Chapter 1



Part A – Multiple Choice – 35 Marks

1. Phil just bought a new pair of Nike's. The first stage in his buying decision process was

|a. |when he decided that Nike's are the best choice. |

|b. |when he sought out information about shoe brands. |

|c. |when he decided to buy Nike's rather than another shoe. |

|d. |when he compared Nike's to the other available shoes. |

|e. |when he saw that his athletic shoes needed to be replaced. |

ANS: E PTS: 1 DIF: 1 REF: p. 143

2. Which of the following best describes a decision support system?

|a. |It is used to store data and transfer data into accessible information. |

|b. |Large organizations usually rely on a single decision support system that operates within the context of the global |

| |information system. |

|c. |One of the current drawbacks of the decision support system is the inability to be interactive within the company. |

|d. |It manages the interface between the user and computer system. |

|e. |The purpose of the decision support system is to allow decision makers to design questions through indirect interaction |

| |with data bases. |

ANS: A PTS: 1 DIF: 3 REF: p. 116

3. Roots Canada’s design expertise is one of the company’s

|a. |marketing mix elements. |

|b. |strategic factors. |

|c. |core competencies. |

|d. |competitive differentials. |

|e. |macroenvironmental forces. |

ANS: C PTS: 1 DIF: 3 REF: p. 68

4. The study of demography includes

|a. |distribution of natural resources. |

|b. |how social institutions and norms develop. |

|c. |the behaviour of people when they are in groups. |

|d. |the composition and distribution of population. |

|e. |the study of psychological aspects of behaviour. |

ANS: D PTS: 1 DIF: 3 REF: p. 81

5. At the broadest level, the function of marketing activities is to

|a. |sell a product. |

|b. |create brand awareness. |

|c. |get the customer into the store. |

|d. |make a profit. |

|e. |bring buyers and sellers together. |

ANS: E PTS: 1 DIF: 3 REF: p. 5

6. In marketing research, it is important not to confuse problems with

|a. |symptoms of problems. |

|b. |seasonal variations. |

|c. |pseudo-problems. |

|d. |opportunities. |

|e. |hypotheses. |

ANS: A PTS: 1 DIF: 1 REF: p. 120

7. The Canadian population has grown older because

|a. |infant mortality is higher in Canada than any other western country. |

|b. |"baby boomers" put off having children. |

|c. |our population, on the whole, is healthier. |

|d. |the baby-boomers have grown up and their sheer numbers are causing the population to age. |

|e. |AIDS and other life threatening diseases have increased the death rate among younger age groups. |

ANS: D PTS: 1 DIF: 3 REF: p. 83

8. The True North Toothpaste Company divided Canadian consumers into three groups for the purpose of marketing toothpaste: "white tooth lovers" that seek whitening power; "fresh breath kissers" that want clean smelling breath; and "health conscious brushers" that value cavity protection. In this instance, The True North Toothpaste Company is involved in

|a. |market division. |

|b. |target marketing. |

|c. |market differentiation. |

|d. |segmentation grouping. |

|e. |market segmentation. |

ANS: E PTS: 1 DIF: 5 REF: p. 41

9. Which of these is not a business marketing transaction?

|a. |A wholesaler buys lumber to build shelves in a warehouse. |

|b. |A school buys nine crates of chalk. |

|c. |Sacred Heart Church buys six barrels of sweeping compound. |

|d. |A farmer buys a truckload of fertilizer for his corn crop. |

|e. |A dentist buys computer software to keep track of his personal investments. |

ANS: E PTS: 1 DIF: 3 REF: p. 172

10. Honda automobiles have a perception of superior quality among Canadian car buyers. For the Honda organization, this quality perception is a

|a. |marketing mix objective. |

|b. |competitive advantage. |

|c. |corporate value. |

|d. |consumer behaviour factor. |

|e. |an example of selective evaluation. |

ANS: B PTS: 1 DIF: 1 REF: p. 64

11. A man buying a new suit brings his wife along to get her opinion on how he looks in various suits. Her opinions help him to make a purchase because

|a. |internal information sources are important to the decision-making process. |

|b. |he is in the problem-recognition stage of the decision-making process. |

|c. |he is turning the decision-making process into a routinized behaviour. |

|d. |her presence helps with reduction of perceived risk. |

|e. |her input eliminates the evaluation-of-alternatives stage in the decision-making process. |

