Posted: November 2nd, 2015

Final Questions

Final Questions

Q1. Which is not a strategy for a retailer to increase its average sale?

a. placing impulse goods in high-traffic locations

b. opening additional hours

c. increasing impulse sales

d. suggestion selling

Q2. An approach to the study of retailing that stresses activities such as buying,

pricing, and personnel practices is a _____ approach.

a. strategic

b. functional

c. institutional

d. retail audit

Q3. Payment for shelf space by manufacturers to supermarkets illustrates _____.

a. the role of manufacturers’ representatives

b. channel power by a retailer

c. channel cooperation by retailers

d. competition in the marketplace

Q4. Only large firms can successfully adjust their retail strategies in response

to consumer preferences.

a. true

b. false

Q5. The first stage in development of a retail strategy should be to determine the

retailer’s _____.

a. most appropriate target market

b. short-run objectives

c. long-run objectives

d. type of business and orientation of the firm

Q6. Channel relations tend to be most volatile in which form of distribution?

a. exclusive distribution

b. intensive distribution

c. selective distribution

d. vertical integration

Q7. Operating costs in supermarkets are higher than those in department stores.

a. true

b. false

Q8. Which form of distribution balances channel cooperation with an increased

opportunity for product sales?

a. exclusive distribution

b. selective distribution

c. intensive distribution

d. dual distribution

Q9. In 2004, the ten largest U.S. retailers earned average after-tax profits

amounting to about _____ percent of sales.

a. 1.1

b. 2.5

c. 3.3

d. 5.7

Q10. Channel conflict can be minimized through intensive distribution and/or

horizontal integration.

a. true

b. false

Q11. Which statement concerning retailing is correct?

a. Retailing activities cannot be performed by wholesalers.

b. It is the last stage in the distribution process.

c. All retail activities are store-based.

d. A lawyer purchasing stationery for use in his/her office is an example of

retailing.

Q12. An approach to the study of retailing which focuses on a retailer’s need to

revise plans continually in order to adapt to a changing environment is the

retailing concept.

a. true

b. false

Q13. A change in retail productivity can have a large impact on consumers and the

economy.

a. true

b. false

Q14. In a revolving credit account, _____.

a. a customer is billed at the end of the month on the basis of the outstanding

cumulative balance

b. no interest is assessed if a consumer pays part of the bill when it is due

c. a customer can exceed his/her credit limit

d. a customer must pay his/her bill in full when it becomes due

Q15. As enunciated by President Kennedy about 45 years ago, consumers have the

right to low prices, safety, full employment, and to be heard.

a. true

b. false

Q16. A fundamental concept of the value chain is the _____.

a. interrelationship among manufacturer, wholesaler, and retailer

b. independence of all channel members

c. notion that value is interpreted similarly by all final consumers

d. notion that value is affected by price alone

Q17. Computerized checkout systems allow retailers to develop up-to-date sales

reports.

a. true

b. false

Q18. Partial, revolving payments are not permitted in _____.

a. revolving credit accounts with a maximum credit limit

b. monthly payment credit accounts

c. open credit accounts

d. option credit accounts

Q19. The reduction of customer defections by 5 percent may result in an increase

in profits of 50 percent.

a. true

b. false

Q20. A customer must pay the bill when it is due with a revolving credit account.

a. true

b. false

Q21. An augmented retail strategy for a discounter could be an expected retail

strategy for a full-service retailer.

a. true

b. false

Q22. An advantage of a retailer-generated credit card is _____.

a. no bad debt or slow-payment problems

b. no need for credit checks

c. low startup costs

d. the encouragement of store loyalty

Q23. Variability in service quality can be reduced through _____.

a. standardizing services

b. development of branches

c. market research

d. warranties

Q24. A basic service is an example of an augmented retail strategy.

a. true

b. false

Q25. Owned-goods service providers often receive competition from _____.

a. outshoppers

b. do-it-yourselfers

c. in-home shoppers

d. personalizing shoppers

Q26. Electronic banking enables cash transactions to occur using retail coding

systems.

a. true

b. false

Q27. Store hours and days during which retailers can conduct business are

regulated by _____.

