Deck 3: The Marketing Environment, Social Responsibility, and Ethics

Question 1

In what ways is the United States becoming an increasingly diverse nation in terms of culture?

Answer 1

The number of immigrants into the United States has steadily risen during the last 40 years. In the 1960s, 3.3 million people immigrated to the United States; in the 1970s, 4.4 million immigrated; in the 1980s, 7.3 million arrived; in the 1990s, the United States received 9.1 million immigrants; and in the 2000s, more than 8.3 million people have immigrated to the United States. In contrast to earlier immigrants, very few recent ones are of European origin. Another reason for the increasing cultural diversification of the United States is that most recent immigrants are relatively young, whereas U.S. citizens of European origin are growing older. These younger immigrants tend to have more children than their older counterparts, further shifting the population balance. By the turn of the 20th century, the U.S. population had shifted from one dominated by whites to one consisting largely of three racial and ethnic groups: whites, blacks, and Hispanics. The U.S. government projects that by the year 2060, approximately 128.8 million Hispanics, 61.8 million blacks, and 34.4 million Asians will call the United States home. Although the majority of the population still identify themselves as white, Hispanic and Asian ethnicities are expected to grow in the next 50 years, while white non-Hispanics ethnicities are estimated to decrease. Marketers recognize that these profound changes in the U.S. population bring unique problems and opportunities. But a diverse population means a more diverse customer base, and marketing practices must be modified-and diversified-to meet its changing needs.

Question 2

Explain the differences between the competitive structures of a monopoly and an oligopoly.

Answer 2

A monopoly exists when an organization offers a product that has no close substitutes, making that organization the sole source of supply. In reality, most monopolies surviving today are local utilities, which are heavily regulated by local, state, or federal agencies.
An oligopoly exists when a few sellers control the supply of a large proportion of a product. Products facing oligopolistic competition may be homogeneous, such as aluminum, or differentiated, such as package delivery services.

Question 3

Contrast recession and depression.

Answer 3

During a recession unemployment rises, while total buying power declines. Pessimism accompanying a recession often stifles both consumer and business spending. A prolonged recession may become a depression, a period in which unemployment is extremely high, wages are very low, total disposable income is at a minimum, and consumers lack confidence in the economy.

Question 4

When PepsiCo takes the information collected through research and attempts to assess and interpret what it means for its soft-drink marketing efforts, PepsiCo is engaged in environmental

A) scanning.
B) forces.
C) management.
D) manipulation.
E) analysis.

Question 5

Given a new brand of barbecue sauce for which to develop a marketing strategy, describe how you would conduct environmental scanning and analysis.

Question 6

What roles do the Better Business Bureau and the National Advertising Review Board play in self-regulation of business?

Question 7

The Lazy-Boy Furniture Company collects information about a wide variety of competitive, economic, political, legal and regulatory, technological, and sociocultural forces that affect its marketing activities. This process is called

A) environmental scanning.
B) survey of environment.
C) marketing.
D) environmental analysis.
E) marketing information processing.

Question 8

Collecting 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.

Question 9

What are the major forces that are referred to as sociocultural forces and how do they present marketers with both challenges and opportunities?

Question 10

To 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

Question 11

Nabisco learned that health-conscious consumers preferred lower fat snack and lower-carbohydrate foods. At 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. Which of the following best describes Nabisco's action?

A) Environmental scanning
B) Environmental marketing
C) Demarketing
D) Segmentation
E) Environmental analysis

Question 12

Describe several ways in which federal agencies influence marketing activities.

Question 13

In 2009 the Coca-Cola Company introduced the "Freestyler," a new free-standing soda dispensers where consumers can chose from over 120 different types of soda and customize their drink.  Freestylers would take the place of typical dispensers where there are only a few different types of soda brands available.  In order to develop the new dispenser, Coca-Cola collected information on the soda-drinking habits of individuals in several different age groups, as well as information about new technologies for dispensing liquids from vending machines and the sales of its "fountain" syrup for national restaurant chains to use in their soda machines.  Coca-Cola's collection of this information is an example of _____ while the assessment of its impact on the potential for the new "Freestyler" is an example of _________.

A) environmental scanning; environmental analysis
B) an environmental force; environmental scanning
C) environmental analysis; environmental strategy
D) strategizing; environmental scanning
E) strategic management; environmental scanning

Question 14

Three 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.

Question 15

SiriusXM Radio is concerned about how the increasing use of smart phones will affect the future sales of its satellite radio service. The company decides to gather information about the changing trends in music access and delivery to prepare for this trend. Sirius XM's process is called

A) environmental scanning.
B) target marketing.
C) surveying.
D) environmental analysis.
E) dynamic responsiveness.

