BUS 100 Final exam Final exam-CHAPTERS (9-12)

BUS 100 Final exam Final exam-CHAPTERS (9-12) Chapter 9 Leadership and Decision Making Chapter 10 Human Resource Management and Labor Chapter 11 Marketing Processes and Consumer Behavior Chapter 12 Pricing, Distribu ...

BUS 100 Final exam Final exam-CHAPTERS (9-12) Chapter 9 Leadership and Decision Making Chapter 10 Human Resource Management and Labor Chapter 11 Marketing Processes and Consumer Behavior Chapter 12 Pricing, Distributing, and Promoting Products Chapter 9 37) Which of the following describes the concept of leadership? A) the processes and behaviors used by someone to determine the optimal decision among several options B) the processes and behaviors used by someone to motivate, inspire, and influence the behaviors of others C) the processes and behaviors used by someone to establish the organizational structure of a firm D) the processes and behaviors used by someone to manage the functioning of an organization E) the processes and behaviors used by someone to achieve tangible outcomes within an organization Answer: B Explanation: B) Leaders set agendas and inspire others to follow their direction. Page Ref: 222 Difficulty: Easy Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 38) Whereas managers focus on plans, results, and goals, what do leaders focus on? A) productivity B) profitability C) people D) sales E) organization Answer: C Explanation: C) Leadership is concerned with motivating and inspiring people, rather than controlling and organizing a company. Page Ref: 222 Difficulty: Easy Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 39) Which tasks do managers typically focus on? A) monitoring organizational goals B) agenda setting C) aligning the organization with its environment D) inspiring employees E) planning and budgeting Answer: E Explanation: E) Management is concerned with the running of an organization. Page Ref: 222Difficulty: Easy Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 40) When creating an agenda, what do leaders focus on? A) establishing direction B) controlling and problem solving C) organizing and staffing D) outlining procedures E) planning and budgeting Answer: A Explanation: A) This is the prime concern of a leader. Page Ref: 222 Difficulty: Easy Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 41) When developing the human resources for achieving an agenda, what do managers focus on? A) establishing direction B) controlling and problem solving C) organizing and staffing D) aligning people E) motivating and inspiring Answer: C Explanation: C) This is the primary methodology for a manager to achieve his or her goals. Page Ref: 222 Difficulty: Easy Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 42) When developing the human resources necessary for achieving an agenda, what do leaders focus on? A) establishing direction B) controlling and problem solving C) organizing and staffing D) aligning people and goals E) establishing workplace policies Answer: D Explanation: D) Aligning people to work together toward an agenda is one of the leadership responsibilities. Page Ref: 222 Difficulty: Easy Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 43) What area was the earliest research on leadership most concerned with? A) leadership behaviors B) leadership traits C) leadership situations D) leadership integrityE) leadership roles Answer: B Explanation: B) The trait approach to leadership yielded various lists of attributes that successful leaders often have. Page Ref: 223 Difficulty: Easy Objective: 9.2 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 44) What was a major problem with the trait approach to leadership? A) The results were too innovative and thus were not taken seriously at the time. B) The results were too inconsistent and thus not very practical. C) The results were not very inspiring and thus ignored. D) The results were found to be too pessimistic and thus were dismissed as useless. E) The results were too worshipful of certain leaders and thus were dismissed as irrelevant. Answer: B Explanation: B) These early studies never really managed to agree with each other. Page Ref: 223 Difficulty: Difficult Objective: 9.2 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 45) Which of the following best describes task-focused leader behavior? A) concentration on how tasks should be performed B) concentration on which tasks should be performed C) concentration on why tasks should be performed D) concentration on who should perform which tasks E) concentration on when tasks should be performed Answer: A Explanation: A) Task-focused leader behavior occurs when a leader focuses on how tasks should be performed in order to meet certain goals and to achieve certain performance standards. Page Ref: 224 Difficulty: Easy Objective: 9.2 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 46) Which of the following best describes employee-focused leader behavior? A) concentration on both the work quality and work quantity of employees B) concentration on both the well-being and work quality of employees C) concentration on both the satisfaction and work quantity of employees D) concentration on both the satisfaction and the well-being of employees E) concentration on both the work quantity and the well-being of employees Answer: D Explanation: D) Employee-focused leader behavior occurs when a leader focuses on the satisfaction, motivation, and well-being of his or her employees. Page Ref: 224 Difficulty: Easy Objective: 9.2 Learning Outcome: Summarize the major theories of and approaches to leadershipSkill: Concept 47) Which of the following describes one of the primary concerns associated with charismatic leadership due to severe devotion to a particular leader? A) the potential lapse of ethical practices B) the potential inability to replace leadership efficiently C) the potential encouragement of micromanaging D) the potential stagnation of corporate vision E) the potential creation of bureaucracy Answer: A Explanation: A) Although many of these reflect hazards of charismatic leadership, overzealousness of supporters has often lead to serious ethical lapses of judgment. Page Ref: 226 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 48) Bill Lopez spends most of his time performing normal, routine tasks. Which of the following types of leadership is he primarily involved with? A) charismatic leadership B) transformational leadership C) behavioral leadership D) situational leadership E) transactional leadership Answer: E Explanation: E) Transactional leadership is essentially the same as management in that it involves routine, regimented activities. Page Ref: 226 Difficulty: Easy AACSB: Reflective thinking skills Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 49) Which of the following accurately describes a primary characteristic of charismatic leaders? A) They tend to set high expectations for themselves and energize others. B) They tend to set high expectations for themselves and establish high standards for others. C) They tend to establish high standards for and energize others. D) They tend to energize others and establish good, stable practices. E) They tend to set high expectations for themselves and establish good, stable practices. Answer: A Explanation: A) High standards are practiced through example in charismatic leadership, more than insisting that everyone follow them. Page Ref: 226 Difficulty: Difficult Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 50) Which of the following organizational aspects allows employees to perform capably without the direction ofa leader? A) leadership neutralizers B) leadership substitutes C) leadership incentives D) leadership guidelines E) leadership obstructions Answer: B Explanation: B) Leadership substitutes are individual, task, and organizational characteristics that tend to outweigh the need for a leader to initiate or direct employee performance. Page Ref: 227 Difficulty: Easy Objective: 9.5 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 51) Which of the following best describes the effects of leadership neutralizers in an organization? A) They tend to make leader behavior ineffective. B) They tend to make leaders more charismatic. C) They tend to outweigh the need for leader behavior. D) They tend to make managers become effective leaders. E) They tend to make leaders more neutral toward employees. Answer: A Explanation: A) Leadership neutralizers are factors that may render leader behaviors ineffective. Page Ref: 227 Difficulty: Easy Objective: 9.5 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 52) Which of the following may be substitutes for leadership? A) lax individual professionalism B) group divisiveness C) explicit plans and goals D) a loose system of rules and procedures E) a performance-based reward system Answer: C Explanation: C) These may make the need for a leader to plan things out ineffective or unnecessary. Page Ref: 227 Difficulty: Easy Objective: 9.5 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 53) Bob, Joe, and Larry can all perform their jobs well without supervision. What does this indicate? A) presence of a rigid reward system B) presence of a leadership neutralizer C) presence of a leadership substitute D) presence of a leadership incentive E) presence of a highly automated system Answer: C Explanation: C) This is precisely an example of a situation for which a leader is not needed. Page Ref: 227Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.5 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 54) The norms of the engineering group at Acme Incorporated are so strong that there is nothing the new company leader can do to change things. What does this illustrate? A) leadership charisma B) leadership neutralizers C) leadership substitutes D) leadership mandates E) leadership amplifiers Answer: B Explanation: B) This is one example of a leadership neutralizer. Page Ref: 227 Difficulty: Moderate Objective: 9.5 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 55) Which of the following types of leaders has the primary role of helping a less experienced person learn how to function and to advance within an organization? A) enabler B) mentor C) manager D) task master E) motivator Answer: B Explanation: B) Mentors help less experienced employees learn the ropes and advance within the organization. Page Ref: 229 Difficulty: Easy Objective: 9.6 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 56) Which is the most accurate statement regarding one of the main differences between the Japanese and American cultures? A) Overall, Japanese culture is often characterized as conservative, whereas American culture is often characterized as liberal. B) Overall, Japanese culture is often characterized as rigidly structured, whereas American culture is often characterized as loosely structured. C) Overall, Japanese culture is often characterized as authoritarian, whereas American culture is often characterized as democratic. D) Overall, Japanese culture is often characterized as collectivist, whereas American culture is often characterized as individualist. E) Overall, Japanese culture is often characterized as socialist, whereas American culture is often characterized as capitalist. Answer: D Explanation: D) This is often the primary difference between the structures of Japanese and American firms. Page Ref: 229-230 Difficulty: EasyAACSB: Multicultural and diversity understanding Objective: 9.6 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 57) Which part of the management of an organization would be most involved with strategic leadership? A) the top level of management B) the supervisory level of management C) the advisory level of management D) the auxiliary level of management E) all levels of management Answer: A Explanation: A) Strategic leadership explicitly relates leadership to the role of top management. Page Ref: 230 Difficulty: Easy Objective: 9.7 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 58) Recent corporate scandals at firms like Enron have brought increased attention to what area of leadership? A) virtual leadership B) ethical leadership C) strategic leadership D) employee-focused leadership E) charismatic leadership Answer: B Explanation: B) This type of scrutiny, had it been present, may have prevented the 2008 economic meltdown. Page Ref: 230 Difficulty: Easy AACSB: Ethical understanding and reasoning abilities Objective: 9.7 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 59) Which of the current business characteristics has brought the rise of virtual leadership? A) more communication within the organization B) little communication among employees C) more face-to-face communication within the organization D) less face-to-face communication within the organization E) little communication between employees and management Answer: D Explanation: D) That is, telecommuting. Page Ref: 230 Difficulty: Easy Objective: 9.7 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 60) Which of the following is the name for choosing one alternative from among several options? A) decision making B) assessment C) evaluationD) discernment E) arbitration Answer: A Explanation: A) This is the definition of decision making. Page Ref: 231 Difficulty: Easy Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 61) What is the first step in rational decision making? A) understanding who will make the decision B) recognizing that a decision is necessary C) identifying alternatives to the problem D) choosing an alternative E) implementing the alternative Answer: B Explanation: B) The first step is figuring out that a first step is needed. Page Ref: 232 Difficulty: Easy Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 62) What is the definition of a coalition? A) an informal group formed to achieve a common goal B) an institution incorporated in order to achieve a common goal C) a pro-business political party D) the network of management within a firm E) the network of employees within a firm Answer: A Explanation: A) All of the other answers are possible specific examples of a coalition, but not its overall definition. Page Ref: 234 Difficulty: Easy Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 63) Managers at Adidas had a hunch that their sponsorship deal with the Yankees would be a good one. Their feelings were based on what concept? A) escalation of commitment B) risk propensity C) intuition D) perception E) rational decision making Answer: C Explanation: C) Intuition is based on feeling the answer, rather than analyzing the situation. Page Ref: 235 Difficulty: Easy AACSB: Reflective thinking skills Objective: 9.8Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 64) Which of the following reflects the extent to which a leader is willing to gamble when making a decision? A) escalation of commitment B) overconfidence C) caution D) intuition E) risk propensity Answer: E Explanation: E) The organization's culture is a prime ingredient in fostering different levels of risk propensity. Page Ref: 235 Difficulty: Easy Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 65) Anne bought stock in ABC Company in hopes of making a profit. Although the stock's price steadily continued to drop, she refused to sell her stock. What does this illustrate? A) risk propensity