Marketing ch 8

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1. Abbott's Office Supplies buys furniture and filing cabinets from Craine Furniture. Craine buys d
paper, pens, and folders from Abbott's. The two firms are engaged in

a. cross-selling.
b. tying agreements.
c. producer marketing.
d. reciprocity.
e. competitive bidding.
2. About what percentage of the annual U.S. gross domestic product is government spending? c

a. 2 percent
b. 10 percent
c. 20 percent
d. 30 percent
e. 50 percent
3. An accountant who purchases software for maintaining clients' books is an example of a buyer in a(n) ___________ market. b

a. consumer
b. producer
c. reseller
d. government
e. institutional
4. Administrative assistants that control the flow of information to other people in the a
organization often play the _____ role in the buying center.

a. gatekeeper
b. user
c. influencer
d. buyer
e. controller
5. After deciding to order replacement parts for aging machinery, the buyer for a construction company examines catalogs c
and trade publications looking for these parts. The buyer is at which stage in the business buying decision process?

a. Problem recognition
b. Product specification
c. Product-supplier search and evaluation
d. Product-supplier selection
e. Product-supplier post-evaluation
6. All of the following are important concerns of business customers except c

a. achieving a specific level of quality in the products offered to target markets.

b. obtaining a level of quality that meets specifications.
c. obtaining products that exceed specifications to ensure the best possible product performance.
d. obtaining products for which the quality level is consistent.
e. supporting customers with services they expect.
7. All of the following describe the demand for business products except a

a. elastic.
b. derived.
c. joint.
d. inelastic.
e. fluctuating.
8. ___________ analysis is a systematic evaluation of current and potential suppliers that b
focuses on many dimensions including price, product quality, delivery service, product
dependability, and overall company reliability.

a. Value
b. Vendor
c. Buying center
d. Strategic
e. Cost
9. Anderson Distribution Company has purchased 15 forklifts over the past two years. As it e
plans to place its next order for another five machines, management wonders if additional features may be needed in order
to handle changes in the product lines it carries. For Anderson, these new forklifts represent a ___________ purchase.

a. new-task
b. repetitive
c. straight rebuy
d. repetitive order
e. modified rebuy
10. As it places its order for truck tires with Michelin, South Side Industrial Supply realizes that it c
must also place an order for valve stems and balancing weights for the truck tires. Such business products are characterized
as having ____________ demand.

a. derived
b. inelastic
c. joint
d. fluctuating
e. higher
11. Barry Gluckman of WP International, a major marketer of word-processing software, calls the secretary of Renee a
Dorchette, director of purchasing for MMK, Inc. He sets up an
appointment to discuss an upcoming purchase of software. The secretary plays the role of
___________ in this purchase decision.

a. gatekeeper
b. buyer
c. decider
d. buying center captain
e. order giver
12. Business markets are typically divided into four categories. These categories are c

a. retailers, wholesalers, services, and nonprofit firms.

b. producer, manufacturer, reseller, and government.
c. producer, reseller, government, and institutional.
d. manufacturer, wholesaler, retailer, and services.
e. reseller, retailer, government, and institutional.
13. A buyer for Macy's Department Stores orders handbags from a supplier because that b
supplier allows the buyer to maintain Macy's company policy of 30-day advance purchase
notice. This is an example of ___________ influence on the business buying decision
process.

a. environmental
b. organizational
c. interpersonal
d. individual
e. demographic
14. ______ buy products from manufacturers and then resell the products to other firms in the distribution system. e

a. Retailers
b. Producers
c. Distributors
d. Warehouses
e. Wholesalers
15. Christy Bridgman is considering the purchase of a new fax machine for her real estate office. d
She is considering a machine that doesn't have as many functions but is available at a considerably lower price than her
current machine. She is engaged in ___________ analysis.

