CHAPTER 3

The Marketing Environment

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Given a new brand of barbecue sauce for which to develop a marketing strategy, describe how you would conduct environmental scanning and analysis. AACSB: Analytic DF: M Page: 64 Type: KN Explain the differences between the competitive structures of a monopoly and an oligopoly. AACSB: Communication, Marketing plan DF: M Page: 6 Type: KN escribe what is meant by a consumer!s buying power. "ow might this affect a marketing strategy# AACSB: Analytic DF: ! Page: " Type: KN %ontrast recession and depression. AACSB: Communication DF: M

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Explain how a period of recession might affect the marketing of a product. AACSB: #e$lecti%e T&inking DF: ! Page: " Type: KN Explain the difference between procompetitive legislation and consumer protection laws. AACSB: Communication DF: ! Page: 4 Type: KN escribe several ways in which federal agencies influence marketing activities. AACSB: Analytic DF: ! Page: 4 Type: KN *hat roles do the +etter +usiness +ureau and the ,ational -dvertising .eview +oard play in self/ regulation of business# AACSB: Analytic DF: M Page: 4' ( Type: KN *hy must marketers be aware of new developments in technology# AACSB: Tec&nology DF: ! Page: ) Type: KN *hat are the ma2or forces that are referred to as sociocultural forces# AACSB: Di%er*ity DF: M Page: +, Type: KN 3n what ways is the 4nited 5tates becoming an increasingly diverse nation in terms of culture# AACSB: Di%er*ity DF: M Page: +, Type: KN

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Chapter 3: The Marketing Environment 8o monitor changes in the marketing environment effectively, marketers must engage in a: environmental scanning and analysis. b: economic scanning c: self/regulatory analysis d: marketing research analysis e: information collecting An*: a AACSB: Communication, Marketing plan DF: ! -.: -., Page: 64

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%ollecting information from secondary sources such as business, government, trade, and general/interest publications plays an important role in a: environmental analysis. b: competitive forces. c: environmental scanning. d: procompetitive legislation. e: self/regulatory forces. An*: c AACSB: Communication, Marketing plan DF: ! -.: -., Page: 64 Type: KN 8hree primary methods of collecting information for environmental scanning are a: marketing research, company records, and advance orders. b: secondary sources, company records, and observation. c: executive knowledge, media, and marketing research. d: observation, secondary sources, and marketing research. e: company database, executive knowledge, and research. An*: / AACSB: Communication, Marketing plan DF: M -.: -., Type: KN

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ell %omputer collects information about a wide variety of competitive, economic, political, legal and regulatory, technological, and sociocultural forces that affect its marketing activities. 8his process is called a: environmental scanning. b: survey of environment. c: marketing. d: environmental analysis. e: marketing information processing. An*: a AACSB: Communication, Marketing plan DF: M -.: -., Page: 64 Type: AP 3f 9;9 9ars %andies found a maga<ine article that provided key information on the television viewing habits of ma2or candy consumer groups, this would be an example of information obtained through environmental a: scanning. b: forces. c: analysis. d: strategi<ing. e: management. An*: a AACSB: Analytic, Marketing Plan DF: ! -.: -., Page: 64 Type: AP

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Chapter 3: The Marketing Environment =9 .adio is concerned about how the increasing use of 9>3 players will affect the future sales of its satellite radio service. 8he company decides to gather information about the changing trends in music access to prepare for this trend. =9 .adio!s process is called a: environmental scanning. b: target marketing. c: surveying. d: environmental analysis. e: dynamic responsiveness. An*: a AACSB: Analytic, Marketing Plan DF: M -.: -., Page: 64 Type: AP

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Environmental scanning means ??????????? information about the marketing environment, whereas environmental analysis is concerned with ??????????? this information. a: assessing@ collecting b: assessing@ interpreting c: collecting@ assessing d: interpreting@ observing e: gathering@ observing An*: c AACSB: Communication, Marketing plan DF: ! -.: -., Page: 64 Type: KN *hen >epsi%o takes the information collected through research and attempts to assess and interpret what it means for its soft/drink marketing efforts, >epsi%o is engaged in environmental a: scanning. b: forces. c: management. d: manipulation. e: analysis. An*: e AACSB: Communication, Marketing plan DF: ! -.: -., Page: 64 Type: AP ,abisco learned that health/conscious consumers preferred lower fat snack and lower/carbohydrate foods. -t the same time, the firm saw sales of such products slumping and was careful not to launch any new varieties of these products for a while. *hich of the following 0e*t describes ,abisco!s action# a: Environmental scanning b: Environmental marketing c: emarketing d: 5egmentation e: Environmental analysis An*: e AACSB: Analytic, Strategy DF: M -.: -., Page: 64 Type: AP -fter "ome epot gathers information related to its marketing environment, it attempts to define current environmental changes and predict future changes. 8his determines possible opportunities and threats facing the company. 3t illustrates the process that is called a: environmental scanning. b: survey of environment. c: marketing. d: environmental analysis. e: marketing information processing. An*: / AACSB: Analytic, Strategy DF: M -.: -., Page: 6( Type: AP

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Chapter 3: The Marketing Environment 9arketers who attempt to influence and change the various environmental forces have aAn: ????? response to these forces. a: reactive b: inactive c: variable d: positive e: proactive An*: e AACSB: Communication, Marketing plan DF: M -.: -., Page: 6( Type: KN 8oyota has developed aluminum car bodies that are 111 percent recyclable and light enough to help conserve fuel. *hat kind of response is this to environmental forces# a: >roactive b: %ompetitive c: .eactive d: 3nactive e: %ontrollable An*: a AACSB: Analytic, Marketing Plan DF: M -.: -., Page: 6(166 Type: AP -lthough 9att!s company engages in environmental scanning and analysis, he feels more comfortable changing his policies and strategies to adapt to environmental forces rather than trying to influence these forces. 9att has aAn: ????? approach to marketing environmental forces. a: inactive b: reactive c: proactive d: negative e: variable An*: 0 AACSB: Analytic, Strategy DF: M -.: -., Page: 6(166 Type: AP 9arketers who view political forces as being beyond their control are taking a ??????????? response toward these forces. a: reactive b: aggressive c: proactive d: competitive e: liberal An*: a AACSB: Communication, Marketing plan, *trategy DF: M -.: -., Page: 6( Type: C2 8he textbook suggests that the 0e*t approach a firm can take in responding to marketing environmental forces is a: reactive. b: proactive. c: inactive. d: active. e: variable. An*: e AACSB: Communication, Marketing plan, *trategy DF: ! -.: -., Page: 66 Type: KN

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Chapter 3: The Marketing Environment *hen marketers define their target market, they establish a set of a: technologies. b: monopolies. c: competitors. d: government regulations. e: sociocultural forces. An*: c AACSB: Communication, Marketing plan, *trategy DF: M -.: -., Page: 66 Type: KN

