The Examination Paper of Jinan University

Academic Year : 2020–2021 Semester: 1st [ √ ] 2nd[ ] Course Type

Compulsory [ √ ] Elective [ ]
Course Title: International Marketing
For Form of the Examination
Instructor Instructor’s Name Jingwen Xia Open-book [ ] Closed-book [ √ ]
Only
Date of the Examination__7/1/2021__(dd/mm/yyyy) Paper A[ √ ] Paper B [ ]

Total Pages 14
School/College International School Major IET
For Student
Name Student No.
Only

Mainland Student [ ] Non-mainland Student [ ]

Total
Section No. I II III IV V
Score

Score

Evaluator

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There should be no separate answer sheets. If the exam paper is graded by more than one teacher, each
reviewer should sign in the "Evaluator" box of the corresponding question section while the teacher
responsible for final score calculation will sign in the "Evaluator” box of "total score". In case of one
grader, the teacher only needs to sign in the " Evaluator" box under the "total score".

Score
Section I: Multiple choice questions (20×1’=20’)

Please fill answers in the following table.

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
11. 12. 13. 14. 15. 16. 17. 18. 19. 20.
1. If you ever talk to anyone who has flown on Singapore Air, you will no doubt hear that
individual praise the food that was served during the flight, the friendliness of the air
stewards, and the comfortable surroundings. From this description, you can surmise
Singapore Air creates customer value by providing its customers with:
a. the best service.
b. the most convenient flight schedules.
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c. the best price.
d. the best airport experience.
e. all of the above
2. Which of the following statements is an example of time utility?
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

a. A new motor oil container comes equipped with a disposable pouring spout.
b. Supermarkets are adding restaurants.
c. A service station has a 24-hour ice machine available for use even when the
station is closed.
d. A waterbed company offers six-month financing, same as cash.
e. Disposable diapers come equipped with resealable tabs.
3. Men’s Wearhouse (MW) caters to the man who doesn’t necessarily enjoy shopping. The
stores are located in outdoor shopping centers so that customers can get in and out
quickly. Additionally the MW targets the budget-conscious consumer with suit prices
ranging from $250-300. Earnings rose 23% in 2003, indicating that the location of
the stores and the pricing strategy both are part of the MW:
a. a competitive advantage.
b. benchmarking expertise.
c. a tactical innovation.
d. leapfrogging capabilities.
e. a viable mission.
4. In 2003 Kodak had a very flat level of sales revenue. The CEO did not like the no-growth
results and instead forecasted an increase in sales revenue based on new plans and
actions. The difference between the existing flat level of sales revenue and the
increased level is known as:
a. the contribution margin.
b. a marginal analysis.
c. the product differentiator.
d. the planning gap.
e. a tactical analysis.
5. There are many diet aids on the market. They promise immediate weight loss without
exercise or a change in diet. Each is accompanied by a testimonial from a satisfied
user. If you pay close attention, you will notice that each ad also contains the
statement, “Results may vary.” More than likely, this statement is included to prevent
the FTC from requiring the dietary aid distributor from having to:
a. guarantee truth-in-advertising.
b. engage in competitive advertising.
c. run corrective advertising.
d. prevent comparative advertising.
e. engage in self-regulation.
6. Your company is introducing a new line of activewear for teenagers and invites the
members of the cheerleading squad to a private display of the line. This group
consists of __________ for activewear clothing.
a. syncratic decision makers
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b. aspirational
c. opinion leaders
d. autonomous leaders
e. joint decision makers
7. Tums antacid stresses the fact that it is a calcium supplement in its advertisements. It also
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

