Part 8 Flashcards

1
Q
Hellmut Schütte's modified hierarchy of needs includes all of the following EXCEPT \_\_\_\_\_\_\_.
A. self-actualization
B. affiliation
C. admiration
D. status
E. safety
A

A. self-actualization

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2
Q

In some product categories, marketers can charge premium prices for imported items because ________.
A. the actual cost of product is higher
B. imported items are of higher quality
C. of consumer perception of foreign superiority
D. of distribution costs
E. of differences in currency

A

C. of consumer perception of foreign superiority

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3
Q

Why do Chinese consumers prefer products from Germany, Italy, and France to “Made in China” products?
A. The Chinese want to take advantage of new accessibility.
B. Chinese products are more expensive than imported products.
C. Products made in Europe still carry a great appeal as symbols of success.
D. Chinese products are too expensive or ostentatious.
E. Chinese products are of low quality.

A

C. Products made in Europe still carry a great appeal as symbols of success.

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4
Q

Which of the following statements is TRUE regarding the country-of-origin effect?
A. Perceptions and attitudes due to the country-or-origin effect do not change over time.
B. The only products the country-of-origin effect exists for are automobiles and electronics.
C. Perceptions of, and attitudes toward, particular countries often extend to products and brands known to
originate in those countries.
D. Only positive perceptions and attitudes result from the country-of-origin effect.
E. Only negative perceptions and attitudes result from the country-of-origin effect.

A

C. Perceptions of, and attitudes toward, particular countries often extend to products and brands known to
originate in those countries.

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5
Q

In some product categories, foreign products have a substantial advantage over their domestic counterparts simply because of
their “foreign-ness.” Global marketers have an opportunity to capitalize on this situation by __________________.
A. increase advertising
B. not importing these products
C. running more sales promotions
D. charging premium prices
E. ceasing production of the domestic counterparts

A

D. charging premium prices

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6
Q
The country-of-origin effect is largely based on \_\_\_\_\_\_\_.
A. advertising
B. the location of the country
C. foreign-ness
D. brand equity
E. perceptions
A

E. perceptions

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7
Q
Italian is synonymous with style, and French is synonymous with chic. These are examples of \_\_\_\_\_.
A. the country-of-origin effect
B. the NIH syndrome
C. co-branding
D. a brand extension
E. product-communication adaptation
A

A. the country-of-origin effect

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8
Q

________ is a strategic alternative that uses almost no product or brand adaptation for global distribution.
A. Product extension-communication adaptation
B. Innovation
C. Product-communication extension (dual extension)
D. Product-communication adaptation (dual adaptation)
E. Product adaptation-communication extension

A

C. Product-communication extension (dual extension)

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9
Q

Which of the following is the strategic alternative where both the product and at least one of the promotional elements are
adapted for a particular country market?
A. Product-communication adaptation (dual adaptation)
B. Innovation
C. Product-communication extension (dual extension)
D. Product extension-communication adaptation
E. Product adaptation-communication extension

A

A. Product-communication adaptation (dual adaptation)

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10
Q

Which global product planning strategy is used when companies sell the same product with virtually no adaptation, using the
same advertising and promotional appeals used domestically, in two or more country markets or segments?
A. Product extension-communication adaptation
B. Product adaptation-communication extension
C. Product-communication extension
D. Dual adaptation
E. Innovation

A

C. Product-communication extension

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11
Q
Generally speaking, which of the following product categories represents the best potential for extension into international
markets without any adaptation?
A. Durable products
B. Industrial products
C. Food products
D. Automobiles
E. Beverages
A

B. Industrial products

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12
Q

To promote its Centrino wireless chip, Intel launched a global ad campaign that features different celebrities in different
countries. The wireless chip itself is standardized. Which global product planning approach is this?
A. Product extension-communications adaptation
B. Dual adaptation
C. Product-communications extension
D. Product adaptation-communications extension
E. Innovation

A

A. Product extension-communications adaptation

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13
Q

What is the major appeal of the product extensioncommunication adaptation strategy?
A. Using the same communication strategy in multiple countries.
B. Greater profitability.
C. Adapting the product to local preferences.
D. The low cost of implementation.
E. Using innovation to develop an entirely new product.

A

D. The low cost of implementation.

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14
Q
Which of the following is a type of innovation that could be described as a "game-changer"?
A. Discontinuous innovation
B. Continuous innovations
C. Dynamically continuous innovations
D. Line extension innovations
E. Platform innovation
A

A. Discontinuous innovation

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15
Q
In which of the following innovation categories do products share certain features with earlier products while incorporating new,
added-value features?
A. Product transformation
B. Disruptive innovation
C. Dynamically continuous innovation
D. Discontinuous innovation
E. Continuous innovation
A

C. Dynamically continuous innovation

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16
Q
Apple's new product introductions in the 2000s of the iPod, the iPhone, and the iPad, were examples of which type of
innovation?
A. A platform
B. A discontinuous innovation
C. A dynamically continuous innovation
D. A continuous innovation
E. A global startup
A