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%ompanies that market products with similar features, benefits, and prices to the same customer group are known as ????????? competitors. a: generic b: product c: brand d: total budget e: monopolistic An*: c AACSB: Communication, Marketing plan DF: D -.: -.3 Page: 66 Type: KN *hich of the following would represent a brand competitor for Bord!s Escape "ybrid sport utility vehicle# a: "onda >ilot b: 8oyota!s "ighlander "ybrid c: "onda %ivic "ybrid d: 8axi ride e: %hevrolet 8ahoe rented from -vis An*: 0 AACSB: Communication, Marketing plan DF: D -.: -.3 Page: 66 Type: AP ?????????? competitors provide very different products that satisfy the same basic customer need. a: +rand b: Generic c: 8otal budget d: >roduct e: 9arketing An*: 0 AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 66 Type: KN ??????????? competitors are those that compete in the same product class, but their products have different features, benefits, and prices. a: 8otal budget b: Generic c: +rand d: >roduct e: >rice An*: / AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 66 Type: KN *hich of the following is not at the generic competitor level for Bord!s Expedition sport utility vehicle# a: 5aturn 5CD b: Enterprise car rental c: "arley avidson motorcycle d: 5chwinn mountain bike e: 8axi cab ride An*: a AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: 66 Type: AP

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Chapter 3: The Marketing Environment 9arketers primarily focus their environmental analysis on ???? competitors. a: brand b: product c: total budget d: generic e: monopolistic An*: a AACSB: Communication, Marketing plan DF: M -.: -.3

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3n today!s marketing environment, competitors can take on many forms. Bor example, iet %oke can be seen as a competitor to *rigley!s ouble 9int chewing gum. 3n this circumstance, these two products are described as ??????????? competitors. a: generic b: product c: total budget d: monopolistic e: pure An*: c AACSB: Analytic, Marketing Plan DF: D -.: -.3 Page: 66 Type: AP ue to limited resources, a consumer decided to serve "awaiian >unch to a ,ew Dear!s Eve party crowd instead of Corbel champagne. -s a result of this action, Corbel and "awaiian >unch can be viewed as ??????????? competitors. a: generic b: product c: total budget d: oligopolistic e: pure An*: a AACSB: Analytic, Marketing Plan DF: D -.: -.3 Page: 66 Type: AP %ompanies that compete for the same limited financial resources of the same customers are known as ????????? competitors. a: oligopolic b: total budget c: generic d: product e: brand An*: 0 AACSB: Communication, Marketing plan DF: D -.: -.3 Page: 66'6 Type: KN ??????????? competitors are the mo*t significant to marketers because buyers see the different products of these firms as direct substitutes for each other. a: Eligopolic b: 8otal budget c: Generic d: >roduct e: +rand An*: e AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: 66'6 Type: KN

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Chapter 3: The Marketing Environment 60 9ixed %oncrete cannot be shipped farther than twenty/five miles because the concrete might harden in the truck. %itrus %ounty %oncrete %ompany is the only supplier of mixed concrete to customers within a thirty/ mile radius. %itrus %ounty %oncrete is an example of which one of the following competitive structures# a: 9onopoly b: Eligopoly c: 9onopolistic competition d: >ure competition e: 9onopsony An*: a AACSB: #e$lecti%e T&inking, Marketing Plan DF: M -.: -.3 Page: 6 Type: AP 8he four ma2or competitive structures are a: monopolies, oligopolies, oligopolistic monopolies, and pure competition. b: pure competition, heavy competition, moderate competition, and light competition. c: brand, product, total budget, and generic. d: oligopolies, monopolies, monopolistic competition, and pure competition. e: monopolies, limited competition, oligopolistic competition, and pure competition. An*: / AACSB: Communication, Marketing plan DF: D -.: -.3 Page: 6

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*hat type of competitive structure exists when a firm produces a product that has no close substitutes# a: 9onopoly b: Eligopoly c: 9onopolistic competition d: >ure competition e: 9ixed competition An*: a AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 6 Type: KN 8he type of competitive structure that exists in the case where there are almost no substitutes for a product is aAn: a: monopolistic competition. b: oligopoly. c: pure competition. d: monopoly. e: noncompetition. An*: / AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6 Type: KN 8he -merican automobile industry used to be dominated by F8he +ig 8hree,G including General 9otors, Bord, and %hrysler. "owever, as many more foreign competitors began influencing this market, the -merican companies had to modify and differentiate their products. 8he automobile industry moved from aAn: ?????? structure to aAn: ??????? structure. a: monopolistic@ oligopolistic b: oligopolistic@ pure competition c: oligopolistic@ monopolistic competition d: monopolistic competition@ pure competition e: monopolistic@ monopolistic competition An*: c AACSB: #e$lecti%e T&inking, Marketing Plan DF: M -.: -.3 Page: 6 '6) Type: AP

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Chapter 3: The Marketing Environment 8he /7ite %orporation produces a uniHue type of light bulb that is used in refrigerator manufacturing. / 7ite is the only maker of this light bulb, and there are no close substitutes for it. 3n this case, the /7ite %orporation would be a: an oligopoly. b: a monopoly. c: involved in monopolistic competition. d: involved in perfect competition. e: involved in a perfect oligopoly. An*: 0 AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: 6 '6) Type: AP *hich of the following firms would be mo*t likely to have a monopoly for its competitive environment# a: 8ime*arner %able 8I b: 9itchell 8rucking c: %ontinental -irlines d: .ogers >lumbing e: %hemlawn 7awn %are An*: a AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: 6 '6) Type: AP Mo*t marketers operate in a competitive environment of either a: oligopoly or monopoly. b: oligopoly or monopolistic competition. c: oligopoly or pure competition. d: monopoly or pure competition. e: pure competition or monopolistic competition. An*: 0 AACSB: Analytic, Marketing Plan DF: M -.: -.3

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*hen a firm has many potential competitors and tries to develop a marketing strategy to differentiate its products from the competitors! products, aAn: ??????? structure exists in the competitive environment. a: oligopoly b: monopoly c: pure competition d: oligopolistic competition e: monopolistic competition An*: e AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: 6 '6+ Type: KN *hat type of competitive structure exists when 2ust a few sellers control a large portion of the supply of a product# a: 9onopoly b: Eligopoly c: 9onopolistic competition d: 9ixed competition e: >ure competition An*: 0 AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6 '6+ Type: KN

