Question 1

A marketing audit is necessary because:

Accepted Answer

A)  it is a standard practice adopted by all companies worldwide. 
B)  managers may pursue certain strategies blindly, when other strategies might be more effective. 
C)  regulators require marketing audits at the same time as accounting audits. 
D)  all of the above. 
A)  it is a standard practice adopted by all companies worldwide. 
B)  managers may pursue certain strategies blindly, when other strategies might be more effective. 
C)  regulators require marketing audits at the same time as accounting audits. 
D)  all of the above.

Question 2

According to the "80/20 rule":

Accepted Answer

A)  marketing accounts for 80 percent of the consumer's dollar. 
B)  only 20 out of every 100 firms use formal marketing control programs. 
C)  about 20 percent of a typical firm's customers are unprofitable to serve. 
D)  even though a firm might be showing a profit, 80 percent of its business might be coming from only 20 percent of its products or customers. 
E)  None of the above is correct. 
A)  marketing accounts for 80 percent of the consumer's dollar. 
B)  only 20 out of every 100 firms use formal marketing control programs. 
C)  about 20 percent of a typical firm's customers are unprofitable to serve. 
D)  even though a firm might be showing a profit, 80 percent of its business might be coming from only 20 percent of its products or customers. 
E)  None of the above is correct.

Question 3

A company produces three product lines and a different marketing manager is responsible for each line. Most marketing expenses are specific to each line, but a common sales force sells all three lines. Sales reps are paid by commission, with a different commission for each product line. In this case, in a marketing cost analysis,

Accepted Answer

A)  the contribution-margin approach would probably divide personal selling expense based on commission expense for each product line. 
B)  a full-cost approach would ignore commission expense since it is not a fixed cost. 
C)  sales commissions are a variable expense and would not be considered in the contribution-margin approach. 
D)  the full-cost approach would be easier to do if all sales reps were paid a straight salary. 
E)  None of the above is true. 
A)  the contribution-margin approach would probably divide personal selling expense based on commission expense for each product line. 
B)  a full-cost approach would ignore commission expense since it is not a fixed cost. 
C)  sales commissions are a variable expense and would not be considered in the contribution-margin approach. 
D)  the full-cost approach would be easier to do if all sales reps were paid a straight salary. 
E)  None of the above is true.

Question 4

Averages are useful for summarizing data--but only analyzing "averages" may be misleading according to:

Accepted Answer

A)  the "iceberg principle." 
B)  AIDA. 
C)  hypothesis--testing theory. 
D)  the "law of central tendency." 
E)  the "50/50" rule. 
A)  the "iceberg principle." 
B)  AIDA. 
C)  hypothesis--testing theory. 
D)  the "law of central tendency." 
E)  the "50/50" rule.

Question 5

The best way to do a sales analysis is to first break down sales by customer type, and then geographic region.

Accepted Answer

A) True 
 B)False

Question 6

The "contribution margin approach" to marketing cost analysis:

Accepted Answer

A)  allocates all costs to products or customers. 
B)  should always be used instead of the full-cost approach--so that fixed costs are fully considered. 
C)  focuses management's attention on variable costs rather than total costs. 
D)  assumes that all costs must be allocated. 
E)  None of the above. 
A)  allocates all costs to products or customers. 
B)  should always be used instead of the full-cost approach--so that fixed costs are fully considered. 
C)  focuses management's attention on variable costs rather than total costs. 
D)  assumes that all costs must be allocated. 
E)  None of the above.

Question 7

Regarding marketing cost analysis,

Accepted Answer

A)  the full-cost approach usually should be used as there are almost always some fixed costs to be allocated. 
B)  the contribution-margin approach focuses attention on variable costs. 
C)  fixed costs should be allocated according to the contribution-margin approach. 
D)  the action implications will be the same whether the full-cost or contribution-margin approach is used. 
E)  the contribution-margin approach provides the most complete allocation of total expenses. 
A)  the full-cost approach usually should be used as there are almost always some fixed costs to be allocated. 
B)  the contribution-margin approach focuses attention on variable costs. 
C)  fixed costs should be allocated according to the contribution-margin approach. 
D)  the action implications will be the same whether the full-cost or contribution-margin approach is used. 
E)  the contribution-margin approach provides the most complete allocation of total expenses.