B. A discontinuous innovation

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17
Q

After 4 years of product development, Procter & Gamble recently introduced a new, improved disposable diaper. Pampers Rash
Guard diapers are designed to prevent diaper rash and represent the first time a company has made a medical claim for its
diapers. What kind of innovation do the new diapers represent?
A. Discontinuous innovation
B. Platform-based innovation
C. A global startup
D. Continuous innovation
E. Dynamically continuous innovation

A

E. Dynamically continuous innovation

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18
Q
Most new products fall into which category of innovation?
A. A global startup
B. Platform-based innovation
C. Discontinuous innovation
D. Continuous innovation
E. Dynamically continuous innovation
A

D. Continuous innovation

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19
Q
The Sensor, SensorExcel, and MACH3 shaving systems represent Gillette's ongoing efforts to bring new technology to bear on
wet shaving, an activity that is performed today pretty much as it has been for centuries. These products represent which type
of new product innovation?
A. Continuous innovation
B. Platform-based innovation
C. A global startup
D. Dynamically continuous innovation
E. Discontinuous innovation
A

D. Dynamically continuous innovation

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20
Q
Which of the following has had the greatest impact on global price transparency?
A. NAFTA
B. The World Trade Organization (WTO)
C. The United Nations
D. The Internet
E. The European Union
A

D. The Internet

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21
Q

In a typical corporation, which of the following internal positions would be most interested in competitive pricing in the world
marketplace?
A. Individual country managers
B. The director of global marketing
C. Controller and financial vice president
D. Counsel
E. Vice president of operations

A

B. The director of global marketing

22
Q

Because of differences in national markets, the global marketer must develop pricing systems and pricing policies that take into
account which of the following three factors?
A. Price floors, price ceilings, and domestic prices
B. Price floors, price ceilings, and price skimming
C. Price floors, price ceilings, and optimum prices
D. Price skimming, domestic prices and penetration pricing
E. Price floors, optimum prices and domestic prices

A

C. Price floors, price ceilings, and optimum prices

23
Q

As _______ has made price information for many products available around the globe, companies must carefully consider how
customers in one country or region will react if they discover they are paying significantly higher prices for the same product
than customers in other parts of the world.
A. the company catalog
B. eBay
C. each company
D. Amazon.com
E. the Internet

A

E. the Internet

24
Q

Generally speaking, international trade results in___________.
A. higher inflation
B. increased trade restrictions
C. higher prices for goods
D. lower prices for goods
E. the same price for goods in all market areas

A

D. lower prices for goods

25
Q

What is the “law of one price”?
A. The law of one price states that a product should never be sold for one price.
B. The law of one price states that one price should be set for a product on a global basis.
C. The law of one price states that in a truly global market all customers in the market could get the best
product available for the best price.
D. The law of one price states that global marketers should charge one price on the internet and a different price through
retail outlets.
E. The law of one price states that there is only one price that consumers will be willing to pay for a product.

A

C. The law of one price states that in a truly global market all customers in the market could get the best
product available for the best price.

26
Q
Which type of pricing strategy sets a high price in the introductory phase of the product life cycle?
A. Captive pricing
B. Market skimming
C. Export pricing
D. Cost-based pricing
E. Market penetration
A

B. Market skimming

27
Q
Which type of pricing strategy is typically used by HP for its laser printers?
A. Market penetration
B. Market skimming
C. Captive pricing
D. Cost-based pricing
E. Export pricing
A

C. Captive pricing

28
Q
Which pricing strategy calls for setting price levels that are low enough to quickly build market share?
A. Market skimming
B. Market penetration
C. Gray market
D. Cost-based market
E. Holding market
A

B. Market penetration

29
Q
The obvious advantage of which pricing strategy is its simplicity?
A. Gray-based
B. Skimming
C. Cost-based
D. Penetration
E. Holding
A

C. Cost-based

30
Q

Which of the following is NOT a step in the target costing process?
A. Compute overall target costs with the aim of ensuring the company’s future profitability.
B. Determine the segment(s) to be targeted, as well as the prices that customers in the segment will be willing to pay.
C. Obey the cardinal rule: If the design team can’t meet the targets, the product should not be launched.
D. Allocate target costs to the product’s various functions. Calculate the gap between the target cost and the estimated
actual production cost.
E. Purchase the inventory well in advance to make significant cost-savings.

A

E. Purchase the inventory well in advance to make significant cost-savings.

31
Q

Procter & Gamble (P&G) managers know that workers in Mexico are often paid a daily wage and that its Mexican customers
generally carry 5- and 10-peso coins. To keep prices of shampoo and detergent below 11 or 12 pesos and ensure satisfactory
profit margins, Procter & Gamble uses which method of pricing?
A. Cost-based pricing
B. Export price costing
C. Cost-plus approach
D. Target costing
E. Price bundling

A

D. Target costing

32
Q

The internationally accepted contract terms of trade are known as ________.
A. free on board (FOB)
B. International Commercial Terms (Incoterms)
C. delivered duty paid (DDP)
D. ex-works (EXW)
E. free alongside ship (FAS)