a. vendor
b. downsizing
c. strategic
d. value
e. profit
16. Churches, charitable organizations, and private colleges are considered _____ buyers. c

a. corporate
b. government
c. institutional
d. producer
e. nonprofit
17. Demand for a business product is ___________ if a price increase or decrease will not significantly affect that demand. b

a. elastic
b. inelastic
c. derived
d. joint
e. separate
18. Demand for a business product is _____ when two or more items are used in combination to produce a product. b

a. inelastic
b. joint
c. fluctuating
d. derived
e. partnered
19. Demand for business products is also known as ______ demand. e

a. derived
b. corporate
c. business buying
d. manufacturing
e. industrial
20. Demand for business products is characterized as derived. From what is the demand c
derived?

a. Industrial demand
b. Modified demand
c. Demand for consumer products
d. Future product demand
e. The business cycle
21. A disadvantage of reciprocity is that it can lead to d

a. a price war.
b. higher promotional costs.
c. more competitive firms entering the industry.
d. less-than-optimal purchases for the buyer.
e. longer periods of negotiation.
22. During the search for products and evaluating possible suppliers stage of the business b
buying decision process, marketers sometimes use _________ analysis to examine the
quality, design, materials, and possibly item reduction in order to acquire the product in the
most cost-effective way.

a. cost
b. value
c. profit
d. strategic
e. SWOT
23. The fact that business customers purchase products to be used directly or indirectly in the c
production of goods and services to satisfy customers' needs means that demand for
business products is

a. joint.
b. economically stable.
c. derived.
d. inelastic.
e. more fluctuating.
24. Goodyear is a manufacturer and marketer of tires for new passenger cars. In recent years, c
the company's business has declined because of the overall decrease in consumer demand
for new cars. In this case, the demand for Goodyear's tire products is said to be _______ since it depends on the demand for
new cars.

a. inelastic
b. fluctuating
c. derived
d. elastic
e. nonderived
25. The group of people within a business who are involved in making business buying decisions is referred to as e

a. the new-task team.

b. negotiators.
c. purchasing agents.
d. deciders.
e. the buying center.
26. If a business owner buys parts by specifying the quantity, grade, and other attributes, which a
buying method is he or she using?

a. Description
b. Sampling
c. Negotiation
d. Ordering
e. Inspection
27. In business markets, individuals or groups purchase products for one of three purposes. d
These purposes are

a. resale, wholesale, and direct use.

b. wholesale, direct use, and use in producing other products.
c. producing other products.
d. resale, direct use in producing other products, and use in general daily operations.
e. use in general daily operations, wholesale, and resale.
28. Individual influencing factors refer to d

a. relationships among those in the firm's buying center.

b. uncontrollable environmental forces.
c. the power an individual controls in the buying center.
d. personal characteristics of individuals in the buying center.
e. activities of suppliers.
29. Individuals and business organizations that buy finished goods and resell them to make a profit without changing the e
physical characteristics of the product are classified as
___________ markets.

a. consumer
b. institutional
c. producer
d. government
e. reseller
30. Individuals and business organizations that purchase products for the purpose of making a profit either by using the c
products to produce other products or by using them in their operations are classified as ___________ markets.

a. consumer
b. institutional
c. producer
d. government
e. reseller
31. Inelastic demand simply means that c

a. buyers will not make a modified rebuy purchase.

b. demand depends on how many items are purchased.
c. a price increase or decrease will not significantly change the demand for an item.
d. when price goes up, demand goes down.
e. when supply is reduced, the price will increase.
32. In its purchase of desktop business computers, Albertson's asked that potential suppliers b
provide information only on units with 2.0 gigabytes of memory. As Albertson's management
evaluates this purchase, it finds that 2.0 gigabytes are inadequate for many of the software
programs used at Albertson's. In this instance, the firm would need to modify which aspect of
the purchase process?

a. Searching
b. Specification development
c. Alternative evaluation
d. Selection
e. Performance evaluation
33. In placing a tire order with Michelin, South Side Industrial Supply finds that the truck tires it is ordering have increased b
$37.50 in price since the last order. South Side proceeds with the order, confident that it can pass on the price increase to
future customers. This is an
example of business products having ___________ demand.

a. derived
b. inelastic
c. joint
d. fluctuating
e. higher
34. Input-output analysis is most likely to yield what type of information? b

a. Number of employees that a firm has

b. Industries that purchase the major portion of an industry's output
c. Kinds of returns a firm is getting on its equipment investments
d. Type of inventory turnover that is characteristic of a firm
e. Kinds of variables that would be used to segment the target market
35. Institutional markets are e

a. intermediaries who resell goods to make a profit.

