Deck 6: Understanding Organizations As Customers

Question 1

A firm that reprocesses a product or service it buys before selling the product again to the next buyer is referred to as a(n)

A)industrial firm.
B)reseller firm.
C)government agency.
D)wholesaler.
E)retailer.

Answer 1

A

Question 2

Which of the following organizational buyers purchases raw materials and parts to reprocess into the finished goods they sell?

A)retailers
B)wholesalers
C)agents
D)manufacturers
E)ultimate consumers

Answer 2

D

Question 3

Manufacturers,wholesalers,retailers,and government agencies that buy goods and services for their own use or for resale are referred to as

A)multinational buyers.
B)resellers.
C)organizational buyers.
D)ultimate consumers.
E)institutional buyers.

Answer 3

C

Question 4

Kim Nagele,the senior sourcing manager at JCPenney,purchases tons of publication paper annually at a cost of hundreds of millions of dollars.As described and inferred in the textbook,Mr.Nagele performs all of the following roles in the JCPenney buying center EXCEPT:

A)user
B)gatekeeper
C)influencer
D)buyer
E)decider

Question 5

The size and number of JCPenney direct mail pieces like catalogs that are designed and mailed to consumers would determine how much paper JCPenney needs to buy.This is an example of __________.

A)derived demand
B)reciprocity
C)a tying agreement
D)derived supply
E)elastic supply

Question 6

Organizational buyers can be divided into three different markets,which are

A)industrial,wholesaler,and retailer.
B)industrial,retailer,and government.
C)retailer,manufacturer,and government.
D)industrial,government,and ultimate consumer.
E)industrial,reseller,and government.

Question 7

According to the textbook,JCPenney buys paper for which of the following medium(a)?

A)in-store signage
B)special advertising inserts in magazines such as Cosmopolitan
C)newspaper inserts and direct mail pieces
D)annual and 10K reports
E)point-of-purchase displays

Question 8

JCPenney looks at several capabilities when selecting a paper supplier.These organizational buying criteria include on-time delivery,the availability,quality and quantity of selected grades of paper,the firm's forestry management and sustainable practices,and price.This examination would be done during the __________ stage of the organizational buying decision process.

A)procurement analysis
B)break-even analysis
C)purchase decision
D)information search
E)alternative evaluation

Question 9

Which of the following types of firms comprises an industrial market?

A)retailing
B)transportation
C)wholesaling
D)state governments
E)federal regulatory agencies

Question 10

Which of these statements regarding organizational buyers is most accurate?

A)Wholesalers and retailers resell the goods they buy without reprocessing them.
B)Wholesalers and retailers alter the goods they sell to meet the specific needs of their customers prior to resale.
C)Manufacturers purchase processed goods and resell them to suppliers who in turn resell them to ultimate consumers.
D)Ultimate consumers can be considered organizational buyers when they purchase in large quantities.
E)Government agency purchases are more similar to ultimate consumer purchases than they are to wholesalers and retailers.

Question 11

All of the following are organizational buyers EXCEPT:

A)industrial firms.
B)government units.
C)ultimate consumers.
D)resellers.
E)wholesalers.

Question 12

When JCPenney buys paper,it considers suppliers' forest management and other sustainability practices.For JCPenney,these are important

A)profit responsibilities.
B)organizational buying criteria.
C)ecological mandates.
D)legal authorities.
E)buying center roles.

Question 13

The marketing of goods and services to companies,governments,or not-for-profit organizations for use in the creation of goods and services that they can produce and market to others,is referred to as __________.

A)integrated marketing
B)institutional marketing
C)business marketing
D)reseller marketing
E)organizational marketing

Question 14

An industrial firm

A)is one that is independently owned and takes title to the merchandise it sells.
B)buys physical goods and resells them again without any reprocessing.
C)deals exclusively with federal,state,and local governments.
D)in some way reprocesses a product or service it buys before selling it again to the next buyer.
E)only produces a product,not a service.

