, many media companies reject any advertising that contains subliminal messages. Answer: False 66) According to Maslow's hierarchy of needs, a person is concerned with fulfilling basic physiological needs before he is concerned with fulfilling social or psychological needs. Answer: True 67) In a laboratory experiment, a rat in a maze learns the quickest route to a piece of cheese after several attempts. This is an example of observational learning. Answer: False 68) When an insurance company tailors its promotional messages to show how its products protect people from being devastated by a natural disaster or an accident, the company is appealing to a higher level need on Maslow's hierarchy of needs. Answer: False 69) The cognition component of a person's attitude would typically be more influential than the affect component for purchases such as scented candles, bath salts, and luxurious towels. Answer: False 70) Describe the process of perception and discuss how marketers can influence each component of the perception process. Answer: Perception is the process by which people select, organize, and interpret information from the outside world. The three components of perception are exposure, attention, and interpretation. Exposure is the extent to which a person's sensory receptors—eyes, ears, nose, mouth, and skin—are capable of registering a stimulus. Attention is the extent to which we devote mental-processing activity to a marketing stimulus. We do not attend to every stimulus to which we are exposed. Interpretation is the process of assigning meaning to a stimulus based on prior associations and assumptions. Marketers should present their messages in media that increase consumer exposures and that increase the likelihood of consumer attention. Because consumers may not interpret messages in the way marketers intended, marketers should take care to avoid content that would lead to possible misinterpretations. 71) In a marketing context, a person's attitude has three components. What are these components? List and briefly describe each in the context of marketing. Answer: The three components of attitude are affect, cognition, and behavior. Affect is the feeling component of attitudes, the overall emotional response a person has to a product. Cognition is the knowing component, or the belief and knowledge a person has about the product. Behavior is the doing component, which involves a person taking action by deciding to buy or use the product. Affect is usually the dominant attitude factor for decisions involving expressive products, such as perfume or clothing. Cognition is usually the dominant attitude factor for decisions involving complex products, such as cameras or laptops. 72) Which internal influence on consumer behavior most likely explains why so many ads contain puppies, kittens, and small children that have nothing to do with the product? Explain your answer. Answer: These are examples of classical conditioning, through which a person perceives two stimuli (the product and the puppy, the kitten, or the child) at about the same time. The marketer is hoping the person has a positive response to the puppy, kitten, or child and transfers this positive response to the product. 73) People's moods and behaviors are strongly influenced by their physical surrounding. Two dimensions, ________, determine whether a shopper will react positively or negatively to a store environment. A) color and size B) size and activity C) arousal and pleasure D) perceived risk and level of involvement E) motivation and self-concept Answer: C 74) ________ is made up of the values, beliefs, customs, and tastes produced or practiced by a group of people. A) The family life cycle B) Culture C) Lifestyle D) Psychographic data E) Social class Answer: B 75) A group coexisting with other groups in a larger culture whose members share a distinctive set of beliefs or characteristics is a ________. A) target market B) market segment C) social class D) subculture E) lifestyle Answer: D 76) ________ is the overall rank of people in a society. A) The family life cycle B) Mass-class C) Subculture D) Microculture E) Social class Answer: E 77) There are people who have similar income and education levels and often share tastes in clothing, decorating styles, and leisure activities. These people also share many political and religious beliefs as well as ideas regarding valued activities and goals. These people could all be categorized as being in the same ________. A) family life cycle B) social class C) regional group D) operant conditioning set E) microculture Answer: B 78) Which of the following refers to the hundreds of millions of global consumers who now have a level of purchasing power that allows them to afford high-quality products offered by multinational companies? A) reference group B) social class C) mass-class D) green market E) microculture Answer: C 79) ________ serve as visible markers to flaunt membership in higher social classes. A) Heuristics B) Psychographics C) Status symbols D) Reference groups E) Attitudes Answer: C 80) A ________ is a set of people a consumer wants to please or imitate. A) culture group B) family lifestyle group C) perception group D) reference group E) social class group Answer: D 81) ________ often influence others' attitudes or behaviors because others perceive them as possessing expertise about a product. A) Opinion leaders B) Status symbols C) Heuristics D) Reference groups E) Social classes Answer: A 82) Some expectations regarding appropriate attitudes, behaviors, and appearances for men and women come from society's strong pressure to conform to ________. A) social classes B) gender roles C) cognitive dissonance D) microcultures E) the family life cycle Answer: B 83) Jane's aunt wants a cashmere blanket to put over her legs when