Question 1

Order processing, inventory management, materials handling, warehousing, and transportation are the activities that define

Accepted Answer

A) wholesaling. 
B) retailing. 
C) physical distribution. 
D) channel management. 
E) drop shipping.

Question 2

Dell Computers is a nationally recognized manufacturer of computers for the small business and home markets. If Dell were to order one of its wholesalers not to carry any computer products other than those made by Dell, this arrangement would be called

Accepted Answer

A) a tying contract. 
B) refusal to deal. 
C) a restricted sales territory. 
D) a restricted channel. 
E) exclusive dealing.

Question 3

As her Internet quilt and bed linen business grew, Danielle could no longer perform all the distribution activities, so she hired a shipper and an information technology firm to assist with these functions. Danielle is using ____ for physical distribution for her business.

Accepted Answer

A) producers 
B) wholesalers 
C) retailers 
D) selling agents 
E) outsourcing

Question 4

A manufacturer has decided to improve its inventory management by maintaining low inventory levels and waiting to purchase materials until right before they are needed in production. This inventory management technique is called

Accepted Answer

A) just-in-time (JIT). 
B) time management. 
C) inventory minimization. 
D) economic order quantity. 
E) reorder point maximization.

Question 5

Aaron attends a seminar on just-in-time inventory management. Excited about the idea, he returns to his office at Atlanta Auto Supply to start designing such an inventory system. Which of the following steps must Aaron take as he institutes this change?

Accepted Answer

A) Increase safety stock 
B) Raise the reorder point 
C) Reduce customer service standard 
D) Increase order frequency 
E) Reduce estimates of inventory turnover rate

Question 6

Fragile products that require special handling are more likely to be distributed through

Accepted Answer

A) longer channels. 
B) shorter channels. 
C) direct channels. 
D) strategic alliances. 
E) exclusive outlets.

Question 7

Scenario 15.1
Use the following to answer the questions.
Liz Claiborne, Inc. markets several different brands, under their own Claiborne name label, as well as others. Their primary brands, such as Liz Claiborne, Liz & Co, and DKNY, are sold to wholesalers. These brands are then available through retail department stores such as Kohl's and Macy's. Their wholesale-based brands division is positioned as customer-focused and cost-efficient. Their premium brands division includes labels such as Kate Spade, Juicy Couture, and Mexx. These premium brands are sold through stores that the Claiborne company owns.
-Refer to Scenario 15.1. Which of the following is most likely the primary factor Liz Claiborne, Inc. used when selecting the marketing channel for its Juicy Couture brand?

Accepted Answer

A) characteristics of the intermediaries 
B) product attributes 
C) type of organization 
D) marketing environmental forces 
E) competition

Question 8

When Sophie buys organic produce for her household using a channel with only one intermediary, that intermediary is classified as a

Accepted Answer

A) retailer. 
B) wholesaler. 
C) broker. 
D) functional middleman. 
E) producer.

Question 9

A channel that includes both a manufacturers' agent and an industrial distributor is appropriate under which of the following circumstances?

Accepted Answer

A) When the firm wants specialized personnel to follow up the work of the sales force 
B) When the marketer wishes to enter a new geographic market but does not wish to expand the existing sales force 
C) When only one or two channels of distribution are available for products 
D) When the sales force is large and the marketer is thinking of cutting it down 
E) When customers are highly concentrated in one geographic area

Question 10

Organizational buyers are especially partial to direct marketing channels when

Accepted Answer

A) they buy cheap materials in large quantities. 
B) they try a new product for the first time. 
C) they are filling an order for a very important customer. 
D) a modified rebuy type of decision is involved. 
E) expensive and/or complex equipment is involved.

Question 11

Rob Stevens is the head of a company that produces computer software for production scheduling. The firm is small and presently does not generate enough volume to justify hiring a sales force. The firm is probably using ____ to maintain contact with the firms using its products.

Accepted Answer

A) wholesalers 
B) brokers 
C) agents 
D) merchants 
E) retailers

Question 12

Many companies use more than one marketing channel to distribute their products to the same target market, a tactic called

Accepted Answer

A) multiple channeling. 
B) strategic channel alliance. 
C) intensive distribution. 
D) dual distribution. 
E) market splitting.

Question 13

The reasons a vertically integrated channel can be more effective against competition is because of all of the following except

Accepted Answer

A) the consolidation of power. 
B) tightly controlled and bureaucratic management style. 
C) the ability to inhibit competitors. 
D) the sharing of responsibilities and information. 
E) increased bargaining power.

Question 14

____ adds time and place utility to a product by moving it from where it is made to where it is purchased and used.

Accepted Answer

A) Warehousing 
B) Containerization 
C) Distribution 
D) Materials handling 
E) Transportation

Question 15

Marketing channel members are likely to experience misunderstandings, frustration, and poorly coordinated strategies as a result of

Accepted Answer

A) channel conflict caused by inefficient communication between channel members. 
B) open communication among the channel members. 
C) methods of channel coordination designed to reduce ambiguity. 
D) negotiating territorial issues among regional distributors of a product. 
E) allowing one member of the channel to take the role of channel captain.

Question 16

Madison is responsible for the freight transportation of products sold by Richland Tech, a producer of cooking oils sold to large institutions. Since Madison needs to schedule freight transportation with the mode that provides the most flexible schedules and routes, which of the following should she use?

Accepted Answer

A) Trucks 
B) Waterways 
C) Warehousing 
D) Pipelines 
E) Railroads

Question 17

River City, Inc. is an independent business that takes title to products and carries inventories. River City, Inc. is most likely a(n)

Accepted Answer

A) industrial distributor. 
B) intermediary. 
C) agency. 
D) wholesaler. 
E) producer.

Question 18

What function of physical distribution enables companies to compensate for dissimilar production and consumption rates and stabilize prices and availability of seasonal items?

Accepted Answer

A) Materials handling 
B) Warehousing 
C) Transportation 
D) Inventory management 
E) Order processing

Question 19

If a microchip in a computer at the Pentagon failed, which method of transportation would be most appropriate to use to replace the chip immediately if one could get the new chip only from New York City?

Accepted Answer

A) Government vehicle 
B) Airway 
C) Waterway 
D) Truck 
E) Railroad

Question 20

Netflix sells its movie services using its website while Red Box sells its movie services using vending machines. From a customer's point of view, Netflix is using ____ and Red Box is using ___.

Accepted Answer

A) a direct marketing channel; a slightly shorter channel. 
B) a direct-marketing channel; an agent. 
C) an Internet wholesalers; a retailers. 
D) an Internet wholesaler; a slightly longer channel. 
E) a direct-marketing channel; a type of retailer.

Exam 15: Marketing Channels and Supply Chain Management