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Study Resources (Business Management)

    71) When choosing a medium for an advertising message, a small business owner needs to consider the absolute costs of the ad, the ad's cost per potential customer reached. 72) Newspaper circulation as a percentage of total households reached has climbed over the past two decades, making it an excellent value.
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    51) Price wars usually begin when: A) the economy is in turmoil. B) when there are more than 4 competitors. C) when one competitor believes that they can achieve a higher volume through lower price. D) small businesses enter the market dominated by bigger giants.   52) Customers that sell small-ticket items frequently offer their customers:.
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    21) Evie works for a domestic wholesaler who does business in foreign markets, buying goods from domestic companies and selling them in foreign markets. Evie's firm is an: A) resident buying office. B) export trading company. C) foreign distributor. D) export merchant.   22) ________ participating companies get antitrust immunity, allowing them to cooperate freely. A) Foreign.
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    91) Price lining, leader pricing, and odd pricing are three geographic pricing strategies that can be used for established products.   92) Under uniform delivered pricing, a company charges all of its customers the same price, even though the cost of selling or transporting the merchandise varies.   93) Under FOB Factory terms, the.
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    11) ________ is the personal contact between salespeople and potential customers that comes from sales efforts. A) Publicity B) Personal selling C) Specialty advertising D) Advertising 12) The ________ cost of an advertising medium compares the actual dollar cost of an ad with the number of potential customers it reaches. A) relative B) continuous C) absolute D) comparative   13) When.
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    111) Even though cost-plus pricing is simple, it does not encourage a small business to use its resources efficiently. 112) The traditional method of product costing, absorption costing, is extremely useful in helping the manufacturer determine prices or the effect of price changes. 113) The problem with using full absorption cost information.
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    51) Before making a sales call, the salesperson sets three objectives. Which one is not an objective? A) The primary objective B) The visionary objective C) The maximum objective D) The minimum objective   52) Floating spots are common in what type of advertising media? A) Radio B) Newspaper C) Magazine D) Television   53) Tactics that can help an entrepreneur stimulate.
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    41) An entrepreneur wants to move into international markets but can't quite figure out how to do it. He's not clear on his target market or how to approach it but he knows he needs to "go global." This entrepreneur is experiencing which barrier to international trade? A) Financing B) Information C) Cultural D).
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    81) Export merchants represent a limited number of non-competing domestic companies.   82) Selling to a resident buying office is just like selling to domestic customers since the buying office handles all of the details of exporting the products.   83) Foreign distributors work in a close partnering relationship with a small business, providing.
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    1) ________ is said to link trading partners, whether they are giant corporations or single individuals with a small business. A) Technology B) Better management C) Higher salaries D) Smaller organizations   2) Expanding a small business into international markets: A) guarantees its success in the marketplace. B) makes it a member of GATT automatically. C) often helps it.
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    131) When setting prices, business owners should automatically match or beat the competitors.   132) Two factors are vital to studying the effects of competition on a small firm's pricing policies: the location of the competitors and the nature of the competing goods.   133) The nature of competitors' goods does not influence the.
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    61) The problem with using ________ is that it clouds the true relationships among price, volume, and costs by including fixed expenses in unit cost. A) full-absorption costing B) variable costing C) contribution margin D) break-even   62) Which of the following is correct? A) Sales — variable costs — fixed costs = contribution margin B) Total.
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    101) If a firm lacks a unique business image, it must match its competitor's prices or risk losing customers.   102) Non-price competition is using personal service, free delivery, and other extras to attract and keep customers without changing prices.   103) The underlying forces that dictate price are generally the same across industries,.
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    11) ________ is the primary market for U.S. franchisers. A) South America B) Europe C) Mexico D) The Caribbean   12) ________ involves a transaction in which a company selling goods in a foreign country agrees to promote investment and trade in that country. A) Countertrade B) Export C) Import D) Bartering   13) Small businesses go global: A) for very different reasons.
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    51) The North American Free Trade Agreement: A) brought Chile, Mexico, the United States, and Canada together as one market. B) eliminated all tariffs among member nations, effective immediately, and raised them to nonmembers. C) benefits the trading relationship between Canada and the United States most. D) created a unified market of 456.5 million.
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    101) Trade show advertisements reach a particular type of customers–those who have already made a purchase decision. 102) A major advantage of trade shows is their ability to provide a pre-selected audience of potential customers.   103) One significant disadvantage of trade shows is inability to bring in new customers or international customers.   104).
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    111) Fortunately for U.S. business owners, American customs and habits have become the standard for proper business behavior around the world.   112) The World Trade Organization was formed as a consequence of the growth of the European Community.   113) GATT will probably bring 2 million jobs and as much as $1 trillion.
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    31) Which of the following is an advantage of outdoor ads? A) Prominence of the ads B) Narrow reach C) Long exposure D) Flexibility 32) Which of the following is a disadvantage of outdoor ads? A) High absolute and relative costs B) Legal restrictions C) Narrow reach D) Lack of flexibility   33) The best color combination for an outdoor ad.
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  141) Define and explain the terms: price, price range, price ceiling, and price floor. Why is it important to keep these terms distinct in the entrepreneur's thinking?   142) Name and explain the three basic pricing strategies a small business owner has in establishing a new product's price.   143) There are at least.
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    101) The key to successfully establishing an international location is properly screening for the right partner company with compatible goals and products/services. 102) Usually, the first step a small business takes when getting its products into international markets is setting up permanent offices in foreign countries.   103) An advantage to establishing an.