Question 8

Performance indexes:

Accepted Answer

A)  are based on the "iceberg principle." 
B)  show the relation of one value to another. 
C)  are used mainly to eliminate lazy salespeople. 
D)  provide a qualitative measure of what "ought to happen." 
E)  are calculated from the Consumer Price Index. 
A)  are based on the "iceberg principle." 
B)  show the relation of one value to another. 
C)  are used mainly to eliminate lazy salespeople. 
D)  provide a qualitative measure of what "ought to happen." 
E)  are calculated from the Consumer Price Index.

Question 9

When a company hires a consulting firm to do a complete annual review and analysis of its marketing plans and financial performance, this process is a:

Accepted Answer

A)  Marketing audit. 
B)  Performance analysis. 
C)  Performance index. 
D)  Full-cost approach. 
E)  Contribution-margin approach. 
A)  Marketing audit. 
B)  Performance analysis. 
C)  Performance index. 
D)  Full-cost approach. 
E)  Contribution-margin approach.

Question 10

A _____ is a systematic, critical, and unbiased review and appraisal of the basic objectives and policies of the marketing function and of the organization, methods, procedures, and people employed to implement the policies.

Accepted Answer

A)  benchmarking study 
B)  marketing audit 
C)  sales analysis 
D)  full-cost assessment 
E)  marketing strategy survey 
A)  benchmarking study 
B)  marketing audit 
C)  sales analysis 
D)  full-cost assessment 
E)  marketing strategy survey

Question 11

The "contribution-margin approach" to marketing cost analysis:

Accepted Answer

A)  Focuses attention on the allocation of fixed costs. 
B)  Is mainly concerned with the allocation of variable costs. 
C)  Always leads to the same conclusions as the "full-cost approach." 
D)  Is always preferred to the "full-cost approach." 
E)  None of the above. 
A)  Focuses attention on the allocation of fixed costs. 
B)  Is mainly concerned with the allocation of variable costs. 
C)  Always leads to the same conclusions as the "full-cost approach." 
D)  Is always preferred to the "full-cost approach." 
E)  None of the above.

Question 12

A marketing manager who wants to analyze the firm's sales should be aware that:

Accepted Answer

A)  sales invoice files contain little useful information. 
B)  the best way to analyze sales data is according to geographic regions. 
C)  sales analysis involves a detailed breakdown of a company's sales forecasts. 
D)  sales analysis may not be possible unless the manager has made arrangements for the company to capture identifying information about each sale. 
E)  a manager can never have too much data. 
A)  sales invoice files contain little useful information. 
B)  the best way to analyze sales data is according to geographic regions. 
C)  sales analysis involves a detailed breakdown of a company's sales forecasts. 
D)  sales analysis may not be possible unless the manager has made arrangements for the company to capture identifying information about each sale. 
E)  a manager can never have too much data.

Question 13

Which of the following statements best explains the "iceberg principle"?

Accepted Answer

A)  Several salespeople in a sales force usually meet their quotas while many others don't. 
B)  Many salespeople don't make their quotas because they only try to sell to large customers. 
C)  Most consumer decisions are at the 90 percent pre-conscious level. 
D)  Ten percent of a firm's customers usually account for 90 percent of its sales. 
E)  Good performance in some areas may hide poor performance in other areas if only averages are evaluated. 
A)  Several salespeople in a sales force usually meet their quotas while many others don't. 
B)  Many salespeople don't make their quotas because they only try to sell to large customers. 
C)  Most consumer decisions are at the 90 percent pre-conscious level. 
D)  Ten percent of a firm's customers usually account for 90 percent of its sales. 
E)  Good performance in some areas may hide poor performance in other areas if only averages are evaluated.

Question 14

The text's "full-cost approach" to marketing cost analysis:

Accepted Answer

A)  looks only at each customer or product's "contribution margin." 
B)  allocates all costs to products, customers, or other categories. 
C)  looks only at those costs which are directly related to particular alternatives. 
D)  is misleading and should be avoided. 
E)  All of the above. 
A)  looks only at each customer or product's "contribution margin." 
B)  allocates all costs to products, customers, or other categories. 
C)  looks only at those costs which are directly related to particular alternatives. 
D)  is misleading and should be avoided. 
E)  All of the above.

Question 15

A marketing audit should help determine if:

Accepted Answer

A)  current marketing strategies are good ones. 
B)  the company's marketing objectives are reasonable. 
C)  implementation of a marketing program was effective. 
D)  All of the above. 
E)  None of the above. 
A)  current marketing strategies are good ones. 
B)  the company's marketing objectives are reasonable. 
C)  implementation of a marketing program was effective. 
D)  All of the above. 
E)  None of the above.

Question 16

Which of the following statements about the contribution-margin approach is FALSE?