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Chapter 3: The Marketing Environment 62 3f in an industry, none of the many sellers could influence the price of supply of its products, this industry would be characteri<ed as a: pure competition. b: a monopoly. c: monopolistic competition. d: oligopolistic competition. e: an oligopoly. An*: a AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6 '6+ Type: KN 8he tobacco industry in the 4nited 5tates is dominated by three large companies. *hen any one of these companies changes its price on tobacco products, the other two companies Huickly ad2ust their prices to match it. Brom these characteristics, the tobacco industry could 0e*t be described as a: price sensitive. b: opportunistic. c: monopolistic competition. d: an oligopoly. e: a monopoly. An*: / AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: 6 '6+ Type: AP J. >itner %lothing is a medium/si<e specialty men!s and women!s clothing store in a market with many other specialty stores, department stores, and discounters. 3t has established a reputation for offering high/Huality, fashionable merchandise with Huality service. J. >itner!s competitive environment would 0e*t be characteri<ed as a: a monopoly. b: an oligopoly. c: monopolistic competition. d: pure competition. e: faceted competition. An*: c AACSB: Analytic, Marketing Plan DF: D -.: -.3 Page: 6 '6) Type: AP 3n general, which of the following competitive structures is an organi<ation lea*t likely to operate# a: 9onopoly b: 9onopolistic competition c: Eligopoly d: Elastic competition e: >ure competition An*: e AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: 6 '6) Type: C2 8he two least common competitive structures at the opposite ends of the continuum are a: monopolies and oligopolies. b: pure competition and monopolies. c: monopolistic competition and monopolies. d: pure competition and no competition. e: oligopolies and pure competition. An*: 0 AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6 '6) Type: KN

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Chapter 3: The Marketing Environment 8he best approach for a company to take when monitoring its competitors is a: watching for increases and decreases in competitors! prices and match them. b: analy<ing all information that is readily available about competitors. c: sending employees to competitors! offices and factories to observe their actions. d: developing a system for gathering ongoing information about competitors. e: reading important business publications such as T&e 4all Street 5ournal. An*: / AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6)

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*hich of the following attributes of a 8oyota 5cion would be most appropriate to emphasi<e in television commercials during an economic recession# a: 5tereo system b: >restige c: urability d: 7eg room e: 5porty design An*: c AACSB: Analytic, Strategy DF: ! -.: -.3 Page: " Type: AP 3n a period of economic recovery, the 0e*t marketing strategy for BedEx would be characteri<ed by which of the following features# a: Blexibility b: -ggressiveness c: -usterity d: .etrenchment e: +oldness An*: a AACSB: Analytic, Strategy DF: M -.: -.3 Page: 6)' " Type: AP -ssuming that inflation is low, high buying power characteri<es the ????? stage of the business cycle. a: prosperity b: depression c: recovery d: succession e: recession An*: a AACSB: Analytic, Strategy DF: ! -.: -.3 Page: 6)' " Type: KN uring which stage of the business cycle is unemployment low and total income relatively high# a: .epression b: >rosperity c: .ecovery d: .ecession e: epression An*: 0 AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6)' " Type: C2 8otal buying power declines during periods of economic a: recovery. b: prosperity. c: recession. d: uncertainty. e: expansion. An*: c AACSB: Communication, Marketing plan DF: !

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Chapter 3: The Marketing Environment -lthough marketing theory supports the contrary, it is more probable that marketing budgets will be cut during periods of economic a: recovery. b: prosperity. c: recession. d: uncertainty. e: expansion. An*: c AACSB: Communication, Marketing plan DF: M -.: -.3 Page: " Type: KN %onsumers begin to become more price and value conscious during periods of a: inflation. b: prosperity. c: recession. d: depression. e: recovery. An*: c AACSB: Communication, Marketing plan DF: ! -.: -.3 Type: KN %onsumer confidence is at a low during periods of a: recession. b: prosperity. c: recovery. d: slowdown. e: depression. An*: e AACSB: Communication, Marketing plan

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%onsumer confidence and willingness to spend begins to increase during periods of ?????, and marketers must remain very flexible to make the necessary ad2ustments. a: depression b: prosperity c: recovery d: growth e: recession An*: c AACSB: Communication, Marketing plan DF: M -.: -.3 Page: " Type: KN 8he strength of a person!s Fbuying powerG depends on economic conditions and a: level of income. b: si<e of resources that can be traded in an exchange. c: how much a consumer will buy. d: a consumer!s spending pattern. e: levels of median wealth. An*: 0 AACSB: Communication, Marketing plan DF: M -.: -.3 Type: KN *hy are marketers interested in consumers! levels of disposable income# a: 3t accurately predicts future buying power. b: 3t increases current buying power. c: 3t is what is left after taxes and savings to buy luxuries with. d: 3t is a ready source of buying power. e: 3t is essential for forecasting future business trends. An*: / AACSB: Analytic, Marketing Plan DF: M -.: -.3

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Chapter 3: The Marketing Environment 8he amount of money received through wages, rents, investments, pensions, and subsidies is called a: income. b: wealth. c: discretionary income. d: prosperity. e: credit. An*: a AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: " Type: KN 3f 8oby .oberts has an income of K31,111, pays K',111 in rent, K1,211 in utilities, and K&,111 in taxes per year, his disposable income is a: K(,)11. b: K1$,111. c: K0,111. d: K2&,111. e: K21,111. An*: / AACSB: Analytic, Marketing Plan DF: D -.: -.3 Page: " Type: AP *hich category of income are marketers most interested in# a: *ealth b: isposable income c: iscretionary income d: 8otal income e: Extra income An*: 0 AACSB: Analytic, Marketing Plan DF: M -.: -.3

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*hat is the most important factor in distinguishing disposable income from income# a: 8axes b: "ousing c: Employment levels d: %onsumer spending e: 5aving An*: / AACSB: Communication, Marketing plan DF: M -.: -.3 Page: Type: C2 - person!s buying power is a function of a: disposable income. b: past income, natural resources, and financial resources. c: wages, rents, and investments. d: income, wealth, and credit. e: discretionary income. An*: / AACSB: Communication, Marketing plan DF: M Type: KN iscretionary income is associated with all of the following e6cept a: automobiles. b: education. c: pets. d: furniture. e: food. An*: e AACSB: Communication, Marketing plan DF: M Type: C2

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Chapter 3: The Marketing Environment (1.

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"eidi decided to spend some of her saved money on tickets to a %old >lay concert coming to town, and now she is planning on buying a new outfit for the concert. *hat type of resources is "eidi making decisions about# a: isposable income b: *ealth c: +uying power d: iscretionary income e: 5avings income An*: / AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: , Type: AP 8he accumulation of past income, natural resources, and financial resources is known as a: income. b: collected income. c: credit. d: wealth. e: savings. An*: / AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: ,

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*hich of the following companies would probably be mo*t interested in tracking discretionary income levels# a: 5afeway food stores b: +9* automobiles c: Gulf 5tates 4tilities d: General 9ills e: Blorida Erange Growers An*: 0 AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: , Type: AP +y offering credit and financing through its G9-% division, General 9otors is trying to help consumers a: expand future buying power at the expense of current buying power. b: expand disposable income at the expense of discretionary income. c: expand current buying power at the expense of future buying power. d: expand both disposable income and wealth. e: decrease both disposable and discretionary income. An*: c AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: 6)' , Type: AP *hen using credit to make purchases, consumers are a: decreasing current buying power and increasing future buying power. b: increasing their present discretionary income to extend purchasing power. c: putting themselves at significant risk of financial disaster. d: forgoing the accumulation of wealth to increase current income. e: increasing current buying power at the expense of future buying power. An*: e AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: , *hich of the following terms refers to consumers! propensity to buy# a: isposable income b: iscretionary income c: +uying power index d: +uying power e: *illingness to spend An*: e AACSB: Communication, Marketing plan DF: M -.: -.3 Type: KN