Question 15

Organizational buyers refer to

A)manufacturers,wholesalers,retailers,and government agencies that buy goods and services exclusively for resale.
B)manufacturers,wholesalers,retailers,and government agencies that buy goods and services for their own use or for resale.
C)manufacturers,wholesalers,retailers,and government agencies that buy goods and services exclusively for their own use.
D)firms that buy physical goods and resell them again without any reprocessing.
E)firms that in some way reprocess a good or service they buy before selling it again to the next buyer.

Question 16

A business market is also referred to as

A)a transactional market.
B)a corporate market.
C)organizational buyers.
D)a reseller market.
E)an industrial market.

Question 17

Mining companies,farms,financial services,and fisheries are all examples of

A)consumer markets.
B)cooperative markets.
C)reseller markets.
D)industrial markets.
E)government markets.

Question 18

Business marketing refers to

A)the marketing of goods to companies,governments,or ultimate consumers for use in the creation of goods and services.
B)the marketing of products and services to not-for-profit organizations at a reduced fee or nominal cost for use in the creation of goods and services that they can produce and market to others.
C)the marketing of goods and services to companies,governments,or not-for-profit organizations for use in the creation of goods and services that they can produce and market to others.
D)the marketing of services in the area of intellectual property such as legal,financial,or creative consulting.
E)the marketing of an idea to create interest or generate goodwill,not just for an individual brand but also for an entire industry or product class.

Question 19

Which of the following represents an organizational buyer?

A)A local baker buys sugar at the grocery store to make cookies with his children at home.
B)A dentist buys a new LG SmartTV 55-inch 3D OLED HDTV for her den.
C)Mr.Langley hires a housecleaning service to clean his apartment.
D)The owner of a fried chicken restaurant hires a snow removal service to keep the parking lot clear.
E)The city mayor rents a tuxedo to wear to his daughter's wedding.

Question 20

Organizational buyers include manufacturers,wholesalers,retailers,and government agencies that

A)purchase exclusively from one supplier.
B)are exempt from state and local taxes.
C)sell directly to ultimate consumers.
D)sell goods and services for their own use.
E)buy goods and services for their own use or for resale.

Question 21

Graham-Field Health Products makes hospital beds and wheelchairs from the component parts and materials it buys.It sells these manufactured products to hospitals,nursing homes,and retailers of health care products.Graham-Field Health Products operates in a(n)__________ market.

A)consumer
B)government
C)service
D)industrial
E)reseller

Question 22

In terms of organizational buyers,Amazon.com,Lands' End,and JCPenney would most LIKELY classified as __________.

A)government units
B)resellers
C)manufacturers
D)wholesalers
E)industrial firms

Question 23

Apex Therapeutic buys medical supplies and services from a variety of suppliers for people with hemophilia and other related blood diseases.When Apex sells directly to a person who is a hemophiliac,it would most LIKELY be classified as a(n)__________.

A)industrial service provider
B)healthcare manufacturer.
C)reseller
D)industrial firm
E)government agency

Question 24

Wholesalers and retailers that buy physical products and resell them without any reprocessing are referred to as

A)industrial firms.
B)reseller firms.
C)government agencies.
D)consumer product firms.
E)nonprofit firms.

Question 25

When the Federal Aviation Administration (FAA)purchases radars for 22 major air traffic control centers in the U.S. ,it is operating as a(n)

A)government unit.
B)industrial market.
C)business market.
D)consumer market.
E)service provider.

Question 26

The services market sells diverse services such as legal advice,auto repair,and dry cleaning;along with finance,insurance,and real estate businesses,and transportation,__________ and public utility firms,and not-for-profit organizations,these firms represent about 75 percent of all industrial firms.

A)wholesaling
B)retailing
C)government units
D)communication
E)manufacturing

Question 27

The reseller market includes

A)manufacturers.
B)logistics and supply chain providers.
C)government agencies.
D)end-user service providers.
E)retailers and wholesalers.

Question 28

Itex Corporation,a marketer of Photostat products used in the graphic arts field,buys photo sensitized paper from Eastman Kodak Company,packages it with the Photostat brand name,and sells it directly to amateur photographers.In this context,Itex Corporation is most LIKELY classified as a

A)manufacturer.
B)reseller.
C)service provider.
D)government agency.
E)industrial firm.

