Chapter 3: The Global Enviroment

Question 1

Marketing Environment consists of what…

Answer 1

The marketing environment consists of outside factors that impact a companies ability to reach marketing goals.

Question 2

What are considered forces in the marketing environment?

Answer 2

Political, economic, demographic, sociocultural, technological.

Question 3

Direct Competition

Answer 3

Direct competition occurs when similar products compete against each other.

Question 4

Substitute Products

Answer 4

Substitute Products are goods and services that can be used in place of each other.

Question 5

Indirect Competition

Answer 5

Indirect competition occurs when products provide alternative solutions to the same market.

Question 6

Environmental Scanning

Answer 6

The process of monitoring developments outside of the firm.

Question 7

What factors influence a firms marketing environment?

Answer 7

Factors include economic, demographic, sociocultural, political, legal, and technological.

Question 8

Gross Domestic Product (Economic Factor)

Answer 8

GDP is the market value of all official final goods and services produced in a country

Question 9

What does the GDP measure?

Answer 9

size and health of an economy

Question 10

GDP per capita

Answer 10

Indicates the country’s standard of living

Question 11

Recession

Answer 11

Occurs when the GDP declines for two or more quarters back to back

Question 12

What does a recession cause?

Answer 12

A recession can cause layoffs, unemployment spikes, and reduced consumer confidence

Question 13

Inflation

Answer 13

Inflation is the increase in general level of a products price over a period of time

Question 14

Purchasing Power

Answer 14

Purchasing Power is the amount of goods and services that can be bought for a specific amount

Question 15

Consumer Confidence

Answer 15

A measure of how optimistic consumers are about the economy and their own finances

Question 16

Demographics

Answer 16

Human characteristics such as age, gender, ethnicity, and education.

Question 17

Sociocultural Factors

Answer 17

Sociocultural factors are social and cultural factors that impact human development

Question 18

PACs

Answer 18

PACs are committees that raise money to help elect individuals who support their issue(s).

Question 19

Why do governmental bodies regulate businesses?

Answer 19

Governmental bodies regulate businesses so that they compete fairly and don’t take advantage of their customers.

Question 20

Sherman Antitrust Act (1890)

Answer 20

Eliminated monopolies and encouraged competition

Question 21

Robinson-Patman Act (1936)

Answer 21

Simplified prohibitions on selling the same product at different prices

Question 22

Wheeler-Lea Act (1938)

Answer 22

Prohibited deceptive and misleading adverts

Question 23

Federal Trade Commission (FTC)

Answer 23

Investigates complaints made about organizations

Question 24

Fair Packaging and Labeling Act (1966)

Answer 24

Guarantees that packages are correctly labeled

Question 25

The Telephone Consumer Protection Act of 1991

Answer 25

Reduced the use of telemarketing

Question 26

Credit Card Accountability, Responsibility, and Disclosure Act of 2009 (CARD)

Answer 26

Banned unfair credit rate increases & requires disclosures about min payments and interest rates be made in plain english.

Question 27

Currency Fluctuation

Answer 27

Currency Fluctuation is how the value of a currency is changed in relation to another.

Question 28

Currency Exchange Rate

Answer 28

The currency exchange rate is the price of once country's currency in terms of another.

Question 29

North American Free Trade Agreement (NAFTA)

Answer 29

NAFTA established a free-trade zone within the U.S, Canada, and Mexico

Question 30

What was the goal of NAFTA?

Answer 30

NAFTA's goal was to eliminate trade barriers between the U.S, Canada, and Mexico

Question 31

Tariffs

Answer 31

Tariffs are taxes on imported and exported goods

Question 32

United States-Mexico-Canada Agreement

Answer 32

USMCA

Question 33

What was is the goal of USMCA?

Answer 33

USMCA had several goals including having car and truck parts made in North America, upgrading environment & labor regulation, and stricter protections for patents and trademarks.

Question 34

Dominican Republic-Central American Free Trade Agreement (DR-CAFTA)

Answer 34

DR-CAFTA's goals are to eliminate tariffs, reduce non-tariff barriers, and facilitating investment amongst the states.

Question 35

European Union (EU)

Answer 35

The EU was formed to create a european market by reducing barriers to the free trade of goods services and financies among its members.

Question 36

World Trade Organization (WTO)

Answer 36

Regulates members trade, and helps importers and exporters.

Question 37

International Monetary Fund (IMF)

Answer 37

The IMFs goal is to promote economic cooperation, trade, employment, and exchange rate stability worldwide

Question 38

Consumer Ethnocentrism

Answer 38

Ethnocentrism is the belief that it is immoral to buy foreign goods and services

Question 39

How are nonprofits funded?

Answer 39

Grants, special events, and donations.