ANS: D PTS: 1 DIF: 3 REF: p. 143

12. Which of the following is the best example of derived demand?

|a. |Chevron knows that it must produce more jet fuel when the economy is in an upswing because more people will be flying. |

|b. |Canadians have become so accustomed to watching a lot of television that many homes have three or more sets in them. |

|c. |Women's clothes are changed in design more frequently than men's because more women are fashion conscious. |

|d. |Canadians buy a lot of Japanese cars. |

|e. |More tourists are using air travel and less automobile travel because they are learning that air travel is safer and |

| |easier. |

ANS: A PTS: 1 DIF: 3 REF: p. 174

13. Which of the following statements regarding defining the problem stage is correct?

|a. |The problem definition stage could also be called the resolution stage. |

|b. |The problem definition stage exists because some symptoms to the problem have been detected. |

|c. |Primary data should be gathered to support exploratory research. |

|d. |Defining the general nature of the problem seldom provides direction for the research. |

|e. |The purpose of exploratory research is to provide conclusions. |

ANS: B PTS: 1 DIF: 3 REF: p. 120

14. Perception is

|a. |the interpretation of sensations and giving meaning to stimuli. |

|b. |the individual tendency to change cognition. |

|c. |another term for attitude change. |

|d. |not a cognitive process. |

|e. |defence mechanisms that screen out new messages when their content is incompatible with past experiences. |

ANS: A PTS: 1 DIF: 3 REF: p. 149

15. Underlying the definition of a market is

|a. |a group of people gathered for any purpose. |

|b. |people who have money. |

|c. |people with resources and a willingness to exchange them. |

|d. |people who want something that they don't have. |

|e. |an advertising campaign. |

ANS: C PTS: 1 DIF: 3 REF: p. 8

OBJ: Recall

16. The primary purpose of exploratory research is to

|a. |provide conclusions. |

|b. |prepare research objectives. |

|c. |eliminate the need for additional research. |

|d. |find possible problem solutions. |

|e. |investigate and explore. |

ANS: E PTS: 1 DIF: 3 REF: p. 121

17. An Internet-based company is likely to have a competitive advantage over its traditional competitors in

|a. |quality-based competition. |

|b. |time-based competition. |

|c. |location-based competition. |

|d. |product-based competition. |

|e. |None of the above are correct. |

ANS: C PTS: 1 DIF: 3 REF: p. 64

18. A consumer has the flu. He suddenly begins noticing commercials for remedies that he had never noticed before. This is an example of

|a. |selective learning. |

|b. |selective attention. |

|c. |selective distortion. |

|d. |selective retention. |

|e. |cognitive dissonance. |

ANS: B PTS: 1 DIF: 3 REF: p. 150

19. Which of the following are included in the promotion mix?

|a. |personal selling, pricing, advertising, publicity |

|b. |personal selling, advertising, sales promotion, distribution |

|c. |sales promotion, advertising, publicity, personal selling |

|d. |advertising, personal selling, publicity, persuasion |

|e. |advertising, buying, selling , communication |

ANS: C PTS: 1 DIF: 1 REF: p. 12

OBJ: Recall

20. The fundamental idea behind a strategic business unit (SBU) form of organization is that

|a. |individual brands compete against individual brands more than whole corporations compete against each other. |

|b. |whole corporations compete against each other in every market segment. |

|c. |some companies do not compete against each other at all. |

|d. |it is better to control the organization as a whole so as to get the "big" picture. |

|e. |customers would rather buy from a large, well established company. |

ANS: A PTS: 1 DIF: 3 REF: p. 33

OBJ: Recall

21. Alliances, networks and informal partnerships are all examples of

|a. |channel members. |

|b. |agencies. |

|c. |competition. |

|d. |collaboration. |

|e. |professional associations. |

ANS: D PTS: 1 DIF: 1 REF: p. 66

22. The Red Pride Hair Care Company aims its marketing plan for a certain product to female Canadian redheads between the ages of 25 and 39. From Red Pride's point of view, these women are BEST called a