Question 29

European Style Furniture (ESF),headquartered in New York,acquires fine furniture from several high quality manufacturers in Europe and enjoys exclusive distribution rights from them to sell to furniture stores throughout the U.S.In this context,ESF is most LIKELY classified as a

A)producer.
B)reseller.
C)service provider.
D)government agency.
E)industrial firm.

Question 30

Federal,state,and local agencies that buy products and services for the constituents they serve are referred to as

A)industrial markets.
B)reseller markets.
C)consumer markets.
D)government units.
E)global markets.

Question 31

Liberty Medical Supply is a home delivery service that sells diabetes testing supplies,prescription drugs,and other supplies directly to consumers to assist them in the management of their health-related conditions.Since Liberty Medical does not make any changes to the supplies that it obtains from manufacturers,it would most LIKELY be classified as a(n)__________.

A)industrial service provider
B)health care manufacturer
C)industrial firm
D)reseller
E)government agency

Question 32

Which of the following is a service business within the industrial market?

A)construction
B)mining
C)insurance
D)government
E)farming

Question 33

When the General Services Administration (GSA),an agency of the federal government,purchased 116 Chevy Volts from General Motors for its vehicle fleet,it was operating as a(n)

A)industrial market.
B)business market.
C)consumer market.
D)government unit.
E)service provider.

Question 34

When Louisiana State University buys new laptops for its faculty,it is operating as a(n)

A)industrial market.
B)business market.
C)government unit.
D)consumer market.
E)service provider.

Question 35

Mile High Frozen Foods is a distributor for McDonalds.It also bakes the buns used by McDonalds in several states.It purchases flour,yeast,and sesame seeds,manufactures the buns,and then ships them to McDonalds' stores.Mile High Frozen Foods is operating in a(n)__________ market.

A)consumer
B)government
C)industrial
D)service
E)reseller

Question 36

Keystone Foods,which invented the individual quick freeze process for beef,provides McDonald's with millions of pounds of chicken,beef,and fish annually for use in its restaurants.The firm sources the animal proteins from farms and processes them in a variety of ways,such as breading or freezing,before selling them to McDonald's.Keystone is operating in a(n)__________ market.

A)consumer
B)government
C)service
D)industrial
E)reseller

Question 37

Archer Daniels Midland Co.(ADM)is the world's largest cocoa-bean processor.It buys cocoa beans and converts them into cocoa powder and cocoa butter,which it then sells to companies like Hershey's that manufacture consumer products containing chocolate.ADM is operating in a(n)__________ market.

A)consumer
B)government
C)service
D)reseller
E)industrial

Question 38

__________ comprise the highest percentage of firms in industrial markets.

A)Manufacturing firms
B)Construction firms
C)Agricultural firms
D)Mining companies
E)Service companies

Question 39

The services market sells diverse services such as legal advice,auto repair,and dry cleaning.Along with finance,insurance,real estate businesses,and __________,communication and public utility firms,as well as not-for-profit organizations,these firms represent about 75 percent of all industrial firms.

A)wholesalers
B)transportation
C)retailers
D)government units
E)educational institutions

Question 40

The services market sells diverse services such as legal advice,auto repair,and dry cleaning.Along with __________,insurance,and real estate businesses,and transportation,communication and public utility firms,and not for profit,these firms represent about 75 percent of all industrial firms.

A)finance
B)wholesalers
C)retailers
D)government units
E)educational institutions

Question 41

International trade statistics indicate the largest exporting industries in the United States focus on __________.

A)ultimate consumers
B)organizational buyers
C)governmental agencies
D)domestic consumers
E)foreign consumers

Question 42

The City of Denver contracts with Solid Waste Management to provide trash collection services for its citizens.The city is operating as a(n)

A)government unit.
B)industrial market.
C)business market.
D)consumer market.
E)service provider.

Question 43

Based on Figure 6-1 above,what is the NAICS code for cable and other subscription programming?