stresses the health benefits of calcium. Most people already know Tums contains
calcium. The new promotion is trying to change the attitude toward Tums by:
a. lowering the price.
b. adding a new attribute to the product.
c. changing the basic product.
d. adding a new attribute and re-positioning the product.
e. changing the perceived importance of the attribute.
8. Comparative advertising in which one brand is compared to another is intended to cause
consumers to perceive differences between the products featured in the advertising.
Marketers who use comparative advertising are trying to use __________ to make
consumers believe that its product is better than the other one.
a. cognitive dissonance
b. stimulus discrimination
c. selective comprehension
d. stimulus generalization
e. selective retention
9. The concept in organizational buying that corresponds most closely to a consumer's
consideration set in consumer buying is the:
a. buying center.
b. seven buying criteria.
c. type of buying situation.
d. bidder's list.
e. NAICS code.
10. The office of SFX Entertainment, a talent promoter, needs a new fax machine that will
print at three seconds a page instead of five seconds per page like the one it is using
now and that has both local and network printing capabilities. Its purchase of a
replacement fax machine would be an example of a:
a. new buy.
b. straight rebuy.
c. modified rebuy.
d. make-buy.
e. standard buy.
11. Safeway displays the thousands of items it sells in aisles containing related items or
product groupings. Examples would be the pet food aisle or the paper product aisle.
Why would Safeway display product groupings in this manner?
a. The groupings increase the number of market-product combinations on the
market-product grid into a more manageable framework for subsequent analysis.
b. Consumers buy more in illogically organized environments.
c. The products are grouped so people can relate to these product groupings in a
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more meaningful way.
d. Product groupings can be generated quantitatively to show which adhere to the
80/20 rule.
e. All of the above are reasons why Safeway would use product groups.
12. Superba Cravats is a major marketer of men's bow ties. It estimates there are 20 million
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

buyers of bow ties each year, that the average wearer of bow ties purchases 4 ties per
year, and that the average price per bow tie is $10. Superba Cravats has a market
share of 20 percent. The market (or industry) potential for bow ties is:
a. $200 million.
b. $800 million.
c. $400 million.
d. $80 million.
e. $160 million.
13. The General Mills Betty Crocker brand of Original Supreme brownie mix with Hershey’s
chocolate is branded using which strategy?
a. manufacturer branding
b. generic branding
c. co-branding
d. mixed branding
e. multiproduct branding
14. Mattel has contractually agreed to let Colgate use the Barbie name and image on kids'
toothpaste and toothbrushes. Colgate pays Mattel a fee for the use of the Barbie name
and image. This is an example of:
a. manufacturer branding.
b. generic branding.
c. reseller branding.
d. mixed branding.
e. licensing.
15. You are president of a manufacturer of small electronic appliances. You want to reduce
your break-even quantity. Other things equal, you can do this by:
a. increasing the quantity sold, while keeping price unchanged.
b. reducing marginal revenue.
c. increasing fixed cost.
d. reducing unit variable cost.
e. doing all of the above.
16. Ace Shoe Company sells heel replacement kits for men's shoes. It has fixed costs of $5
million and unit variable costs of $5 per pair. Suppose a consultant tells Ace it can
sell 750,000 heel repair kits, what price must it charge to achieve a profit of $2.5
million?
a. $3.58
b. $7.58
c. $12.15
d. $15.00
e. $17.90
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17. Different brands within a company’s product line generally have different profit margins;
higher price lines have higher profit margins. For example, Nike Variety tennis shoes
have variable costs of $6 and sell for $24; whereas, Nike Wimbleton tennis shoes
have variable costs of $10 and sell for $48. It must be true that:
a. demand is unrelated to price.
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Student Name ______ _____, Student No.___ __________

b. Nike is using a cost-plus percentage-of-cost pricing strategy.