Question 16

Why must marketers be aware of new developments in technology?

Question 17

Describe what is meant by a consumer's buying power. How might this affect a marketing strategy?

Question 18

According to the textbook, a manager's duties in an environmental analysis include

A) checking information for accuracy, resolving inconsistencies, and assigning significance to the findings.
B) observation and assessment.
C) conducting research, assessment, and reporting.
D) observation, market research, and fact finding.
E) checking the company database, conducting research, and reporting.

Question 19

Explain the difference between procompetitive legislation and consumer protection laws.

Question 20

Explain how a period of recession might affect the marketing of a product.

Question 21

While Silk Soymilk engages in environmental scanning and analysis, the company is more likely to change its products and marketing strategies to adapt to environmental forces rather than trying to influence these forces. Silk Soymilk has a(n) ____ approach to marketing environmental forces.

A) inactive
B) reactive
C) proactive
D) negative
E) variable

Question 22

In today's marketing environment, competitors can take on many forms. For example, Diet Coke can be seen as a competitor to Wrigley's Double Mint chewing gum. In this circumstance, these two products are described as ____ competitors.

A) generic
B) product
C) total budget
D) monopolistic
E) pure

Question 23

What type of competitive structure exists when a firm produces a product that has no close substitutes?

A) Monopoly
B) Oligopoly
C) Monopolistic competition
D) Pure competition
E) Mixed competition

Question 24

Which of the following is not at the generic competitor level for Ford's Expedition sport utility vehicle?

A) Ford's Escape SUV
B) Enterprise car rental
C) Harley Davidson motorcycle
D) Schwinn mountain bike
E) Taxi cab ride

Question 25

The four major 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.

Question 26

After Home Depot gathers information related to its marketing environment, it attempts to define current environmental changes and predict future changes. This determines possible opportunities and threats facing the company. It illustrates the process that is called

A) environmental scanning
B) survey of environment.
C) marketing.
D) environmental analysis.
E) marketing information processing.

Question 27

Marketers who view political forces as being beyond their control are taking a(n) ____ response toward these forces.

A) reactive
B) aggressive
C) proactive
D) competitive
E) liberal

Question 28

When marketers define their target market, they simultaneously establish a set of

A) technologies.
B) monopolies.
C) competitors.
D) government regulations.
E) sociocultural forces.

Question 29

Due to limited resources, a consumer decided to serve Hawaiian Punch to a New Year's Eve party crowd instead of Korbel champagne. As a result of this action, Korbel and Hawaiian Punch can be viewed as ____ competitors.

A) generic
B) product
C) total budget
D) oligopolistic
E) pure

Question 30

Companies 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

Question 31

Companies 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

Question 32

The type of competitive structure that exists in the case where there are almost no substitutes for a product is a(n)

A) monopolistic competition.
B) oligopoly.
C) pure competition.
D) monopoly.
E) noncompetition.

Question 33

____ competitors are the most significant to marketers because buyers see the different products of these firms as direct substitutes for each other.

A) Oligopolic
B) Total budget
C) Generic
D) Product
E) Brand

Question 34

Marketers primarily focus their environmental analysis on ____ competitors.

A) brand
B) product
C) total budget
D) generic
E) monopolistic

Question 35

Companies delivering mixed concrete know that it cannot be shipped farther than twenty-five miles because the concrete might harden in the truck. Citrus County Concrete Company is the only supplier of mixed concrete to customers within a thirty-mile radius. Citrus County Concrete is an example of which one of the following competitive structures?

A) Monopoly
B) Oligopoly
C) Monopolistic competition
D) Pure competition
E) Monopsony

Question 36

____ competitors provide very different products that satisfy the same basic customer need.

A) Brand
B) Generic
C) Total budget
D) Product
E) Marketing

Question 37

The American automobile industry was historically dominated by "The Big Three," referring to General Motors, Ford, and Chrysler. However, as many more foreign competitors began influencing this market, the American companies had to modify and differentiate their products. The automobile industry moved from a(n) ____ structure to a(n) ____ structure.

A) monopolistic; oligopolistic
B) oligopolistic; pure competition
C) oligopolistic; monopolistic competition
D) monopolistic competition; pure competition
E) monopolistic; monopolistic competition

Question 38

____ competitors are those that compete in the same product class, but their products have different features, benefits, and prices.