A)511
B)5152
C)51512
D)51520
E)511515

Question 44

The North American Industry Classification System (NAICS)system designates industries with a numerical code in a defined structure.A six-digit coding system is used.The fourth digit designates a(n)

A)industry subsector.
B)industry group.
C)specific industry.
D)individual country-level national industry.
E)sector of the economy.

Question 45

The North American Industry Classification System (NAICS)system designates industries with a numerical code in a defined structure.A six-digit coding system is used.The fifth digit designates a(n)

A)industry subsector.
B)industry group.
C)specific industry.
D)individual country-level national industry.
E)sector of the economy.

Question 46

The North American Industry Classification System (NAICS)system designates industries with a numerical code in a defined structure.A six-digit coding system is used.The sixth digit designates a(n)

A)industry subsector.
B)industry group.
C)specific industry.
D)individual country-level national industry.
E)sector of the economy.

Question 47

Based on Figure 6-1 above,what is the MOST LIKELY industry sector represented by NAICS code 51?

A)manufacturing
B)fisheries
C)information
D)publishing
E)retailing

Question 48

The North American Industry Classification System (NAICS)system designates industries with a numerical code in a defined structure.A six-digit coding system is used.The first two digits designate a(n)

A)subsector of the economy.
B)industry group.
C)specific industry.
D)individual country-level national industry.
E)sector of the economy.

Question 49

Amtrak,the U.S.passenger train service,purchases train cars from Siemens,a German manufacturing company.This purchase is an example of

A)the product life cycle.
B)global organizational markets.
C)market dynamics.
D)reciprocity.
E)supplier development.

Question 50

Which of the following statements about the North American Industry Classification System (NAICS)is most accurate?

A)After being used for more than 50 years,the NAICS was replaced by the Standard Industrial Classification (SIC)system.
B)The NAICS permits comparability across countries but does not accurately measure new or emerging industries.
C)One drawback to the NAICS is that its industry classifications are inconsistent with the International Standards Organization (ISO).
D)The NAICS groups economic activity to permit studies of market share,demand for goods and services,import competition in domestic markets,and similar studies.
E)The NAICS is a five-digit code that allows comparison of industries even when information is limited.

Question 51

The North American Industry Classification System (NAICS)permits a firm to

A)find the NAICS codes of its present customers and then obtain NAICS-coded lists for similar firms.
B)learn the names of the purchasing agents of all prospective customers.
C)sell to any company within North America as long as it is not a monopoly.
D)engage in benchmarking with companies manufacturing and/or marketing similar products.
E)conduct an industry-wide SWOT analysis to determine internal strengths and weaknesses and external opportunities and threats of current and prospective competitors.

Question 52

S.-based Pratt & Whitney sells aircraft engines to Europe's Airbus S.A.S. ,which in turn sells passenger airplanes to Japan Airlines that flies businesspeople around the world.This is an example of

A)the product life cycle.
B)reseller dynamics.
C)a global organizational market.
D)ISO 9000.
E)the business cycle.

Question 53

The system that provides common industry definitions for Canada,Mexico,and the United States,which makes it easier to measure economic activity in the three member countries of the North American Free Trade Agreement (NAFTA),is referred to as the

A)Standard Industrial Code System (SICS).
B)United Nations Central Product Classification System (UNCPCS).
C)National Codes of Industry System (NCIS).
D)North American Industry Classification System (NAICS).
E)Federal System of International Organizations (FSIO).

Question 54

The NAICS,whose logo is shown above,provides common industry definitions for

A)Canada,England,and the United States.
B)North America,Asia,and Europe.
C)North America,Central America,and South America.
D)Canada,England,Australia.
E)Canada,Mexico,and the United States.

Question 55

The NAICS is consistent with the International Standard Industrial Classification of All Economic Activities,which is published by the __________ to facilitate measurement of global economic activity.

A)United Nations (UN)
B)European Union (EU)
C)International Standards Organization (ISO)
D)North American Free Trade Agreement (NAFTA)
E)North American Product Classification System (NAPCS)

Question 56

A disadvantage of the North American Industry Classification System (NAICS)is that

A)it only lists the top ten firms in any particular industry.
B)it is too difficult and confusing to read.
C)it only covers organizations with sales in excess of (US)$1 million.
D)it makes it possible to find how the firm's customers are coded.
E)five-digit national industry codes are not always available for all three countries.