c. Nike is using a product-line pricing strategy.
d. demand is unrelated to product quality.
e. consumers do not use price as an indication of quality.
18. When Teresa went into the furniture store to buy a new sleeper sofa, she thought the prices
quoted by the salesperson were too high, so she prepared to leave. As she neared the
door, the salesperson asked if she would be interested in buying the sofa if the price
was $150 lower. Teresa returned to the store, purchased the sofa, and felt like she had
gotten a good deal. The furniture store uses:
a. price lining.
b. customary pricing.
c. discretionary pricing.
d. price fixing.
e. a flexible-price policy.
19. Wal-Mart is a channel power because of their strong image, number of outlets, and
purchasing volume.The source of Wal-Mart’s power is:
a. its economic influence.
b. its expertise.
c. its identification with a particular channel member.
d. its legitimate rights through contracts.
e. all of the above.
20. While reading the newspaper, Belinda noticed an advertisement containing manufacturer's
coupons from Kodak redeemable only at Target stores. This ad is an example of:
a. a finance allowance.
b. a case allowance.
c. cooperative advertising.
d. a merchandise allowance.
e. specialty advertising.

Score Section II: True/false questions

5 and rationale ( 10×2’=20’)
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

Fill T or F in the bracket at the end of each

question.
1. DuPont assigned chemists, sales and marketing executives, and regulatory specialists to
create an herbicide for corn growers that recorded sales of $57 million in its first year. This
type of sales approach is called adaptive selling. 【 】

Rationale:

2. An ad for Mercedes Benz cars showed a heart-shaped box of chocolates with one of the
chocolates topped with the well-recognized Mercedes logo. There was no mention of the
company name or sign of a product in the ad. This ad was an example of reminder
institutional advertising. 【 】

Rationale:

3. An advertisement for Lipitor, a cholesterol medicine is shown on TV during the Super

Bowl. The advertisement is an element of the promotional mix which is directed towards the
ultimate consumer, not towards doctors. This is an example of a push promotional strategy.
【 】

Rationale:

4. The channel strategy demonstrated when Hallmark sells its Hallmark brand greeting cards
through Hallmark stores and its Ambassador brand of cards through discount and drugstore
chains is called parallel distribution. 【 】

Rationale:

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The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

5. When a firm is hired to construct a custom home, it is a one-of-a-kind project and often
requires unforeseen expenses. Companies that contract to build custom homes typically add a
fixed percentage to the total unit cost to take care of these unplanned costs. This pricing
method is called cost-plus-fixed-fee pricing. 【 】

Rationale:

6. In one of its least favorite actions, Amazon.com was caught fiddling with its price tags.
Avid videodisc shoppers found that the online store was offering different customers different
prices for the same DVD, and complained vociferously. Amazon was caught red-handed. It
was, company officials admitted, trying to see how much it could charge for an item before
shoppers balked. No matter what the reasoning behind it, Amazon.com was using horizontal
price-fixing. 【 】

Rationale:

7. Some singers sing a great song that shoots to the top of the chart. The singers go on tour
and have sold-out concerts everywhere they appear. Just as quickly (particularly if they are
unable to follow their first hit song with a second one), they are singing to half-filled concerts
and then to smaller clubs, and eventually no one wants to hear them perform. Such one-hit
singers are most likely categorized as fad products. 【 】

Rationale:

8. Todd Harris and Associates, a New York sales promotion agency, discovered from analysis
of its files that one-fifth of its clients accounted for more than three-quarters of its fees and
commissions. This is an example of the 80/20 rule. 【 】

Rationale:

9. To be a Wal-Mart supplier, a firm must be able to deliver its products to Wal-Mart

The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

distribution centers within a 15 minute window. If the driver arrives before or after the
scheduled window they will be turned away and fined. Wal-Mart’s use of a particular
supplier that can provide on-time delivery is based on performance measure. 【 】

Rationale:

10. Market segmentation would be used to group consumers for soda on the basis of whether
they wanted sugar-free and caffeine-free, caffeine-free but with sugar, or regular with sugar
and caffeine. 【 】

Rationale:

Score
Section III: Calculation (3×5’=15’)

1. A custom kitchen cabinet storeowner wishes to use target return-on-sales pricing to

establish a price for a typical section of cabinets. Assume variable cost is $200 per unit,
fixed cost is $44,000, and the storeowner desires a target profit of 20 percent of sales on
an annual volume of 400 cabinets. What price should be charged for a typical cabinet
section?