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Chapter 3: The Marketing Environment -lthough 5helby!s income is comfortable, she hesitates to purchase a new car because she is concerned about how poor economic conditions may affect her company and in turn her future employment. 5helby lacks a: disposable income. b: willingness to spend. c: buying power. d: credit. e: discretionary income. An*: 0 AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: 3 Type: AP 8exas rice farmers wish to get their product into the Japanese market but are hindered by a complex ma<e of regulations imposed by the Japanese government. 8he farmers are mo*t likely to attempt to influence which aspect of the marketing environment# a: 5ociocultural b: 8echnological c: %ompetitive d: Economic e: >olitical An*: e AACSB: Analytic, Marketing Plan DF: ! -.: -.7 Page: 3' 7 Type: AP 8extile companies historically face issues concerning the use of child labor in foreign countries and the various regulations created concerning this labor. 8he type of marketing environment forces executives for these companies are mo*t likely to try to influence are ?????? forces. a: economic b: competitive c: political d: environmental e: sociocultural An*: c AACSB: Analytic, Marketing Plan DF: M -.: -.7 Page: 3' 7 Type: AP *hich of the following is not a reason that marketers try to maintain good relations with elected political officials# a: >olitical officials can influence how much a government agency purchases and from whom. b: >olitical officials can play key roles in helping organi<ations secure foreign markets. c: >olitical officials well disposed toward particular firms or industries are less likely to create or enforce laws and regulations unfavorable to these firms. d: >olitical officials can accept direct corporate campaign contributions. e: >olitical officials who believe that companies in a particular industry are making honest efforts to control pollution are unlikely to create and enforce highly restrictive pollution control laws over that industry. An*: / AACSB: #e$lecti%e T&inking, Strategy DF: M -.: -.7 Page: 3' 7 Type: C2 Ene way for corporations to attempt to influence the political environment is through a: special benefits to employees. b: direct contributions to candidates. c: contributions to elected officials. d: contributions to political action committees. e: organi<ing political action committees. An*: e AACSB: Analytic, Marketing Plan DF: ! -.: -.7 Page: 3' 7

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)2.

Chapter 3: The Marketing Environment *hich of the following acts was enacted to prevent businesses from restraining trade and monopoli<ing markets# a: 5herman -ntitrust -ct b: %layton -ct c: Bederal 8rade %ommission -ct d: .obinson/>atman -ct e: *heeler/7ea -ct An*: a AACSB: Communication, Strategy DF: M -.: -.4 Page: 4 Type: KN

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)3.

3f all the gas stations in a city collaborated to determine what gas prices should be charged, they would be violating the a: *heeler/7ea -ct. b: %layton -ct. c: .obinson/>atman -ct. d: 5herman -ntitrust -ct. e: %eller/Cefauver -ct. An*: / AACSB: Communication, Strategy DF: ! -.: -.4 Page: 4 Type: AP *hich of the following provides protection for and regulates brand names, brand marks, trade names, and trademarks# a: 5herman -ct b: %layton -ct c: .obinson/>atman -ct d: 7anham -ct e: %eller/Cefauver -ct An*: / AACSB: Communication, Strategy DF: D -.: -.4 Page: 4 Type: KN >rocompetitive laws are those designed to a: preserve competition. b: protect the consumer. c: ensure product safety. d: reduce competition. e: limit business lobbying of government officials. An*: a AACSB: Communication, Strategy DF: !

)$.

)&.

-.: -.4

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3nternational Effice 5upplies *holesaler charges different prices to its various customers without any legal 2ustification. 8his company is in violation of the a: 5herman -ntitrust -ct. b: *heeler/7ea -ct. c: 7anham -ct. d: Bederal 8rade %ommission -ct. e: .obinson/>atman -ct. An*: e AACSB: Communication, Strategy DF: ! -.: -.4 Page: 4' ( Type: AP >rice discrimination is prohibited by the ??????????? -ct. a: 5herman b: *heeler/7ee c: .obinson/>atman d: %eller/Cefauver e: %onsumer Goods >ricing An*: c AACSB: Communication, Strategy DF: D

)(.

-.: -.4

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69
)).

Chapter 3: The Marketing Environment 8he 1001 ,utritional 7abeling and Education -ct directly prohibits a: exaggerated claims made by health and fitness products. b: putting the words Fcholesterol/freeG on any food package. c: putting nutritional information on most food products. d: exaggerated health claims on food packages. e: the use of any health claim on food packaging. An*: / AACSB: Communication, Strategy DF: ! -.: -.4

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%onsumer protection legislation deals with all of the following legal concerns e6cept a: consumer safety. b: sale of ha<ardous products. c: monopolistic practices. d: information disclosure. e: health claims on food packages. An*: c AACSB: Communication, Strategy DF: M -.: -.4 Page: (

Type: C2

01.

8he %hildren!s Enline >rivacy >rotection -ct prohibits websites and 3nternet providers from a: selling products to children under the age of 1) b: seeking personal information from children under the age of 13 c: selling products to children under the age of 12 d: doing research about the buying habits of children under 1& e: selling products to children under the age of 1& An*: 0 AACSB: Analytic, Marketing Plan DF: D -.: -.4 Page: ( Type: KN *hich of the following are the mo*t freHuently sentenced organi<ational crimes# a: Balse advertising and price discrimination b: >rice discrimination and fraud c: Braud and antitrust violations d: >rice fixing and antitrust violations e: Braud and price fixing An*: c AACSB: Communication, Strategy DF: M -.: -.4 Page:

01.

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02.

Ef all the federal regulatory units, the ???????????? most heavily influences marketing activities. a: Bood and rug -dministration AB -: b: Bederal %ommunications %ommission AB%%: c: Enviornmental >rotection -gency AE>-: d: Bederal 8rade %ommission AB8%: e: Bederal >ower %ommission AB>%: An*: / AACSB: Communication, Strategy DF: M -.: -.4 Page: Type: KN *hich of the following agencies would most likely have 2urisdiction over the problem with lead in the paint of children!s toys# a: %onsumer >roduct 5afety %ommission b: %hildren!s Enline >rotection -ct c: Bood and rug -dministration d: Environmental >rotection -gency e: ,ational -dvertising .eview +oard An*: a AACSB: Communication, Strategy DF: ! -.: -.4 Page: Type: KN

03.

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0$.

