Marketing and Price Analysis Spring 1993
Final Examination
ARE 225
Tuesday, May 11, 1993
Part I. MULTIPLE CHOICE. (45 points, 5 points per question)
1. The advertising slogan "Join the Pepsi Generation" appeals to
a. cultural needs
b. esteem needs
c. self-actualization needs
d. social needs
e. unspecified needs
2. Five years ago, Tobias spent 30 percent of his $20,000 yearly
income on his bachelor apartment. Today, Tobias is earning
$35,000 annually. According to Engel's law, the percentage of
money he will spend on apartment will be
a. $6,000 per year
b. much less than the original 30 percent
c. about 30 percent of his current income
d. about 52.5 percent; because he had a 75 percent increase in pay,
his household expense will also increase 75 percent, from 30
percent to 52.5 percent
e. much greater because he can afford to spend more
3. A broader view of product is a total concept that includes
a. package design
b. labeling
c. trademarks and brand names
d. customer service activities
e. all of the above
4. A name, term, sign, symbol, design, or some combination of these
used to identify the products of one firm and differentiate them from
competitive offerings is called (a)
a. brand
b. trade name
c. generic name
d. "no frills"
e. corporate logo
5. For recycling to succeed, each of the following conditions must be
satisfied except:
a. A technology for efficiently processing the material being
recycled must be available.
b. A new product must be available for the consumer to start the
process.
c. A market must be available for the end product.
d. A substantial and continuous quantity of secondary products must
be available.
e. A marketing system that can profitably bridge the gap between
suppliers of secondary products and end users must be developed.
6. When promoting high-unit-value industrial goods such as press
machines and operations equipment, a company would use
a. mass media advertising
b. massive sales promotion
c. merchandise marts
d. key placement of publicity
e. direct sales representatives
7. The sales promotion method used to influence channel members and
resellers in the distribution channel is
a. coupons
b. trading stamps
c. trade shows
d. publicity
e. point-of-purchase advertising
8. New York City officials raise fares on the subways when they need
more money for the budget because they feel the demand for subway
rides is
a. a luxury for many people
b. a method to increase ridership
c. justifiable
d. elastic
e. inelastic
9. When General Motors introduced the Saturn, it priced the SL sports
sedan at $2,000 less than the Toyota Corolla DLX and $1,500 less
than the Honda Civic DX. This is an example of pricing strategy
called
a. skimming
b. penetration
c. competitive
d. loss leader
e. functional
Part II. ESSAY. (40 points, 10 per question).
Consider a beer which is very popular in the Dominican Republic:
"Cerveza Tropical." Note that "Cerveza" means beer in spanish.
You would like to market this beer in the New York City area
where there are millions of native Dominicans and where the beer
is not currently sold. The C.I.F. cost of importing the beer is
$8.00 per case of 24. The salaries of hiring a secretary, a
salesperson, and two warehouse helpers comes to about $15,000
per month. Other costs include warehouse/office rent and renting
a truck which add up to about $2,000/month. In light of this
information and based on what you know, answer the following
questions.
10. Select a specific price ($/case) that you would offer to retailers.
Justify your choice.
11. How many cases of beer per month do you need to sell at the price
chosen in #10 in order to breakeven? Show your computations
clearly.
12. Given what you know about the Dominican culture (Caribbean),
briefly but concisely explain how would promote the beer for such
market segment.
13. Assume that in the future, your goal is to go beyond the
Dominican market in NYC. Explain which other market segments
would you try to reach and why. Also explain how would you
position the beer to the non-Dominican segments.
Part III. SHORT ANSWERS. (15 points, 5 per question)
14. Americans currently drink about 1.75 cups of coffee per day which
is about half of what it was in the 1960s. The decline is largely
attributed to younger consumers' preferences to soft drinks. What
attitude component is reflected in this trend? How might the
coffee industry change current consumption patterns in its favor?
Be brief but specific.