2. A manufacturer is currently using manufacturer’s representatives to sell its products.

The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

These representatives receive an 6 percent commission. The company is considering hiring

its own salespeople and has estimated that the fixed cost of managing and paying their
salaries would be $1.2 million annually. The salespeople would also receive a 3 percent
commission on sales. Cost of company salespeople (CS) equals to Cost of manufacturer’s
representatives (MR) based on this year sales. The sales are expected to grow by 15 percent
next year. Would you recommend that the company switch to its own salesforce? Why or
why not?

3. A small gasoline station manager observes that while gasoline sales have been steady, the
service side of her business has fallen off and mechanics are often idle. She decides to offer a
promotion--an oil change for $10 with a coupon mailed to 800 households in a 2-mile radius
from her station. The $10 will just cover the costs of the oil change, and the cost of printing
and mailing is $1000. She hopes the promotion will increase regular maintenance service
calls, whose average price is $40 (Average materials and labor costs per job is $30.) How
many additional maintenance service jobs must result for the promotion to break even?
(Disregard opportunity costs, goodwill effects, and any additional revenues.)

Score
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

Section IV: Short essay questions (2×10’=20’)

1. Compare push strategy with pull strategy, and list differences and similarities
between them.

2. Describe three types of advertising appeals, and list limitations of each of them.

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The Examination Paper for International Marketing (course title) of JNU

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Score
Section V: Case analysis ( 25’)

Stuart Cellars: Price Is a Matter of Taste

Stuart Cellars is a family-owned winery located in Temecula, California. The winery marked its
first harvest in 1999. Forty acres are available for cultivation, giving Stuart Cellars a capacity of
some 150 tons of grapes and yielding about 16,000 cases of wine per year. Stuart Cellars offers its
Chardonnay, Merlot, Cabernet Sauvignon, Cabernet Franc, Zinfandel, Viognier, and other wines
for sale through its tasting room, its website (www.stuartcellars.com), and retailers in California.
Retail prices for Stuart Cellars products range from $13 per bottle for a Chardonnay,
Viognier, Sauvignon Blanc, and White Merlot blend, to $46 per bottle for a 2002 Zinfandel
Vintage Port. The average retail price for a Stuart Cellars wine is about $28 per bottle. Stuart
Cellar Wine Club members enjoy a 20 percent discount and receive additional benefits such as
complimentary tasting at the winery, special “member only” wines, additional discounts for
reorders of the monthly wine selection, and quantity discounts.
PRICING WINE: CONSIDERING COSTS AND PROFITS
How does Stuart Cellars arrive at its pricing? What factors enter into the pricing decision?
The price floor is usually set by costs. Costs vary widely depending on winery location and
number of years in business. There are tremendous economies of scale for larger producers versus
smaller boutique wineries such as Stuart Cellars. Grapes, including labor to grow and harvest, can
represent up to 60 percent of production expenses. One rule of thumb is that a bottle of wine
should be priced at 1/1000 the cost of a ton of grapes. Paying $40,000 for a ton of Cabernet grapes
would yield a bottle price of $40. Napa Valley growers’ costs range from $2,800 per ton to
$10,000 per ton.
Buying land adds to winery costs but provides more operational control. Even wineries that
do grow grapes may need to buy grapes on the market to meet their production needs. The impact
of land ownership depends on the size of the mortgage and the interest rate to finance the property.
Planting costs can be as much as $30,000 per acre, depending on such factors as density of
plantings, trellising, and irrigation methods. Winery facilities and equipment—grape press, tanks,
barrel racks—can be significant. Winemaking barrels are the second-highest production cost for
many wineries. American oak barrels ($300 per barrel) or French oak ($700 per barrel) may have a
useful life of two to three years. On the other hand, a stainless tank may last 20 years. And of
course, repair and maintenance costs for equipment and facilities can add up.
Because it can be a three-year wait to harvest grapes from new planting, followed by barrel
and bottle aging, wineries can easily have five and a half years of capital and cash flow for red
wines—less for white wines that require less aging. Packaging is also important and a reflection
of the wine’s image. Will the winery use flat-bottomed, Burgundy-style bottles at $.50 each, or
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thick-glass, thick-neck, deep-punt bottles at $3? Corks can range in price from pennies to dollars a
piece.
Advertising, public relations, point-of-sale materials, promotions, salesforce, wine tastings,
samples for the wine press, warehousing, shipping, distribution, and excise taxes all mount up and
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can be about 15 percent of the retail price. Warehousing and shipping are significant because wine
is a heavy product.
Many states have regulated distribution systems such as California’s three-tier system of
wineries, wholesalers, and retailers. Wholesalers markups range from 20-35 percent of what the
distributor pays for the wine, with high-volume wines having lower margins as this means less
inventory. Retailer markups can vary from 10-50 percent, depending on the type of outlet. Some
states have mandated minimum markup to prevent predatory pricing.
The wine business is not known as a highly profitable business. Success comes over the long
term as initial investments and expense are spread out over a number of years and over increasing
unit volume.