Chapter 3: The Marketing Environment 8he B8% can issue a cease/and/desist order, which is an in2unction to a: report to the B8% immediately. b: stop doing whatever caused the complaint. c: appear before the courts. d: pay for damages caused by negligence of the firm. e: close down the firm until further notice. An*: 0 AACSB: Communication, Strategy DF: ! -.: -.4 Page: Type: KN *hich of the following agencies regulates marketing activities the most# a: Environmental >rotection -gency b: Bood and rug -dministration c: Bederal 8rade %ommission d: +etter +usiness +ureau e: ,ational -dvertising .eview +oard An*: c AACSB: Communication, Strategy DF: ! -.: -.4

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*hich of the following industries is mo*t commonly regulated by state regulatory agencies# a: -utomobile manufacturers b: %igarette producers c: %lothing manufacturers d: 8elevision networks e: 4tility companies An*: e AACSB: Communication, Strategy DF: M -.: -.4 Page: Type: KN 3n its advertisements for +ud 7ight beer, -nheuser/+usch has decided to include a statement saying FCnow when to say when.G 8his is an example of which one of the following types of regulatory forces affecting marketing efforts# a: Bederal regulation b: 5tate regulation c: %ity regulation d: 5elf/regulation e: 5ocial regulation An*: / AACSB: Analytic, Strategy DF: M -.: -.4 Page: +' ) Type: AP *hich of the following regulatory groups is a system of nongovernmental, independent, local regulatory agencies supported by local businesses# a: 8he %hamber of %ommerce b: 8he ,ational -dvertising .eview +oard c: 8he ,ational -dvertising ivision d: 8he +etter +usiness +ureau e: -merican 9arketing -ssociation An*: / AACSB: Analytic, Strategy DF: ! -.: -.4 Page: +' ) Type: KN 8he >harmaceutical .esearch and 9anufacturers of -merica sets guidelines for its member firms to follow regarding the use of unethical practices. 8hus, it is engaging in a: legislation. b: lobbying. c: self/regulation. d: environmental scanning. e: trade restraint. An*: c AACSB: Analytic, Strategy DF: ! -.: -.4 Page: +' ) Type: AP

0(.

0).

00.

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71

Chapter 3: The Marketing Environment 111. Jared +ledsoe hires a local landscape firm to plant trees and shrubs in his yard. 8he firm plants mostly dead plants but refuses to return Jared!s money or replace the dead items. Jared!s 0e*t course of action would be to contact the a: police. b: Bederal 8rade %ommission. c: 5herman %ommission. d: +etter +usiness +ureau. e: federal district court. An*: / AACSB: #e$lecti%e T&inking DF: ! -.: -.4 Page: +' ) Type: AP 111. 8he +etter +usiness +ureau is probably the best/known a: nongovernmental regulatory group. b: state/operated enforcement agency. c: national evaluator of advertisements. d: federal regulatory group. e: self/regulatory unit operating at the national level. An*: a AACSB: Communication DF: M -.: -.4

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112. 3n its advertisements, Johnson!s "air %are >roducts claims that its C78./1$ gel will restore the hair of bald men. 9embers of the ,-.+ believe the claim is unsupportable. *hat action can the ,-.+ take# a: Borce Johnson!s to stop running the advertisement. b: Bile a complaint with the Bederal 8rade %ommission. c: Bine Johnson!s for each time the ad appears. d: 5ue Johnson!s "air %are >roducts in federal court. e: 5ue Johnson!s "air %are >roducts in state court. An*: 0 AACSB: Analytic DF: M -.: -.4 Page: 6' ) Type: AP 113. *hich of the following statements about self/regulatory programs is $al*e# a: 5elf/regulatory programs are usually less expensive than governmental regulatory programs. b: 5elf/regulatory programs! guidelines generally are more realistic and operational. c: ,ongovernmental self/regulatory programs have neither the tools nor the authority to enforce guidelines. d: 5elf/regulatory guidelines generally are stricter than governmental regulatory programs. e: *hen a trade association sets up industry guidelines, some firms that are in the industry but not in the trade association do not follow the guidelines. An*: / AACSB: Analytic, Marketing Plan DF: M -.: -.4 Page: +' ) Type: C2 11$. *hich of the following is an advantage that self/regulatory agencies such as the +++ and the ,-.+ have over governmental laws and regulatory agencies# a: Birms must strictly abide by the rulings of self/regulatory agencies. b: Establishment and implementation are usually less expensive. c: 8hey have better tools to enforce their rulings. d: Guidelines are often stricter and create greater compliance from firms. e: 9oney is very rarely an issue in enforcing decisions of self/regulatory agencies. An*: 0 AACSB: Analytic, Marketing Plan DF: M -.: -.4 Page: +' ) Type: KN 11&. *hen a firm continues to violate what the +etter +usiness +ureau believes to be good business practices, what is one of the main actions the bureau will take# a: 7ead a consumer boycott of the business. b: 5ue the chief executive of the business. c: 3mpose fines on the ownersLmanagers of the business. d: 5upport legal ordinances against the business. e: *arn consumers of the unfair practices. An*: e AACSB: Communication DF: D -.: -.4 Page: +' ) Type: KN

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Chapter 3: The Marketing Environment 11'. *hat national self/regulatory organi<ation screens ads# a: Bederal -dvertising .eview ivision b: ,ational -dvertising .eview +oard c: Bederal %ommunications %ommission d: %onsumer Bederation of -merica e: +etter +usiness +ureau An*: 0 AACSB: Communication DF: ! -.: -.4

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11(. 8echnology is a: the application of scientific knowledge to build products that customers desire. b: the application of knowledge and tools to solve problems and perform tasks more efficiently. c: applied sciences. d: one of the weakest marketing environment forces. e: the result of research performed primarily by universities. An*: 0 AACSB: Communication, Tec&nology DF: ! -.: -.( Page: ) Type: KN 11). 9ore than half of the research of technology created is paid for by a: corporations. b: state and local governments. c: the federal government. d: large universities. e: private investors. An*: c AACSB: Communication, Tec&nology DF: M -.: -.(

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110. Ne8*8eek enhances its visibility to readers by making its maga<ine available on the 3nternet. Ne8*8eek is capitali<ing on which environmental force# a: Economic b: %ompetitive c: >olitical d: 7egal and regulatory e: 8echnological An*: e AACSB: Tec&nology, Marketing Plan DF: ! -.: -.( Page: ) Type: AP 111. 8he rapid adoption of the use of the 3nternet has resulted in rapid changes such as the increase of distance learning, changing social networks, and concerns such as copyright and privacy issues that the government is focusing on. 8hese effects of technology are collectively known as a: reach. b: the self/sustaining nature. c: growth. d: technological advancement. e: dynamics. An*: e AACSB: Tec&nology, Marketing Plan DF: D -.: -.( Page: +" Type: KN 111. *hich of the following is the 0e*t example of utili<ing technology to improve consumer relationships# a: *aiters recording orders on handheld computers b: 5urveying customers to determine their needs c: .esponding to changes in competitors! prices d: 3ntroducing stringent package standards e: .eHuiring dolphin/safe tuna An*: a AACSB: Tec&nology DF: D -.: -.( Page: +"'+, Type: C2