B) escalation of commitment C) intuition D) perception E) caution Answer: B Explanation: B) This is an example of committing to a decision and sticking it out. Page Ref: 235 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 66) Which of the following do organizations need in order to be effective? A) more leadership than management B) more management than leadership C) both leadership and management D) either leadership or management E) neither leadership nor management Answer: C Explanation: C) Leadership is necessary to create and direct change and to help the organization get through tough times; management is necessary to achieve coordination and systematic results and to handle administrative activities during times of stability. Page Ref: 223 Difficulty: Moderate Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 67) Which of the following statements is the MOST accurate? A) Effective managers lead for stability whereas visionary leaders lead for change. B) Effective leaders lead for stability whereas visionary managers lead for change.C) Visionary managers lead for stability whereas effective leaders lead for change. D) Strategic leaders lead for stability whereas transforming leaders lead for change. E) Strategic managers lead for stability whereas transforming managers lead for change. Answer: A Explanation: A) Management in conjunction with leadership can help achieve planned change, and leadership in conjunction with management can keep the organization aligned with its environment. Page Ref: 222 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 68) In interviews with two leadership applicants, Ben tried to determine each person's knowledge of the industry, level of energy, and level of self-esteem. With which of the following concepts of leadership is Ben most concerned here? A) charismatic leadership B) behavioral leadership C) situational leadership D) trait-based leadership E) transformational leadership Answer: D Explanation: D) With trait theory, some people believe that intelligence, drive, motivation, honesty, integrity, self-confidence, cognitive ability, knowledge of the business, charisma, biological factors, and other variables play a role in one's leadership style. Page Ref: 223 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.2 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 69) Which of the following statements best describes the assumptions made by researchers of the behavioral approach to leadership? A) Behaviors of effective leaders differ in various situations. B) Behaviors of effective leaders are the same in all situations. C) Behaviors of effective leaders reflect the proper traits for effective leadership. D) Behaviors of effective leaders differ as reflected by different traits for effective leadership. E) Behaviors of effective leaders reflect the proper disposition for effective leadership. Answer: B Explanation: B) Behavioral researchers assumed that the behaviors of effective leaders differed somehow from the behaviors of less effective leaders, and that the behaviors of effective leaders would be the same across all situations. Page Ref: 224 Difficulty: Moderate Objective: 9.2 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 70) A company leader who often uses the phrase "that was then and this is now" to explain his decisions most likely follows which model of leadership? A) situational leadershipB) trait-based leadership C) tranformational leadership D) transactional leadership E) charismatic leadership Answer: A Explanation: A) That leaders sometimes focus on employee-focused behaviors and sometimes on task-focused behaviors led to situational theories. Page Ref: 224 Difficulty: Moderate Objective: 9.3 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 71) According to the situational approach to leadership, the extent to which a leader or subordinate is involved in decision making depends on characteristics of which aspects of an organization? A) the leader, the followers, and the situation B) the leader, the structure of the organization, and the situation C) the leader, the resources at hand, and the situation D) the followers, the resources at hand, and the situation E) the resources, the structure of the organization, and the situation Answer: A Explanation: A) This approach was first proposed as a continuum of leadership behavior, with one extreme of having the leader make decisions alone to the other extreme of having employees make decisions with only minimal guidance from the leader; each point on the continuum is influenced by characteristics of the leader, his or her subordinates, and the situation. Page Ref: 224 Difficulty: Moderate Objective: 9.3 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 72) What are group effectiveness, worker disposition, and the type of organization examples of? A) cross-cultural traits that may affect a leader's decision making B) behavioral issues that may affect a leader's decision making C) strategic advantages that may affect a leader's decision making D) leadership obstructions that may affect a leader's decision making E) situational characteristics that may affect a leader's decision making Answer: E Explanation: E) These are the things that make a decision-making situation unique and thus affect the outcome of a decision. Page Ref: 224 Difficulty: Moderate Objective: 9.3 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 73) Which of the following is an example of an approach to leadership as seen through the eyes of followers? A) situational leadership B) ethical leadership C) behavioral leadership D) transformational leadership E) trait-based leadership Answer: DExplanation: D) Both transformational leadership and charismatic leadership are approaches to leadership as seen through the eyes of followers. Page Ref: 225 Difficulty: Moderate Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 74) Which of the following may describe charismatic leadership? A) an approach to leadership emphasizing the perspectives of the leader B) an approach to leadership emphasizing the perspectives of the followers C) an approach to leadership emphasizing the perspectives of the clientele D) an approach to leadership emphasizing the perspectives of the managers E) an approach to leadership emphasizing the perspectives of all parties in the organization Answer: B Explanation: B) Both transformational and charismatic leadership are approaches to leadership as seen through the eyes of followers. Page Ref: 226 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 75) GDB Technologies has had lackluster performance for the past few years. Choi is hired in an attempt to revivify the company's prospects and give it new direction away from its current situation. Which of the following best describes Choi's leadership role? A) transformational B) charismatic C) transactional D) situational E) cross-cultural Answer: A Explanation: A) Transformational leadership involves using a set of abilities that allows a leader to recognize the need for change, to create a vision to guide that change, and to execute the change. Page Ref: 225 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 76) Carol took over a stagnant firm three years ago. At that time, she clearly laid out her vision of where the firm should go and since that time has worked to energize the employees of the firm toward these goals. Which of the following best describes Carol's leadership role? A) transformational B) charismatic C) transactional D) situational E) cross-cultural Answer: B Explanation: B) This is typical charismatic leadership at work.Page Ref: 226 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 77) At Nordic Enterprises, Johann is most effective in carrying out the management of daily tasks that must be performed. Which of the following best describes Johann's leadership role? A) charismatic B) transactional C) transformational D) behavorial E) situational Answer: B Explanation: B) Transactional leadership is essentially the same as management in that it involves routine, regimented activities. Page Ref: 225 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 78) Which of following describes the activities most involved with transactional leadership? A) the implementation of a corporate vision B) the implementation of organizational transformations C) the implementation of routine activities D) the implementation of employee incentives E) the implementation of situational problem-solving Answer: C Explanation: C) Transactional leadership is essentially the same as management in that it involves routine, regimented activities. Page Ref: 225 Difficulty: Moderate Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 79) Which of the following is a fundamental element of charismatic leadership? A) planning B) controlling C) analyzing D) influencing E) organizing Answer: D Explanation: D) Charismatic leadership is a type of influence based on the leader's personal charm. A highly charismatic supervisor will be more successful in influencing subordinate behavior than a supervisor who lacks charisma. Page Ref: 226 Difficulty: Moderate AACSB: Reflective thinking skillsObjective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 80) Which statement is true regarding charismatic leadership? A) Charismatic leadership ideas are unpopular among contemporary managers. B) Many studies have successfully assessed the impact of charismatic leadership. C) Charismatic leadership is recognized as the most important approach to leadership. D) Dependence on charismatic leadership can raise serious ethical concerns. E) Taking over a leadership role from a charismatic leader is often easier than following a leader lacking in charisma. Answer: D Explanation: D) Charismatic leaders can inspire such blind faith in their followers that they may engage in inappropriate, unethical, or even illegal behaviors just because the leader instructed them to do so. Page Ref: 226 Difficulty: Moderate Objective: 9.4 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 81) Steven learned that the cohesiveness among his employees was so strong that there was nothing he could do to change things. Which of the following best describes this cohesiveness? A) leadership neutralizer B) leadership substitute C) leadership mandate D) leadership amplifier E) leadership incentive Answer: A Explanation: A) A leader may be powerless to improve things because a group is so cohesive; leadership neutralizers render certain leadership behaviors ineffective regardless of the extent to which they are present. Page Ref: 227 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.5 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 82) According to current theories of gender roles in leadership, which of the following best describes the differences in decision making? A) Males tend to be more democratic than females in making decisions. B) Males tend to be more critical than females in making decisions. C) Males tend to be more autocratic than females in making decisions. D) Males tend to be more rational than females in making decisions. E) Males tend to be more charismatic than females in making decisions. Answer: C Explanation: C) One difference that does seem to arise in some cases, according to the text, is that women have a tendency to be slightly more democratic in making decisions, whereas men have a tendency to be more autocratic. Page Ref: 229 Difficulty: Moderate AACSB: Multicultural and diversity understanding Objective: 9.6Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 83) As ABC Enterprises has grown during the past few years, more and more workers have been hired from the local Ethiopian population. A number of incidents at the firm have arisen during this time regarding certain customs prevalent among these new workers. Which of the following forms of leadership does the management of this firm need to utilize in order to most harmonize this situation? A) autocratic leadership B) democratic leadership C) cross-cultural leadership D) charismatic leadership E) mentoring leadership Answer: C Explanation: C) Some of these other answers may be local solutions. But the wider situation can only be solved by taking the cross-cultural effects into account for any leadership decisions. Page Ref: 230 Difficulty: Moderate AACSB: Multicultural and diversity understanding Objective: 9.6 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 84) Which states the correct definition of collectivism? A) a greater focus on group characteristics than on individual characteristics B) a greater focus on the group than on the individual C) a greater focus on the individual within a group than on the individual without a group D) a greater focus on individuals who are most successful E) a greater focus on groups that have been operative for the longest time Answer: B Explanation: B) All of the other answers are parts of collectivism, but not the whole concept. Page Ref: 229 Difficulty: Moderate Objective: 9.6 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 85) Which states the correct definition of individualism? A) a greater focus on individual characteristic than on cultural characteristics B) a greater focus on the individual than on the group C) a greater focus on the individual within a group than on the individual without a group D) a greater focus on individuals who have been present for the longest time E) a greater focus on individuals who are in leadership roles Answer: B Explanation: B) All of the other answers are parts of individualism, but not the whole concept. Page Ref: 230 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.6 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 86) In exercising strategic leadership, what is a leader most likely to do?A) focus on company efficiency B) focus on hiring the right people C) align the company with its environment D) avoid environmental impact on the firm E) engage the firm with community organizations Answer: C Explanation: C) Strategic leadership is a leader's ability to understand the complexities of both the firm and its environment and to lead change in the firm so as to achieve and maintain a superior alignment between the organization and its environment. Page Ref: 230 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.7 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 87) An inward belief about something, often without conscious consideration, is often referred to as what? A) intuition B) risk taking C) commitment D) discernment E) rationality Answer: A Explanation: A) Intuition is an innate belief about something, without conscious consideration; managers sometimes decide to do something because it "feels right." Such an inner sense may help managers make an occasional decision without going through a full-blown rational sequence of steps. Page Ref: 235 Difficulty: Moderate Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 88) Bill decides to study a foreign language. All of his friends said it will be easy. After the third week, he realizes the language is very difficult for him to grasp. He continues his studies, hoping that it will eventually get easier. What does this illustrate? A) rational decision making B) risk-taking decision making C) escalation of commitment D) intuitive decision making E) situational commitment