she watches television from her favorite chair. Jane could drive 50 miles and pay $90 for the blanket, or she could order one off the Internet for $168. Because Jane works fifty hours a week, cares for three children, and tries to help her aunt, she opts to buy the blanket on the Internet. This is an example of how ________ influences the consumer decision-making process. A) a microculture B) an opinion leader C) a reference group D) time E) learning Answer: D 84) Easy Spirit uses ads featuring a country music singer with the hope that her fans will see her wearing Easy Spirit shoes and want to wear the same shoes she wears. Easy Spirit is hoping the singer's fans view her as a ________. A) steward B) status symbol C) heuristic D) reference group E) microculture Answer: D 85) The founder of the upscale shoe company Harry's Shoes Ltd. persuaded actors to wear prototypes of his company's shoes to the Oscars. This shoe company believed that the actors would be ________ for the company. A) opinion leaders B) heuristics C) mass-classes D) stewards E) subcultures Answer: A 86) According to ________, men are not supposed to like movies that are described as "chick flicks," and women are not supposed to like movies that emphasize violence and destruction. A) social classes B) gender roles C) subcultures D) situational influences E) reference groups Answer: B 87) Culture is society's personality. Answer: True 88) Microcultures are groups of consumers who identify with a specific activity or art form. Answer: True 89) Opinion leaders influence younger consumers but usually have little or no effect on adults seeking to make a major purchase. Answer: False 90) A belief that your family is more important than your job is an example of a cultural value. Answer: True 91) For marketers, racial and ethnic subcultures are less important than more easily defined microcultures such as avid Green Bay Packers fans or devotees of Southern gospel music. Answer: False 92) Social factors exert a broad and deep influence on consumer behavior. The marketer needs to understand the role played by the buyer's culture, subculture, and social class. Compare the roles of culture, subculture, and social class. Answer: Culture is made up of the values, beliefs, customs, and tastes a group of people produce or practice. Each culture contains smaller subcultures, or groups of people who share a distinctive set of beliefs or characteristics. Many racial and ethnic subcultures make up important markets. Social classes are the overall rankings of people in a society. Members of a social class share similar education and income levels, and often have similar values, interests, and behaviors. 93) How have marketers responded to an increasing sense of time poverty among consumers? Answer: More and more people feel pressed for time and look for products and services that help them save time. In response, marketers offer services such as online shopping and express lines at supermarkets. 94) What is the difference between a subculture and a microculture? Answer: A subculture is broader than a microculture. A subculture is a group within a larger culture whose members share a distinctive set of beliefs or characteristics, while a microculture is a smaller group whose members identify with a specific activity or art form. 95) Many students in a high school wear the same style of shoes to school. From the marketing perspective, why are these students conforming to a similar style? Answer: Consumers often change their behavior to gain acceptance into a particular reference group. Students in this junior high school may want to feel as if they are the same as their fellow classmates, so they will wear the same style of shoes to be part of the group. 96) In what way might a marketer rely on opinion leaders? Answer: Opinion leaders can influence other larger groups of consumers to be attracted to a marketer's products. 97) ________ is the marketing of goods and services that businesses and other organizations buy for purposes other than personal consumption. A) Business-to-business marketing B) Just in time (JIT) marketing C) Single sourcing D) Retailing E) Outsourcing Answer: A 98) Business-to-business marketing differs from consumer marketing in that business-to-business marketing ________. A) is targeted at many individual and household customers B) relies upon frequent impulse purchases C) emphasizes advertising more than any other element of the promotion mix D) typically involves competitive bidding and price negotiations E) usually has one person involved in purchase decisions Answer: D 99) Organizational markets differ from consumer markets in that organizational markets ________. A) have a high number of purchases that are low risk and low cost B) have derived demand C) are not geographically concentrated D) have a single individual in the role of decision maker E) involve more frequent purchases Answer: B 100) Which of the following statements about organizational markets is true? A) The average purchase size in organizational markets is much smaller than the average purchase size in the consumer market. B) Demand for products in the organizational market is derived from demand for consumer products. C) Most demand for organizational markets is fixed. D) Organizational marketers have a broad customer base and a large number of buyers. E) Joint demand is not a factor. Answer: B 101) ________ purchases are much greater than ________ purchases, both in the quantity of items ordered and how much they cost. A) Business; consumer B) Organizational; institutional C) Online; offline D) Not-for-profit; for-profit E) Joint; derived Answer: A 102) Most demand for business-to-business products is ________. A) derived, inelastic, fluctuating, and joint B) derived, elastic, fixed, and joint