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73

Chapter 3: The Marketing Environment 112. 8echnology assessment is a: measuring how much technology has been incorporated into an organi<ation. b: trying to foresee the effects of new products and processes on the firm!s operation and on society in general. c: assessing how much technology one wants to incorporate into a company in the future. d: 2udging how a firm!s products affect society. e: weighing the cost of new technology to determine whether a firm can afford to use it. An*: 0 AACSB: Tec&nology DF: ! -.: -.( Page: +, Type: KN 113. *hen %isco 5ystems attempts to anticipate the effect of new products and processes on its own innovations, other business organi<ations, and society in general, the firm is engaging in a: product differentiation. b: monopolistic competition. c: technology assessment. d: distinctive promotional methods. e: innovative marketing. An*: c AACSB: Communication, Strategy DF: ! -.: -.( Page: +, Type: AP 11$. 9any health care companies are making adaptations to meet the needs of an aging population as the demand for medical services and products such as diabetes supplies increases. 8his change in marketing strategy is best explained by a change in a: demographics. b: cultural values. c: income levels. d: consumerism. e: subcultures. An*: a AACSB: Di%er*ity DF: ! -.: -.( Page: +, Type: C2 11&. >eople for the Ethical 8reatment of -nimals A>E8-: have demonstrated against the sale of coats made of animal furs. >E8-!s efforts to change shoppers! attitudes represent a ?????????? force for fur retailers. a: technological b: political c: sociocultural d: self/regulation e: strategic An*: c AACSB: Analytic, Strategy DF: ! -.: -.6 Page: +,'+3 Type: AP 11'. +y the turn of the twentieth century, the population of the 4nited 5tates had shifted to three large racial and ethnic groups. 8hese groups are a: blacks, "ispanics, and whites. b: -sians, blacks, and whites. c: -sians, blacks, and "ispanics. d: blacks, 3ndians, and whites. e: "ispanics, 3ndians, and whites. An*: a AACSB: Di%er*ity DF: D -.: -.6 Page: +7 Type: KN 11(. 3n the near future, what subculture will become the second largest group in the 4nited 5tates# a: *hites b: -frican -mericans c: -sians d: "ispanics e: ,ative -mericans An*: / AACSB: Di%er*ity, Strategy DF: ! -.: -.6 Page: +7 Type: KN

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Chapter 3: The Marketing Environment

74

11). 8he %oca/%ola %ompany has recogni<ed the significant increase in population diversity within the 4.5. soft/drink market. *hich one of the following 0e*t illustrates the company!s integration of this knowledge into its marketing strategy# a: -ds featuring nostalgic -mericana b: +onus coupons in %oca/%ola twelve/packs c: -ds featuring "ispanic actors and 8e2ano music d: -ds in T&e Ne8 9orker and #ea/er:* Dige*t e: -ds aimed at children An*: c AACSB: Di%er*ity, Strategy DF: M -.: -.6 Page: +7 Type: AP 110. Ergani<ations that provide smoke/free environments or low/fat products are responding to changes in a: technology. b: the legal environment. c: demographics. d: cultural values. e: political forces. An*: / AACSB: Di%er*ity, Strategy DF: ! -.: -.6 Page: +7'+( Type: C2 121. 9any well/known restaurants and corporations are changing to a completely smoke/free environment, and fewer restaurants offer smoking and nonsmoking sections. 8hese firms are responding to changes in a: federal law. b: cultural values. c: demographics. d: consumerism. e: technological forces. An*: 0 AACSB: Communication, Marketing plan, *trategy DF: M -.: -.6 Page: +7'+( Type: AP 121. %onsumerism is a a: diverse group of individuals and organi<ations opposed to foreign producers that sell products in the 4nited 5tates that are much cheaper than those produced by 4.5. manufacturers. b: social movement that is trying to encourage consumer satisfaction. c: social movement that is reorgani<ing the %ouncil of +etter +usiness +ureaus. d: diverse group of individuals and organi<ations attempting to protect the rights of consumers. e: social movement that provides consumers with means for expressing satisfaction and expressing their gratitude to producers. An*: / AACSB: Communication, Marketing plan DF: ! -.: -.6 Page: +( Type: KN 122. - group of protesters carries signs encouraging people to boycott Joe!s 9arket, a small grocery store in an urban area. 8he protesters claim that Joe!s takes unfair advantage of elderly and minority consumers. 8his protest is part of what we see today as the a: cultural diversity movement. b: civil rights movement. c: urban unrest cycle. d: procompetitive movement. e: consumerism movement. An*: e AACSB: Communication, Marketing plan DF: M -.: -.6 Page: +( Type: AP

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75

Chapter 3: The Marketing Environment 4se the following to answer Huestions 123/12'M 9eyers! 5porting Goods, a national chain, has been doing business with 5ol2ur 5ports, a manufacturer of skateboards, for several years. .ecently, it came to the attention of 9eyers! financial director that the average cost per 5ol2ur 5ports skateboard had substantially increased over that of the previous year. - corporate attorney was notified and began to look into the situation. 8he attorney found that 5ol2ur 5ports was selling a similar number of skateboards to a competitive chain for K11 less per skateboard. 8he attorney for 9eyers! 5porting Goods immediately filed a complaint with the Bederal 8rade %ommission. 123. 5uppose that the 5ol2ur 5ports company was actually discriminating against 9eyer 5porting Goods with its price increase. *hich of the following acts prohibits this type of business behavior# a: 5herman b: *heeler/7ee c: .obinson/>atman d: %eller/Cefauver e: %onsumer Goods >ricing An*: c AACSB: Analytic, Pro/uct, Strategy DF: M -.: -.4 Page: 4' ( Type: AP 12$. 3f the Bederal 8rade %ommission believes that 5ol2ur 5porting Goods is acting in violation of the law, the first move for the B8% is to a: issue a cease/and/desist order. b: issue a complaint stating that the business is in violation of the law. c: seek a monetary penalty. d: issue negative publicity about the company. e: contact the sporting goods manufacturers association An*: 0 AACSB: Analytic, Marketing Plan DF: M -.: -.4 Page: ' ) Type: AP 12&. - regular customer of 9eyers 5porting Goods feels that some of its advertisements are deceptive. "e responded to an ad for sale skateboards one hour after the store opened and found that none were left. *here should he file a complaint# a: Bederal -dvertising %ommission b: ,ational -dvertising .eview +oard c: %onsumer >roduct 5afety %ommission d: +etter +usiness +ureau e: Effice of %onsumer -ffairs An*: / AACSB: Analytic, Marketing Plan DF: ! -.: -.4 Page: +' ) Type: AP 12'. 5uppose that a customer has a complaint against 9eyers 5porting Goods 5tores. "e files a complaint with the +etter +usiness +ureau. *hat action could the +++ take against 9eyers if the complaint was substantiated and 9eyers did not change the offending practice# a: 3ssue a cease/and/desist order. b: 5eek a K11,111 monetary penalty. c: 3ssue a warning to consumers through the local newspaper. d: Erder 9eyers to make restitution. e: 5eek a K&,111 monetary penalty. An*: c AACSB: Analytic, Marketing Plan DF: M -.: -.4 Page: +' ) Type: AP