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    81) A significant disadvantage of television advertising is the difficulty in changing an ad to match the rapidly changing marketplace.   82) The effectiveness of banner ads is judged through the pop-up rate.   83) Magazines have a wide audience reach in that nearly 9 out of 10 adults read an average of seven.
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  130) Your small firm is considering using print media, specifically, newspapers and magazines for an advertising campaign. Explain the advantages and disadvantages of each of these media.              131) Discuss the advantages and disadvantages of using radio and television advertising. How and why would you choose one over the other?     .
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    71) As sales volume increases with the broad acceptance of the new products, the firm can lower its price. This is a characteristics of: A) price wars. B) competitive pricing. C) skimming. D) penetration. 72) Small businesses whose pricing decisions are greatly affected by the costs of shipping merchandise to customers across a wide range.
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    1) In reality, advertising: A) is a "luxury expense" to be undertaken only when the budget permits. B) requires a large budget to be successful. C) is an investment in the future; without steady advertising the customer base will dry up. D) is relatively ineffective in increasing sales but it does increase customer awareness.   2).
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    91) Direct mail advertisers have found that recipients of direct mail computer disks throw them away at a higher rate than they do magazines or newspapers. 92) The key to the success of a direct mailing campaign is the accuracy of the customer list.   93) Due to the low cost, most small.
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    31) The first step an entrepreneur should take when starting an export business is to: A) recognize that the tiniest companies and least experienced entrepreneurs have the potential. B) research and pick target markets. C) develop a distribution strategy. D) find his/her customer. 32) To break into international markets the entrepreneur needs to take.
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    41) ________ costing includes only those costs that vary directly with the volume of an item produced. A) Absorption B) Break-even C) Indirect D) Direct   42) ________ tells what portion of the total revenues remains after covering variable costs to contribute toward meeting fixed expenses and earning a profit. A) The full-absorption statement B) The break-even selling.
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    111) Small businesses can save on advertising expenditures by repeating successful ads and running ads when customers are most likely to buy.   112) Spreading a small advertising budget evenly and thinly over a 12 month period is a right choice.   113) Stealth advertising does not necessarily look like traditional ads, and it.
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    21) ________ is a pricing strategy under which local customers "subsidize" the shipping charges the firm incurs when transporting merchandise to distant customers. A) FOB factory pricing B) Uniform delivered pricing C) Zone pricing D) Opportunistic pricing   22) Many small business owners use a ________ strategy to move stale, damaged, or slow moving goods.
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    121) One advantage of installment loans for a small business is that the business owner retains a security interest in the item sold as collateral on the loan.   122) Because installment credit is so profitable for the small business, most small businesses finance themselves. 123) Trade accounts are the equivalent of a.
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    41) Under the ________ method of establishing an advertising budget, the owner sees advertising as a luxury. A) what-is-affordable B) matching competitors C) percentage of sales D) objective-and-task   42) The most commonly used method of establishing an advertising budget for a small business is: A) a percentage of sales. B) spending what competitors spend. C) objective-and-task method. D) what.
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    31) When a small business is faced with price competition from a much larger competitor, it should consider: A) going head-to-head on prices by lowering its cost structure. B) using non-price competition by offering value added service. C) make rapid, continual price changes to keep the competition off balance. D) move to a premium.
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    121) The first step on how to establish an exporting program is to analyze the product or service.   122) Simply duplicating the practices companies have adopted (and have used successfully) in the domestic market and using them in foreign markets is an effective strategy for entrepreneurs.   123) Understanding cultural differences is one.
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    91) The licensing potential for intangibles, such as technology, trademarks, etc., is often greater than the licensing opportunities for products.   92) While franchise outlets are throughout the world, Africa is the primary market for U.S. franchisers.   93) A small business exporting to Hungary would likely have to engage in barter or countertrade.
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  146) Retailers have three pricing techniques available to them. Describe each technique, explain why a retailer would use it, and offer advantages or disadvantages that exist for each technique. 147) What pricing strategies are available to manufacturers? Explain each, why it is used, and what it does for the manufacturer.   148) Discuss.
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  135) Why would the small business owner use trade shows in his/her advertising strategy?   136) Name and discuss the four methods of establishing an advertising budget. 137) How can the entrepreneur use cooperative and shared advertising, and publicity to effectively advertise his/her business and products while holding down promotional costs?       .
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    81) If a company wants quick acceptance and extensive distribution, when introducing a new product into a highly competitive market with a large number of similar products, penetration pricing is the best strategy. 82) Penetration pricing is a short-term pricing strategy and achieves tremendous profit.   83) A penetration pricing strategy is designed.
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    11) The _______ pricing strategy often reinforces the unique, prestigious image of a company. A) penetration B) introductory C) discount D) skimming   12) A ________ strategy works well when a company has a mature product, loyal customers, a reputation for quality, and few competitors. A) penetration B) skimming C) discount D) price lining 13) The Omega Company introduces products with.
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    71) Going global tends to make companies more quality and customer conscious. 72) Going global is risk-free   73) An important question for the small business owner to ask before entering global markets is, "If we go global, can we get back out?"   74) Going global can lower manufacturing costs.   75) Small companies can no.
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    61) Which of the following statement is correct? A) Do not count on sponsorships for your entire advertising campaign. B) It is not necessary to be a dominant sponsor of the event. C) Most sponsorships are free and do not cost the company anything. D) All of the above 62) David started his business a.
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