Question 1

In the context of physical distribution, which of the following is a key management decision regarding customer service?

Accepted Answer

A)  How should we manage incoming and outgoing orders? 
B)  How can we reduce waiting times and facilitate interactions? 
C)  How can we keep products safe from accidents every step of the way? 
D)  How can we move products most efficiently through the supply chain?

Question 2

In the context of physical distribution, which of the following is a key management decision regarding materials handling?

Accepted Answer

A)  How should we manage incoming and outgoing orders? 
B)  How can we serve our customers most effectively? 
C)  How can we best balance efficiency with effectiveness? 
D)  How can we reduce waiting times and facilitate interactions?

Question 3

_____ service customers who are too small to merit in-person sales calls from wholesaler reps.

Accepted Answer

A)  Truck jobbers 
B)  Cash and carry wholesalers 
C)  Drop shippers 
D)  Full-service merchant wholesalers

Question 4

_____ involves determining how a product will flow through a channel from the producer to the consumer.

Accepted Answer

A)  The wheel of retailing 
B)  The physical distribution strategy 
C)  Multilevel marketing 
D)  Breakeven analysis

Question 5

The fixed cost of Brendon Willows, a baseball bat manufacturing company, is $500,000 per year. The cost of wood and labor to manufacture one bat is $5. If the customers pay $25 to buy one bat, how many bats does Brendon Willows need to sell to breakeven?

Accepted Answer

A)  20,000 
B)  25,000 
C)  100,000 
D)  150,000

Question 6

_____ involves placing a producer's products in as many stores as possible.

Accepted Answer

A)  Selective distribution 
B)  Intensive distribution 
C)  Wholesale distribution 
D)  Direct distribution

Question 7

Marketers can evaluate odd pricing strategy by examining its response in the target market.

Accepted Answer

A) True 
 B)False

Question 8

Many states have passed anti-price gouging laws to:

Accepted Answer

A)  prevent businesses and individuals from driving traffic to retail stores by special sales on a limited number of products. 
B)  discourage businesses from pricing a handful of items temporarily below cost to drive traffic. 
C)  increase the incentive for both businesses and individuals to replenish supply after natural disasters. 
D)  discourage both businesses and individuals from raising prices after an emergency.

Question 9

_____ involves hiring independent contractors to sell products to their personal network of friends and colleagues and to recruit new salespeople in return for a percentage of their commissions.

Accepted Answer

A)  Multilevel marketing 
B)  Direct response retailing 
C)  Online retailing 
D)  Vending

Question 10

Mopsun, a garment store, sells customized hoodies at $7 per unit. The total fixed costs add up to $8000 per year, and the variable costs add up to $3 per unit. How many hoodies should Mopsun sell every year in order to cover all costs?

Accepted Answer

A)  1000 
B)  2000 
C)  1500 
D)  2500

Question 11

In the context of modes of transportation, _____ have the most limited availability.

Accepted Answer

A)  planes 
B)  trucks 
C)  railroads 
D)  pipelines

Question 12

Odd pricing refers to the practice of:

Accepted Answer

A)  charging different prices at odd intervals rather than maintaining stable and predictable pricing. 
B)  ending prices in numbers below even dollars and cents. 
C)  charging prices that differ significantly from competitors' prices. 
D)  setting prices based on a statistical analysis of the amount consumers are willing to pay.

Question 13

Nicoloss is a store that sells clothes, cosmetics, travel bags, and furniture to final consumers. Customer reviews indicate that the store offers a high level of service. In this scenario, Nicoloss is an example of a(n) _____.

Accepted Answer

A)  outlet store 
B)  discount store 
C)  department store 
D)  specialty store

Question 14

Suppose the price of your product is $10.00. The variable cost per unit is currently $5.00, and the fixed costs are $15,000 per month. Suppose the company can invest in some equipment that will reduce the variable cost per unit to $3.00. However, the cost of financing the new equipment will increase the fixed costs to $17,500 per month. Compare the breakeven points for these two different options. Assuming the company believes it can sell 2,800 units of its product at $10.00 price, which is the better choice?

Accepted Answer

The answer of Suppose the price of your product is...

Question 15

Which of the following is a key benefit of penetration pricing?

Accepted Answer

A)  It increases traffic in retail stores by special sales on a limited number of products. 
B)  Profitability is not dependent on the volume of sales. 
C)  It tends to discourage competitors. 
D)  Each individual sale typically yields a high profit.

Question 16

Which of the following statements best defines a channel of distribution?

Accepted Answer

A)  It is the network of regulatory agencies that regulate production strategies. 
B)  It is the network of organizations and processes that links producers to consumers. 
C)  It is a theory that suggests retail firms and retail categories become more upscale as they go through their life cycles. 
D)  It is the path through which products are produced and packaged in an assembly line.

Question 17

In the context of prestige pricing, skimming works only when:

Accepted Answer

A)  retail stores are ready to increase traffic by special sales on a limited number of products. 
B)  the aim is to achieve long-term profitability through sheer volume of sales. 
C)  newly launched products are offered at rock-bottom prices. 
D)  a product is tough to copy in terms of design, brand image, technology, or some other attribute.

Question 18

In the context of pricing strategies, the _____ tries to increase traffic in retail stores by special sales on a limited number of products, and greater everyday prices on others.

Accepted Answer

A)  everyday-low pricing strategy 
B)  high/low pricing strategy 
C)  penetration pricing strategy 
D)  price skimming strategy

Question 19

Lynk Corp. drives perishable goods, such as eggs, bread, and muffins to small grocery stores. In addition to taking legal title of the goods it distributes, Lynk Corp. also checks the stock and suggests reorder quantities to the grocery stores. It is evident that Lynk Corp. is a(n) _____.

Accepted Answer

A)  agent 
B)  broker 
C)  drop shipper 
D)  truck jobber

Question 20

_____ is a classic distribution theory that suggests that retail firms and retail categories become more upscale as they go through their life cycles.

Accepted Answer

A)  The bargaining theory 
B)  The wheel of retailing 
C)  The hierarchy of needs theory 
D)  Breakeven analysis

Exam 13: Distribution and Pricing: Right Product, Right Person, Right Place, Right Price