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Chapter 3: The Marketing Environment 4se the following to answer Huestions 12(/131M

76

- new 4.5. automobile company, 5pecialty 9otors, was established in 211$. 3n 211), a recession caused disposable income to decline, and the annual amount of dollars spent by consumers for automobiles dropped drastically. 5pecialty 9otors faced the problem of trying to determine whether the economy would turn toward prosperity or toward depression. ,o matter what happened, 5pecialty 9otors was also worried about an impending global steel shortage, which would make a big difference in its future marketing plans. 8he economy might recover from the recession, but the automobile makers might be forced to ask consumers to curtail consumption 2ust when the hope of a better year was finally in sight. -ll in all, the future looked dismal for 5pecialty 9otors. 12(. -lthough all types of competition will affect 5pecialty 9otors! marketing performance, it will be mo*t concerned about ????????? competitors. a: total budget b: generic c: Japanese d: product e: brand An*: e AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: 66 Type: AP 12). 3n what type of competitive structure is 5pecialty 9otors operating# a: 9onopoly b: Eligopoly c: 9onopolistic competition d: >erfect competition e: 9onopsony An*: c AACSB: Analytic, Marketing Plan DF: M -.: -.3

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120. *hen 5pecialty 9otors is operating during a recessionary period, its promotion efforts should stress a: low cost. b: value and utility. c: the styling of its cars. d: the status of owning a new car. e: the variety of colors from which to select. An*: 0 AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: " Type: AP 131. 8otal disposable income is at its lowest during which of the following# a: 5tagflation b: .ecession c: .ecovery d: epression e: 3nflation An*: / AACSB: Analytic, Marketing Plan DF: ! -.: -.3

Page: "' ,

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131. 8he income a consumer would use to purchase a 5pecialty 9otors automobile is considered ??????????? income. a: discretionary b: buying power c: disposition d: consumer spending e: comprehensive spending An*: a AACSB: Analytic, Marketing Plan DF: ! -.: -.3 Page: , Type: AP

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77

Chapter 3: The Marketing Environment 132. 8 B 8he marketing environment consists of external forces that directly or indirectly influence an organi<ation!s acHuisition of inputs and generation of outputs. An*: True AACSB: Communication, Strategy DF: ! -.: -., Page: 64 Type: KN 133. 8 B Environmental analysis is the process of collecting information about forces in the marketing environment. An*: Fal*e AACSB: Communication, Strategy DF: ! -.: -., Page: 64 Type: KN 13$. 8 B Environmental analysis helps managers identify potential threats and opportunities linked to environmental changes. An*: True AACSB: Communication, Strategy DF: ! -.: -., Page: 64 Type: KN 13&. 8 B +rand competitors market products with similar features, benefits, and prices to the same customers. An*: True AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 66 Type: KN 13'. 8 B >roduct competitors provide very different products that solve the same problem or satisfy the same basic customer need. An*: Fal*e AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 66 Type: KN 13(. 8 B 8he number of firms that control the supply of a product may affect the strength of competition. An*: True AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 6 Type: KN 13). 8 B - monopoly exists when a firm with many potential competitors attempts to develop a marketing strategy to differentiate its products. An*: Fal*e AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 6 Type: KN 130. 8 B -n oligopoly exists when a firm offers a product that has no close substitutes, making the firm the sole source of supply. An*: Fal*e AACSB: Communication, Marketing plan DF: M -.: -.3 Page: 6 '6+ Type: KN 1$1. 8 B >ure competition is a common competitive environment. An*: Fal*e AACSB: Communication, Marketing plan DF: M Type: KN

-.: -.3

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1$1. 8 B 9onitoring the competitive environment guides marketers in developing competitive advantages. An*: True AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: 6) Type: KN 1$2. 8 B Economic forces determine the si<e and strength of demand for products. An*: True AACSB: Communication, Marketing plan DF: ! -.: -.3 Type: KN

Page: 6)

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Chapter 3: The Marketing Environment 1$3. 8 B - recession is characteri<ed by extremely high unemployment, very low wages, minimal total disposable income, and lack of consumer confidence in the economy. An*: Fal*e AACSB: Communication, Marketing plan DF: M -.: -.3 Page: " Type: KN 1$$. 8 B 8he strength of one!s buying power depends partially on the state of the economy. An*: True AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: "

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Type: KN

1$&. 8 B -n individual!s after/tax income is called his or her discretionary income, which is used for spending andLor saving. An*: Fal*e AACSB: Communication, Marketing plan DF: M -.: -.3 Page: , Type: KN 1$'. 8 B isposable income is used to pay taxes, spend, and save. An*: Fal*e AACSB: Communication, Marketing plan DF: ! Type: KN

-.: -.3

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1$(. 8 B 8he total amount of disposable income is affected by the amount of taxes consumers pay. An*: True AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: " Type: KN 1$). 8 B ecreases in taxes lead to decreases in disposable income. An*: Fal*e AACSB: Analytic, Marketing Plan DF: ! -.: -.3

Page: "

Type: KN

1$0. 8 B 8he amount of future income already committed to past credit agreements influences one!s ability to use more credit. An*: True AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: , Type: KN 1&1. 8 B %redit increases future buying power. An*: Fal*e AACSB: Communication, Marketing plan Type: KN

DF: !

-.: -.3

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1&1. 8 B -n individual can have a high income and very little wealth. An*: True AACSB: Communication, Marketing plan DF: ! Type: KN

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1&2. 8 B *ealth is an accumulation of past income and natural and financial resources. An*: True AACSB: Communication, Marketing plan DF: ! -.: -.3 Page: Type: KN

1&3. 8 B 3f a person has buying power, he or she is influenced only by a product!s absolute price. An*: Fal*e AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: , Type: KN 1&$. 8 B *ealth enables consumers to gain buying power. An*: True AACSB: Communication, Marketing plan Type: KN

DF: !

