Fall 2008

MGT301- Principles of Marketing (Session - 2)

Question No: 1    ( M - 1 )    .

Which of the following is NOT a benefit of direct marketing?

Immediate response

Customer relationship building

Assists client prospecting (Correct)

Greater product access and selection

Question No: 2    ( M - 1 )    .

Which one of the following is NOT a part of competitive positions?

► Market leader

► Market challenger

► Market follower

Market controller (Correct)

Question No: 3    ( M - 1 )    .

Which one of the following is a position option open to smaller firms that serves some part of the market that is not likely to attract the attention of the larger firms?

► Market leader

► Market challenger

► Market follower

Market niche (Correct)

Question No: 4    ( M - 1 )    .

The retailer is usually in an excellent position to:

► Make the most profits in the channel

► Become the channel leader

► Gain feedback from consumers

► Co-ordinate the production strategy

Question No: 5    ( M - 1 )    .

A departmental store firm wants to increase sales and reach new markets with direct marketing. To accomplish this, the sales or marketing manager would choose which of the following tool?

► Sales promotions

► Advertising

Kiosk marketing (Correct)

► Public relations

Question No: 6    ( M - 1 )    .

In contrast to vending machines which dispense only products, there are other systems that dispense information and take orders without direct human aid. This system refers to which one of the following options?


Kiosks (Correct)

► TV monitors

► The internet

► Cell phones

Question No: 7    ( M - 1 )    .

Which one of the following is the fastest growing form of marketing that reach more customers and save money?

► Advertising

Direct marketing (Correct)

► Public relations

► Personal selling

Question No: 8    ( M - 1 )    .

Management at Happy Motors must decide what mix of compensation elements to offer their sales force. Which of the following is NOT one of the four basic types of compensation plans?

► Straight commission

► Straight salary

► Salary and commission

Commission and bonuses (Correct)

Question No: 9    ( M - 1 )    .

There are three typical types of sales force structures. Which one is often supported by many levels of sales management positions in specific geographical areas?

Territorial (Correct)

► Customer

► Complex systems

► Matrix

Question No: 10    ( M - 1 )    .

Mr. Tatbeeq sales person from Philips, develops a list of potential customers and evaluates them on the basis of their ability, willingness, and authority to purchase copy machines. What is the name of this process?

► Customer search

► Sales preparation

► Audience identification

Prospecting (Correct)

Question No: 11    ( M - 1 )    .

Giving a free sample of a new product by attaching it to the pack of an existing product refers to which one of the following promotion?

On-pack promotion (Correct)

► New-product promotion

► Extra-fill promotion

► Co-operative discounting

Question No: 12    ( M - 1 )    .

Sales promotion includes a wide assortment of tools. Which one of the following is NOT one of these tools?

► Contests

► Premiums

Telephone surveys (Correct)

► Coupons

Question No: 13    ( M - 1 )    .

Communication process has different elements that are helpful for communicating message to audience. One of the communication tools is the decoding. Which one of the following statements refers to the “Decoding”?

► Intensity of the transmission becomes stronger

Receiver attempts to convert signs into concepts and ideas (Correct)

► Source attempts to convert signs into concepts and ideas

► Receiver filters noise from the feedback

Question No: 14    ( M - 1 )    .

Which one of the following concepts is considered as the basic role of promotion?

► Information

► Manipulation

Communication (Correct)

►  Interpretation

Question No: 15    ( M - 1 )    .

Location is extremely important to a retailer due to which one of the following reasons?

► Suppliers charge more to service stores in certain trading areas.

► A desirable location appeals to consumers' emotions and encourages them to buy. (Correct)

► Location is the major determinant of store image.

► Location determines the trading area from which the store must draw its customers.

Question No: 16    ( M - 1 )    .

Which of the following is considered as huge superstores, perhaps as large as six football fields?

Hypermarket (Correct)

► Department store

► General merchandise retailer

► Discount store

Question No: 17    ( M - 1 )    .

A cash-and-carry wholesaler would be expected to:

► Provide transportation

Handle high turnover products (Correct)

► Carry a wide variety of products

► Provide a wide range of services

Question No: 18    ( M - 1 )    .

Which type of wholesaler not only provides transportation and delivers products to retailers, but also provides the service of placing products on retailers' shelves?

Truck wholesaler (Correct)

► Cash-and-carry wholesaler

► Rack jobber

► Mail-order wholesaler

Question No: 19    ( M - 1 )    .

Which one of the following statement BEST describes a merchant wholesaler?

► Takes title and possession of goods and sells only to retailers.

Takes title and assumes risk and is generally involved in buying and reselling products. (Correct)

► Does not take title and possession of goods but may facilitate exchange between any two parties.

► Carry a limited line of fast-moving goods and sell to small retailers for cash

Question No: 20    ( M - 1 )    .