Question 57

The North American Industry Classification System (NAICS)provides common industry definitions to facilitate the measurement of economic activity for the member countries of the

A)European Union (EU).
B)United Nations (UN).
C)North American Free Trade Agreement (NAFTA).
D)North Atlantic Treaty Organization (NATO).
E)World Trade Organization (WTO).

Question 58

The North American Industry Classification System (NAICS)

A)provides common industry definitions for North America,Central America,and South America to measure economic activity in the Western Hemisphere.
B)provides common industry definitions between Canada and the United States to measure economic activity and reduce barriers of trade for cross-border firms.
C)provides a classification system for products and services that is consistent worldwide.
D)provides a classification system for products and services that is consistent across North America,Central America,and South America to measure economic activity in the Western Hemisphere.
E)provides common industry definitions for Canada,Mexico,and the United States to measure economic activity in the three member countries.

Question 59

The North American Industry Classification System (NAICS)system designates industries with a numerical code in a defined structure.A six-digit coding system is used.The third digit designates a(n)

A)industry subsector.
B)industry group.
C)specific industry.
D)individual country-level national industry.
E)sector of the economy.

Question 60

The acronym of the NAICS logo above stands for

A)National Association of Industrial Compliance Standards.
B)National Association of Industrial Communication Systems.
C)North American Industrial Communication Standards.
D)North American Industry Classification System.
E)North Atlantic Industrial Classification System.

Question 61

Important buying process characteristics in organizational buying behavior include which of the following?

A)Few large transactions are made over the Internet due to concerns of industrial espionage.
B)Negotiations,purchases,and delivery occur in real time at an accelerated rate.
C)There are often reciprocal arrangements and negotiations between buyers and sellers.
D)Most purchases are made through government-licensed negotiators.
E)Direct selling to organizational buyers is rare because it is cost-prohibitive.

Question 62

The demand for industrial products and services that is driven by demand for consumer products and services is referred to as

A)derivative marketing.
B)derived demand.
C)derived supply.
D)demand elasticity.
E)sequential demand.

Question 63

Important product or service characteristics in organizational buying include which of the following?

A)A heavy emphasis is placed on loyalty programs and rebates.
B)Direct selling to organizational buyers is rare.
C)A fixed,nonnegotiable price is the norm.
D)Many of the goods purchased are raw and semifinished.
E)Personal relationships are preferred to online buying over the Internet.

Question 64

Which of the following statements about marketing mix characteristics in organizational buying behavior is MOST ACCURATE?

A)Few large transactions are made over the Internet.
B)The actual buyer retains all of the influence in the buying decision.
C)Advertising is very simplistic in nature.
D)Direct selling to organizational buyers is the rule.
E)Only finished goods are sold in this way.

Question 65

Important market characteristics in organizational buying behavior include which of the following?

A)Organizational buying behavior is similar to consumer buying behavior since individuals are involved in both processes.
B)Demand for industrial products is elastic instead of inelastic.
C)Demand for industrial products and services is derived.
D)Purchase orders much more frequent but they are usually small.
E)Forecasting is not as important in organizational buying as in consumer buying.

Question 66

During late summer and early fall,there is a large demand for containers located in Asia that are used to ship consumer products from Asia to the United States in time for the holiday selling season.The demand for these containers is referred to as __________ demand.

A)unitized
B)derived
C)reseller
D)applied
E)implied

Question 67

In the breakdown for the NAICS code based on Figure 6-1 above,"C" represents the

A)two-digit industry sector code.
B)three-digit industry subsector code.
C)four-digit industry group code.
D)five-digit industry code.
E)six-digit U.S.national industry code.

Question 68

Important product or service characteristics in organizational buying include which of the following?

A)Products or services that are technical in nature and purchased on the basis of specifications.
B)A heavy emphasis is placed on delivery time,technical assistance,and postsale service.
C)Direct selling to organizational buyers is rare.
D)A fixed,nonnegotiable price is the norm.
E)Personal relationships are preferred to online buying over the Internet.