Accepted Answer

A)  It is concerned with the amount contributed by an item or group of items toward covering fixed costs. 
B)  This approach suggests that it is not necessary to consider all costs in all situations. 
C)  Top management almost always finds this approach more useful than full-cost analysis. 
D)  This approach frequently leads to data which suggest a different decision than might be indicated by the full-cost approach. 
E)  It focuses on controllable costs--rather than on total costs. 
A)  It is concerned with the amount contributed by an item or group of items toward covering fixed costs. 
B)  This approach suggests that it is not necessary to consider all costs in all situations. 
C)  Top management almost always finds this approach more useful than full-cost analysis. 
D)  This approach frequently leads to data which suggest a different decision than might be indicated by the full-cost approach. 
E)  It focuses on controllable costs--rather than on total costs.

Question 17

Ideally, a marketing audit should not be necessary.

Accepted Answer

A) True 
 B)False

Question 18

Sales analysis:

Accepted Answer

A)  typically involves reorganizing existing information rather than gathering new information. 
B)  may involve analyzing many different breakdowns of overall sales. 
C)  is usually a good first step when setting up a control system. 
D)  All of the above are true. 
E)  None of the above is true. 
A)  typically involves reorganizing existing information rather than gathering new information. 
B)  may involve analyzing many different breakdowns of overall sales. 
C)  is usually a good first step when setting up a control system. 
D)  All of the above are true. 
E)  None of the above is true.

Question 19

When it comes to marketing cost analysis, a sales rep is likely to favor the full-cost approach over the contribution-margin approach.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements might result from a performance analysis?

Accepted Answer

A)  Our California salesman sold more aluminum tubing than any of our other reps. 
B)  Sophia Sanchez calls on two of our three biggest customers. 
C)  Joshua Voigt sold less tubing to wholesalers than to manufacturers. 
D)  Walker Brown sold more aluminum tubing than steel tubing. 
E)  Pele Ruiz's sales are over his quota. 
A)  Our California salesman sold more aluminum tubing than any of our other reps. 
B)  Sophia Sanchez calls on two of our three biggest customers. 
C)  Joshua Voigt sold less tubing to wholesalers than to manufacturers. 
D)  Walker Brown sold more aluminum tubing than steel tubing. 
E)  Pele Ruiz's sales are over his quota.

Exam 19: Implementing and Controlling Marketing Plans: Evolution and Revolution

A marketing audit is necessary because:

According to the "80/20 rule":

Averages are useful for summarizing data--but only analyzing "averages" may be misleading according to:

The best way to do a sales analysis is to first break down sales by customer type, and then geographic region.

The "contribution margin approach" to marketing cost analysis:

Regarding marketing cost analysis,

Performance indexes:

When a company hires a consulting firm to do a complete annual review and analysis of its marketing plans and financial performance, this process is a:

A _____ is a systematic, critical, and unbiased review and appraisal of the basic objectives and policies of the marketing function and of the organization, methods, procedures, and people employed to implement the policies.

The "contribution-margin approach" to marketing cost analysis:

A marketing manager who wants to analyze the firm's sales should be aware that:

Which of the following statements best explains the "iceberg principle"?

The text's "full-cost approach" to marketing cost analysis:

A marketing audit should help determine if:

Which of the following statements about the contribution-margin approach is FALSE?

Ideally, a marketing audit should not be necessary.

Sales analysis:

When it comes to marketing cost analysis, a sales rep is likely to favor the full-cost approach over the contribution-margin approach.

Which of the following statements might result from a performance analysis?

Marketings Value to Consumers, Firms, and Society

Marketing Strategy Planning

Evaluating Opportunities in the Changing Marketing Environment

Focusing Marketing Strategy With Segmentation and Positioning

Demographic Dimensions of Global Consumer Markets

Final Consumers and Their Buying Behavior

Business and Organizational Customers and Their Buying Behavior

Improving Decisions With Marketing Information

Elements of Product Planning for Goods and Services

Product Management and New-Product Development

Place and Development of Channel Systems

Distribution Customer Service and Logistics

Retailers,wholesalers,and Their Strategy Planning

Promotion-Introduction to Integrated Marketing Communications

Personal Selling and Customer Service

Advertising, Publicity, and Sales Promotion

Pricing Objectives and Policies

Price Setting in the Business World

Managing Marketings Link With Other Functional Areas

Ethical Marketing in a Consumer-Oriented World: Appraisal and Challenges

Economics Fundamentals

Marketing Arithmetic

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