Answer: C Explanation: C) With escalation of commitment, decision makers make decisions and then become so committed to the course of action suggested by that decision that they stay with it, even when it appears to have been wrong. Page Ref: 235 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Application 89) Leadership researchers in the late 1940s believed that leaders should engage in which of the followingbehaviors? A) mostly employee-focused leader behavior B) mostly task-focused leader behavior C) both employee-focused leader behavior and task-focused leader behavior in equal amounts D) a variable mixture of employee-focused leader behavior and task-focused behavior depending on the task E) a variable mixture of employee-focused leader behavior and task-focused behavior depending on the employees Answer: C Explanation: C) In the late 1940s, most researchers began to shift away from the trait approach and to look at leadership as a set of actual behaviors. Page Ref: 224 Difficulty: Difficult Objective: 9.1 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 90) Which statement is FALSE regarding gender and leadership? A) Theories regarding gender and leadership are not well-proven. B) Most leadership theories and studies have focused on males. C) There is much still to be learned about the dynamics of gender and leadership. D) There is a growing number of woman leaders in the business world today. E) Men tend to be more democratic than women in decision making. Answer: E Explanation: E) Most theories and studies have focused on males; further, more work is needed in order to better understand the dynamics of gender and leadership. Page Ref: 229 Difficulty: Difficult AACSB: Multicultural and diversity understanding Objective: 9.6 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 91) In selecting an alternative when making a decision, what should decision makers keep in mind? A) Finding multiple acceptable alternatives is neither possible nor efficient. B) Finding multiple acceptable alternatives should not take very long. C) Selecting one alternative and rejecting all others will be the decision maker's main objective. D) Selecting one alternative and rejecting all others might not be necessary. E) Selecting one alternative and rejecting all others should be a straightforward process. Answer: D Explanation: D) Finding multiple acceptable alternatives may be possible; selecting one alternative and rejecting all the others might not be necessary. Further, selecting alternatives can be a long and difficult task. Page Ref: 233 Difficulty: Moderate Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 92) Which of the following dispositions is typical for leaders with a high degree of risk propensity? A) reliance on intuition B) reliance on rational decisions C) aversion against use of intuition D) aversion against rational decisionsE) aversion against use of both intuition and rational decisions Answer: A Explanation: A) Managers with a high degree of risk propensity tend to rely heavily on intuition, reach decisions quickly, and often risk big investments on their decisions. Page Ref: 235 Difficulty: Difficult Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Concept 93) What is a prime ingredient in fostering different levels of risk propensity within an organization? A) organizational culture B) profitability level C) gender differences D) cross-cultural interactions E) company size Answer: A Explanation: A) Risk propensity is the extent to which a decision maker is willing to gamble when making a decision; since some organizations' cultures are more conservative than others, organizational culture is a prime ingredient in fostering different levels of risk propensity. Page Ref: 235 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 9.8 Learning Outcome: Summarize the major theories of and approaches to leadership Skill: Synthesis Chapter 10 24) What is another name given to human resource managers? A) financial managers B) personnel managers C) production managers D) accounting managers E) business development managers Answer: B Explanation: B) Human resource or personnel managers have a substantial impact on a firm's performance as a business. Page Ref: 245 Difficulty: Easy Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 25) Which of the following outlines the duties of a job, its working conditions, and the tools, materials, and equipment used to perform it? A) job advertisement B) job specification C) job descriptionD) job analysis E) job report Answer: C Explanation: C) The job description is part of the job analysis process. Page Ref: 245 Difficulty: Easy Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 26) Which of the following describes the skills, abilities, and qualifications required for a job? A) staffing survey B) advertising budget C) job specification D) employee analysis E) replacement chart Answer: C Explanation: C) A job specification lists the attributes an employee needs in order to perform the job effectively. Page Ref: 245 Difficulty: Easy Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 27) Which of the following contains information on each employee's education, skills, work experiences, and career aspirations? A) managerial grid B) employee information system C) job analysis D) job specification E) labor forecast Answer: B Explanation: B) This system can quickly locate every employee who is qualified to fill a position. Page Ref: 246 Difficulty: Easy Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 28) Jean's paycheck is calculated from the number of hours worked during the week times her hourly rate. What type of system is used to pay Jean? A) gainsharing B) salary C) profit sharing D) wage E) incentive Answer: D Explanation: D) A wage is the dollar amounts paid to employees for their labor. Page Ref: 250 Difficulty: Easy AACSB: Reflective thinking skillsObjective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 29) Which of the following links salary increases to performance levels in nonsales jobs? A) bonuses B) collective bargaining C) merit salary systems D) cafeteria benefit plans E) workers' compensation insurance Answer: C Explanation: C) An example is the rewarding of executives with stock options. Page Ref: 251 Difficulty: Easy Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 30) Which plan refers to compensation other than wages and salaries and other incentives offered by a firm to its workers? A) profit-sharing B) gainsharing C) benefits D) pay-for-knowledge E) variable Answer: C Explanation: C) Benefits account for an increasing percentage of most compensation budgets. Page Ref: 251 Difficulty: Easy Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 31) What is the name given to an employee who is hired on something other than a permanent or full-time basis? A) knowledge expert B) contingent worker C) technical employee D) supervisory manager E) managing director Answer: B Explanation: B) Contingent workers include independent contractors, on-call workers, and leased employees. Page Ref: 257 Difficulty: Easy Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 32) What is the name given to a group of individuals, working together to achieve shared job-related goals such as higher pay, shorter working hours, greater benefits, or better working conditions? A) management organization B) company hierarchyC) labor union D) external organization E) permanent employees Answer: C Explanation: C) The percentage of American workers belonging to a labor union has been declining over the last 15 years. Page Ref: 257 Difficulty: Easy Objective: 10.6 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 33) What is the process of dealing with employees who are represented by a union? A) labor relations B) human resource management C) negotiation D) arbitration E) contingency recruitment Answer: A Explanation: A) A company executive needs special skills in dealing and negotiating with labor unions. Page Ref: 257 Difficulty: Easy Objective: 10.7 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 34) What is the process by which union leaders and managers negotiate common terms and conditions of employment for the workers represented by unions? A) striking B) picketing C) informational gathering D) collective bargaining E) compensation planning Answer: D Explanation: D) It is the process in which a labor contract can be drafted for union-represented workers. Page Ref: 258 Difficulty: Easy Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 35) Which of the following occurs when union members agree not to buy the products of a targeted employer? A) lockout B) boycott C) mediation D) arbitration E) slowdown Answer: B Explanation: B) Workers may also urge consumers to boycott the firm's products. Page Ref: 260 Difficulty: Easy Objective: 10.8Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 36) What term describes the situation when workers perform jobs at a less efficient pace? A) lockout B) boycott C) slowdown D) walkout E) strike Answer: C Explanation: C) A variation on the slowdown is a sickout, when large numbers of workers call in sick. Page Ref: 260 Difficulty: Easy Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 37) If negotiations fail, what can a company choose to use to prevent union employees from coming to work? A) wildcat strike B) lockout C) strikebreaker D) economic strike E) bailout Answer: B Explanation: B) Lockouts are illegal if they are used as offensive weapons to give management a bargaining advantage. Page Ref: 261 Difficulty: Easy Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 38) What occurs when a neutral third party dictates a settlement between two sides that have agreed to submit to outside judgment? A) mediation B) arbitration C) strikebreaker D) impasse E) picketing Answer: B Explanation: B) In arbitration, the neutral third party (the arbitrator) dictates a settlement between the two sides, which have agreed to submit to outside judgment. Page Ref: 261 Difficulty: Easy Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 39) Which of the following is considered the starting point of effective human resource management? A) external staffing B) recruitment C) planningD) financing E) compensation Answer: C Explanation: C) The starting point for effective human resource management is human resource planning, which involves job analysis and forecasting the demand for and supply of labor. Page Ref: 245 Difficulty: Moderate Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 40) What is the purpose of a skills inventory? A) to plan and identify people for transfer or promotion B) to list key managerial positions C) to describe the specifications for a job D) to assess trends in previous human resource usage E) to hire people from outside the organization Answer: A Explanation: A) Some organizations also use employee information systems. Page Ref: 246 Difficulty: Moderate Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 41) Plants Galore is a business selling a range of indoor plants. In the past there has been a problem with plants being stolen by staff. Which of the following represents the biggest limitation in reference checks as a reliable way of assessing the value of prospective employees? A) Reference checks are illegal in a number of states. B) Reference checks obtained from previous employers are out of date. C) Some previous employers may no longer be in business. D) Some reference checks can be time consuming. E) Reference checks tend to only tap positive recommendations. Answer: E Explanation: E) Reference checks have been shown to have limited value because individuals tend to provide the names of people who will give them positive recommendations. Page Ref: 248 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 10.2 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 42) Which of the following types of training occurs while the employee is at his or her place of work? A) on-the-job training B) vestibule training C) off-site training D) incentive training E) remote training Answer: A Explanation: A) On-the-job training occurs while an employee is at work; most of this training is informal. Page Ref: 249Difficulty: Easy Objective: 10.3 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 43) Fletcher is meeting with each of his subordinates to discuss their performance over the past year. What process is he involved in? A) job description B) labor negotiations C) vestibule assessment D) performance appraisal E) financial remuneration Answer: D Explanation: D) In some small companies, performance appraisal takes place when the owner tells an employee that he or she is "doing a good job." In larger companies, performance appraisals are designed to show more precisely how well workers are doing their jobs. Page Ref: 249 Difficulty: Moderate Objective: 10.3 Learning Outcome: Discuss the factors that affect motivation and behavior in the workplace Skill: Application 44) What is the total package that a firm offers employees in return for their labor? A) wage B) salary C) benefits package D) compensation system E) retention plan Answer: D Explanation: D) In addition, the compensation package is a major factor in retaining skilled workers. Page Ref: 249 Difficulty: Moderate Objective: 10.3 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 45) What do top executives often receive as incentives? A) merit salary systems B) workers' compensation insurance C) salaries D) stock options E) wages Answer: D Explanation: D) Though stock options are common incentives, such options have been at the center of some of the recent accounting scandals plaguing some businesses today. Page Ref: 251 Difficulty: Moderate Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 46) A Web design company, Gen Max, is expanding rapidly and needs to hire middle managers in a climatewhere first to market is an imperative. Which incentive plan for these employees would best help the firm achieve its first to market goal? A) variable pay B) merit raises C) profit-sharing D) gainsharing E) pay-for-knowledge Answer: A Explanation: A) Variable pay has proven to be a high motivator for work performance. The popularity of variable pay programs has increased in the United States over the last decade. Page Ref: 251 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 10.4 Learning Outcome: Discuss the factors that affect motivation and behavior in the workplace Skill: Application 47) Which term refers to the situation in which middle managers are rewarded for especially productive output, such as for producing earnings that significantly exceed the cost of bonuses? A) wage inflation B) a merit salary system C) a gainsharing plan D) pay for performance E) salary sacrifice Answer: D Explanation: D) Variable pay goes to middle managers on the basis of companywide performance, business unit performance, personal record, or all three factors. Page Ref: 251 Difficulty: Moderate Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 48) Ace Products' profits for fiscal year 2005 have exceeded estimates by over 2 million dollars. Which plan can Ace use to distribute part of this excess to employees? A) gainsharing plan B) profit-sharing plan C) cafeteria plan D) insurance plan E) salary-sharing plan Answer: B Explanation: B) Under profit-sharing plans, profits