1. A computer falls into the ________ category of service mix.
a. tangible good with accompanying services
b. pure service
c. major service with accompanying minor goods
e. pure tangible good
2. In order to map out the service process, the points of customer contact, and the evidence of
service from the customer’s point of view, service firms should develop a ________.
a. business plan
b. Gantt chart
c. service floor plan
d. service blueprint
e. marketing plan
3. Which of the following is an example of a complementary service?
a. AXA Bank set up automated teller machines so that its customers could avoid standing
b. Big department stores usually hire extra staff to handle the rush during the holiday
c. The Caesar Park Hotel generally caters to business customers during the week, but has
now decided to promote minivacation weekends for non-business customers as well.
d. More paramedics are on hand to assist physicians during times when emergency
admissions are highest.
e. Chesterton College hires part-time teachers when enrollment goes up.
4. Susanna wanted to check out a new salon in her locality, so she decided to go for a hair styling
session. She was very happy with the way her stylist connected and related with her concerns.
She is judging the service based on its ________.
a. promotional marketing
b. functional quality
c. technical quality
d. external marketing
e. search qualities
5. Although Brenda previously used the U.S. Postal Service because it offered better prices on
package shipping, she now uses only FedEx because it gives her the facility of shipping from
any FedEx Kinkos location 24 hours a day. Which of the following factors led to Brenda’s
customer switching behavior?
c. response to service failure
d. involuntary switching
e. ethical problems
6. The most important determinant of service quality is ________ which refers to the ability to
perform the promised service dependably and accurately.
7. When customers calculate the perceived economic benefits of a continuously provided service in
relationship to the economic costs, they are gauging the ________.
a. brand equity
b. payment equity
c. private equity
d. customer-service equity
e. product-service equity
8. ________ price refers to what the consumers feel the product should cost.
a. Usual discounted
e. Maximum retail
9. A company decided to conduct a market survey for its new MP3 player which it had priced at
$150. However, in the survey, 95 percent of the participants said that the maximum they would
pay for the MP3 player is $100. This is an example of which of the following possible consumer
a. upper-bound price
b. expected future price
c. usual discounted price
d. historical competitor price
e. last price paid
10. Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent
because the perfume is from a well-known brand. What kind of a pricing is the company
a. market-skimming pricing
b. target pricing
c. markup pricing
d. image pricing
e. going-rate pricing
11. If demand hardly changes with a small change in price, the demand is said to be ________.
d. unit elastic
12. A retailer who holds on to a(n) ________ policy charges a constant low price with little or no
price promotions and special sales.
a. going-rate pricing
b. high-low pricing
c. auction-type pricing
d. low cost
e. everyday low pricing
13. In ________, the seller charges different amounts to different classes of buyers.
a. perceived value pricing
b. third-degree price discrimination
c. second-degree price discrimination
d. psychological discounting
e. first-degree price discrimination
14. When museums charge a lower admission fee to students and senior citizens, this form of
price discrimination is known as ________ pricing.
15. A company does not set a final price until the product is finished or delivered. This is known as
a. an escalator clause
b. the shallow-pockets trap
c. special-event pricing
d. time pricing
e. delayed quotation pricing
16. Which of the following entities in the marketing channel is a merchant?
c. sales agents
e. advertising agencies
17. Which of the following covers payment terms and producer guarantees?
a. pricing policies
b. territorial rights
c. mutual services
d. exclusive dealings
e. conditions of sale
18. A(n) ________ VMS consists of independent firms at different levels of production and
distribution, integrating their programs on a contractual basis to obtain more economies or
sales impact than they could achieve alone.
19. In a retailer cooperative, ________.
a. profits are equally divided among members
b. members plan their advertising jointly
c. members standardize their selling practices
d. members rely on distribution programming
e. nonmembers cannot buy through the co-op
20. A franchise organization is an example of a(n) ________ vertical marketing system.
21. Alcart Solutions is a large distributor of Aldor phones in Canada. The company distributes
products to various retailers in the New Brunswick province. Recently, Aldor received several
complaints from its retailers that their orders are not delivered on time. They also complain
that Alcart offers preferential treatment to some of the other retailers in the region. This is an
example of ________ conflict.
22. Which of the following is true for self-service retailing?
a. Salespeople are ready to assist in every phase of the “locate-compare-select” process.
b. It results in high staffing costs compared to other forms of retailing.
c. This service model is favored by discount stores and customers who want to save money.
d. These retailers carry more shopping goods and services such as credit and
merchandise return privileges.
e. Customers need more information and assistance than in other forms of retailing.
23. Which of the following is an example of direct marketing?
a. Reynold’s tries to minimize its staff costs by installing vending machines in its stores.
b. J3 is a storeless retailer that organizes the retail activity of the employees of four firms.
c. E&OE sells its herbal skincare products exclusively through its stand-alone stores.
d. TCJ is a telemarketing firm that sells products from a number of different suppliers.
e. Jayne’s sells most of its products to customers through home sales parties.
24. Jake wants to open a Subway franchise in his small town. To do this, he must pay the company
a ________ payment.
25. ________ are independently owned businesses that take title to the merchandise they handle.
They are full-service and limited-service jobbers, distributors, and mill supply houses.
c. Retailers’ branches
d. Specialized wholesalers