Which one of the following concept reflects the term “Order processing”?

► Is the same as order handling

Is characterized by electronic processing (Correct)

► Is the receipt and transmission of sales order information

► Is the second stage in a physical distribution system

Question No: 21    ( M - 1 )    .

The success of each channel member depends on the performance of which of the following?

► Key channel members

► The entire supply chain

The manufacturer (Correct)

► The wholesaler

Question No: 22    ( M - 1 )    .

When Mr. A is using a channel with only one intermediary, that intermediary is classified as which of the following?

Retailer (Correct)

► Wholesaler

► Broker

► Producer

Question No: 23    ( M - 1 )    .

Relationships among channel members, i.e. producers, wholesalers and retailers, are usually:

► Short-term commitments

Long-term commitments (Correct)

► Expensive resource commitments

► Only minor commitments

Question No: 24    ( M - 1 )    .

Which one of the following is the function of a direct channel of distribution?

The flow of products from producers to customers (Correct)

► Links producers to other marketing intermediaries

► Takes title to products and resells them

► Manages transportation and warehousing functions

Question No: 25    ( M - 1 )    .

Three key issues associated with initiating price changes are, the circumstances, the tactics and:

► Sales targets

► Bad publicity

► Stock levels

Competitor reactions (Correct)

Question No: 26    ( M - 1 )    .

When a firm or store offers a price reduction to customers who buy during off-peak periods throughout the year, the firm is giving which of the following discount?

► Functional

Seasonal (Correct)

► Annual

► Credit

Question No: 27    ( M - 1 )    .

If a retailer form Islamabad orders a quantity of merchandise to be delivered to his store in Lahore and is quoted a price that does not include transport costs, the retailer is paying a price called:

► F.O.B. destination

FOB price (Correct)

► Geographic price

► Base-point price

Question No: 28    ( M - 1 )    .

The Shirt Company utilizes a push strategy to sell the shirt line. Its basic promotional tool is discount. These discounts offered to middlemen are referred to as which one of the following discounts?

► Trade

► Cumulative

► Noncumulative

Cash  (Correct)

Question No: 29    ( M - 1 )    .

If Pepsi sets the price of its six packs to match exactly the price of Coca-Cola's, Pepsi is using which of the following pricing method?

► Demand-oriented

► Cost-oriented

► Experience curve

Competition-oriented (Correct)

Question No: 30    ( M - 1 )    .

Which one of the following pricing method is the simplest pricing method?

► Value-based

► Fixed cost

Cost-based (Correct)

► Skimming

Question No: 31    ( M - 1 )    .

Companies set prices by selecting a general pricing approach that includes one or more of three sets of factors. One of these is the cost-based approach, which means:

► Value-based pricing and market-skimming pricing

► Going-rate and sealed-bid pricing

Cost-plus pricing, break-even analysis, and target profit pricing (Correct)

► Competition-based pricing and market-penetration pricing

Question No: 32    ( M - 1 )    .

Which one of the following pricing objectives is rarely operational because its achievement is difficult to measure?

► Return on investment

► Profit maximization

► Market share

Survival (Correct)

Question No: 33    ( M - 1 )    .

Price is a key element in the marketing mix because it relates directly to:

► The size of the sales force

► The speed of an exchange

► The control of quality

The generation of total revenue (Correct)

Question No: 34    ( M - 1 )    .

Less frequently purchased consumer products and services which are compared by the customer on different product attributes, refers to which one of the following product?

► Specialty products

Shopping products (Correct)

► Unsought products

► Industrial products

Question No: 35    ( M - 1 )    .

Which of the following factors are often used for segmenting customer groups?

► Geographic factors

► Psychographic factors

► Behavioral factors

Demographic factors (Correct)

Question No: 36    ( M - 1 )    .

What is the stage of the buyer decision process in which the consumer uses information to evaluate brands in the choice set?

► The alternative evaluation stage

► The situational stage

► The experimental stage

The informative stage (Correct)

Question No: 37    ( M - 1 )    .

The factors such as the buyer’s age, life-cycle stage, occupation, economic situation, lifestyle, personality and self-concept that influences buyer’s decisions refers to which one of the following characteristic?

Personal characteristics (Correct)

► Psychological characteristics

► Behavioral characteristics

► Demographical characteristics

Question No: 38    ( M - 1 )    .

Marketers are interested in the roles and influence of the husband, wife and children on the purchase of different products and services. Which one of the following segment is being studied by the marketer?

► Social class

► Opinion leader

► Reference group

Family (Correct)

Question No: 39    ( M - 1 )    .

Marketing stimuli consist of the four Ps. Which is NOT one of these Ps?

► Product

Political (Correct)

► Price

► Promotion

Question No: 40    ( M - 1 )    .

Which one of the following step in the marketing research process deals in "defining the problems and research objectives, implementing the research plan, and interpreting and reporting the findings"?

