Chapter 3The Environment of Marketing Channels

MULTIPLE CHOICE
1. For channel managers, which of the following is a variable in the external environment?
a. Interest rates
b. Emerging competitors
c. Birth rates
d. Inflation rates
e. All of the above
AN! E "p. #$%
&. For the channel manager, the external environments can be ran'ed, from most important
to least important, as!
a. Economic, competitive, socioc(lt(ral, technological, legal.
b. )egal, competitive, technological, economic, socioc(lt(ral.
c. Economic, legal, competitive, technological, socioc(lt(ral.
d. *here is no single se+(ence for all ind(stries at all times.
e. All are e+(all, important.
AN! - "p. #$%
.. *he channel manager m(st anal,/e the external environment in terms of its impact on!
a. *arget mar'ets.
b. Facilitating agencies.
c. Intermediaries.
d. All channel participants.
e. 0etailers and bro'ers.
AN! - "p. #$%
1. Adam 2age, channel manager at 3ood 2rod(cts, Inc., read in this morning4s paper that
two large 5idwest f(rnit(re retailing chains had merged. 2age needs to recogni/e the
potential impact of this change in the external environment on all of the following except!
a. 3ood 2rod(cts, Inc.
b. 2(blic wareho(ses, tr(c'ing firms, and other 5idwest facilitating agencies.
c. All 5idwest f(rnit(re retailers.
d. 6ons(mers.
e. *he change in interest rates on b(siness loans.
AN! E
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*he Environment of 5ar'eting 6hannels
$. According to the text, the most pervasive and obvio(s environmental force affecting
managers in all 'inds of b(siness and nonb(siness organi/ations has been!
a. Economic environment.
b. ocioc(lt(ral environment.
c. 6ompetitive environment.
d. )egal environment.
e. *echnological environment.
AN! A "p. ##%
8. B, the close of the &9th cent(r,, it was said abo(t recessions that!
a. *here wo(ld be more recessions in the f(t(re and the, wo(ld be more severe than
past recessions.
b. Information technolog, co(ld be (sed to warn b(sinesses of potential economic
slowdowns and companies co(ld ma'e ad:(stments.
c. Altho(gh there wo(ld no longer be an, recessions, the new econom, wo(ld
experience more depressions.
d. *he b(siness c,cle of ;boom4 and ;b(st4 wo(ld be more rapid.
e. Economic slowdowns co(ld be diverted b, increasing interest rates and decreasing
inflation.
AN! B "p. ##%
#. *o deal with inflation and recession, channel managers sho(ld do all of the following
except!
a. *a'e responsibilit, for helping intermediaries weather the sit(ation.
b. <ave contingenc, plans prepared to implement when economic conditions
warrant.
c. Increase spending on advertising.
d. =se special trade promotions.
e. Increase prod(ction and inventor,.
AN! E "p. ##7#>%
>. *he ?official@ definition of a recession among professional economists is!
a. Ane +(arter of decline in B-2.
b. *wo consec(tive +(arters of decline in B-2.
c. *hree consec(tive +(arters of decline in B-2.
d. Fo(r consec(tive +(arters of decline in B-2.
e. An, three +(arterl, declines d(ring a two7,ear period.
AN! B "p. ##%
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C. As cons(mer spending slows down in recessionar, periods, mar'eting channels for
DDDDDDDDDD (s(all, feel the impact earliest.
a. cons(mer pac'aged goods
b. cons(mer d(rable goods
c. health services
d. tobacco and alcohol prod(cts
e. None of the above.
AN! B
19. 3hich of the following is a false statement abo(t the &99#7&99> recession?
a. 5an, cons(mers shifted to lower priced prod(cts and brands.
b. 6ons(mer spending in m(ltiple b(siness categories.
c. 6ons(mer spent less on the Internet.
d. =nemplo,ment rates rose.
e. *he b(siness sector fo(nd that it had excess prod(ction capacit,.