-.: -.3

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1&&. 8 B Bor a given level of buying power, the larger the family, the greater the willingness to spend. An*: True AACSB: Analytic, Marketing Plan DF: M -.: -.3 Page: 3 Type: KN

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79

Chapter 3: The Marketing Environment 1&'. 8 B - factor that affects willingness to spend is general economic conditions. An*: True AACSB: Communication, Marketing plan DF: ! -.: -.3 Type: KN

Page: 3

1&(. 8 B >olitical and legal forces in the marketing environment are highly interrelated. An*: True AACSB: Analytic, Marketing Plan DF: ! -.: -.7 Page: 3

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1&). 8 B Governments are big buyers, and the people who hold political offices often determine how much is purchased. An*: True AACSB: Analytic, Marketing Plan DF: ! -.: -.7 Page: 3' 7 Type: KN 1&0. 8 B >olitical forces are beyond the control of marketers, and so they can only react to them. An*: Fal*e AACSB: Analytic, Marketing Plan DF: M -.: -.7 Page: 3' 7 Type: KN 1'1. 8 B 3f political officials have positive feelings toward particular firms or industries, they are less likely to create or enforce laws and regulations that are unfavorable for business organi<ations. An*: True AACSB: Analytic, Marketing Plan DF: M -.: -.7 Page: 3' 7 Type: KN 1'1. 8 B -lthough laws limit corporate contributions to campaign funds, corporations sometimes contribute through their employees. An*: True AACSB: Communication, Marketing plan DF: M -.: -.7 Page: 3' 7 Type: KN 1'2. 8 B 9any laws that directly influence marketing activities were enacted either to preserve a competitive atmosphere or to protect consumers. An*: True AACSB: Analytic, Strategy DF: ! -.: -.4 Page: 7 Type: KN 1'3. 8 B 8he 5herman -ntitrust -ct, along with several other laws, is a procompetitive law because it was created to preserve competition. An*: True AACSB: Analytic, Strategy DF: ! -.: -.4 Page: 4' ( Type: KN 1'$. 8 B Braud and antitrust violations are the most freHuently sentenced organi<ational crimes. An*: True AACSB: Communication, Strategy DF: M -.: -.4 Page: ( Type: KN 1'&. 8 B -ll marketers interpret laws and regulations conservatively and strictly to avoid violating a vague law. An*: Fal*e AACSB: Analytic, Strategy DF: M -.: -.4 Page: 6 Type: KN 1''. 8 B +ecause of overlapping areas of responsibilities of regulatory agencies, confusion and conflict regarding 2urisdiction of marketing activities are common. An*: True AACSB: Analytic, Strategy DF: M -.: -.4 Page: 6 Type: KN 1'(. 8 B 8he Bood and rug -dministration influences marketing activities the most. An*: Fal*e AACSB: Communication, Strategy DF: M -.: -.4 Page:

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1'). 8 B 5tate and local regulatory agencies usually do not establish and enforce regulations that conflict with the actions of national regulatory agencies. An*: True AACSB: Analytic, Strategy DF: ! -.: -.4 Page: Type: KN

6 2111 %engage 7earning. -ll .ights .eserved. 8his edition is intended for use outside of the 4.5. only, with content that may be different from the 4.5. Edition. 9ay not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

Chapter 3: The Marketing Environment

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1'0. 8 B ,umerous self/regulatory programs have been created to stop or stall the development of laws and government regulatory groups that would regulate marketing practices. An*: True AACSB: Analytic, Strategy DF: ! -.: -.4 Page: + Type: KN 1(1. 8 B -lthough numerous regulatory forces arise from governmental sources, nongovernmental regulatory forces may also affect marketing decisions. An*: True AACSB: Analytic, Strategy DF: ! -.: -.4 Page: +' ) Type: KN 1(1. 8 B - good example of a government regulatory group at the local level is the +etter +usiness +ureau. An*: Fal*e AACSB: Communication, Strategy DF: M -.: -.4 Page: + Type: KN 1(2. 8 B 8he %ouncil of +etter +usiness +ureaus and the B8% make up the ,ational -dvertising .eview +oard A,-.+:. An*: Fal*e AACSB: Communication, Strategy DF: M -.: -.4 Page: +' ) Type: KN 1(3. 8 B -ll members of an industry are bound to follow trade association guidelines. An*: Fal*e AACSB: Communication, Strategy DF: M -.: -.4 Page: )

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1($. 8 B 8echnology is the application of knowledge and tools to solve problems and perform tasks more efficiently. An*: True AACSB: Tec&nology, Strategy DF: ! -.: -.( Page: ) Type: KN 1(&. 8 B 8echnological developments have a direct impact on creating and maintaining a marketing mix. An*: True AACSB: Tec&nology, Strategy DF: ! -.: -.( Page: ) Type: KN 1('. 8 B 8echnological changes do not directly affect what, how, when, and where products are marketed. An*: Fal*e AACSB: Tec&nology, Strategy DF: M -.: -.( Page: +" Type: KN 1((. 8 B >ersonal computers and cellular phones are technology. An*: Fal*e AACSB: Tec&nology DF: ! -.: -.(

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1(). 8 B 8echnology affects the types of products offered to consumers. An*: True AACSB: Tec&nology, Strategy DF: M -.: -.( 1(0. 8 B 8echnology can help marketers become more productive. An*: True AACSB: Tec&nology, Strategy DF: ! -.: -.( 1)1. 8 B Birms always adopt and use new technology. An*: Fal*e AACSB: Tec&nology, Strategy DF: M

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1)1. 8 B 8hrough technology assessment, managers try to foresee the effects of new products and processes on the firm!s operations and on society. An*: True AACSB: Analytic, Tec&nology, Strategy DF: M -.: -.( Page: +, Type: KN

6 2111 %engage 7earning. -ll .ights .eserved. 8his edition is intended for use outside of the 4.5. only, with content that may be different from the 4.5. Edition. 9ay not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

81

Chapter 3: The Marketing Environment 1)2. 8 B 8he three ma2or components of sociocultural forces are demographic and diversity characteristics, cultural values, and consumerism. An*: True AACSB: Di%er*ity, Strategy DF: ! -.: -.6 Page: +, Type: KN 1)3. 8 B 8he proportion of the 4.5. population that will be over '& years of age is expected to decline by the year 21&1. An*: Fal*e AACSB: Di%er*ity, Strategy DF: M -.: -.6 Page: +, Type: KN 1)$. 8 B 8he number of single men and women living alone is declining. An*: Fal*e AACSB: Di%er*ity, Strategy DF: ! -.: -.6 Page: +3

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1)&. 8 B -n increasingly diverse cultural base in the 4nited 5tates means that marketers face increasingly diverse consumer markets. An*: True AACSB: Di%er*ity, Strategy DF: M -.: -.6 Page: +7 Type: KN 1)'. 8 B %hanges in values have little effect on people!s needs for products. An*: Fal*e AACSB: Communication, Strategy DF: ! -.: -.6

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1)(. 8 B >eople have changed their values regarding the permanence of marriage, which in turn has led to an increased emphasis on people being happily married. An*: True AACSB: Communication, Strategy DF: M -.: -.6 Page: +4'+( Type: KN 1)). 8 B 8he ma2or source of cultural values is the family. An*: True AACSB: Communication DF: ! -.: -.6

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1)0. 8 B 8he ma2or forces that make up the consumerism movement are consumer organi<ations and business organi<ations. An*: Fal*e AACSB: Communication DF: M -.: -.6 Page: +( Type: KN 101. 8 B 8o achieve their ob2ectives, consumer advocates write letters to companies, lobby government agencies, broadcast public service announcements, and boycott companies whose actions they deem irresponsible. An*: True AACSB: Communication DF: ! -.: -.6 Page: +( Type: KN

6 2111 %engage 7earning. -ll .ights .eserved. 8his edition is intended for use outside of the 4.5. only, with content that may be different from the 4.5. Edition. 9ay not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.