C) derived, inelastic, static, and dependent on the macroenvironment D) independent of all consumer market influences E) competitive, derived, fluctuating, and elastic Answer: A 103) The success of one company in one industry may depend on another company in a different industry. This dependence creates ________. A) inelastic demand B) value-added demand C) derived demand D) micro-dependent demand E) elasticity Answer: C 104) When a product has ________ demand, an increase or decrease in the price of the product has little or no effect on the demand for the product. A) elastic B) joint C) derived D) inelastic E) fixed Answer: D 105) One year many customers' machinery wears out and needs to be replaced. The following year no customers need new machinery. This is an example of ________ demand. A) inelastic B) fluctuating C) elastic D) consumer E) static Answer: B 106) ________ occurs when two or more goods are necessary to create a product. A) Inelastic demand B) Fluctuating demand C) Joint demand D) Elastic demand E) Economic demand Answer: C 107) The major categories of business-to-business customers are ________. A) producers, retailers, and consumers B) resellers and governments C) organizations, producers, and manufacturers D) producers, resellers, and organizations E) consumers and retailers Answer: D 108) ________ do not actually produce goods, but they do provide their customers with time, place, and possession utility by making goods available when and where consumers want them. A) Resellers B) End users C) Not-for-profit organizations D) Producers E) Buying centers Answer: A 109) Which of the following make up the largest single business and organizational market in the United States? A) raw material markets B) producer markets C) not-for-profit markets D) e-commerce markets E) government markets Answer: E 110) Many businesses today are abandoning traditional business attire and allowing their employees to come to work in business casual that typically does not include ties, cufflinks, or business suits. There has been a decrease in the sale of silk ties as a result of this cultural trend. A decrease in consumer demand for silk ties has led to a decrease in demand for silk because the demand for silk is ________. A) independent B) micro-dependent C) derived D) inelastic E) fixed Answer: C 111) A Miami restaurant has created atmosphere through its subtle use of blue and green lighting, ceiling fans over each table, and frozen drinks. If its electrical energy supplier raises its prices, the restaurant will most likely ________. A) continue its present operation because it has an elastic demand for electricity B) ask other Miami restaurants to create a derived demand for cheaper electricity C) decide to find other ways to use electricity D) continue its present operation because it has an inelastic demand for electricity E) remove its lighting, turn off its fans, and economize on its use of electricity Answer: D 112) In terms of organizational markets, discount stores are examples of ________. A) resellers B) re-suppliers C) not-for-profit markets D) producers E) facilitating agents Answer: A 113) Aeroxchange.com was founded by 13 airline companies as a Web site where the companies could purchase all the goods and services for their operations, excluding aircraft and fuel. Selected suppliers were invited to partner with these airlines at this site. Items that are traded through Aeroxchange include a wide range of airline-specific products and services, such as engine components and maintenance. Aeroxchange is an example of a(n) ________. A) Web link B) search engine C) intranet D) private exchange E) crowdsource Answer: D 114) Business marketers have a broader customer base and a larger number of buyers compared to consumer marketers. Answer: False 115) Business markets tend to be more geographically concentrated than consumer markets. Answer: True 116) Fluctuating demand in business markets can be partially explained by the infrequency of the purchases. Answer: True 117) PPG Industries is a producer of glass for windows. It likely sells its products in the consumer market. Answer: False 118) How are consumer demand and business-to-business demand of goods and services related? Answer: Consumer demand is based on a direct connection between a need and the satisfaction of that need. Business customers do not purchase goods and services to satisfy their own needs. Business-to-business demand is derived demand because a business's demand for goods and services comes either directly or indirectly from the consumers' demand. Therefore, in each purchasing decision, the consumers' demand is important. 119) What is the difference between producers and resellers? Answer: Producers purchase products for the production of other goods and services that they in turn sell to make a profit, while resellers buy finished goods for the purpose of reselling, renting, or leasing to other businesses. Resellers do not produce goods but do provide time, place, and possession utility to their customers. 