Question 69

Spruceland Millworks in Canada makes wooden pallets for transporting and storing new appliances such as stoves,freezers,and refrigerators.The demand for Spruceland pallets would be classified as

A)reactive demand,which is tied to the sales of appliances,not the sale of the pallets.
B)unitary demand,which is tied to the sales of appliances.
C)derived demand,which is tied to the sales of appliances.
D)inelastic demand,which is tied to the cost of the components of the pallets.
E)elastic demand,which is tied to the cost of the components of the pallets.

Question 70

Derived demand means the demand for industrial products and services is driven by,or derived from,the

A)NAICS statistical models.
B)gross national product.
C)demand for consumer products and services.
D)demand for other industrial products and services.
E)demand for government products and services.

Question 71

In the breakdown for the NAICS code based on Figure 6-1 above,"A" represents the

A)two-digit industry sector code.
B)three-digit industry subsector code.
C)four-digit industry group code.
D)five-digit industry code.
E)six-digit U.S.national industry code.

Question 72

Unfortunately,the NAICS system will not allow marketing managers to gather information about

A)import competition in domestic markets.
B)geographic distribution of industries.
C)market share in a pure competition environment.
D)demand for products and services.
E)data on industries that are oligopolies.

Question 73

Derived demand refers to

A)a graph relating the quantity sold and price,which shows the maximum number of units that will be sold at a given price.
B)the demand for industrial products and services that is driven by the demand for consumer products and services.
C)the relationship between total revenue and total cost to determine profitability at various levels of output.
D)the point on a demand curve where supply and demand intersect.
E)the percentage change in quantity demanded relative to a percentage change in price.

Question 74

Airbus manufactures commercial aircraft that it sells to a variety of airlines worldwide.Still,demand for its products often depends on rates of air travel among consumers.Demand for Airbus products is referred to as __________ demand.

A)unitized
B)reseller
C)applied
D)implied
E)derived

Question 75

Important market characteristics in organizational buying behavior include which of the following?

A)unlimited markets but orders become progressively smaller over time
B)diminishing international opportunities as more firms enter the market
C)many customers placing progressively larger orders over time
D)fewer customers but with larger orders
E)a market that functions independently of consumer demand

Question 76

How might a marketing manager for a manufacturer of turboprop engines,used in private jet planes,use the NAICS to help her with marketing planning?

A)Record the NAICS numbers for each of her firm's best customers and then obtain lists of companies with the same NAICS numbers.
B)Go to a library and find the NAICS numbers for all government units-federal,state,and local.
C)Identify all NAICS numbers that reflect the classifications of her firm's customers and compare them to previous SIC codes.
D)Poll her field sales organization to see if her company's sales representatives know what NAICS numbers mean.
E)Forgo using the NAICS system because it has recently been replaced by the SIC system,which is more useful in this scenario.

Question 77

In the breakdown for the NAICS code based on Figure 6-1 above,"B" represents the

A)two-digit industry sector code.
B)three-digit industry subsector code.
C)four-digit industry group code.
D)five-digit industry code.
E)six-digit U.S.national industry code.

Question 78

In the breakdown for the NAICS code based on Figure 6-1 above,"D" represents the

A)two-digit industry sector code.
B)three-digit industry subsector code.
C)four-digit industry group code.
D)five-digit industry code.
E)six-digit U.S.national industry code.

Question 79

In the organizational buying process,important product or service characteristics include

A)delivery time,technical assistance,and postsale service.
B)low price,buyer incentives,and extended contracts.
C)buyer incentives,technical assistance,and exclusive contracts.
D)quantity discounts,delivery time,and exclusive contracts.
E)low price,buyer incentives,and post-sale service.

Question 80

You are the research director of a major marketing research consulting firm.You need to select an NAICS code that gives you the most detail about the competitors in a client's industry,which operate in Canada,Mexico,and the U.S.Which of the following levels of classification would provide the greatest detail about the firms within this industry?

A)Code 51
B)Code 517
C)Code 5172
D)Code 51721
E)Code 517212