earned above a certain level are distributed to employees. Page Ref: 251 Difficulty: Moderate Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 49) Which of the following companywide incentive plans distribute bonuses to employees when a company's costs are reduced through greater work efficiency? A) wage setting plans B) pay for performance plansC) profit-sharing plans D) gainsharing plans E) pay-for-knowledge plans Answer: D Explanation: D) Gainsharing plans distribute bonuses to employees when a company's costs are reduced through greater work efficiency. Page Ref: 251 Difficulty: Moderate Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 50) At Ace Products, employees receive a fixed dollar amount for benefits, but they may choose between various health insurance, life insurance, disability insurance, and educational benefits. What is the name of this plan? A) gainsharing B) profit-sharing C) cafeteria benefits D) equal employment E) retention benefits Answer: C Explanation: C) With a cafeteria benefit plan, a certain dollar amount of benefits per employee is set aside so that each employee can choose from a variety of alternatives. Page Ref: 252 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 10.4 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 51) What was the fundamental reason why affirmative action was established? A) to give certain people an unfair advantage over others in the work place B) to require diversity committees in all organizations with 50 or more employees C) to combat prejudices against baby boomers still in the workforce D) to prevent exclusion by racial and gender discrimination E) to increase global marketing for products and services Answer: D Explanation: D) Affirmative action required that organizations employ a certain amount of Hispanics, African Americans, and women to combat discrimination that those groups experience. Page Ref: 253 Difficulty: Moderate Objective: 10.5 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 52) Which legal concept holds that both employer and employee have the mutual right to terminate an employment relationship any time for any reason and without advance notice to the other? A) quid pro quo B) affirmative action C) employment at will D) mutual consent E) equal employment opportunityAnswer: C Explanation: C) Specifically, employment at will holds that an organization employs an individual at its own will and can, therefore, terminate that employee at any time for any reason. Page Ref: 255 Difficulty: Moderate Objective: 10.5 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 53) Mary is a supervisor at her company. Under which legal concept is it legal for Mary to discharge all her employees without advance notice? A) quid pro quo B) affirmative action C) employment at will D) joint agreement E) arbitration Answer: C Explanation: C) This concept holds that both employer and employee have the mutual right to terminate an employment relationship anytime for any reason. Page Ref: 255 Difficulty: Moderate Objective: 10.5 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 54) Workers such as computer scientists, engineers, and game developers who typically require extensive and highly specialize training are known as what? A) technical workers B) knowledge workers C) contingent workers D) labor relation workers E) union workers Answer: B Explanation: B) Employees who add value because of what they know are usually called knowledge workers, and the skill with which they are managed is a major factor in determining which firms will be successful. Page Ref: 256 Difficulty: Moderate Objective: 10.6 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 55) Which term refers to employees hired to supplement a firm's permanent workforce? A) union workers B) contingent workers C) knowledge workers D) flextime workers E) remote workers Answer: B Explanation: B) A contingent worker is a person who works for an organization on something other than a permanent or full-time basis. Page Ref: 257 Difficulty: ModerateObjective: 10.6 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 56) What are independent contractors, on-call workers, temporary employees, contract employees, and leased employees all examples of? A) union workers B) contingent workers C) migratory workers D) ancillary workers E) international workers Answer: B Explanation: B) These are categories of contingent workers, all of whom work for an organization on something other than a permanent or full-time basis. Page Ref: 257 Difficulty: Moderate Objective: 10.6 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 57) What employment issue would a labor union be best equipped to resolve? A) Aarif is Muslim and requires working an alternate schedule during Ramadan, but other employees still have to work the standard 8:00 to 5:00 while he is observing the month for religious purposes. B) Celia is a Latina woman who feels she did not get hired because of her ethnicity. C) Gary has a salary that is $8,000 higher than Sarah's. Sarah and Gary are the same age with similar professional experiences. The only difference is that Sarah has a Master's degree and Gary has a Bachelor's degree. D) Daniel is of retirement age, but wants to continue to work in his organization. E) Sean is interested in applying for a position that requests applicants have higher credentials than what he has. Answer: C Explanation: C) A labor union would help fight for equal pay for women. Page Ref: 258 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 10.7 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 58) When does the collective bargaining process begin? A) when the contract is ratified by the members B) when the bargaining zone is identified C) when the union is recognized as the official bargaining agent D) when union and management representatives agree to contract terms E) when the employer establishes a maximum limit Answer: C Explanation: C) When a union has been legally certified, it assumes the role of official bargaining agent for workers; collective bargaining then begins. Page Ref: 259 Difficulty: Moderate Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept59) The insurance company Montas is negotiating with its labor union on varying aspects of the compensation package including remuneration and benefits. Which strategy would be most appropriate for the CEO to use in reaching agreement on the contract terms for the amount of staff vacation? A) bargaining with union representatives for nonfinancial benefits B) expanding the use of tough bargaining tactics C) gathering information about staff expectations D) brokering the prospect of arbitration E) setting up mediation processes Answer: C Explanation: C) It would be important for the information to be gathered on the expectations for the maximum and minimum limits. Page Ref: 259 Difficulty: Moderate Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 60) Which term refers to a labor action in which employees temporarily walk off the job and refuse to work? A) strike B) lockout C) boycott D) mediation E) bargaining Answer: A Explanation: A) Most strikes in the United States are economic strikes, triggered by stalemates over mandatory bargaining items, including such issues as working hours. Page Ref: 260 Difficulty: Easy Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 61) Who are temporary or permanent replacements for striking workers? A) strikebreakers B) union busters C) union breakers D) contingent workers E) labor relation teams Answer: A Explanation: A) However, the law forbids the permanent replacement of workers who strike because of unfair practices. In some cases, an employer can obtain legal injunctions that either prohibit workers from striking or prohibit a union from interfering with its efforts to use replacement workers. Page Ref: 261 Difficulty: Moderate Objective: 10.8 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 62) Gretta is observing and interviewing several database administrators to determine the duties and responsibilities associated with their job as well as the knowledge, skills, and abilities that someone must haveto perform the job. Which HR function is Gretta performing? A) staffing B) promotion C) job analysis D) training E) retention Answer: C Explanation: C) Job analysis is a systematic analysis of jobs within an organization, resulting in the job description and the job specification. Page Ref: 245 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 63) Where is a skills inventory often maintained? A) replacement chart B) employee information system C) internal supply forecast D) work flow chart E) job description spreadsheet Answer: B Explanation: B) Employee information systems are usually computerized; they contain information on each employee's education, skills, experience, and aspirations. Page Ref: 246 Difficulty: Moderate Objective: 10.1 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 64) Which selection technique is most likely to introduce bias? A) interview B) application forms C) aptitude tests D) drug testing E) polygraph tests Answer: A Explanation: A) The interview is sometimes a poor predictor of job success; biases inherent in the way people perceive and judge others on first meeting affect subsequent evaluations. Page Ref: 247 Difficulty: Moderate Objective: 10.2 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 65) Health Connect is a start-up software development company specializing in the design of imaging for medical practitioners. They are at the stage where they need to recruit a team of technical employees. Which of the following is the BEST reason for NOT relying solely on interviews when recruiting the technical staff? A) Interviews tend to have a poor record as a predictor of successful job performance. B) Technical staff tend to be confident people, and they all perform equally well in the interview situation. C) Start-up companies are not in the position to afford extra recruiting procedures.D) Interviews used in conjunction with polygraphs can cause job candidates to confess to crimes. E) Technical people need to be able to assess situations quickly and accurately. Answer: A Explanation: A) The interview is a widely used selection device but can be affected by the bias of the interviewer and first meeting impressions. A practical task can be effective in showing how the prospective employee would undertake a real work task. Page Ref: 247 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 10.2 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 66) When does the appraisal process begin? A) when the manager defines performance standards for an employee B) after the manager observes the employee's performance C) as soon as the employee begins working D) when the employee leaves an organization E) as soon as the employee requests direction Answer: A Explanation: A) The process begins when a manager defines performance standards for an employee; after that, the manager observes the employee's performance. Page Ref: 249 Difficulty: Difficult Objective: 10.3 Learning Outcome: Summarize the functions carried out by human resources Skill: Concept 67) A restaurant is undergoing a change in cuisine and style of service. It is important that new staff are hired and existing staff retrained. Why might the HR manager recommend vestibule training as being highly effective in this situation? A) Prospective and present employees can be screened to see if they convey the restaurant's new ethos. B) Off-site training has great value for evaluating the effectiveness of performance appraisals. C) Employees will be reluctant to undertake training removed from the workplace. D) The owners can be more confident that the change to the restaurant will be popular with customers. E) Employees will see limited connections to everyday work in this type of training. Answer: A Explanation: A) Since vestibule training takes place in simulated environments, it offers employees the chance to learn new skills or retrain in a realistic setting. Page Ref: 249 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 10.3 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 68) Which of the following constitutes an illegal hiring practice? A) asking someone about their availability because the position requires a 50-hour work week B) establishing a diversity committee to help diverse employees connect with each other C) asking a candidate whether or not he attends church, because it is important that candidates are available to work on Saturdays and Sundays D) keeping track of how many males and females are in the organizationE) requiring an applicant to specify gender on an application Answer: C Explanation: C) The Civil Rights Act of 1964 prohibits employers from screening a candidate for religious reasons. Page Ref: 253 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 10.5 Learning Outcome: Discuss the factors that affect motivation and behavior in the workplace Skill: Application 69) A large clothing retailer, Finch Line, has recently expanded but is having problems retaining experienced staff, despite paying salaries that are above industry averages. Which strategy would best support the HR manager's initiative to decrease the rate of turnover of the company's experienced staff? A) offering employees a structured path to promotion B) offering across-the-board pay increases to all employees C) making cost-of-living adjustments in employees' wages D) offering staff more money for better performance E) evaluating staff expectations as they relate to management goals Answer: A Explanation: A) Naturally, employees feel better about their companies when they believe that they are being fairly compensated; however, studies reveal that beyond a certain point, more money will not produce better performance. Page Ref: 256 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 10.6 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 70) Jane, a supervisor, has offered George, a subordinate, a raise and promotion in exchange for a sexual relationship. What type of harassment is this offer an example of? A) quid pro quo B) hostile work environment C) employment at will D) reverse E) financial Answer: A Explanation: A) In cases of quid pro quo harassment, the harasser offers to exchange something of value for sexual favors. Page Ref: 255 Difficulty: Difficult Objective: 10.5 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 71) Under what legal concept is Bill able to quit his job at the pickle factory at any time and without notice? A) quid pro quo B) mutual consent C) joint agreement D) employment at will E) labor relation negotiationAnswer: D Explanation: D) This concept holds that both employer and employee have the mutual right to terminate an employment relationship anytime for any reason, with or without advance notice to the other. Page Ref: 255 Difficulty: Moderate Objective: 10.5 Learning Outcome: Summarize the functions carried out by human resources Skill: Application 72) In considering the contributions of knowledge workers in the information age, what value do these employees add? A) their work style B) their professional network C) their skill in a specialized field D) their management skills E) their capacity to change careers Answer: C Explanation: C) Employees who add value because