120) A ________ identifies the degree of effort required of the firm's personnel to collect information and make a purchase decision. A) needs hierarchy B) purchase continuum C) buy class framework D) buying center continuum E) need-response framework Answer: C 121) A new-task buy ________. A) requires less time and effort than a modified rebuy B) cannot be used if the buyer uses single sourcing C) is characterized by uncertainty and high risk D) is similar to routine decision making in the consumer market E) begins with a SWOT analysis Answer: C 122) The group of people in the organization who participate in the purchase decision-making process is referred to as the ________. A) gatekeeper B) resource center C) buying center D) purchasing hierarchy E) purchasing office Answer: C 123) Which of the following statements about buying centers is true? A) The buying center is like a standing committee. B) The buying center roles are specified on the organizational chart. C) The most commonly found buying center has six employees, one to assume each of the buying center's roles. D) An individual's role in the buying center does not change. E) The members of a buying center typically participate in a cross-functional team. Answer: E 124) The ________ is the member of the buying center who controls the flow of information to other members. A) initiator B) gatekeeper C) decider D) user E) influencer Answer: B 125) Which member of the buying center typically has the most power? A) buyer B) gatekeeper C) decider D) initiator E) influencer Answer: C 126) The ________ is the member of the buying center whose primary function is handling the details of the transaction. A) buyer B) gatekeeper C) decider D) initiator E) influencer Answer: A 127) When a business needs to make a complex purchase, it is most likely to form a buying center during the ________ stage of the business buying decision process. A) problem recognition B) vendor analysis C) information search D) supplier selection E) alternative evaluation Answer: A 128) What is the next step in the business buying decision process after the product specifications are written? A) obtain written or verbal bids B) evaluate alternatives C) scan trade publications D) evaluate vendors E) set price ceiling Answer: A 129) Which of the following is an advantage of using single sourcing? A) Suppliers are more likely to remain cost-competitive. B) Buyers are less reliant on one firm to deliver the needed goods without interruption. C) The buyer and seller agree to be each other's customers. D) Consistency of quality of materials input into the product process is greater. E) Buyers have other suppliers to fall back on if one supplier fails. Answer: D 130) Sometimes supplier selection is based on ________, which means a buyer and a seller agree to purchase each other's goods and services even though the terms of the sales may not be the best available. A) requisition B) reciprocity C) customer references D) outsourcing E) reverse marketing Answer: B 131) ________ is a business practice in which a buyer shapes a supplier's products and operations to satisfy its needs. A) Reciprocity B) Functionalization C) Reverse marketing D) Bottom-up marketing E) Crowdsourcing Answer: C 132) Which of the following is the simplest form of B2B e-commerce? A) online catalogs B) reciprocal sites C) intranets D) extranets E) private exchanges Answer: A 133) A company uses a(n) ________ to allow certain suppliers, customers, and others outside the organization to access its internal system. A) corporate Web site B) search engine C) extranet D) private exchange E) intranet Answer: C 134) To purchase an item from an Internet site, you will be asked to provide a credit card number. Because of ________, a computer hacker who intercepts this number as it is being sent to the seller would likely see £D¥$&0PDJLJL, or something equally as meaningless. A) decoding B) back-translation C) encryption D) the firewall E) reverse encoding Answer: C 135) The Green Awning is a flower and gift store. When its owner purchases the green foam used in the bottom of vases of cut flowers, floral tape used in flower arrangements, and gift cards, she is most likely making a ________. A) straight rebuy B) complex-task purchase C) modified rebuy D) new-task buy E) gatekeeping buy Answer: A 136) Although much of the equipment used by dentists is thrown away after one use, many of the instruments used to clean teeth, fill cavities, and deal with impactions and other dental problems are made of steel and must be sterilized. A dentist is considering replacing his conventional steam sterilizer with a chemical sterilizer that cleans without rusting or corroding instruments. Because the dentist is already familiar with sterilizers, he is looking to find the best price possible on a chemical sterilizer. He is engaged in a ________. A) straight rebuy B) customer-reference purchase C) modified rebuy D) reciprocal purchase E) reverse marketing purchase Answer: C 137) A trucking company is considering purchasing new trucks that are powered by ethanol instead of diesel fuel. In terms of the buying center, the truck drivers who must make sure that the trucks' fuel tanks do not run out of fuel are the ________. A) initiators B) liaisons C) agents D) users E) gatekeepers Answer: D 138) A patient of Dr. Albrecht told the dentist he needed to buy a machine that would sterilize his tools without using any water because water tends to cause the tools to rust or corrode over time. In terms of the buying center, the patient had the role of ________. A) decider B) liaison C) agent D) user E) influencer Answer: E 139) Worthington Farm raises chickens. For years, it has used wooden coops to haul its poultry to market. When Bob Worthington went to reuse some of his coops, he noticed many of them could not be sufficiently cleaned for reuse and ought to be replaced. Worthington was at which stage of the business buying process? A) problem recognition B) vendor analysis C) information search D) information evaluation E) product selection Answer: A 140) Johnson Controls, Inc. produces the seats for the Dodge Neon. Although Johnson initially was able to meet Dodge's cost target, it was not able to meet its safety, weight, and comfort specifications. Engineers from Dodge visited the Johnson plant and worked with its design people to create a seat that met all of the technical requirements at a cost that both could agree on. Johnson Controls and Dodge engaged in ________. A) reciprocity B) functionalization C) reverse marketing D) crowdsourcing E) multiple sourcing Answer: C 141) A