AN! 6 "p. ##7#>%
11. In a recession, intermediaries are at greatest ris' if!
a. *he, cannot sell their heav, inventories.
b. *he, do not red(ce prices to final cons(mers.
c. *he, do not increase promotional spending.
d. *he, do not expand their prod(ct lines.
e. *he, do not enhance information technolog, capabilities.
AN! A "p. ##7#>%
1&. -(ring recessionar, periods, channel members at the wholesale and retail levels are
li'el, to!
a. *r, to increase their inventor, levels.
b. )ose sales vol(me.
c. Broaden their prod(ct line.
d. Increase financial borrowing.
e. Improve prod(ct +(alit,.
AN! B "p. ##7#>%
1.. In inflationar, times, channel members can expect cons(mer spending to!
a. low down.
b. Increase.
c. Be (npredictable.
d. -rop off for d(rable goods b(t remain fairl, stead, for non7d(rables.
e. -rop off for services b(t remain fairl, stead, for tangible prod(cts.
AN! 6 "p. #C%
.7.
*he Environment of 5ar'eting 6hannels
11. In inflationar, times, intermediaries generall, can be expected to!
a. toc' (p on inventor, at toda,4s prices.
b. Be enth(siastic abo(t man(fact(rer4s new prod(ct introd(ctions.
c. 2ress(re man(fact(rers for special deals.
d. Increase the prod(ct line.
e. Increase the amo(nt of mone, borrowed from ban's.
AN! 6 "p. #C%
1$. *o help intermediaries thro(gh periods of high inflation, man(fact(rers can do all of the
following except!
a. Increase p(ll promotion.
b. Emphasi/e lower7priced prod(cts in its prod(ct line.
c. 2rovide low cost financing for inventor, p(rchases.
d. -ecrease inventor, t(rnover.
e. 2rovide faster order processing.
AN! - "p. >9%
18. -eflation on a wide scale res(lting in a decline in prices across a broad spectr(m of
goods and services!
a. <as been a characteristic of the 1CC9s econom,.
b. Acc(rs abo(t once each decade.
c. Almost alwa,s res(lts from inflation.
d. <as not occ(rred in the =.. since the 1C.9s.
e. Alwa,s follows periods of inflation.
AN! - "p. >9%
1#. Ather economic iss(es of concern to channel members incl(de all of the following
except!
a. *he federal b(dget deficit.
b. <igh interest rates.
c. *he trade deficit.
d. National debt.
e. New companies entering the mar'etplace.
AN! E "p. >9%
1>. *he real interest rate is!
a. *he same as the nominal rate.
b. Abo(t twice the nominal rate.
c. <igher when inflation is higher.
d. *he nominal rate of interest min(s the inflation rate.
e. *he nominal rate of interest pl(s the inflation rate.
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AN! - "p. >9%
1C. 3hen the val(e of the =.. dollar is high!
a. *he price of =.. prod(cts decreases relative to foreign prod(cts.
b. *he price of =.. prod(cts increases relative to foreign prod(cts.
c. It ta'es fewer foreign dollars to b(, =.. prod(cts.
d. =.. prod(cts become more competitive in foreign mar'ets.
e. It ta'es more =.. dollars to b(, foreign prod(cts.
AN! B "p. >1%
&9. -(ring periods of low inflation!
a. It is easier to pass price increases thro(gh the channel.
b. 5an(fact(rers, wholesalers, and retailers rarel, face b(ilt7in cost press(res.
c. It becomes more diffic(lt to pass price increases thro(gh the channel.
d. Increasing prices to offset cost press(res is more feasible.
e. 5embers of the channel are less sensitive to higher prices.
AN! 6 "p. >9%
&1. -(ring periods of low inflation, passing price increases thro(gh the channel!
a. Becomes more diffic(lt.
b. Becomes less diffic(lt.
c. 5a'es no difference.
d. Increases the length of the channel.
e. None of the above.