of what they know are usually called knowledge workers. Page Ref: 256 Difficulty: Moderate Objective: 10.6 Skill: Concept 73) The Internet start-up company QuickThink is considering whether to hire recent college grad Thomas as a full-time employee or as a contingent worker. Which of the following is NOT a likely disadvantage to the company if they hired Thomas as a contingent worker rather than a full-time one? A) Thomas may not be fully committed to the organization and its long-term goals. B) QuickThink will have to provide Thomas with ongoing and highly specialized training to prevent his skills from becoming obsolete. C) Thomas may lack much firm-specific knowledge. D) Managers will face possibly complicated decisions about how to integrate Thomas into the organization. E) Thomas may be less willing to engage in organizational citizenship behaviors. Answer: B Explanation: B) QuickThink would be more likely to have to provide ongoing and highly specialized training to its full-time knowledge workers than to a contingent worker like Thomas. Page Ref: 257 Difficulty: Moderate Objective: 10.6 Learning Outcome: Summarize the functions carried out by human resources Skill: Application Chapter 11 23) What is the term for the process of creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders? A) financial planning B) controlling C) operations management D) marketing E) demographic profiling Answer: DExplanation: D) Marketing involves processes that go beyond making advertisements and promoting sales through social networks. Page Ref: 270 Difficulty: Easy Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 24) What is the term for intangible products, such as time, expertise, or an activity that can be purchased? A) industrial goods B) personal goods C) risky assets D) services E) ideas Answer: D Explanation: D) Examples of services include providing professional advice or information used in making decisions. Page Ref: 271 Difficulty: Easy Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 25) Which of the following identifies products that are dissimilar from those of competitors but can fulfill the same need? A) brand competition B) international competition C) the marketing mix D) product shift E) substitute products Answer: E Explanation: E) These products may appear to be very different but can fulfil the same need. Page Ref: 274 Difficulty: Easy Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 26) What is the term for the type of competition based on buyers' perceptions of the benefits of products offered by particular companies? A) institutional competition B) monopolistic competition C) forced competition D) perfect competition E) brand competition Answer: E Explanation: E) An example is the competition between Internet search companies Google, Yahoo, and Bing. Page Ref: 275 Difficulty: Easy Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept27) What is the term for a detailed strategy for focusing marketing efforts on consumers' needs and wants? A) marketing mix B) marketing manager C) product differentiation D) product development E) marketing plan Answer: E Explanation: E) Marketing strategy begins when a company identifies a consumer need and develops a product to meet it. Page Ref: 275 Difficulty: Easy Objective: 11.2 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 28) What is the term that encompasses a good, a service, or an idea designed to fill a consumer need? A) product B) firm C) want D) utility E) condition Answer: A Explanation: A) The conceptualization and development of new products is a constant challenge for marketers. Page Ref: 275 Difficulty: Easy Objective: 11.2 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 29) What do marketers call groups of people with similar wants and needs? A) price points B) target markets C) distribution points D) target points E) product positioning Answer: B Explanation: B) Target markets is a key concept for marketers. Page Ref: 277 Difficulty: Easy Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 30) What type of variables are lifestyles, opinions, interests, and attitudes referred to as? A) geographic variables B) demographic variables C) psychographic variables D) product use variables E) labor market variables Answer: C Explanation: C) These variables are important to marketers because they can be changed by marketing efforts. Page Ref: 278Difficulty: Easy Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 31) What is the decision process by which customers come to purchase and consume products? A) marketing B) segmentation C) resource management D) consumer behavior E) acculturation Answer: D Explanation: D) Marketers need to be able to understand why consumers purchase one good over another. Page Ref: 279 Difficulty: Easy Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 32) What type of behavior do consumers exhibit by regularly purchasing products because they are satisfied with their performance? A) psychological influences B) need recognition C) brand loyalty D) emotional motives E) consumer activism Answer: C Explanation: C) Such people are less subject to influence and are more likely to stick with preferred brands. Page Ref: 279 Difficulty: Easy Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 33) What are the tangible and intangible qualities that a company builds into its products? A) features B) requirements C) benefits D) safety devices E) guarantees Answer: A Explanation: A) It is important to remember that features must also provide benefits. Page Ref: 282 Difficulty: Easy Objective: 11.6 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 34) What is selling the rights to place a brand name on products such as t-shirts referred to as? A) international branding B) national branding C) private brandingD) regional branding E) licensed branding Answer: E Explanation: E) Marketers exploit brands for their public appeal. Page Ref: 288 Difficulty: Easy Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 35) When a wholesaler or retailer develops a brand name and has the manufacturer place that name on the product, what is that product name called? A) national brand B) private brand C) luxury brand D) licensed brand E) manufacturer brand Answer: B Explanation: B) Examples of private brands include Craftsman tools and Canyon River Blues denim clothing. Page Ref: 289 Difficulty: Easy Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 36) A product's benefits include all of the following EXCEPT which? A) the emotional satisfaction associated with owning the product B) the satisfaction associated with experiencing the product C) the time required to purchase the product D) the functions of the product E) the acceptance by a peer group Answer: C Explanation: C) Benefits include both the functions of the product as well as the emotional satisfaction associated with owning, experiencing, or possessing it. Page Ref: 270 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 37) What type of goods include raw materials and integrated circuits? A) substitute products B) industrial goods C) consumer goods D) marketing goods E) disposable goods Answer: B Explanation: B) Industrial goods are physical items used by companies to produce other products. Page Ref: 271 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizationsSkill: Concept 38) What type of marketing do insurance companies, airlines, investment counselors, health clinics, and public accountants typically engage in? A) personal selling B) service marketing C) industrial selling D) consumer marketing E) wholesale selling Answer: B Explanation: B) Service marketing, a major growth area in the United States, involves the sales of services to both consumer markets and industrial markets. Page Ref: 271 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 39) What type of marketing is a "loyalty banking" program an example of? A) industrial marketing B) relationship marketing C) social marketing D) economic marketing E) consumer marketing Answer: B Explanation: B) Relationship marketing emphasizes building lasting relationships with customers and suppliers; loyalty banking programs are one example. Page Ref: 271 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 40) What is data warehousing? A) a marketing strategy that creates sales agreements that stipulate product delivery B) the process of dividing a market into categories of customer types C) the study of consumer needs and wants and the way in which sellers can best meet them D) the process of collecting, storing, and retrieving data in electronic files E) a customer identification strategy that targets potential buyers Answer: D Explanation: D) The compiling and storage of data provides the raw materials from which marketers can extract information that could enable them to better know their customers and supply more of what they need or want. Page Ref: 272 Difficulty: Moderate AACSB: Use of information technology Objective: 11.1 Learning Outcome: Identify the different types of technologies used in business and describe their uses Skill: Concept 41) Congress has conducted hearings on the use of cell phones while driving. What factors would this constitute in a company's external environment?A) political-legal B) sociocultural C) technological D) competitive E) demographic Answer: A Explanation: A) Political activities, both foreign and domestic, have profound effects on marketing. Page Ref: 272 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 42) Marketing managers often support the activities of political action committees (PACs). In doing this, which environment are they attempting to influence? A) competitive B) economic C) technological D) political-legal E) geo-demographic Answer: D Explanation: D) When companies contribute to political candidates and support the activities of PACs maintained by their respective industries, they are attempting to influence the political-legal environment. Page Ref: 272 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 43) A company decides to introduce a line of golf gear designed specifically for women. What environmental trend is the company responding to? A) competitive B) sociocultural C) political-legal D) economic E) technological Answer: B Explanation: B) Changes in social values encourage companies to develop and promote new products for both individual consumers and industrial consumers in a myriad of ways. Page Ref: 272 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 44) What kind of factor in the business environment are cell phones considered an example of? A) economic B) technological C) global D) competitive E) sociocultural Answer: BExplanation: B) New technologies create new goods and services. Page Ref: 273 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 45) The satellite dish and home television shopping provide examples of changes to which of the following external environmental factors that affect marketing? A) economic B) technological C) legal D) political E) competitive Answer: B Explanation: B) Both satellite dishes and home television shopping are examples of technological change. Page Ref: 273 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 46) What are fitness programs and drug regimens to lower cholesterol levels both an example of? A) brand competition B) marketing targets C) substitute products D) social trends E) brand extension Answer: C Explanation: C) Substitute products may not look alike, or they may seem very different from one another, but can fulfill the same need. Page Ref: 274 Difficulty: Moderate Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 47) What part of the marketing mix includes communicating information about products? A) product B) promotion C) price D) place E) publicity Answer: B Explanation: B) Promotion is the most highly visible element of the marketing mix; promotion involves all of the various techniques used for communicating information about products and services. Page Ref: 276 Difficulty: Moderate Objective: 11.2 Learning Outcome: Explain the role of marketing in organizations Skill: Concept48) Which is usually the first step in the marketing strategy? A) distribution B) product differentiation C) target markets D) pricing E) integration Answer: C Explanation: C) Selecting target markets is usually the first step in the marketing strategy. Page Ref: 277 Difficulty: Moderate Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 49) Burberry is repositioning itself as a global luxury brand, such as Gucci and Louis Vuitton, and calls for luring a different type of customer. This is an example of what type of market segmentation? A) geographic B) demographic C) psychographic D) product-use E) strategic Answer: C Explanation: C) Specific lifestyles, attitudes, and interests create certain customer tastes, such as luxury brands, among consumer segments; these are psychographic variables. Page Ref: 278 Difficulty: Moderate Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Application 50) Which of the following is the LEAST important influence on consumer behavior? A) psychological factors B) personal factors C) social factors D) technological factors E) corporate factors Answer: D Explanation: D) The influences that are most active in explaining consumers' choices and predicting future buying behaviors are psychological factors, personal influences, social influences, and cultural influences. Page Ref: 279 Difficulty: Moderate Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 51) In consumer behavior, what is the name for the influences that include the "way of living" that distinguishes one large group from another and one ethnic group from another? A) psychological B) personal C) social D) domestic E) culturalAnswer: E Explanation: E) Cultural influences also include subculture and social class. Page Ref: 279 Difficulty: Moderate Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 52) What do consumers exhibit when they regularly purchase products because they are satisfied with the products' performance? A) aspirations B) cultural influence C) social influence D) brand loyalty E) expectations Answer: D Explanation: D) Further, such consumers are less subject to influence and tend to stick with preferred brands. Page Ref: 279 Difficulty: Moderate Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 53) Reading the relevant issues of Consumer Reports prior to purchasing a product is an example of what part of the consumer buying process? A) problem recognition B) information seeking C) selecting substitutes D) need recognition E) consideration setting Answer: B Explanation: B) The search is not always extensive, but before making major purchases, most people seek information from personal sources, public sources, and experience. Page Ref: 280 Difficulty: Moderate Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Application 54) Marketing does not stop with the sale of a product. What is the term that describes what happens after the sale? A) postpurchase evaluation B) prepurchase evaluation C) rational motives D) emotional motives E) evoked set Answer: A Explanation: A) Marketers want consumers to be happy after buying products so that they are more likely to buy them again. Page Ref: 280 Difficulty: Moderate Objective: 11.4Learning Outcome: Explain the role of marketing in organizations