CONSUMER DEMEND AND COMPETITION

Costs and profit objectives are only part of the pricing formula. Wineries also have to consider
buyer characteristics—retailers and consumers. According to Steven Bombola, consulting general
manager, Stuart Cellars is targeting the “upper end of wine connoisseurs, people who can afford a
premium product at a premium price” and represents perhaps “the top 10-15 percent of the wine
purchasing public.”These are savvy consumers; they read and follow wine reviews. Wineries also
need to consider and compare pricing from competitive wineries. Wine buyers certainly will make
these comparisons. And while price is often a cue for quality, there are many great-tasting wines at
reasonable prices.
If a wine is priced too low, it will affect consumers’ perceptions of quality. However,
charging a price significantly higher than competitor prices can drive consumers away to lower-
priced competitor products.
The average bottle price for wine has been dropping, in large part due to the popularity of
Australian and New Zealand wines. Most popular wine brands retail for less than $10 per bottle.
Image is very important in wine marketing. Fancy bottles, elegant and artistic labels,
advertising, celebrity endorsements, and wine reviews can all impact consumers’ perceptions of
the value of a wine. There is often greater prestige from small-production, boutique wineries than
larger-volume operations. Scarcity, the real or perceived rarity of a wine, can drive up prices.
Demand can be influenced by global supply, those all-important ratings from publications such as
the Wine Spectator, and the quality of the vintage. All the marketing efforts in the world can’t
make a poor wine taste good.

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Questions:
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

1.What factors related to (a) demand, (b) cost, (c) profit and (d) competition are used by
Stuart Cellars to arrive at an approximate price level?

2. If the average Stuart Cellars wine retails for $28 per bottle, what does Stuart Cellars sell
the wine for if retailers take a 15 percent margin and wholesalers take a 20 percent margin?

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3.Assume that Stuart Cellars annual fixed costs are $1,000,000. With an average retail price
of $28 per bottle and assuming estimated variable costs of $11.50, calculate break-even
The Examination Paper for International Marketing (course title) of JNU

Student Name ______ _____, Student No.___ __________

volume. If there are 12 bottles per case, how does the break-even unit volume compare
to Stuart Cellars’ capacity?

4.You are a Stuart Cellars Wine Club member. You want to order Cabernet Sauvignon that
normally retails for $45 per bottle. The following discount structure applies: 20 percent
discount for purchases of 11 bottles or less; 30 percent discount for purchase of 12 bottles or
more. Add 7.75 percent sales tax for California residents. What price, before shipping and
handling, would you pay if (a) you order 10 bottles? (b) you order 12 bottles? (c) What are
the implications of this discounting structure?

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