AN! A "p. >9%
&&. *o cope with periods of slow economic growth, channel managers need to!
a. Increase prod(ctivit,.
b. Expand prod(ct lines.
c. Increase sales personnel.
d. -ecrease capital expendit(res.
e. -ecrease sales to foreign mar'ets.
AN! A
&.. 6ompetition between Emart and 3al75art is an example of!
a. <ori/ontal competition.
b. Intert,pe competition.
c. Fertical competition.
d. 6hannel s,stem competition.
e. <ori/ontal7vertical competition.
AN! A "p. >&%
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*he Environment of 5ar'eting 6hannels
&1. G6ompetition between an independent hardware store and the hardware department of a
ears store is an example of!
a. Fertical competition.
b. 6hannel s,stem competition.
c. <ori/ontal competition.
d. Intert,pe competition.
e. Fertical mar'eting competition.
AN! - "p. >&%
&$. 5c-onald4s competition with B(rger Eing is an example of!
a. Fertical competition.
b. <ori/ontal competition.
c. Intert,pe competition.
d. Fertical7intert,pe competition.
e. Fertical mar'eting s,stem competition.
AN! B "p. >&%
&8. A wholesaler attempts to sec(re retailer acceptance for its own brand of g(itars. *hat
wholesaler also carries similar g(itars from a man(fact(rer of a nationall, 'nown brand.
*his is an ill(stration of!
a. <ori/ontal competition.
b. Fertical competition.
c. 6hannel s,stem competition.
d. Intert,pe competition.
e. 5(ltiple channel competition.
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&#. Fertical mar'eting s,stems are t,picall, divided into the following three basic categories!
a. 6orporate, contract(al, and hori/ontal.
b. 6ontract(al, vertical, and franchise.
c. Administered, contract(al, and corporate.
d. 6orporate, vol(ntar, associations, and administered.
e. 0etailers4 cooperatives, contract(al, and corporate.
AN! 6 "p. >.%
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&>. 2(re 2la, e7tailers, s(ch as Ama/on and Eto,s, competing with ;bric's and mortar4
companies is an example of what t,pe of competition?
a. Fertical
b. 6hannel s,stem
c. Intert,pe
d. Fertical 5ar'eting s,stems
e. <ori/ontal
AN! 6 "p. >&%
&C. Bift wrapping paper on a grocer4s shelf is an example of!
a. Fertical integration.
b. crambled merchandise.
c. 0etail assortment.
d. <ori/ontal integration.
e. 6hannel d,sf(nction.
AN! B "p. >1%
.9. 0etailers li'e to sell their own brands beca(se of all of the following except!
a. Bross margins are higher.
b. *he, control their own destin,.
c. 6ompetitive comparisons are more diffic(lt.
d. *he, are excl(sive to the retailer.
e. 6ons(mers prefer private label prod(cts.
AN! E "p. >.%
.1. *he most important of the socioc(lt(ral factors listed in the text incl(de all of the
following except!
a. Blobali/ation.
b. 6ons(mer mobilit, and connectedness.
c. -emographics.
d. ocial networ'ing.
e. *he Breen 5ovement.
AN! 6 "p. >#%
.&. DDDDDDDDDDDDDDD is the tem most commonl, (sed to describe interconnectedness and
interdependencies of co(ntries aro(nd the world.
a. Blobali/ation.
b. 6ons(mer mobilit, and connectedness.
c. -emographics.
d. ocial networ'ing.
e. *he Breen 5ovement.
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*he Environment of 5ar'eting 6hannels
AN! A "p. >#%
... GDDDDDDDDDDDD has created world7class c(stomer expectations that need to be satisfied
thro(gh world7class channel strateg,, design and management.G
a. Blobali/ation.
b. 6ons(mer mobilit, and connectedness.
c. -emographics.
d. ocial networ'ing.
e. *he Breen 5ovement.