Skill: Concept 55) What do B2B buyer-seller situations often involve? A) frequent and enduring buyer-seller relationships B) incidental buyer-seller interactions C) buyers and sellers with limited training D) short term buyer-seller relationships E) commercial buyer-seller networks Answer: A Explanation: A) In contrast, consumer-seller relationships are often impersonal, short-lived, one-time interactions. Page Ref: 282 Difficulty: Moderate Objective: 11.5 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 56) Bill is looking for an insurance policy at an affordable price. What type of good or service is he looking for? A) shopping good B) shopping service C) specialty good D) specialty service E) convenience good Answer: B Explanation: B) Shopping services (such as insurance) are more expensive and are purchased less often than convenience products. Consumers often compare brands, sometimes in different stores. They may also evaluate alternatives in terms of style, performance, color, price, and other criteria. Page Ref: 283 Difficulty: Moderate Objective: 11.6 Learning Outcome: Explain the role of marketing in organizations Skill: Application 57) What type of good is a custom-made wedding gown classified as? A) convenience good B) shopping good C) ceremonial good D) luxury good E) specialty good Answer: E Explanation: E) A custom-made wedding gown is a specialty good, often extremely important to the consumer and expensive. Consumers of such goods decide precisely on what they want and will accept no substitutes. Page Ref: 283 Difficulty: Moderate Objective: 11.6 Learning Outcome: Explain the role of marketing in organizations Skill: Application 58) A firm makes bookcases, bicycles, soft drinks, armored cars, and novelty dishes. What do these items make up? A) product lineB) product variety C) product assortment D) product mix E) product inventory Answer: D Explanation: D) The group of products that a company makes available for sale, whether consumer, industrial, or both, is its product mix. A group of products that are closely related because they function in a similar manner is a product line. Page Ref: 284 Difficulty: Moderate Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Application 59) What results when companies extend their horizons and identify opportunities outside existing product lines? A) disconnected product lines B) multiple product lines C) uniform product lines D) universal product lines E) tailored product lines Answer: B Explanation: B) Many marketers extend their product lines to include multiple, or diversified, product lines. Starbucks, for example, has a line of home brewing equipment, a line of supermarket products, a line of music, etc. Page Ref: 284 Difficulty: Moderate Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 60) During the product life cycle, when do sales begin to climb and the product begin to show profit? A) ascending B) mature C) initial D) growth E) accelerated Answer: D Explanation: D) In the growth stage, sales start to climb rapidly if the new product attracts enough consumers. The product starts to show profit, and other firms move rapidly to introduce their own versions. Page Ref: 286 Difficulty: Moderate Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 61) During the product life cycle, when do sales begin to slow down while profit levels are high? A) decline B) maturity C) introduction D) growth E) promotionAnswer: B Explanation: B) Sales start to slow in the maturity stage; although the product earns its highest profit level early in this stage, increased competition eventually forces price cutting and lower profits. Page Ref: 286 Difficulty: Moderate Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 62) LiveLong Company provides volunteer participants with new products to try and then asks them to share the information with their friends, family, coworkers, and others in their social network. What is this type of marketing called? A) share marketing B) buzz marketing C) viral marketing D) placement marketing E) target marketing Answer: B Explanation: B) Buzz marketing relies on word of mouth to spread "buzz" about a particular product or idea. Page Ref: 288 Difficulty: Moderate Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Application 63) Noxzema, Prudential, and Minute Maid would be examples of which kind of brand name? A) licensed B) private C) national D) international E) convenience Answer: C Explanation: C) National brands are produced by, widely distributed by, and carry the name of the manufacturer. Page Ref: 288 Difficulty: Moderate Objective: 11.7 Learning Outcome: Explain the role of marketing in organizations Skill: Application 64) What type of brands are Sears Craftsman tools and Kenmore appliances examples of? A) national B) licensed C) private D) global E) social Answer: C Explanation: C) When a wholesaler or retailer develops a brand name and has a manufacturer put it on a product, the resulting name is a private brand. Page Ref: 289 Difficulty: Moderate Objective: 11.7Learning Outcome: Explain the role of marketing in organizations Skill: Application 65) Some products can be sold abroad with virtually no changes. Which of the following is an example of such a product? A) Coca-Cola B) electric razors C) Gerber baby food D) Apple computers E) fruit juices Answer: A Explanation: A) On the other hand, a variety of products must be created with inbuilt flexibility in order to be able to be marketed internationally. Page Ref: 290 Difficulty: Moderate Objective: 11.8 Learning Outcome: Explain the benefits and challenges of engaging in international business Skill: Application 66) Little Earth Productions is a company that makes fashion accessories such as handbags. After examining shopping habits, what should they focus on for better visibility of the product for customers? A) better shipping techniques B) better in-store displays C) zero response time D) lower pricing E) distribution Answer: B Explanation: B) Better display techniques showing the products to their best advantage can increase product visibility and sales. Page Ref: 290 Difficulty: Moderate Objective: 11.8 Learning Outcome: Describe the major components of effective promotion Skill: Application 67) Leif designs and sells surfboards. Although his sales are declining, he decides to keep his prices constant. The marketing professionals with whom Leif consults all support his decision. Which of the following statements is LEAST likely to be true? A) Surfboards at the other shops are priced much higher. B) Leif's shop is more strategically located than the other stores are. C) The other shops' promotional materials are far superior to Leif's. D) Leif offers a much wider variety of surfboards than his competitors do. E) Leif and the marketing professionals believe that low demand will continue. Answer: E Explanation: E) Marketing professionals are well-versed in the best marketing practices. If they support Leif's decision, they must have reason to believe his business will recover. Page Ref: 275 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 11.8 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Application68) Which of the following occurs between similar products and is based on buyers' perceptions of the benefits of products offered by particular companies? A) international competition B) substitute competition C) brand competition D) benefit competition E) placement competition Answer: C Explanation: C) Brand competition is based on buyers' perceptions of the benefits of products offered by particular companies. Page Ref: 275 Difficulty: Difficult Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 69) Garrett is in the business of selling baseball bats. He decides to employ focus groups to determine which bats will likely be bestsellers. Which of the following groups will he be LEAST likely to invite as participants? A) players from the state's professional baseball team B) local college and high school coaches C) administrators of the local Little League baseball program D) spectators at a baseball tournament E) junior high players from the surrounding counties Answer: D Explanation: D) Spectators have an interest in baseball but are not necessarily baseball bat users. They would not provide the best feedback to inform a good decision. Page Ref: 277 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Application 70) Tamika starts a business making teddy bears and is excited to deliver the first batch to young patients. When Tamika arrives at the hospital, she learns that she has more bears than she needs. Which of the following would likely explain this? A) Tamika failed to collect primary data. B) Tamika did not interview all of the children. C) Tamika was not told that five more children had been admitted. D) Tamika conducted too much market research. E) Tamika received incorrect secondary data from the hospital. Answer: E Explanation: E) Secondary data are data that have already been collected and processed. The hospital most likely gave Tamika the wrong number of children. Page Ref: 279 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Application71) Tamika starts a business making teddy bears and elects to use focus groups to determine whether customized bears would be well received in a hospital setting. The focus groups prove to be unhelpful in answering this question. Which of the following could NOT be a valid explanation? A) Not enough focus groups were used. B) Focus groups are not a recommended method for obtaining people's opinions. C) The people in the focus groups could not relate to a hospitalized child's experience. D) Responses from focus group members were not recorded accurately. E) The questions asked were not designed to reveal the information being sought. Answer: B Explanation: B) This statement is untrue. Focus groups are a primary data source used to solicit feedback in reference to a product or service. Page Ref: 279 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Application 72) Quinn Clothes is a successful business selling fashionable and athletic swimwear. The marketing staff has said that the company's plan to develop and market waterproof perfumes might be hindered by a lack of experience in the perfume field. Which of the following is the BEST response to that weakness? A) Hire a chemist to develop the fragrances. B) Seek product ideas from existing staff. C) Employ new graphic designers to develop a new logo. D) Ensure that the perfume can be sold in the same retail stores as the swimwear. E) Rethink the company's promotional approach to selling products. Answer: A Explanation: A) Bringing in a specialist will best help develop a good product. Page Ref: 275 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 11.1 Learning Outcome: Explain the role of marketing in organizations Skill: Application 73) What does the process of "positioning" involve? A) hiring only employees who have the strongest credentials B) designing a company's products to appeal to target customers C) focusing on only one component of the marketing mix D) disregarding customers' reactions to a company's products E) reorganizing employees according to seniority Answer: B Explanation: B) By definition, positioning is the process of developing a unique marketing mix that best satisfies a target market. Page Ref: 277 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Concept 74) What would be the best target market for waterproof fragrances?A) male lifeguards B) college fraternity members C) Olympic ice skaters D) school-aged children who live in warm climates E) female swimmers and divers Answer: E Explanation: E) This product would best meet the needs of female (with the perfume) swimmers and divers (with the bathing suits). Page Ref: 278 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 11.3 Learning Outcome: Explain the role of marketing in organizations Skill: Application 75) Which of the following is the best example of an emotional motive in consumer purchasing? A) A major shoe company purchases the latest designer styles in order to please customers. B) A leather shop provides goods to local handbag makers. C) A businesswoman buys a new suit for an important presentation. D) A housewife donates unworn dresses to a resale shop. E) A group of neighborhood moms holds a free childcare seminar for new mothers. Answer: C Explanation: C) A consumer market transaction involves less sophisticated and more emotional purchase decisions made by an individual. Page Ref: 280 Difficulty: Difficult Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Application 76) Accessing a Web site in search of magazine articles about a product before its purchase is an example of what part of the consumer buying process? A) post-purchase evaluation B) problem-solving C) information seeking D) purchasing the product E) recognizing a need Answer: C Explanation: C) The search is not always extensive, but before making major purchases, most people seek information from personal sources, public sources, and experience. Page Ref: 280 Difficulty: Moderate Objective: 11.4 Learning Outcome: Explain the role of marketing in organizations Skill: Application 77) Which of the following is the best example of a B2B market transaction? A) A college student buys dorm furniture from an on-campus store. B) A group of teenage girls buy new clothes for the upcoming school year. C) A high-school coach borrows sports equipment from a neighboring school. D) A dentist provides free toothbrushes to patients. E) A chain of ice cream parlors regularly purchases napkins from the same supplier.Answer: E Explanation: E) Often buyers in B2B markets purchase directly from sellers, as opposed to consumer markets, where products typically go through many wholesalers before the product is delivered to the end user. Page Ref: 282 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 11.5 Learning Outcome: Explain the role of marketing in organizations Skill: Application 78) Which defining word or phrase below best captures the meaning of capital items? A) bulk loads B) directly used in the production process C) to the consumer within a year D) permanent E) stable Answer: D Explanation: D) Capital items are permanent goods or services; they have expected lives of more than a year and, typically, of several years. Page Ref: 283 Difficulty: Difficult Objective: 11.6 Learning Outcome: Explain the role of marketing in organizations Skill: Concept Chapter 12 30) Which of the following terms refers to the monetary amount added to a product's cost to the seller in order to sell it at a target profit? A) profit margin B) breakeven cost C) revenue D) revenue margin E) markup Answer: E Explanation: E) Products are marked up from the cost to produce the product in order that they may be sold at a profit. Page Ref: 301 Difficulty: Easy Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 31) Which of the following costs refers specifically to those that change with the quantity of a product sold or produced? A) annual costs B) variable costs C) fixed costs D) marginal costs E) market-adjusted costs Answer: BExplanation: B) Variable costs are adjusted with regard to how much of a product is produced or how much is projected to be sold, so that a certain profit can be obtained. Page Ref: 301 Difficulty: Easy Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 32) Which of the following costs refers specifically to those that are unaffected by the quantity of a product sold or produced? A) annual costs B) variable costs C) fixed costs D) marginal costs E) market-adjusted costs Answer: C Explanation: C) Fixed costs are those that it cost to produce the product in the first place. Page Ref: 301 Difficulty: Easy Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 33) Odd-even pricing falls under the category of which of the following? A) price fixing B) psychological pricing C) market pricing D) price lining E) price skimming Answer: B Explanation: B) Odd-even pricing posits that consumers generally don't like to pay an even amount of dollars for their products. It also takes advantage of those consumers who don't understand the concept of "rounding up." Page Ref: 304-305 Difficulty: Easy Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 34) Which of the following pricing strategies has stimulation of sales as a higher priority than maximization of profits? A) price fixing B) price discounting C) price skimming D) price pointing E) price lining Answer: B Explanation: B) This is a strategy often used to introduce a product in an already very populated market. Page Ref: 303 Difficulty: Easy Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting pricesSkill: Concept 35) Which of the following refers to the combination of channels that a firm selects to get a product to end users? A) distribution mix B) transportation strategy C) merchandising system D) marketing plan E) retail system Answer: A Explanation: A) The distribution mix is the total use of distribution to optimally get a product into the hands of consumers. Page Ref: 305 Difficulty: Easy Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Concept 36) Rachel has set up a firm that buys circuit boards from overseas producers and sells them to a local computer manufacturing company. Which title best describes her role in the computer manufacturing distribution mix? A) marketer B) sales agent C) broker D) retailer E) wholesaler Answer: E Explanation: E) A wholesaler buys products from a producer in bulk and sells them to a retailer or other producer. Page Ref: 305 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Application 37) An online comic book store is an example of which type of intermediary? A) marketer B) sales agent C) broker D) wholesaler E) retailer Answer: E Explanation: E) Retailers are those intermediaries who sell the product directly to the consumer. Page Ref: 305 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Application 38) A farmers' market is an example of which type of distribution channel? A) direct distribution B) retail distribution C) wholesale distributionD) distribution by brokers E) distribution by sales agents Answer: A Explanation: A) Since the product is channeled directly from producer to consumer, this is direct distribution. Page Ref: 305-306 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Application 39) Phillip is an independent intermediary who deals in the local produce market of northeast Ohio. Over the years, he has formed long-term relationships and come to represent several farmers in the area in the sale of their produce to local grocery stores. Which of the following titles best describes Phillip's role in the distribution mix of northeast Ohio produce? A) wholesaler B) retailer C) sales agent D) broker E) direct marketer Answer: C Explanation: C) A sales agent sells products from producers directly to consumers or retailers. Page Ref: 306 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Application 40) Which of the following intermediaries matches numerous sellers and buyers as needed, often without knowing in advance who they will be? A) producer representative B) retailer C) syndicated seller D) sales agent E) broker Answer: E Explanation: E) A broker is an agent that matches sellers and buyers in the market. Page Ref: 306 Difficulty: Easy Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 41) Which of the following denotes small retail stores carrying only one product line or category of related products? A) department stores B) bargain retailers C) supermarkets D) convenience stores E) specialty stores Answer: E Explanation: E) Specialty stores carry only one type of product for a certain type of consumer. Page Ref: 307Difficulty: Easy Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 42) In which of the following bargain retailers do the customers view display samples, place orders, and wait briefly while clerks retrieve orders from attached warehouses? A) off-price store B) catalog showroom C) factory outlet D) wholesale club E) discount house Answer: B Explanation: B) Catalog showrooms display samples of items available to order by catalog. Page Ref: 309 Difficulty: Easy Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 43) Which of the following best describes department stores? A) A department store is a large product line retailer organized into smaller, convenience-focused components. B) A department store is a large product line retailer organized into smaller, bargain-focused components. C) A department store is a large product line retailer organized into smaller, producer-focused components. D) A department store is a large product line retailer organized into smaller, product-focused components. E) A department store is a large product line retailer organized into smaller specialty stores. Answer: D Explanation: D) Department stores are characterized by organization by the types of products. Page Ref: 307 Difficulty: Moderate Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 44) Which of the following terms refers specifically to the activities needed to move products efficiently from manufacturer to consumer? A) physical distribution B) the distribution mix C) product distribution D) transportation modes E) product placement Answer: A Explanation: A) Physical distribution is the moving of products from the producer of the product to the eventual consumer who buys the product. Page Ref: 311 Difficulty: Easy Objective: 12.5 Learning Outcome: Describe the major components of effective distribution Skill: Concept 45) Within which of the following storage facilities would one expect to see the widest variety of products stored?A) private warehouse B) public warehouse C) food storage facility D) department store distribution center E) specialty store stockroom Answer: B Explanation: B) Given that public warehouses are utilized by anyone willing to pay the rental fee, this will necessarily have the widest variety of products within it. Page Ref: 311 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 12.6 Learning Outcome: Describe the major components of effective distribution Skill: Concept 46) Which of the following concerns finding the most effective techniques for communicating information about and selling a product? A) market share B) advertising C) promotion D) profit management E) customer relations Answer: C Explanation: C) Promotion is the communication of attributes about a product to the consumer. Page Ref: 314 Difficulty: Easy Objective: 12.6 Learning Outcome: Describe the major components of effective promotion Skill: Concept 47) Which of the following describes two of the primary objectives of promotion? A) positioning and communicating information B) positioning and developing new uses for products C) developing new uses for products and communicating information D) adding value to a product and eliminating competition E) controlling sales volume and eliminating competition Answer: A Explanation: A) These are two of the main four objectives, the others being "adding value" and "controlling sales volume." Page Ref: 314 Difficulty: Moderate Objective: 12.6 Learning Outcome: Describe the major components of effective promotion Skill: Concept 48) Which of the following best characterizes the difference between the roles of advertising and personal selling in the promotional mix of a firm? A) Advertising is, at its worst, very expensive with little return, whereas personal selling is also very expensive, at its worst, but with better returns. B) Advertising, at its best, targets a specific audience about a product, whereas personal selling, at its best, is always dependent on the clients that a seller has. C) Advertising involves public relations with the overall population of consumers, whereas personal sellinginvolves personalized relationships with select individuals. D) Advertising is a relatively new method of promotion, whereas personal selling is the oldest method of promotion. E) Advertising is nonpersonal in its communication about a product, whereas personal selling is highly individualized. Answer: E Explanation: E) The blanketing efforts of advertising versus the individualized care of personal selling best characterizes the different roles that these two methods play. Page Ref: 315-317 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 12.6 Learning Outcome: Describe the major components of effective promotion Skill: Synthesis 49) A firm that wanted to conduct a short-term activity in order to boost consumer buying would use which of the following strategies? A) sales promotions B) special offers C) trade shows D) point-of-sale displays E) missionary selling Answer: A Explanation: A) These would include coupons or premiums. Page Ref: 319 Difficulty: Easy Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Concept 50) Which of the following is NOT a type of sales promotion? A) warranties B) coupons C) point-of-sale displays D) trade show displays E) free samples Answer: A Explanation: A) This is not a sales promotion type—it is concerned with the product after it has been bought. Page Ref: 320 Difficulty: Easy Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Concept 51) Companies that price their product low enough to attract a large number of buyers are most likely pursuing which of the following goals? A) stable market pricing B) high profits C) stable market activity D) low market volatility E) high market share Answer: EExplanation: E) Because marketers are willing to accept minimal profits, even losses, to get buyers to try products, they are likely pursuing a goal of high market share. A goal of high market share indicates that the marketer is aiming to eventually supply a larger portion of the market. Page Ref: 300 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 52) The sales price of a product is given as the product's cost to the seller plus which of the following quantities? A) breakeven price B) revenue price C) variable price D) fixed price E) markup price Answer: E Explanation: E) Markup is the amount added to an item's cost to sell it at a profit. Page Ref: 301 Difficulty: Moderate Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 53) Which of the following gives the correct formula for calculating markup percentage? A) sales price/markup B) sales price/fixed costs C) fixed costs/variable costs D) markup/sales price E) sales price/variable costs Answer: D Explanation: D) For example, a reasonable sales price of $15 with a markup of $7 yields a markup percentage of 46.7 percent: $7/$15 = 46.7 percent. Page Ref: 301 Difficulty: Moderate Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 54) From the choices below, pick the best definition of the term fixed costs. A) costs that are needed to acquire a fixed market share B) costs that are needed to acquire fixed profits C) costs that are unaffected by the number of goods sold by the firm D) costs that remain the same from year to year E) costs that remain the same across all products Answer: C Explanation: C) Fixed costs are costs that must be paid to produce the product at all, regardless of the number of goods sold by the firm. Page Ref: 301 Difficulty: Moderate Objective: 12.1Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 55) Which of the following strategies is involved with price skimming? A) setting an initial low price to establish a new product in the market B) setting an initial low price to cover new product costs and still generate a profit C) setting a limited number of prices for certain categories or products D) setting an initial high price to establish a new product in the market E) setting an initial high price to cover new product costs and still generate a profit Answer: E Explanation: E) The revenue is often needed to cover development and production costs. Skimming works only if marketers can convince consumers that a new product is truly different from existing products. Page Ref: 303 Difficulty: Moderate Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 56) Which of the following strategies is involved with penetration pricing? A) setting an initial low price to establish a new product in the market B) setting an initial low price to cover new product costs and still generate a profit C) setting a limited number of prices for certain categories or products D) setting an initial high price to establish a new product in the market E) setting an initial high price to cover new product costs and still generate a profit Answer: A Explanation: A) Penetration pricing is used to create consumer interest and stimulate trial purchases among consumers. Page Ref: 303 Difficulty: Moderate Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 57) Which of the following pricing strategies is used by many e-tailers in order to provide flexibility between buyers and sellers in setting a price? A) penetration pricing B) psychological pricing C) breakeven pricing D) fixed pricing E) dynamic pricing Answer: E Explanation: E) Dynamic pricing is a highly variable pricing system. Page Ref: 304 Difficulty: Moderate Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Application 58) Which of the following pricing strategies best describes price lining? A) setting an initial low price to establish a new product in the market B) setting an initial high price to cover new product costs and generate a profit C) setting individually negotiated prices for certain categories of productsD) setting a limited number of prices for certain categories of products E) setting individually negotiated prices for all categories of products Answer: D Explanation: D) Price lining is illustrated when a retailer offers sweatshirts at three amounts: $25, $35, and $50. The ranges in price likely indicate varying quality levels. Page Ref: 304 Difficulty: Moderate Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 59) Which distribution channel is used by Valley Farm Dairy to distribute its products to consumers without intermediaries? A) direct distribution B) retail distribution C) wholesale distribution D) distribution by agents E) distribution by brokers Answer: A Explanation: A) That is, the product travels from the producer directly to the consumer. Page Ref: 305-306 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Application 60) Which distribution channel is used by companies which distribute their goods through their own system of outlets? A) direct distribution B) retail distribution C) wholesale distribution D) distribution by agents E) distribution by brokers Answer: B Explanation: B) This illustrates retail distribution; producers distribute products through retailers. Goodyear maintains its own system of