15. For each of the following items, choose the base for consumer
market segmentation that is best represented. Write a line
justifying your choice.
- ESPN attracts sports-oriented males, while Lifetime, "The
Women's Network," appeals to both career women and
contemporary homemakers.
- Campbell Soup decided to divide the U.S. market into 22
geographic regions.
- "7-Up, clear, crisp, with no caffeine"
- "This is not your father's Oldsmobile."
16. In the "Looking Good Calendar" video (last one on 4/30/93), what
pricing strategy did the Colachis brothers (students at the
University of Southern California) used? How did they justify the
choice of that strategy?
Have a good summer!
Marketing and Price Analysis Name:___________________ _____
Spring 1994 Exam Grade:___ _____
Final Grade:___ _____
ARE 225
Final Examination - Friday, May 13
Part I. True/False. (26 points, 2 points per question).
_____ 1. A distinguishing feature of black and Hispanic consumers
is that they exhibit strong brand loyalty.
_____ 2. Motives are inner states that direct a person toward the
goal of satisfying a felt need.
_____ 3. Subliminal advertising is considered manipulative due to
the fact that it has been exceedingly successful in inducing
purchases of goods and services even though the consumer
was not inclined to buy the product or service.
_____ 4. A Consolidated Metropolitan Statistical Area includes any
city in the United States.
_____ 5. Engel's law states that as income rises, expenditures on
luxury items go up and spending on necessities falls.
_____ 6. In the maturity stage of the product life cycle, some firms
attempt to differentiate their products by focusing on
attributes such as quality, reliability, and service.
_____ 7. Product positioning refers to the consumer's perception of
a product's attributes, use, quality, and advantages and
disadvantages relative to competing brands.
_____ 8. The term wholesaler applies to intermediaries who do not
take title to the products they handle.
_____ 9. Brokers and agents usually take possession and title of the
goods they handle.
_____ 10. Television is the dominant medium for advertising to local
markets.
_____ 11. Any advertisement should gain attention and interest,
inform and/or persuade, and lead to buying action.
_____ 12. A skimming pricing strategy involves the use of low price
relative to prices of competing products or services.
_____ 13. A competitive pricing strategy shifts the emphasis from
price competition to nonprice factors.
Part II. Multiple Choice. (64 points, 4 points per question).
14. The U.S. Army theme of "Be all you can be" is an example of
a. safety needs.
b. social (belongingness) needs.
c. esteem needs.
d. self-actualization needs.
e. patriotism needs.
15. Under the Standard Industrial Classification, if food and kindred
goods were assigned 20, meats were assigned 1, and poultry
slaughtering and processing were assigned 5, the SIC code for
poultry would be
a. 5120.
b. 1205.
c. 2015.
d. 1520.
e. 0215.
16. Addressing a marketing class, a real estate salesperson would be
interested in the response to the question,
a. Who wants to buy a condominium in Aspen, Colorado?
b. Who would like to purchase a home in San Diego, California?
c. Who has $100,000 for a down payment and can qualify for a
mortgage on a cooperative apartment in Sutton Place in New
York City?
d. Who prefers to rent an apartment rather than purchase a house?
e. Whose parents can lend them money for a down payment on a
home?
17. If you were marketing luxury automobiles, you would most likely
seek to target
a. POSLSQ.
b. SSWD.
c. DINKS.
d. cocoons.
e. empty-nesters.
18. A good marketing strategy would be to promote the extensive use
of market segmentation in the
a. introductory stage.
b. stabilization stage.
c. growth stage.
d. maturity stage.
e. market research period.
19. Fillmore Pharmaceuticals was recently approached by a large retail
drug chain that wants its vitamin E to be marketed under the drug
chain's name. This type of branding is an example of
a. private brands.
b. generic brands.
c. family brands.
d. national brands.
e. individual brands.
20. A characteristic of a good brand name is that
a. it should avoid any specific connotation.
b. it should be short and descriptive.
c. it has generic reference.
d. the pronunciation should be unique to the reader and user.
e. it should be intricate in detail and phonetically similar to those< /P>
of its competitors.