AN! A "p. >>%
.1. In some of the co(ntries in *ropical Africa, ver, long channels with man, la,ers of
intermediaries are common. (ch channel str(ct(res within the socioc(lt(ral context of
*ropical Africa are!
a. <ighl, inefficient.
b. <ighl, irrational.
c. Not s(ited to the needs of the cons(mers.
d. 0ational and reasonabl, efficient.
e. Archaic and c(mbersome.
AN! - "p. >1%
.$. *he Hapanese distrib(tion s,stem that lin's together man(fact(rers, wholesalers and retail
sales o(tlets is called!
a. *rading companies
b. Export management companies.
c. 6ategor, 'illers.
d. Eeirets(.
e. 5erchant 3holesaler.
AN! - "p. >$%
.8. 0egarding the implications of the connectivit, and mobilit, revol(tion that relates to m7
commerce, which of the following is true:
a. Firt(all, all channel members will need to incl(de m7commerce channels in their
channel mixes.
b. 6hannel members will need to sort o(t the role m7commerce pla,s in their
respective m(lti7channel mix.
c. 6hannel members will need to sort o(t the potential of m7commerce channels.
d. 6hannel members will need to sort o(t the limitations of m7commerce channels.
e. All of the above.
AN! E "p. >>%
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.#. DDDDDDDDDDD is the term that refers to interaction in networ's comprised of individ(als
or organi/ations that are lin'ed together based on some t,pe of common interest.
a. Blobali/ation.
b. 6ons(mer mobilit, and connectedness.
c. -emographics.
d. ocial networ'ing.
e. *he Breen 5ovement.
AN! - "p. >>%
.>. From a mar'eting channels perspective, social networ'ing has!
a. 6a(sed cons(mers to ma'e poor prod(ct choices.
b. Not lived (p to the expectations that the Internet wo(ld allow cons(mers to be
better informed.
c. <elped cons(mers ma'e better prod(ct choices b(t has had no effect on their
channel choices.
d. It has made cons(mers more demanding abo(t the channels the, choose.
e. All of the above.
AN! - "p. >C%
.C. 6hanges in technolog, occ(r!
a. moothl, and predictabl, over time.
b. At a decelerating pace.
c. -o not occ(r evenl, or predicativel, change over time.
d. Anl, at the man(fact(ring level of the mar'eting channel.
e. At accelerating rates in developing co(ntries.
AN! 6 "p. C9%
19. 3hich of the following is a conse+(ence of the digital revolution?
a. )ess than 19I of retailers have web sites.
b. Anline shopping via the Internet has become a mainstream mar'eting channel for
B&6 b(t not B&B mar'ets.
c. 1.> I of man(fact(rers now have web sites.
d. Anline shopping via the Internet has become a mainstream mar'eting channel for
both B&B and B&6 mar'ets.
e. 0etailers are wor'ing hard to avoid (se of web sites.
AN! - "p. C&%
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*he Environment of 5ar'eting 6hannels
11. A widespread acceptance of teleshopping andJor comp(ter shopping might ver, well do
all of the following except!
a. 0ed(ce the need for traditional retail stores.
b. -ecrease changes made b, channel participants.
c. Increase cons(mer shopping efficienc,.
d. Bive rise to new t,pes of facilitating agencies.
e. Bive small retailers the same access to mar'ets as large retailers.
AN! B
1&. 6omp(teri/ed inventor, control s,stems available to all channel members will mean!
a. Increased dominance b, man(fact(rers over retailers.
b. 5ore time for the man(fact(rer to plan prod(ction sched(les.
c. lower responses b, retailers to slow7moving items.
d. -ecreased profits.
e. Better forecasting techni+(es.