retail stores; Levi's has its own outlets but also produces jeans for other retailers such as Gap. Page Ref: 305 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Concept 61) Convenience stores utilize which kind of distribution? A) direct distribution B) retail distribution C) wholesale distribution D) distribution by agents E) distribution by brokers Answer: C Explanation: C) Wholesalers play a large role in the storage function; faced with rising costs of storage space, many retailers have found that they cannot afford both retail and storage space.Page Ref: 305-306 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Concept 62) Which component of the distribution mix do agents and brokers represent in receiving commissions? A) producers B) consumers C) retailers D) industrial users E) other intermediaries Answer: A Explanation: A) Agents and brokers represent producers and sell to consumers, industrial users, or wholesalers. Page Ref: 306 Difficulty: Moderate Objective: 12.3 Learning Outcome: Describe the major components of effective distribution Skill: Concept 63) In which type of store would you most likely find shoes, furniture, a women's section, and a men's section? A) a supermarket B) a discount house C) a department store D) a convenience store E) a specialty store Answer: C Explanation: C) Department stores are organized into specialized departments; these stores usually handle a wide array of goods and offer a variety of services. Page Ref: 307 Difficulty: Moderate Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 64) Which of the following gives examples of bargain retailers? A) bakery outlet, athletic shoe store B) local bakery, discount shoe chain C) bakery thrift shop, athletic shoe store D) bakery thrift shop, shoe factory outlet E) local bakery, shoe factory outlet Answer: D Explanation: D) Bargain retailers, such as these, carry wide ranges of products and come in many forms. Page Ref: 307-309 Difficulty: Moderate Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Application 65) Which of the following bargain retailers generate large sales volume by offering a wide variety of new products at substantial price reductions? A) discount housesB) catalog showrooms C) second-hand stores D) factory outlets E) direct-response bargain marketing Answer: A Explanation: A) Discount houses began by selling large numbers of items at large discounts on a cash-only basis. As these retailers began to establish themselves, they eventually evolved into moving to better locations, improving décor, selling better-quality merchandise, and offering department store services. Page Ref: 307 Difficulty: Moderate Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 66) In which of the following retail outlets is there a most direct communication line between producer and consumer? A) e-retailing B) specialty store retailing C) catalog showroom retailing D) mail-order retailing E) brokered retailing Answer: D Explanation: D) Mail order is an example of direct-response retailing, in which the producer is directly communicating to the consumers, usually via mail catalogs. Page Ref: 307-309 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Synthesis 67) What are the three major classifications of retail outlets in the United States? A) large-sized outlets, medium-sized specialty shops, small-sized convenience stores B) product-based retailers, discount-based retailers, convenience-based retailers C) quality-based retailers, quantity-based retailers, specialty-based retailers D) producer-owned retailers, franchised retailers, independently owned retailers E) brick-and-mortar retailers, e-retailers, hybrid retailers Answer: B Explanation: B) The three major classifications relate to the overall goal of service to the customer. Page Ref: 307 Difficulty: Difficult AACSB: Reflective thinking skills Objective: 12.4 Learning Outcome: Describe the major components of effective distribution Skill: Concept 68) Which of the following describes the function of search engines that act as collections of business Web sites representing diverse products? A) Internet service providers B) electronic storefronts C) cybermalls D) e-catalogsE) interactive retailing Answer: C Explanation: C) After entering a cybermall, consumers can navigate by choosing from a list of stores, product listings, or departments. Page Ref: 310 Difficulty: Moderate Objective: 12.5 Learning Outcome: Describe the major components of effective distribution Skill: Concept 69) Home Shopping Club and QVC are examples of which of the following retail sales outlet? A) direct selling B) video marketing C) electronic shopping D) virtual selling E) telemarketing Answer: B Explanation: B) Video marketing, a long-established form of interactive marketing, lets viewers shop at home from TV screens by phoning in or e-mailing orders. Page Ref: 311 Difficulty: Moderate Objective: 12.5 Learning Outcome: Describe the major components of effective distribution Skill: Application 70) J.C. Penney owns and maintains its own warehouses. What is this type of warehouse called? A) public warehouse B) relay warehouse C) distribution center D) private warehouse E) storage warehouse Answer: D Explanation: D) A private warehouse is owned by a single manufacturer, wholesaler, or retailer. Page Ref: 311 Difficulty: Moderate Objective: 12.6 Learning Outcome: Describe the major components of effective distribution Skill: Application 71) Which of the following will a large firm utilize when it needs temporary storage space for a large amount of products in immediate demand? A) public warehouses B) distribution centers C) relay warehouses D) private warehouses E) storage warehouses Answer: A Explanation: A) Public warehouses are independently owned and operated; because companies rent only the space they need, these facilities are popular with firms needing storage only during peak periods. Page Ref: 311 Difficulty: Moderate Objective: 12.6Learning Outcome: Describe the major components of effective distribution Skill: Concept 72) Which of the following is the fastest and most expensive transportation mode? A) railroads B) airplanes C) pipelines D) water carriers E) trucks Answer: B Explanation: B) Air is the fastest and most expensive form of transportation. Page Ref: 312 Difficulty: Moderate Objective: 12.6 Learning Outcome: Describe the major components of effective distribution Skill: Concept 73) Which of the following is the slowest and the cheapest mode of transportation? A) railroads B) planes C) pipelines D) water carriers E) trucks Answer: D Explanation: D) Networks of waterways allow water carriers to reach many areas throughout the world; this mode is the slowest and the cheapest. Page Ref: 312 Difficulty: Moderate Objective: 12.6 Learning Outcome: Describe the major components of effective distribution Skill: Concept 74) Which of the following is involved in the final stage in the buyer decision process? A) After the buyer has purchased the product, the marketer asks for feedback on the quality of the product. B) After the buyer has purchased the product, the marketer promotes more advanced versions of the product. C) After the buyer has purchased the product, the marketer provides customer assistance for use of the product. D) After the buyer has purchased the product, the marketer reminds the buyer that he or she made a wise purchase. E) After the buyer has purchased the product, the marketer promotes related products by the same company. Answer: D Explanation: D) During the final stage, advertising and personal selling can remind customers that they made wise purchases. Page Ref: 315 Difficulty: Moderate Objective: 12.6 Learning Outcome: Describe the major components of effective promotion Skill: Concept 75) Which of the following is crucial for high-priced consumer products such as homes and cars? A) creative selling B) interactive marketing C) missionary sellingD) order processing E) trade shows Answer: A Explanation: A) Creative selling can help persuade customers to purchase a high-priced item. Page Ref: 319 Difficulty: Moderate Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Concept 76) Which of the following are examples of premiums? A) contests that reward winners with free samples of the product B) free items given out at trade shows C) coupons for reduced prices on certain products D) reduced-price items available upon purchase of a product E) reduced-price items available during a sales promotion Answer: D Explanation: D) Premiums are free or reduced-priced items given to consumers in return for buying a specified product. Page Ref: 318 Difficulty: Moderate Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Application 77) Which of the following best describes the purpose of point-of-sale displays? A) to inform customers about the benefits of the products B) to entice customers to buy additional products C) to make it easier for customers to find products D) to promote the reputation of the company offering certain products E) to target specific messages about the product to customers Answer: C Explanation: C) POS displays make it easier for customers to find products and easier for sellers to eliminate competitors. Page Ref: 318 Difficulty: Moderate Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Concept 78) Which of the following describes best what distinguishes publicity among all other forms of promotion? A) Publicity is less directed than other forms of promotion. B) Publicity is less effective than other forms of promotion. C) Publicity is more impersonal than other forms of promotion. D) Publicity is cheaper than other forms of promotion. E) Publicity is more direct than other forms of promotion Answer: D Explanation: D) Given that publicity is free, it is indeed cheaper than any other form of promotion. Page Ref: 319 Difficulty: Moderate Objective: 12.7 Learning Outcome: Describe the major components of effective promotionSkill: Concept 79) A well-established Internet provider is facing stiff competition from several new companies. Which of the following techniques would it use in order to demonstrate to consumers that its product is superior to that of its competitors? A) order processing B) sales promotions C) direct marketing D) creative selling E) missionary selling Answer: D Explanation: D) With creative selling, salespeople persuade buyers to purchase their product by providing information about its benefits. Page Ref: 319 Difficulty: Difficult Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Application 80) A highly successful bakery specializes in making cherry tarts. Which of the following costs at the bakery is NOT variable? A) cost of cherries B) cost of flour C) cost of wax paper liners D) cost of the oven E) cost of heating the oven Answer: D Explanation: D) The oven is the only cost listed here that is not directly dependent on the number of tarts made—its cost will remain constant no matter how many tarts are made and sold. Page Ref: 301 Difficulty: Difficult Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Application 81) Betty's Breads is trying to calculate its breakeven point. Monthly fixed costs are $5,255. The cost of making one loaf of bread, considering labor and materials, is $3.50. Betty's sells the bread at $6 per loaf. How many loaves does Betty's need to sell each month in order to break even? A) 251 B) 626 C) 1502 D) 2102 E) 2200 Answer: D Explanation: D) Breakeven point (in units) = fixed costs/(price - variable cost per unit). In this scenario, breakeven point = $5255/($6 - $3.50) = 2102 loaves of bread. Page Ref: 302 Difficulty: Difficult AACSB: Analytic skills Objective: 12.1 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Application82) Which of the following assumptions is the strategy of pricing above the market based on? A) Higher price implies higher quality. B) Higher price means higher customer support. C) Higher prices means higher customer satisfaction. D) Higher price creates higher demand. E) Higher price means easier distribution. Answer: A Explanation: A) Godiva Chocolates and Patek Philippe watches price high by promoting prestige and quality images, for example. Page Ref: 303 Difficulty: Difficult Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 83) Which of the following scenarios would allow a firm to price below prevailing market price and still succeed? A) The public does not learn that the firm's product is indeed inferior. B) The firm can offer a product of acceptable quality. C) The firm can offer an entirely new product. D) The firm has effective promotional tactics and marketing strategies. E) The firm can effectively criticize its competitors' products. Answer: B Explanation: B) Budget and Dollar car rental companies following this strategy, for example. Page Ref: 303 Difficulty: Difficult Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Concept 84) Which of the following options best describes an example of price lining? A) having the price of each individual song on an online music store be determined by length of song B) having the price of each individual song on an online music store be determined by popularity of the band C) having the price of each individual song on an online music store be determined by user auction D) having the price of each individual song on an online music store be determined by reverse auction E) having the price of each individual song on an online music store be determined by which of several categories the song falls into Answer: E Explanation: E) With price lining, a retailer predetermines three or four price points at which a particular product will be sold. Page Ref: 304 Difficulty: Difficult AACSB: Analytic skills Objective: 12.2 Learning Outcome: Discuss strategies for setting and adjusting prices Skill: Application 85) Which of the following is most directly related to differences in transportation cost from mode to mode? A) packing necessary for the product B) fuel efficiency of the carrier C) regularity of use of a given carrierD) discount agreements with the carriers E) delivery speed Answer: E Explanation: E) Differences in transportation cost from mode to mode are most directly related to delivery speed. Page Ref: 312 Difficulty: Difficult Objective: 12.6 Learning Outcome: Describe the major components of effective distribution Skill: Concept 86) Marshall is a route salesperson for a beverage company. Which of the following would most likely occupy his work time? A) trade show demonstrations B) sales promotions C) missionary selling D) direct mail advertising E) order processing Answer: E Explanation: E) Since route salespeople have a set of regular customers, their main task is processing orders for inventory. Page Ref: 317 Difficulty: Difficult Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Application 87) A new Internet provider has entered a very crowded market. Which of the following methods would it most likely use in order to make consumers aware of its services? A) creative selling B) direct marketing C) interactive marketing D) missionary selling E) personal selling Answer: D Explanation: D) This technique is most concerned with promoting the reputation of the company rather than increasing sales. Page Ref: 318 Difficulty: Difficult Objective: 12.7 Learning Outcome: Describe the major components of effective promotion Skill: Application