21. The most correct statement concerning a franchise is:
a. Sherwin-Williams and Firestone and examples.
b. It is a channel member established by a corporate system in
order to sell only that manufacturer's products.
c. It exists when a dealer agrees to the operating requirements and
restrictions of a granting franchisor.
d. It can be either a wholesale-sponsored voluntary or a retail
cooperative type of organization.
e. It is a certain guarantee of success.
22. Costs can be reduced at the wholesale level by
a. providing advertising allowances to the retailer.
b. reducing wholesale prices.
c. increasing shipping distances to retailers.
d. purchasing in small amounts from the manufacturer.
e. making large volume purchases from the manufacturer.
23. Sales promotion includes each of the following methods except
a. product demonstrations.
b. billboards.
c. coupons, contests, samples, and premiums.
d. displays.
e. trade shows.
24. Nonprofit organizations such as Planned Parenthood and "right to
life" antiabortion groups generally utilize
a. informative advertising.
b. reminder advertising.
c. comparative advertising.
d. advocacy advertising.
e. specialty advertising.
25. The advertising medium that offers the highest informational
content is
a. direct mail.
b. newspapers.
c. magazines.
d. radio.
e. television.
26. The so-called "sin" taxes on tobacco and alcohol have as their
objective
a. revenue maximization.
b. profit maximization.
c. cost recovery.
d. providing market incentives.
e. market suppression.
27. Of the following, the method that uses a base-cost figure per unit
and adds a markup to cover unassigned costs and to provide a
profit is
a. marginal analysis pricing.
b. breakeven pricing.
c. modified breakeven pricing.
d. cost-plus pricing.
e. incremental-cost pricing.
28. A five pound bag of peanuts sells for $8, and the average variable
costs are $4 per bag. If the total fixed costs are $80,000, the
breakeven point in production units is
a. 20,000.
b. 40,000.
c. 80,000.
d. 120,000.
e. 160,000.
29. In an industry with many competing brands, the pricing strategy
that would be used for new products is
a. competitive.
b. functional.
c. penetration.
d. prestige.
e. cost-plus.
Part III. Short Answers. (10 points, 5 per question). Answer two of
the following three questions.
(a) Describe the product marketed by Arbor Acres Farms, Inc.
and how they market it internationally (Dr. Paul Aho's
presentation).
(b) What kind of wholesaler was the person owning Northern
Produce/Mushroom, Inc. (video April 29) and what are
some of the functions he performed?
(c) If you were to market a calendar to UConn students, what
would it be and how would you price it? (you may borrow
ideas from the Colachis Brothers video).
30. (5 points). Answer here.
31. (5 points). Answer here.
Have a good summer!
Marketing and Price Analysis Name:___________________ _____
Spring 1995 Exam Grade:___ _____
Final Grade:___ _____
ARE 225
Final Examination - Friday, May 12
Part I. True/False. (66 points, 2 points per question).
_____ 1. Nonprofit organizations do not need to implement market
segmentation techniques because their goals differ from
other types of organizations.
_____ 2. A consolidated Metropolitan Statistical Area includes any
city in the United States.
_____ 3. Marketers should not be concerned with discretionary
income because it is only available to one-third of U.S.
households.
_____ 4. Psychographic segmentation was developed from the
psychological profiles of different consumers by asking
them to evaluate PIO statements.
_____ 5. Both the producer and the purchaser share the narrow
definition of the word product and both tend to focus on
the physical or functional characteristics of a good or
service.
_____ 6. The growth stage of the product life cycle is highlighted by
promotional campaigns that stress information about the
features of a new item.
_____ 7. During the maturity stage of the product life cycle, industry< /P>
sales reach a plateau, available products exceed industry
demand, and competitors tend to cut prices in an attempt
to attract new buyers.
