Question 1

All of the following statements about the purchase involved in organizational buying are true except which?

Accepted Answer

A)   The length of time required to arrive at a purchase agreement can vary with size of purchase.
B)   The dollar value of a single purchase made by an organization often runs into thousands or millions of dollars.
C)   The size of purchase impacts who participates in the purchase decision.
D)   The size of purchase impacts who makes the final decision.
E)   The size of the purchase is typically smaller than it is in consumer buying but it is done more frequently. E

Question 2

At which stage of the organizational buying decision process would purchasing assess the financial status of potential suppliers?

Accepted Answer

A)   problem recognition
B)   information search
C)   alternative evaluation
D)   purchase decision
E)   postpurchase behavior C

Question 3

Consider how buy classes affect buying center tendencies in different ways. Describe the buy-class situations, and discuss the implications for the organization of each type of buy class.

Accepted Answer

New buy. Here the organization is a first-time buyer of the product or service. This involves greater potential risks in the purchase, so the buying center is enlarged to include all those who have a stake in the new buy. Straight rebuy. Here the buyer or purchasing manager reorders an existing product or service from the list of acceptable suppliers, probably without even checking with users or influencers from the engineering, production, or quality control departments. Modified rebuy. In this buying situation the users, influencers, or deciders in the buying center want to change the product specifications, price, delivery schedule, or supplier. Although the item purchased is largely the same as with the straight rebuy, the changes usually necessitate enlarging the buying center to include people outside the purchasing department. See Figure 6-4.

Question 4

Which of the following is indicative of the purchase decision stage of the organizational buying decision process?

Accepted Answer

A)   The purchase decision is usually quick once the information search has been completed.
B)   After the bid is submitted and even once accepted, terms must still be negotiated.
C)   Even if several vendors make it onto the bidder's list, ultimately only one supplier is chosen.
D)   If a supplier on the bidder's list is not selected, it is rarely told the reason it was rejected.
E)   Once an agreement has been formally reached, neither the buyer nor the seller is permitted to make changes to the terms of the contract.

Question 5

What is the North American Industry Classification System (NAICS)?

Accepted Answer

The answer of What is the North American Industry Classification...

Question 6

The demand for industrial products and services that is driven by demand for consumer products and services is referred to as

Accepted Answer

A)   secondary marketing.
B)   derived demand.
C)   reciprocal supply.
D)   demand elasticity
E)   sequential demand.

Question 7

Manufacturers, wholesalers, retailers, service companies, not-for-profit organizations, and government agencies that buy goods and services for their own use or for resale are referred to as

Accepted Answer

A)   multinational buyers.
B)   resellers.
C)   organizational buyers.
D)   ultimate consumers.
E)   institutional buyers.

Question 8

The services market sells diverse services such as legal advice, auto repair, and dry cleaning, and this market represents 75 percent of all industrial firms. Which of the following is another such service firm?

Accepted Answer

A)   communication
B)   wholesalers
C)   retailers
D)   government units
E)   educational institutions

Question 9

The North American Industry Classification System (NAICS) designates industries with a numerical code in a defined structure. A six-digit coding system is used. The third digit designates

Accepted Answer

A)   an industry subsector.
B)   an industry group.
C)   a specific industry.
D)   an individual country-level national industry.
E)   a sector of the economy.

Question 10

The primary organizational buying objective for business firms is to

Accepted Answer

A)   create an atmosphere of inclusiveness.
B)   help smaller companies stay in business.
C)   increase the efficiency of its buyers.
D)   help the firm increase profitability.
E)   turn inventory.

Question 11

Which of the following types of firms are in the industrial market?

Accepted Answer

A)   retailing
B)   fisheries
C)   wholesaling
D)   state governments
E)   federal regulatory agencies

Question 12

European Style Furniture (ESF), headquartered in New York, acquires fine furniture from several high-quality manufacturers in Europe and enjoys exclusive distribution rights from them to sell to furniture stores throughout the United States. In this context, ESF is most likely classified as

Accepted Answer

A)   a producer.
B)   a reseller.
C)   a service provider.
D)   a government agency.
E)   an industrial firm.

Question 13

A ________ exists when a buyer and its supplier adopt mutually beneficial objectives, policies, and procedures for the purpose of lowering the cost or increasing the value of products and services delivered to the ultimate consumer.

Accepted Answer

A)   supplier development agreement
B)   reciprocal arrangement
C)   shareholder relationship
D)   supply partnership
E)   strategic alliance

Question 14

When the General Services Administration (GSA), an agency of the federal government, purchased 116 Chevy Volts from General Motors for its vehicle fleet, it was operating as

Accepted Answer

A)   an industrial market.
B)   a business market.
C)   a consumer market.
D)   a government unit.
E)   a service provider.

Question 15

Beth is part owner of a chain of auto repair shops. Her company was considering adding tire sales in some of its facilities, and several people were slated to meet to discuss the idea. Beth gathered information about possible distributors. Her son had been laid off from a job with one of them, so she removed this company from the group she was preparing to present to the others. Here, Beth was acting in what role in the buying center?

Accepted Answer

A)   gatekeeper
B)   decider
C)   user
D)   obstructionist
E)   power broker

Question 16

Which of the following possible characteristics of consumer buying is least likely to enter into an organizational buying decision?

Accepted Answer

A)   comparison of product performance with expectations
B)   purchase decisions based on the highest overall evaluation
C)   alternatives evaluated on important criteria
D)   information gathered from internal and external searches
E)   problem recognition triggered by self-actualization motives

Question 17

Independent e-marketplaces act as a neutral third party, provide an Internet technology trading platform, and provide ________ market that enable exchanges between buyers and sellers.

Accepted Answer

A)   a centralized
B)   a deconsolidated
C)   a segregated
D)   an integrated
E)   a noncompetitive

Question 18

Which of the following statements about e-marketplaces that act as independent trading communities is false?

Accepted Answer

A)   These trading communities allow buyers to easily compare offerings from various sellers.
B)   Independent trading communities charge a fee for their service.
C)   Independent trading communities often consist of thousands of geographically dispersed buyers and sellers.
D)   This independent type of trading community is favored by large companies.
E)   Independent trading communities often operate in an environment where demand and supply fluctuations cause volatile prices.

Question 19

Important buying process characteristics in organizational buying behavior include which of the following?

Accepted Answer

A)   Few large transactions are made over the Internet due to concerns of industrial espionage.
B)   Negotiations, purchases, and delivery occur in real time at an accelerated rate.
C)   There are often reciprocal arrangements and negotiations between buyers and sellers.
D)   Most purchases are made through government-licensed negotiators.
E)   Direct selling to organizational buyers is rare because it is cost-prohibitive.

Question 20

Organizational buyers include manufacturers, wholesalers, retailers, service companies, not-for-profit organizations, and government agencies that

Accepted Answer

A)   purchase exclusively from one supplier.
B)   are exempt from state and local taxes.
C)   sell directly to ultimate consumers.
D)   sell goods and services for their own use.
E)   buy products and services for their own use or for resale.

Exam 6: Understanding Organizations As Customers