A) Total budget
B) Generic
C) Brand
D) Product
E) Price

Question 39

Marketers who attempt to influence and change the various environmental forces have a(n) ____ response to these forces.

A) reactive
B) inactive
C) variable
D) positive
E) proactive

Question 40

Toyota has developed aluminum car bodies that are 100 percent recyclable and light enough to help conserve fuel. What kind of response is this to environmental forces?

A) Proactive
B) Competitive
C) Reactive
D) Inactive
E) Controllable

Question 41

When a firm has many potential competitors and tries to develop a marketing strategy to differentiate its products from the competitors' products, a(n) ____ structure exists in the competitive environment.

A) oligopoly
B) monopoly
C) pure competition
D) oligopolistic competition
E) monopolistic competition

Question 42

Which of the following firms would be most likely to have a monopoly for its competitive environment?

A) TimeWarner Cable TV
B) Mitchell Trucking
C) American Airlines
D) Rogers Plumbing
E) Chemlawn Lawn Care

Question 43

Volkswagen is planning its promotional strategy for its Passat model. When compared to others in its class, the Passat has average gas mileage, better comfort ratings, more leg room, better interiors, average dependability, and is made in its plants in Tennessee. Which of the following attributes of a Volkswagen Passat would be most appropriate to emphasize in television commercials during an economic recession?

A) Gas mileage
B) Dependability
C) Made in the U.S.A.
D) Leg room
E) Comfort

Question 44

The two least common competitive structures 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.

Question 45

Assuming that inflation is low, high buying power characterizes the ____ stage of the business cycle.

A) prosperity
B) depression
C) recovery
D) succession
E) recession

Question 46

Publix Supermarket is revising its marketing plan for the upcoming quarter. Publix typically focuses on its wide variety of products and its high quality customer service, having very few weekly "sales." However, during the upcoming quarter, Publix plans to focus on price and value, and promote weekly "values" instead. Publix is most likely in a(n)

A) inflation period.
B) prosperity period.
C) recession.
D) depression.
E) recovery period.

Question 47

Although 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.

Question 48

Total buying power declines during periods of economic

A) recovery.
B) prosperity.
C) recession.
D) uncertainty.
E) expansion.

Question 49

Changes Salon is part of the hair and personal care service industry. In what type of competitive environment is Changes Salon most likely operating?

A) pure competition.
B) a monopoly.
C) monopolistic competition.
D) oligopolistic competition.
E) an oligopoly.

Question 50

J. Pitner Clothing is a medium-size specialty men's and women's clothing store in a market with many other specialty stores, department stores, and discounters. It has established a reputation for offering high-quality, fashionable merchandise with quality service. J. Pitner's competitive environment would best be characterized as

A) a monopoly.
B) an oligopoly.
C) monopolistic competition.
D) pure competition.
E) faceted competition.

Question 51

The Decca Electric Corporation produces light bulbs that are used in refrigerator manufacturing. Currently, only three other companies produce bulbs used in the production of refrigerators, with Decca as the leader in market share. In this case, Decca Electric Corporation would be considered

A) an oligopoly.
B) a monopoly.
C) involved in monopolistic competition.
D) involved in perfect competition.
E) involved in a perfect oligopoly.

Question 52

What type of competitive structure exists when just a few sellers control a large portion of the supply of a product?

A) Monopoly
B) Oligopoly
C) Monopolistic competition
D) Mixed competition
E) Pure competition

Question 53

Consumer confidence and willingness to spend begins to increase during periods of ____, and marketers must remain very flexible to make the necessary adjustments.

A) depression
B) prosperity
C) recovery
D) growth
E) recession

Question 54

The tobacco industry in the United States is dominated by three large companies. When any one of these companies changes its price on tobacco products, the other two companies quickly adjust their prices to match it. From these characteristics, the tobacco industry could best be described as

A) price sensitive.
B) opportunistic.
C) monopolistic competition.
D) an oligopoly.
E) a monopoly.

Question 55

Consumer confidence is at a low during periods of

A) recession.
B) prosperity.
C) recovery.
D) slowdown.
E) depression.

Question 56

In a period of economic recovery, the best marketing strategy for FedEx would be characterized by which of the following features?

A) Flexibility
B) Aggressiveness
C) Austerity
D) Retrenchment
E) Boldness

Question 57

In general, which of the following competitive structures is an organization least likely to operate?

A) Monopoly
B) Monopolistic competition
C) Oligopoly
D) Elastic competition
E) Pure competition

Question 58

The 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) analyzing 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 The Wall Street Journal .

Question 59

Most 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.