_____ 8. Progresso Foods has introduced single-serving cans of soup
for one-person households. By offering a traditional
product in a smaller package to reach a new target market,
the company has downsized its physical size in order to
extend the life cycle of its product offering.
_____ 9. A company will usually grow more rapidly when it
concentrates on a single product.
_____ 10. Effective brand names should be easy to pronounce,
recognize, and remember.
_____ 11. Brand names are intended to muddle product identification
in order to create confusion for consumers and to cause
purchases of competing brands.
_____ 12. In general, industrial channels tend to be shorter than
consumer channels due to geographic concentration in
industrial buying and a relatively limited number of
purchasers.
_____ 13. A franchise is a contractual arrangement in which a
wholesaler or retail dealer agrees to meet the operating
requirements of a manufacturer or other franchiser.
_____ 14. Independent wholesaling intermediaries can be divided into
three categories: merchants, wholesalers, and
agents/brokers.
_____ 15. Brokers and agents usually take possession and title of the
goods they handle.
_____ 16. Brokers operate in industries characterized by a large
number of small suppliers and purchasers.
_____ 17. The primary objective of promotional efforts is to increase
the demand for a specific product or service.
_____ 18. The marketing mix is a subset of the overall promotional
mix.
_____ 19. Product advertising is the personalized selling of a product
or service.
_____ 20. Television is the dominant medium for advertising to local
markets.
_____ 21. The advantages of radio advertising include immediacy,
low cost, flexibility, practical and low-cost audience
selection, and mobility.
_____ 22. Sales promotion is another term for advertising and
encompasses the same things.
_____ 23. Pricing objectives can be classified into (1) profitability
objectives, (2) volume objectives, (3) meeting competition
objectives, and (4) prestige objectives.
_____ 24. Full-cost pricing allows the marketer to average variable
costs over the entire line of products being sold by a firm.
_____ 25. Demand for a product with close substitutes tends to be
inelastic.
_____ 26. A price cut will increase revenue only if demand is elastic;
a price increase will raise revenue only if demand is
inelastic.
_____ 27. Price theory concepts are easily applied to practical pricing< /P>
situations.
_____ 28. Cost-plus pricing uses a marginal cost figure per unit and
allows for the determination of markdowns to achieve
maximum profit.
_____ 29. A skimming pricing strategy involves the use of low price
relative to prices of competing products or services.
_____ 30. A competitive pricing strategy shifts the emphasis from
price competition to nonprice factors.
_____ 31. Geographical pricing considerations include such policies
as FOB plant, freight absorption, uniformed delivered
price, zone pricing, and basing point systems.
_____ 32. In simple random sampling, every member of the relevant
universe has an equal opportunity of being selected.
_____ 33. The limited and inaccurate nature of secondary data limits
their usefulness.
Part II. Multiple Choice. (12 points, 4 points per question).
34. Campbell's Soup for One is an example of a product that would be
targeted to
a. POSLSQ
b. SSWD.
c. DINKS.
d. YENTA.
e. MSA.
35. The medium with the greatest flexibility from one locality to
another is
a. outdoor advertising.
b. TV.
c. radio.
d. magazines.
e. newspapers.
36. The Design Center sells formica tables for $100 each. The
variable cost per table is $70. The fixed costs for the Design
Center are $45,000. The number of tables this firm must sell at
$100 to break even is
a. 4,500
b. 450
c. 2,100
d. 1,500
e. around 642
Part III. Essay. (24 points)
Assume that you were asked to develop and market a calendar for
UConn students and interested individuals (You may borrow some ideas
from the Colachis Brothers Video, the last one). Justifying all your
answers and being brief and specific, present a proposal for your
marketing mix:
A) Target Market: Who would be your target market? Describe it.
B) Product: What type of calendar would it be?
C) Price: What kind of pricing strategy would you use? How much
would you charge?
D) Distribution: How would you distribute it? Where would it be
sold?
E) Promotion: How would you promote it? What kind of media?
Have a good summer!