► Developing the research budget

► Choosing the research agency

Choosing the research method (Correct)

► Developing the research plan

Question No: 41    ( M - 1 )    .

Which one of the following environment is made up of institutions and other forces affecting society’s basic values, perceptions, preferences and behaviors?

Cultural environment (Correct)

► Fictitious environment

► Natural environment

► Political environment

Question No: 42    ( M - 1 )    .

Which one of the following is NOT a part of marketing channel firms (intermediaries)?

► Physical distribution firm

► Marketing service agency

Financial intermediary (Correct)

► Stock exchange

Question No: 43    ( M - 1 )    .

Advertising agencies are an example of which of the following marketing intermediaries?

► Insurance company

► Financial intermediary

► Marketing services agency (Correct)

► Physical distribution firm

Question No: 44    ( M - 1 )    .

Which one of the following is a chief goal of the implementation function in marketing process?

► Develop marketing plans

Turns plans into actions (Correct)

► Take corrective actions.

► Develop strategic plans.

Question No: 45    ( M - 1 )    .

Developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities represent which one of the following concept?

Marketing objectives

Strategy planning (Correct)

Marketing activities

Corporate strategies

Question No: 46    ( M - 1 )    .

Which one of the following options is best to explain the purpose of intranets?

► Buying and selling processes

► Business-to-business purchasing

Communication among employees (Correct)

► Maintaining customer relations

Question No: 47    ( M - 1 )    .

A network of networks that consists of millions of smaller domestic, academic, business, and government networks, which together carry various information and services. Which one of the following networks represents it?


► Intranet

Extranet (Correct)

► Internet

Question No: 48    ( M - 1 )    .

Which one of the following statements is an example of a problem that may arise in the implementation of the marketing concept?

► Dissatisfaction of one segment affects the satisfaction of other segments

Consumers do not understand what the marketing concept is (Correct)

► Dealers do not support the marketing concept

► A product may fit the needs of too many segments

Question No: 49    ( M - 1 )    .

Which one of the following option is NOT a benefit of internet marketing?

► Cost effective

► Time saving

Reliability (Correct)

► Open new venue

Question No: 50    ( M - 1 )    .

Which one of the following option is NOT a benefit for buyer with E-commerce?

► Convenience

► Easy and private

Reliability (Correct)

► Greater product access

Question No: 51    ( M - 5 )

What do you understand by the term Logistics and enlist the logistics functions?

Answer :

A value added flows from suppliers to final users

Major functions include

  • Order processing
  • Warehousing
  • Inventory Management
  • Transportation.

Question No: 52    ( M - 10 )

If you think of your store as a doorway and just on the other side of the doorway is your customer who is reluctant to enter in the shop. How do you get them to come in? You can choose to pull the prospect through the door or you can push them through the door. Explain both concepts (pull marketing and push marketing) with the help of examples.


Push Marketing

A promotion strategy that calls for using the sales force and trade advertising to push the product through the channel is called push marketing. For example the manufacturer promotes the product to wholesalers, the wholesalers promote to retailers and finally the retailers promote to consumers.

Pull Marketing

A promotional strategy that calls for spending a lot on advertising and consumer promotion to build up consumer demand pull marketing. For example if consumer will ask their retailers for the product, the retailer will ask the wholesalers and wholesalers will ask the producers.

Question No: 53    ( M - 10 )

What do you understand by direct marketing; discuss the advantages of direct marketing?


Direct marketing consists of direct communication with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationship, with no intermediary levels and is also called one to one marketing. It has been hailed by some marketers as “marketing model of the next millennium”.



It brings so many benefits to both Buyer & Seller which are as follows.


Advantages for buyers.

  • Provides wealth of proportional information.
  • Greater product access and selection.
  • Handy, easy & private.
  • Some companies allow buyers to design their own products online (For example, HP allows customers to make their tailor made notebook online and quotes immediately)


Advantages for Sellers.

  • Because of its one-to-one, interactive nature, the Internet is an especially compelling marketing tool.
  • Continuous relationships with customers can be developed.
  • Diminish costs and increase speed and efficiency.
  • A powerful tool for customer relationship building.
  • It can also be timed to reach prospects at just the right moment.
  • The internet is a truly global medium and online marketing offers greater flexibility.
  • Buyers are now active participants in shaping the marketing offer and process.

Question No: 54    ( M - 10 )

Mr. Danish is a marketing head of credit card department at bank UBL. He is interested in establishing a sales force to market the bank Visa card. What do you understand by the term “sales force” and what steps Mr. Danish will take to manage the sales force?


Salespeople act for a company and perform following tasks.

Prospecting of new business,

Communicating with potential and existing customers;

Servicing customers and information gathering.

Help business customers and find ways to economize


Sales force Management.

Mr. Danish should analysis, planning, implementation, and control of Sales force activities.