AN! B "p. C17C&%
1.. A relativel, new technolog, that (ses an electronic tag to trac' people or prod(cts (sing
radio waves is called?
a. Electronic scanners
b. 6omp(teri/ed inventor, control tags
c. 0FI- tag
d. 2ortable comp(ters
e. =niversal prod(ct codes
AN! 6 "p. C.%
11. All technolog, has both (p sides and down sides. *o man(fact(rers, the downside of
electronic scanners and comp(teri/ed inventor, control s,stems is!
a. 0etailers react ver, +(ic'l, to sales and th(s can s(ddenl, stop ordering slow7
selling prod(ct.
b. 5an(fact(rers are too dependent on retailers for information.
c. 0etailers press(re man(fact(rers for large +(antities of fast7selling prod(cts.
d. An inabilit, to predict c(stomer needs.
e. 5an(fact(rers are (nable to control who has access to information.
AN! A "p. C1%
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1$. 3hich of the following is not a relativel, new t,pe of technolog, that can have a ma:or
impact on mar'eting channels?
a. =niform 2rod(ct 6odes
b. martphones
c. 5obile robots
d. .7- modeling
e. =ltra7wideband technolog,
AN! A
18. An Internet7based technolog, that enables both large and small b(sinesses and
organi/ations to (tili/e comp(ter applications witho(t having to have their own hardware,
software, office comp(ting space, and staff is called!
a. 0aid s,stems.
b. 6lo(d comp(ting.
c. 0FI- tags.
d. 5obile robots that deliver, in large offices.
e. 6omp(teri/ed inventor, s,stem.
AN! B "p. C1%
1#. *he channel manager m(st DDDDDDDDDD the legal environment as it affects the channel.
a. be an expert on
b. have a general 'nowledge of
c. be familiar onl, with fo(r basic pieces of federal legislation relevant to
d. follow closel, and in detail all co(rt cases impinging on
e. retain an attorne, that has 'nowledge of
AN! B "p. C$%
1>. *he implicit, 2attern case indicates that man(fact(rers!
a. ho(ld treat wholesalers and retailers the same.
b. 6annot ass(me the co(rts will r(le that retailers with different operating
characteristics are not in competition.
c. 6an ref(se to deal with channel members who (nderc(t s(ggested retail prices.
d. -o not need to doc(ment their cases.
e. 6annot force franchises to b(, all of their s(pplies from a designated so(rce.
AN! B "p. CC%
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*he Environment of 5ar'eting 6hannels
1C. EKB 2rod(cts, a prod(cer of perf(mes, prohibits its intermediaries from selling
competitive perf(me prod(cts. EKB is engaged in!
a. elective distrib(tion.
b. F(ll7line forcing.
c. Excl(sive dealing.
d. 0ef(sal to deal.
e. 2(shing.
AN! 6 "p. C#%
$9. A piece of federal legislation that specificall, deals with price discrimination is the!
a. 6la,ton Act.
b. Baitman70oberson Act.
c. 2atman75organ Act.
d. 2rice 5aintenance Act.
e. 0obinson72atman Act.
AN! E "p. C$%
$1. *he DDDDDDDDDDDDDDD Act passed in 1C11 granted powers to investigate and enforce
(nfair methods of competition in interstate commerce.
a. 6eller7Eefa(ver
b. herman Anti7*r(st
c. 0obinson72atman
d. Federal *rade 6ommission
e. 6la,ton
AN! - "p. C$%
$&. A federal act that specificall, deals with the anticompetitive iss(es of ac+(isitions and
mergers thro(gh vertical integration is the!
a. herman Antitr(st Act.
b. Federal *rade 6ommission Act.
c. 6eller7Eefa(ver Act.
d. 5organ tanle, Act.
e. 0obinson72atman Act.
AN! 6 "p. C8%
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$.. An increasing n(mber of man(fact(rers are opening their own stores that carr, the same
merchandise sold b, independent retailers. *his practice introd(ces a potential legal
+(estion regarding!
a. 0esale restrictions.
b. -(al distrib(tion.
c. Excl(sive dealing.
d. Intensive distrib(tion.
e. Bilateral distrib(tion.