b. federal and state government units.
c. state or local government units.
d. consumers who buy products for their own use.
e. organizations that seek nonbusiness goals.
36. _________ is(are) a major threat to the sales success of jointly demanded products. b

a. Price changes
b. Shortages
c. Economic instability
d. Inventory buildup
e. Proliferation of brands
37. Johnson's Industrial Pest Control Service wants to meet its customers' expectations with a
regard to the quality of service it provides. How should Johnson's identify these expectations?

a. Conduct market research.

b. Use management judgment.
c. Trace existing service levels.
d. Stress quality service with employees.
e. Train employees better.
38. Many suppliers and their customers invest time and resources to build and maintain mutually beneficial relationships which a
are often called

a. partnerships.
b. co-ops.
c. monopolies.
d. reciprocity.
e. alliances.
39. Most business buying decisions are made by c

a. one person.
b. a team of purchasing agents.
c. a firm's buying center.
d. inventory control personnel.
e. the sales force.
40. Most businesses try to control the level of quality in the parts they buy from suppliers. Most d
firms develop standards for _____ in order to achieve their quality goals.

a. how many different suppliers they use

b. how many parts can fail
c. controlling when shipments will arrive
d. the percentage of defects allowed
e. how long the parts should last
41. Most business purchases can be classified as belonging to one of three types: c

a. delinquent, repetitive, or delivered.

b. repetitive, new-task, or modified rebuy.
c. modified rebuy, new-task, or straight rebuy.
d. delinquent, new-task, or reciprocal.
e. rebuy, reciprocal, or delayed.
42. An organization that decides to buy all of a certain part from the same company is using e

a. single-supplier purchasing.
b. multiple sourcing.
c. same vendor analysis.
d. straight rebuy.
e. sole sourcing.
43. Perry Supply's sales and sales force have continued to expand. Now, the firm plans to add a c
fleet of company cars as part of its sales compensation package. For Perry Supply, these
vehicles would represent a ____________ purchase.

a. modified rebuy
b. straight rebuy
c. new-task
d. reevaluated
e. repetitive
44. A Pillsbury mill in Utah buys grain from growers in the western region. The purchasing agent c
for Pillsbury will most likely use which buying method?

a. Description
b. Inspection
c. Sampling
d. Negotiation
e. Selection
45. Product specifications are a

a. physical characteristics and level of quality.

b. types of services that are provided with the product.
c. financing available for the product.
d. types of competitors offering similar products.
e. product return policies.
46. Raython Hardware and Thames Industrial Supplier have worked closely for many years and b
have a mutually beneficial relationship in which Raython provides all of Thames's hardware needs in a timely manner.
Raython and Thames's relationship could be best characterized as
a(n)

a. reciprocity agreement.
b. partnership.
c. intra-organizational group.
d. alliance.
e. tying arrangement.
47. A representative from Coca-Cola stops by at a local fast-food restaurant once a month to c
inquire how much soft drink syrup the store will need. The restaurant's orders are an
example of which type of business purchase?

a. New-task
b. Modified rebuy
c. Straight rebuy
d. Bid
e. Negotiated
48. Reseller markets consist mainly of c

a. consumers.
b. retailers.
c. wholesalers and retailers.
d. manufacturers.
e. industrial users.
49. The second stage in the business buying decision process is to c

a. search for products and suppliers.

b. select the most appropriate product.
c. develop product specifications.
d. evaluate product and supplier performance.
e. recognize the problem.
50. Snappy Tools, Inc., purchases hammers, bolts, and other hardware items from a variety of manufacturers a
and sells them to hardware stores at a price that includes a profit for Snappy Tools, Inc. The company
would be part of what type of business market?