participant in a buying center can only assume one role for any single purchase decision. Answer: False 142) Suppliers are more likely to stay price competitive when the purchasing company uses single sourcing than when it uses multiple sourcing. Answer: False 143) Suppliers, customers, and employees have ready access to a company's intranet. Answer: False 144) In terms of the buy class framework, the purchase of paper towels and toilet paper to restock an employee restroom would be an example of a modified rebuy. Answer: False 145) The individual who develops the product specifications for a complex product would likely assume the role of influencer in the buying center. Answer: True 146) Discuss the security issues of B2B e-commerce and how companies address those issues. Answer: The major security threats B2B e-commerce companies face include hackers destroying company records or stealing trade secrets, ensuring authentication and making transactions secure, employees giving unauthorized access to company systems, and systems infected with worms and viruses. Companies use several safety measures to address these problems. Firewalls are combinations of hardware and software that allow only authorized individuals access to company computer systems. Through encryption software, companies scramble messages so that only those with the right decoder "key" can read the message. Such encryption software is used to protect private customer information, such as credit card numbers, from hackers using sniffer programs to intercept and read messages. 147) Compare the three business-to-business buy classes. Answer: The three business-to-business buy classes are straight rebuys, modified rebuys, and new-task buys. A straight rebuy is a routine purchase of items that a business-to-business customer regularly needs. The buyer has purchased the same items many times before and routinely reorders them when supplies are low. A modified rebuy occurs when a firm wants to shop around for suppliers with better prices, quality, or delivery times. This situation also can occur when the organization has new needs for products it already buys. A new-task buy requires the buyer to start from scratch to gather information on purchase specifications. This situation requires the most effort of buyers and offers the most opportunity for new sellers. 148) What are the steps in the business-to-business buying decision process? Discuss how they are different from the steps in the consumer decision process. Answer: Steps in the business-to-business buying decision process are problem recognition, information search, evaluation of alternatives, product and supplier selection, and post purchase evaluation. In the first step of the B2B buying process, a firm may form a buying center. Multiple individuals are involved in the buying decision process. Business buyers conduct a much more thorough information search than consumers do. They also develop product specifications and obtain bids from potential suppliers during this step. Much more negotiation is typically involved in the alternative evaluation stage of the B2B buying process. Also, the B2B buying process often includes formal presentations and product demonstrations by potential suppliers. Unlike consumers, B2B buyers must decide on what type of sourcing to use for a purchase in the product and supplier selection stage. Finally, the B2B post purchase evaluation is much more formal than the consumer post purchase evaluation. 149) Tri Restaurant, Inc. is the parent company of three chains of restaurants. How might Tri Restaurant, Inc. utilize the company extranet? Answer: A company uses an extranet to allow certain suppliers, customers, and others outside the organization to access its internal system. Tri Restaurant could use its extranet to communicate with and place orders with its food and restaurant supply vendors. 150) In what type of purchase would one person most likely assume all or most buying center roles? Answer: One person will likely play all roles in purchasing routine products and services, or a straight rebuy, in a small organization. 151) How does reverse marketing work? Answer: Reverse marketing changes the marketing process. Instead of sellers trying to identify potential customers, buyers try to find suppliers capable of producing specific, needed products, and then attempt to convince the suppliers to contract to make the products. 152) Identify an advantage and disadvantage of implementing multiple sourcing. Answer: Multiple sourcing means buying a product from several different suppliers. Under this system, suppliers are more likely to remain price competitive. And if one supplier has problems with delivery, the firm has others to fall back on. One of the disadvantages to purchasing from multiple sources is that a firm may not have much clout with a supplier when it comes to negotiating prices and contract terms. Also, having many suppliers increases the firm's administrative costs because it has more invoices to pay, more contracts to negotiate, and more salespeople to see than if it used a single source. 153) Why might a company use crowdsourcing? Answer: When a company has a complex problem that cannot be solved by its own employees or partners, the company may call on outsiders from around the world to create possible solutions. 154) Identify two post purchase evaluation metrics that may be used in the B2B buying process. Answer: Post purchase evaluation metrics include satisfaction, quality, customer engagement, purchase intentions, and promptness and effectiveness of problem resolution. Test Bank for Marketing: Real People, Real Choices Michael R. Solomon, Greg W. Marshall, Elnora W. Stuart 9780132948937, 9780135199893, 9780134292663, 9780135209929
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