A

B. International Commercial Terms (Incoterms)

33
Q
Which of the categories of Incoterms refers to a transaction where the buyer takes delivery at the seller's location?
A. Delivered duty paid (DDP)
B. Free on board (FOB)
C. Ex-works (EXW)
D. Free carrier (FCA)
E. Free alongside ship (FAS)
A

C. Ex-works (EXW)

34
Q

All the following activities must be performed when goods cross international boundaries EXCEPT _______________.
A. arranging for ocean freight and preparation
B. obtaining marine insurance and certificate of the policy
C. packing the goods for export
D. obtaining a currency permit, if required
E. using the cost-based pricing method

A

E. using the cost-based pricing method

35
Q
What does the word Incoterms stand for in relation to conducting international terms of trade?
A. International Commerce Terminology
B. Internal Commercial Terms
C. International Commercial Terms
D. In Company Terms
E. International Credit Terminology
A

C. International Commercial Terms

36
Q

_____________ refers to a transaction in which the buyer takes delivery at the premises of the seller; the buyer bears all risks
and expenses from that point on.
A. Free carrier (FCA)
B. Cost and freight (CFR)
C. Delivered duty paid (DDP)
D. Ex-works (EXW)
E. Cost, insurance, freight (CIF) named port

A

D. Ex-works (EXW)

37
Q
A market holding strategy is often used in response to unfavorable \_\_\_\_\_\_\_\_.
A. currency valuation swings
B. competitive prices
C. inflation
D. increased tariffs
E. government subsidies
A

A. currency valuation swings

38
Q
One way for a country to curb runaway inflation is to \_\_\_\_\_\_\_\_.
A. encourage dumping
B. subsidize domestic products
C. impose price controls
D. discourage exporting
E. increase manufacturing capacity
A

C. impose price controls

39
Q

Price discrepancies across the euro zone have been disappearing because manufacturers can no longer cite currency
fluctuations as a justification for the discrepancies. ______________ means that buyers can comparison shop easily because
goods will be priced in euros as opposed to marks, francs, or lira.
A. Price competitiveness
B. Changes in price
C. Price transparency
D. Standard pricing
E. Price control

A

C. Price transparency

40
Q

Which of the following is an essential requirement for pricing in an inflationary environment?
A. Decrease operating margins
B. Maintain the price
C. Ignore inventory management technology
D. Reduce the selling price
E. Maintain operating profit margins

A

E. Maintain operating profit margins

41
Q
Marketers of domestically manufactured finished products may be forced to switch to \_\_\_\_\_\_\_\_\_\_\_\_\_\_ of certain components
to keep costs and prices competitive.
A. offshore sourcing
B. inferior quality
C. alternative parts
D. cheaper parts
E. domestic suppliers
A

A. offshore sourcing

42
Q
Which of the global pricing alternatives allows management in each global market to establish its own prices?
A. Extension pricing
B. Polycentric pricing
C. Geocentric pricing
D. Ethnocentric pricing
E. Fixed pricing
A

B. Polycentric pricing

43
Q
Which of the pricing alternatives calls for a per-unit price of a product to be the same no matter where in the world it is being
sold?
A. Adaptation pricing
B. Corporate pricing
C. Polycentric pricing
D. Geocentric pricing
E. Extension pricing
A

E. Extension pricing

44
Q

If company managers decide to set the export price for a particular product at an amount equivalent to the home-country price,
they would be using which approach to pricing?
A. Adaption pricing
B. Geocentric
C. Polycentric
D. Arbitrage
E. Ethnocentric

A

E. Ethnocentric

45
Q

When disparities in prices between different country markets exceed the transportation and duty costs separating the markets,
enterprising individuals can purchase goods in the lower-price country market and then transport them for sale in markets
where higher prices prevail. This is called ______________.
A. extension of distribution
B. secondary market
C. secondary selling
D. advanced selling
E. arbitrage

A

E. arbitrage

46
Q
According to a recent study of European industrial exporters, companies that utilized independent distributors would be most
likely to utilize \_\_\_\_\_\_\_\_\_\_\_\_\_\_.
A. extension pricing
B. ethnocentric pricing
C. geocentric pricing
D. arbitrage
E. polycentric pricing
A

E. polycentric pricing

47
Q

Gray markets flourish when ________.
A. there is low margin on goods
B. ethnocentric pricing policies are used
C. a penetration pricing strategy is used
D. a product is in short supply
E. supply exceeds demand

A

D. a product is in short supply

48
Q
Which of the following groups gains the most from a gray market?
A. Governments
B. Manufacturers
C. Exporters
D. Consumers
E. Retailers
A

D. Consumers

49
Q
The unauthorized distribution of trademarked goods sold by unauthorized persons or organizations in world markets is known
as \_\_\_\_\_\_\_\_\_\_\_\_\_\_.
A. gray marketing
B. dumping
C. licensing
D. black marketing
E. market skimming
A

A. gray marketing

50
Q

Which of the following conditions would discourage gray marketing practices?
A. There is easy access to pricing information.
B. A product is in abundant supply.
C. A product is in short supply.
D. Marketers use skimming strategies.
E. Goods are subject to substantial markups.

A

B. A product is in abundant supply.