AN! B "p. C#%
$1. 3hen <Lagen -a/s, the 2illsb(r,7owned premi(m ice cream compan,, told its
wholesalers that its polic, was to sell onl, thro(gh wholesalers that did not sell
competing prod(cts, <Lagen -a/s was engaging in!
a. Excl(sive dealing.
b. elective distrib(tion.
c. 0ef(sal to deal.
d. F(ll7line forcing.
e. None of the above.
AN! A "p. C#%
$$. 3hen a s(pplier re+(ires its channel members to carr, a broad gro(p of its prod(cts in
order to sell an, partic(lar prod(ct in the s(pplier4s line, the s(pplier is involved in!
a. elective distrib(tion.
b. Excl(sive dealing.
c. F(ll7line forcing.
d. 0esale restrictions.
e. 2rice maintenance.
AN! 6 "p. C>%
$8. 2rice maintenance laws enacted b, state governments that allowed retail price fixing,
were no longer exempted from federal antitr(st legislation with the repeal of the!
a. 0obinson72atman Act.
b. 5iller7*,dings and 5cB(ire Acts.
c. 0obeson7Hohnson and <astings Acts.
d. 6eller7Eefa(ver Act.
e. 5cB(ire7*,dman and 5organ Acts.
AN! B "p. 199%
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*he Environment of 5ar'eting 6hannels
$#. *he ?6olgate -octrine@ is!
a. *he legal basis for the American -ental Association4s endorsement of toothpastes.
b. *he common term for state level ?fair trade laws@.
c. *he legal basis for sellers to (se their own criteria and :(dgment in selecting
channel members
d. *he legal basis for man(fact(rers retaining some c(stomers as ?ho(se acco(nts@.
e. Allows the practice of price maintenance in the mar'eting channel.
AN! 6 "p. 199%
$>. *erritorial restrictions constit(te one of the ma:or t,pes of!
a. *,ing agreement restrictions.
b. F(ll7line forcing restrictions.
c. -(al distrib(tion restrictions.
d. 2rice discrimination.
e. 0esale restrictions.
AN! E "p. 191%
$C. Interbrand competition vers(s intrabrand competition has been eval(ated b, the co(rts in
considering!
a. Fair trade laws.
b. -(al distrib(tion.
c. *,ing agreements.
d. Fertical integration.
e. 0esale restrictions.
AN! E "p. 191%
89. -(al distrib(tion occ(rs when!
a. A man(fact(rer (ses more than one channel.
b. A man(fact(rer sells its prod(cts (nder different brand names to the same
c(stomer.
c. *wo or more different channel str(ct(res for the same prod(ct exist.
d. A firm distrib(tes thro(gh its own verticall,7integrated channel.
e. A man(fact(rer sells the same prod(ct thro(gh two competing retail o(tlets.
AN! 6 "p. C#%
81. *he Business Electronics Corp. v. Sharp Electronics Corp. case has generall,!
a. 5ade it harder for man(fact(rers to exercise price control over channel members.
b. 5ade it easier for man(fact(rers to exercise price control over channel members.
c. <ad no effect on the man(fact(rer4s abilit, to control prices.
d. 0es(lted in strict prohibition of price control b, man(fact(rers over channel
members.
e. Eliminated totall, ?free riders@ from mar'eting channels.
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AN! B "p. 191%
8&. An example of DDDDDDDDDDDD occ(rred when 5icrosoft incl(ded the Internet Explorer
software into its 3indows operating s,stem.
a. a t,ing agreement
b. d(al distrib(tion
c. f(ll7line forcing
d. intrabrand competition
e. vertical integration
AN! A "p. 19&%
8.. DDDDDDDDDDDDD exist"s% when a s(pplier re+(ires its channel members to carr, a broad
line of its prod(cts.
a. -(al distrib(tion
b. F(ll7line forcing
c. Excl(sive dealing
d. Fertical integration
e. *,ing Agreements
AN! B "p. C>%
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