|a. |marketing group. |

|b. |market opportunity. |

|c. |homogeneous grouping. |

|d. |target market. |

|e. |segmentation variable. |

ANS: D PTS: 1 DIF: 5 REF: p. 41

23. Most types of insurance probably appeal to what type of needs on Maslow's Hierarchy?

|a. |psychological needs and wants |

|b. |safety |

|c. |food and water |

|d. |self-esteem |

|e. |self-actualization |

ANS: B PTS: 1 DIF: 3 REF: p. 148

24. Which statement is false?

|a. |Canadian social values affect Canadian marketers. |

|b. |Beliefs, unlike social values, do not change. |

|c. |Social values usually vary from one culture to another. |

|d. |Technology and science are dynamic and have no effect on values. |

|e. |Laws are considered uncontrollable aspects of the environment. |

ANS: B PTS: 1 DIF: 3 REF: p. 79-80

25. Generally speaking, when do consumers want their products and services?

|a. |in the morning |

|b. |always as soon as possible |

|c. |when the fashions change |

|d. |exactly when the product is needed |

|e. |just after the price goes down |

ANS: D PTS: 1 DIF: 3 REF: p. 63

26. Which of the following is not generally true in a new task buying situation?

|a. |Buyers must seek out alternative ways of solving the problem and alternative suppliers. |

|b. |Occurs infrequently--but is very important to marketers because it sets the pattern for the more routine purchases that |

| |will follow. |

|c. |A great deal of information is needed. |

|d. |The buying alternatives are known, but something about them has changed. |

|e. |It is undertaken in response to a requirement or problem that has not arisen before. |

ANS: D PTS: 1 DIF: 5 REF: p. 178

27. All of the following are advantages of using a survey in marketing research except

|a. |surveys are versatile. |

|b. |surveys eliminate bias. |

|c. |surveys can satisfy specific needs information. |

|d. |surveys can be quick and efficient in gathering primary data. |

|e. |if surveys are designed properly, they are very accurate. |

ANS: B PTS: 1 DIF: 3 REF: p. 126

28. Which is the best example of an oligopoly?

|a. |In Italy, only the government can sell tobacco products. |

|b. |In Germany, virtually all the steel sold comes from four manufacturers. |

|c. |In Japan, businesses that export are heavily subsidized. |

|d. |In France, markets at which farmers sell their products are common. |

|e. |The Lubbock Power Company is a coop owned by its customers. |

ANS: B PTS: 1 DIF: 3 REF: p. 91

29. Market position means

|a. |the physical position that a product occupies on a shelf. |

|b. |where a retail store is located. |

|c. |the method used to discover where consumers are. |

|d. |the way consumers perceive a product compared to competition. |

|e. |where the manufacturer is located relative to its raw materials. |

ANS: D PTS: 1 DIF: 3 REF: p. 43

30. Which of the following statements is true about promotion?

|a. |Promotion is only used to communicate to potential buyers, not to existing customers. |

|b. |Promotion is the means by which marketers "talk to" existing customers and potential buyers. |

|c. |Promotion is used to inform customers only about factual information. |

|d. |Promotion is always used to just remind the market that the organization or product is still around. |

|e. |Promotion is mostly a waste of money because word-of-mouth is more powerful, anyway. |

ANS: B PTS: 1 DIF: 3 REF: p. 12

31. Competition based on delivering a product when the consumer wants it is known as

|a. |price competition |

|b. |quality-based competition |

|c. |time-based competition |

|d. |benefit-based competition |

|e. |location-based competition |

ANS: C PTS: 1 DIF: 3 REF: p. 63

32. The consumer decision-making process illustrated very clearly that

|a. |consumer behaviour is pretty simple. |

|b. |consumer behaviour is easy to figure out if you know people. |

|c. |consumer behaviour is complex, and there is always more to learn. |

|d. |the behaviour of business people is easier understand than that of individual consumers. |

|e. |brand loyal customers will never change so there is no need to worry about them. |

ANS: C PTS: 1 DIF: 1 REF: p. 147

33. Which of the following is not a stage in the marketing research process?

|a. |selecting the results |

|b. |identifying the problem |

|c. |selecting the sample |

|d. |following up |

|e. |analyzing data |

ANS: A PTS: 1 DIF: 3 REF: p. 118

34. From a marketing standpoint, forces in the macroenvironment impact the microenvironment which in turn impact the company’s

|a. |Intraenvironment. |

|b. |marketing mix decisions. |

|c. |organizational behaviour. |

|d. |technology factors. |

|e. |environmental factors. |

ANS: B PTS: 1 DIF: 1 REF: p. 58

35. Which of the following statements is true about buying centers?

|a. |Large organizations always have about 20 people in their buying center. |

|b. |Small organizations don't have buying centers. In small organizations, the owner usually makes all the decisions. |

|c. |Large organizations tend to have buying centers that may have an identifiable group. |

|d. |Small organizations don't require their buying centers to purchase sophisticated products. |

|e. |Large organizations have the buying centers identified on the organizational chart. |

ANS: C PTS: 1 DIF: 3 REF: p. 180

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