a. blue laws

b. Green River laws

c. the Robinson-Patman Act

d. the Universal Product Code

Q28. A firm’s organizational mission is reflected in its general attitude toward

consumers, employees, suppliers, competitors, government, and others.

a. true

b. false

Q29. A heavily diversified retailer requires _____.

a. a separate retail strategy for each major retail business unit

b. a uniform strategy so that each retail business unit has a common image

c. a centralized organization structure for all key functional areas

d. the use of a mass marketing strategy

Q30. Signals of performance such as employee satisfaction questionnaires, sales

reports, and inventory records are examples of _____.

a. retail audits

b. feedback

c. tactics

d. retail demographic data

Q31. A retailer’s organizational mission should reflect its competitive advantages

as a retailer.

a. true

b. false

Q32. The lower the efficiency rating figure, the more efficient the retail firm.

a. true

b. false

Q33. Most department stores seek multiple market segments when they provide

several distinctive boutiques.

a. true

b. false

Q34. The personal needs of the retailer during the early, unprofitable stage of

business are paid through _____.

a. a bank credit plan

b. life insurance loans

c. personal savings

d. a personal drawing account

Q35. A retailer that sells to multiple segments should use which management

alternative?

a. professional manager system

b. decentralized structure

c. owner-manager system

d. centralized structure

Q36. A systematic procedure for analyzing the performance of a retailer is _____.

a. tactical performance evaluation

b. a retail audit

c. feedback

d. strategy evaluation

Q37. A retailer’s time demand requirements can be reduced through use of a

partnership organization, self-service formats, and automation/industrialization.

a. true

b. false

Q38. An advantage of buying an existing business versus starting a new business is

_____.

a. the ability to generate new supplier relationships

b. the ability to generate immediate sales

c. no cost for goodwill

d. flexibility in developing and changing retail strategy

Q39. Increased coordination among channel members is a major advantage of clear

channel roles to all channel members.

a. true

b. false

Q40. A disadvantage of a leased department to the leased department operator is

the _____.

a. restriction on goods/services carried

b. high promotional expense

c. poor cash flow due to centralized checkouts

d. creation of a one-stop shopping environment

Q41. The use of franchising and the designation of suggested retail selling prices

are channel control strategies of _____.

a. consumer cooperatives

b. wholesalers

c. retailers

d. manufacturers

Q42. FTC rulings, fair practice laws, and franchise-member organizations have the

effect of _____.

a. shifting some channel power back to franchisees

b. limiting franchisor “right-to-purchase” laws

c. promoting service-sponsor versus manufacturer franchises

d. further constraining decision making relative to franchisees

Q43. Retailing is best characterized by which of the following?

a. independent ownership dominating sales

b. franchise organizations dominating sales

c. ease of entry into the marketplace

d. vertical marketing systems being fully integrated

Q44. The most common form of vertical marketing system is _____.

a. independent vertical marketing system

b. partially integrated marketing system

c. fully integrated marketing system

d. a retail cooperative

Q45. An example of a product/trademark franchise is a(n) _____ franchise.

a. McDonald’s fast-food

b. Wendy’s fast-food

c. Super 8 hotel

d. Chevrolet auto dealership

Q46. In an independent vertical marketing system, _____.

a. successive stages of production and distribution are jointly owned

b. manufacturers seek out wholesalers, who seek out retailers to stock and sell

products

c. two channel members can perform all production and marketing functions

d. marketing operations are franchised

Q47. The use of prototype stores, standardized product lines, and cooperative

advertising characterizes _____.

a. retail cooperatives

b. business format franchising

c. product/trademark franchising

d. vertical marketing systems

Q48. Exclusive distribution, fully integrated vertical marketing systems, and

franchising are used by manufacturers to increase their channel control.

a. true

b. false

Q49. A unique disadvantage for independent retailers is a lack of _____.

a. competitive advantages

b. independence

c. control over strategy

d. management succession

Q50. Independent retailers are characterized by _____.

a. a partnership form of organization

b. a franchise form of distribution

c. vertical integration

d. ownership of only one retail unit

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