a. Reseller
b. Producer
c. Consumer
d. Government
e. Supply
51. The stages of the business buying decision process, in order, are a-- Recognize,
establish, search,
a. recognizing the problem, establishing product specifications, searching for select, evaluate--
products and evaluating possible suppliers, selecting suppliers and products, and evaluating RESSE
performance.
b. recognizing the problem, searching for products and evaluating possible
suppliers, selecting suppliers and products, establishing product specifications, and evaluating
performance.
c. recognizing the problem, selecting suppliers and products, evaluating performance, establishing
product specifications, and searching for substitute products.
d. establishing product specifications, recognizing the problem, searching for
products, evaluating possible products and suppliers, selecting suppliers and products, and evaluating
performance.
e. establishing product specifications, searching for products, selecting suppliers
and products, evaluating performance, recognizing the problem, and evaluating
possible products and suppliers.
52. The state of Montana is preparing to buy a large quantity of frozen orange juice for use in a e
large school district. Citrus Sweet, Inc. is in the citrus juice business but has never sold to the
government market. To have a chance at getting this order, Citrus Sweet's first step must be
to get her firm to

a. make a presentation appointment with the state.

b. quote prices to the purchasing department.
c. advertise in the capital city.
d. negotiate with the state.
e. secure a slot on the list of qualified bidders.
53. The third stage in the business buying decision process is to e

a. evaluate product specifications to solve the problem.

b. evaluate products relative to specifications.
c. select and order the most appropriate product.
d. evaluate product and supplier performance.
e. search for products and suppliers.
54. The three purposes for which individuals or groups can use products in order for it to be c
considered a business market are

a. use in daily operations, end consumption, and resale.

b. direct use in producing other products, company travel, and end consumption.
c. resale, use in daily operations, and direct use in producing other products.
d. governmental, institutional, and reseller purposes.
e. making other products, selling to other businesses, making component parts.
55. Volkswagen purchases upholstery for the interiors of its vehicles from various suppliers. This upholstery must have a set e
of characteristics that is expressed by Volkswagen. This set is called

a. descriptions.
b. product features.
c. criterion.
d. purchase requests.
e. specifications.
56. What are the four major categories of factors that influence business buying decisions? a --
EOII
a. Environmental, organizational, interpersonal, and individual
b. Environmental, organizational, psychological, and individual
c. Environmental, psychological, individual, and technological
d. Technological, organizational, environmental, and interpersonal
e. Environmental, organizational, technological, and individual
57. What is a primary difference between business and consumer buyers? e

a. Consumer buyers require more product information than business buyers.

b. Business purchases are made by one individual whereas families make consumer purchases together.
c. Repeat sales are more common with consumer buyers than business buyers.
d. Consumers primarily buy inexpensive items; businesses only buy expensive
items.
e. Business buyers generally make larger orders than consumer buyers.
58. When a business is making its initial purchase of an item to be used to perform a new job, it d
is known as a _________ purchase.

a. straight rebuy
b. reciprocal
c. delayed
d. new-task
e. modified rebuy
59. When a business routinely purchases the same product with similar terms of sale, the c
purchase is called a

a. new-task.
b. repetitive purchase.
c. straight rebuy.
d. modified rebuy.
e. standard order.
60. When certain consumer products are in high demand, producers might buy extra materials d
and equipment and when demand subsides, producers will cut back on their material
purchases. This describes _____ demand.

a. joint
b. inelastic
c. consumer
d. fluctuating
e. derived
61. When Hunter Ceiling Fans buys electrical wire for use in producing its ceiling fans, Hunter is part of what type of market for e
electrical wire?

a. Resale
b. Wholesale
c. Customer
d. Consumer
e. Business
62. When the requirements associated with a new-task purchase are changed the second or third time, this is called a ___________ a
purchase.

a. modified rebuy
b. continued new-task
c. contractual
d. straight rebuy
e. negotiated rebuy
63. Which method of business buying is necessary when products are highly homogeneous and b
examination of each item is not feasible?

a. Negotiation
b. Sampling
c. Description
d. Inspection
e. Homogeneous selection
64. Which of the following would be considered an institutional buyer? d

a. The University of Illinois

b. The Environmental Protection Agency
c. Apple Computers
d. The United Way
e. City of Greenville
65. Which type of business market tends to have the most complex buying procedures? d

a. Reseller
b. Institutional
c. Retailer
d. Government
e. Producer