Question 1

What is the primary disadvantage of using a market test as a forecasting tool?

Accepted Answer

A)  It is difficult to interpret. 
B)  It is expensive. 
C)  It is inaccurate. 
D)  It is unacceptable to consumers. 
E)  It is overused.

Question 2

A market comprised of individuals or organizations with diverse product needs is called a(n) market.

Accepted Answer

A)  undifferentiated 
B)  concentrated 
C)  homogenous 
D)  differentiated 
E)  heterogeneous

Question 3

In developing a company sales forecast, the forecasting methods are limited to surveys and correlation methods.

Accepted Answer

A) True 
 B)False

Question 4

Only one variable can be used to segment a market.

Accepted Answer

A) True 
 B)False

Question 5

A market segment profile may cover such aspects as demographic characteristics, geographic factors, product benefits sought, lifestyles, brand preferences, and usage rates.

Accepted Answer

A) True 
 B)False

Question 6

Guess Inc. will be spending $22 million on marketing activities next year and expects to sell 30 million pairs of jeans. These 30 million pairs represent the company's:

Accepted Answer

A)  sales potential. 
B)  market potential. 
C)  sales forecast. 
D)  market sales. 
E)  selected market.

Question 7

Generally speaking, individuals who are unemployed would not be considered a target market for lawn care services because:

Accepted Answer

A)  they would not desire such products. 
B)  they would not be willing to purchase such products. 
C)  they would not have the ability to purchase such products. 
D)  such markets are narrowly defined geographically. 
E)  they would not be authorized to purchase such products.

Question 8

In a customer survey, a marketer would question customers about the types and quantities of products they intend to buy during a specific time period.

Accepted Answer

A) True 
 B)False

Question 9

Jack has just joined a law firm as its purchasing agent for all supplies, equipment, and service contracts. In his previous position at another company, Jack could make decisions for any purchase up to $1 million; however, at the new law firm, he can only make decisions for purchases less than $500,000. Recently, Jack has been working with a sales representative from a computer software firm about a contract for a new program to process the firm's billing statements. Jack signs the contract, even though it is for $950,000. In this case, Jack part of the market for the software because .

Accepted Answer

A)  is; he has very little buying power. 
B)  is; has the need for the software. 
C)  is not; he is willing to spend the firm's money. 
D)  is; he has the desire for the software. 
E)  is not; he does not have the authority to purchase.

Question 10

What are the three major issues that need to be considered in the process of evaluating market segments?

Accepted Answer

The answer of What are the three major issues that...

Question 11

Interior Designs Inc. sells expensive custom-made draperies, bedding, and accessories through sales representatives who are also interior designers. It also has another, slightly less expensive line that it sells through stores such as Nordstrom's and Saks Fifth Avenue. Interior Designs Inc. is most likely using a (n) targeting strategy.

Accepted Answer

A)  differentiated 
B)  undifferentiated 
C)  concentrated 
D)  homogeneous 
E)  heterogeneous

Question 12

Many marketers are concerned about the number of potential customers within a certain area of land because of the different requirements to serve dissimilar areas. This segmentation variable is known as .

Accepted Answer

A)  micromarketing 
B)  population 
C)  market density 
D)  MSA 
E)  PMSA

Question 13

The size of the market potential places limits on the size of the company sales potential.

Accepted Answer

A) True 
 B)False

Question 14

Justin Franklin's company is interested in locating areas where the average income is high, the average age range is 25-35 years, and the lifestyles of the people involve extreme adventures and dangerous leisure activities. His company would most likely find possible markets through:

Accepted Answer

A)  U.S. Census Bureau information. 
B)  geographic segmentation variables. 
C)  geodemographic segmentation. 
D)  climate information. 
E)  psychographic segmentation.

Question 15

Demographic variables such as income and occupation, as well as how people spend their time and the importance of things in their surroundings, are all factors considered in segmentation.

Accepted Answer

A)  behavioristic 
B)  social class 
C)  lifestyle 
D)  personality 
E)  family life cycle

Question 16

Which of the following forecasting methods is least dependent on historical sales data?

Accepted Answer

A)  Regression analysis 
B)  Trend analysis 
C)  Time series analysis 
D)  Cycle analysis 
E)  Market tests

Question 17

When a business has a relatively small number of customers, a preferred method of forecasting is .

Accepted Answer

A)  regression analysis 
B)  trend analysis 
C)  the Delphi technique 
D)  a market test 
E)  a customer forecasting survey

Question 18

The psychographic variable that includes numerous characteristics related to people's activities, interests, and opinion is:

Accepted Answer

A)  motive. 
B)  social class. 
C)  personality. 
D)  stage in family life cycle. 
E)  lifestyle.

Question 19

The sales prediction technique based on the correlation between sales and other factors such as population density, per capita income, or family size is:

Accepted Answer

A)  executive judgment. 
B)  time series analysis. 
C)  regression analysis. 
D)  a market test. 
E)  an expert survey.

Question 20

Why do marketers rely heavily on demographic characteristics when segmenting consumer markets?

Accepted Answer

The answer of Why do marketers rely heavily on demographic...

Exam 5: Target Markets: Segmentation and Evaluation

What is the primary disadvantage of using a market test as a forecasting tool?

A market comprised of individuals or organizations with diverse product needs is called a(n) market.

In developing a company sales forecast, the forecasting methods are limited to surveys and correlation methods.

Only one variable can be used to segment a market.

A market segment profile may cover such aspects as demographic characteristics, geographic factors, product benefits sought, lifestyles, brand preferences, and usage rates.

Guess Inc. will be spending $22 million on marketing activities next year and expects to sell 30 million pairs of jeans. These 30 million pairs represent the company's:

Generally speaking, individuals who are unemployed would not be considered a target market for lawn care services because:

In a customer survey, a marketer would question customers about the types and quantities of products they intend to buy during a specific time period.

What are the three major issues that need to be considered in the process of evaluating market segments?

Many marketers are concerned about the number of potential customers within a certain area of land because of the different requirements to serve dissimilar areas. This segmentation variable is known as .

The size of the market potential places limits on the size of the company sales potential.

Justin Franklin's company is interested in locating areas where the average income is high, the average age range is 25-35 years, and the lifestyles of the people involve extreme adventures and dangerous leisure activities. His company would most likely find possible markets through:

Demographic variables such as income and occupation, as well as how people spend their time and the importance of things in their surroundings, are all factors considered in segmentation.

Which of the following forecasting methods is least dependent on historical sales data?

When a business has a relatively small number of customers, a preferred method of forecasting is .

The psychographic variable that includes numerous characteristics related to people's activities, interests, and opinion is:

The sales prediction technique based on the correlation between sales and other factors such as population density, per capita income, or family size is:

Why do marketers rely heavily on demographic characteristics when segmenting consumer markets?