Question 60

During which stage of the business cycle is unemployment low and total income relatively high?

A) Repression
B) Prosperity
C) Recovery
D) Recession
E) Depression

Question 61

Which of the following terms refers to consumers' propensity to buy?

A) Disposable income
B) Discretionary income
C) Buying power index
D) Buying power
E) Willingness to spend

Question 62

Shelby's new job with the federal government provides a comfortable income and a fairly stable income. She would like to buy a new car now that she has a job; however, Shelby hesitates to purchase a new car because she is concerned about how poor economic conditions may affect her position in the future. Shelby lacks

A) disposable income.
B) willingness to spend.
C) buying power.
D) credit.
E) discretionary income.

Question 63

Textile companies historically face issues concerning the use of child labor in foreign countries and the various regulations created concerning this labor. The type of marketing environment forces executives for these companies are most likely to try to influence are ____ forces.

A) economic
B) competitive
C) political
D) environmental
E) sociocultural

Question 64

If Julio Ruiz has an income of $30,000, pays $6,000 in rent, $1,200 in utilities, and $5,000 in taxes per year, his disposable income is

A) $7,800.
B) $14,000.
C) $9,000.
D) $25,000.
E) $20,000.

Question 65

Texas rice farmers wish to get their product into the Japanese market but are hindered by a complex maze of regulations imposed by the Japanese government. The farmers are most likely to attempt to influence which aspect of the marketing environment?

A) Sociocultural
B) Technological
C) Competitive
D) Economic
E) Political

Question 66

Discretionary income is associated with all of the following except

A) automobiles.
B) education.
C) pets.
D) furniture.
E) food.

Question 67

Which of the following companies would probably be most interested in tracking discretionary income levels?

A) Safeway food stores
B) BMW automobiles
C) Gulf States Utilities
D) General Mills
E) Florida Orange Growers

Question 68

The accumulation of past income, natural resources, and financial resources is known as

A) income.
B) collected income.
C) credit.
D) wealth.
E) savings.

Question 69

When 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.

Question 70

Why are marketers interested in consumers' levels of disposable income?

A) It accurately predicts future buying power.
B) It increases current buying power.
C) It is what is left after taxes and savings to buy luxuries with.
D) It is a ready source of buying power.
E) It is essential for forecasting future business trends.

Question 71

A 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.

Question 72

Lindsay was reviewing her bank statement for last month. She had paid her rent, her car payment, electric and phone bills, and made three trips to the grocery. Lindsay had also bought tickets to a Katy Perry concert and new clothes to wear to the concert. The money spent on Lindsay's rent, car, electric and phone bills was likely from her ____ , while the money spent on the concert tickets and new clothes was from her _____.

A) Disposable income; savings
B) Gross income; disposable income
C) Disposable income; net income
D) Disposable income; discretionary income
E) Gross income; Savings income

Question 73

Which of the following actions is illegal?

A) Political officials influencing how much a government agency purchases and from whom.
B) Corporate contributions to candidates.
C) Corporate contributions to elected officials.
D) Political officials helping businesses secure foreign markets.
E) Paying political officials not to enforce a particular law.

Question 74

Which of the following statements is true?

A) Political officials can-not influence how much a government agency purchases and from whom.
B) The U.S. Supreme Court ruled that the government is not authorized to ban corporate spending in candidate elections.
C) Company sponsored political advertising can only focus on topics and not on candidates.
D) Political officials can-not accept direct corporate campaign contributions.
E) Companies can-not participate in the political process through lobbying.

Question 75

Which of the following acts was enacted to prevent businesses from restraining trade and monopolizing markets?

A) Sherman Antitrust Act
B) Clayton Act
C) Federal Trade Commission Act
D) Robinson-Patman Act
E) Wheeler-Lea Act

Question 76

Which category of income are marketers most interested in?

A) Wealth
B) Disposable income
C) Discretionary income
D) Total income
E) Extra income

Question 77

The amount of money received through wages, rents, investments, pensions, and subsidies is called

A) income.
B) wealth.
C) discretionary income.
D) prosperity.
E) credit.

Question 78

If all the gas stations in a city collaborated to determine what gas prices should be charged, they would be violating the

A) Wheeler-Lea Act.
B) Clayton Act.
C) Robinson-Patman Act.
D) Sherman Antitrust Act.
E) Celler-Kefauver Act.

Question 79

The strength of a person's "buying power" depends on economic conditions and

A) level of income.
B) size 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.

Question 80

By offering both credit and financing through its GMAC division, General Motors 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.