Chapter 12—Producing and Distributing Goods and Services

MATCHING

Complete the following using the terms listed.

a. marketing intermediary
b. test marketing
c. brand insistence
d. product life cycle
e. brand name
f. wholesaler
g. family brand
h. product line
i. convenience products
j. product line
k. wheel of retailing
l. logistics
1. A single brand name such as Johnson & Johnson that is used for the entire line of products is an
example of a(n) _____ .
2. A(n) _____ is a firm that moves goods between producers and consumers or business users.
3. _____ are those items typically purchased often by consumers, with little effort.
4. _____ refers to the stages a product goes through when it enters and leaves the market.
5. A group of related products marked by physical similarities or intended for a similar market.
6. _____ introduces a new product supported by a complete marketing campaign to a selected city or TV
coverage area.
7. Coca-Cola, Nike, Google, and American Express are examples of _____.
8. _________ are the distribution channel that sells primarily to retailers, other wholesalers, or business
users.
9. A(n) _____ is a group of related products marked by physical similarities or intended for a similar
market.
10. _____ is the ultimate degree in brand loyalty, in which the consumer will accept no substitute for a
preferred brand.
11. In a process called the _____, new retailers enter the market by offering lower prices made possible
through reductions in service.
12. The process of coordinating the flow of goods, services, and information among members of the
supply chain is called _____.

1. ANS: g DIF: MEDIUM REF: 12.3 Product Identification

Pg. 398 AACSB Analytic BT: K
2. ANS: a DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 402 AACSB Analytic BT: K
3. ANS: i DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Analytic BT: K
4. ANS: d DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 392 AACSB Analytic BT: K
5. ANS: j DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 391 AACSB Analytic BT: K
6. ANS: b DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 395 AACSB Analytic BT: K
7. ANS: e DIF: MEDIUM REF: 12.3 Product Identification
 Pg. 397 AACSB Analytic BT: K
8. ANS: f DIF: MEDIUM REF: 12.5 Wholesaling
Pg. 406 AACSB Analytic BT: K
9. ANS: h DIF: MEDIUM REF: 12.4 Product Strategy
Pg. 391 AACSB Analytic BT: K
10. ANS: c DIF: MEDIUM REF: 12.3 Product Identification
Pg. 399 AACSB Analytic BT: K
11. ANS: k DIF: MEDIUM REF: 12.6 Retailing
Pg. 409 AACSB Analytic BT: K
12. ANS: l DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

ESSAY

13. Define product. What decisions are included in the marketing conception of a product?

ANS:
A product is a bundle of physical, service, and symbolic attributes designed to satisfy consumer wants.
The marketing conception of a product includes the brand, product image, warranty, service attributes,
packaging, and labeling, as well as the physical or functional characteristics of the good or service.

DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 388 AACSB Analytic BT: K

14. Compare the classification of consumer goods and services to business goods and services.

ANS:
Goods and services are classified as either consumer or business depending on the purchaser of the
particular item. Consumer products are those purchased by ultimate consumers for their own use. They
can be convenience products, shopping products, or specialty products. Business products are those for
use either directly or indirectly in the production of other goods and services for resale. They can be
classified as installations, accessory equipment, component parts and materials, raw materials, and
supplies. Services can be classified as either consumer or business.

DIF: HARD REF: 12.1 Product Strategy

Pg. 389 AACSB Reflective Thinking BT: AP

15. Provide examples of each of the following consumer products: convenience, shopping, and specialty.

ANS:
Convenience products include items such as newspapers, snacks, or candy. Shopping products include
items such as a new sofa or television set. Examples of specialty products include Rolex watches,
Prada shoes, or Smart cars.

DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 389 AACSB Analytic BT: AP

16. Explain the relationship between a company’s product line and product mix.

ANS:
 A product line is a series of related products marked by physical similarities or intended for a similar
market. A product mix is the assortment of product lines and individual goods and services that a firm
offers to consumers and business users.

DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 391 AACSB Analytic BT: K

17. Describe how services differ from goods.

ANS:
Services, unlike goods, are intangible. Services are perishable, since neither consumers nor firms
cannot stockpile them in inventory. Services are also difficult to standardize, since consumer needs,
wants, and expectations vary. Finally, from the buyer's perspective, the service provider is the service.

DIF: HARD REF: 12.2 Product Life Cycle

Pg. 391 AACSB Reflective Thinking BT: AP

18. Identify and describe the major stages of the product life cycle.

ANS:
The product life cycle refers to the four stages a product goes through from the time it first enters the
market until it is no longer a viable product. These stages are introduction, growth, maturity, and de-
cline. In the introduction stage, the firm tries to promote demand for its new offering; inform the mar-
ket about it; give free samples to entice consumers to make a trial purchase; and explain its features,
uses, and benefits. During the growth stage, sales climb quickly as new customers join early users who
now are repurchasing the item. Word-of-mouth referrals and continued advertising and other special
promotions by the firm induce others to make trial purchases. In the maturity stage, industry sales at
first increase, but they eventually reach a saturation level at which further expansion is difficult. Com-
petition also intensifies, increasing the availability of the product. Sales continue to fall in the decline
stage, the fourth phase of the product life cycle. Profits decline and may become losses as further
price-cutting occurs in the reduced overall market for the item.

DIF: HARD REF: 12.2 Product Life Cycle

Pg. 392 AACSB Reflective Thinking BT: AP

19. Describe methods used to extend life cycle of a product.

ANS:
A commonly used strategy for extending the life cycle is to increase customers’ frequency of use. An-
other strategy is to add new users. Finally, a third approach includes finding new uses for a product.

DIF: HARD REF: 12.2 Product Life Cycle

Pg. 394 AACSB Reflective Thinking BT: AP

20. What are the advantages and disadvantages of test marketing?

ANS:
 Test marketing allows the firm to gain insights into a product's likely market performance before
making a major commitment to a full-scale introduction. The results of test marketing can be used to
make adjustments to the product and promotional efforts that increase the chances of a successful
product launch. However, test marketing has some drawbacks. It can be expensive, delay the
introduction of a product, and provide competitors with advance warning about the firm's new
products. In some cases, competitors are able to skew the results of test marketing by running special
promotions or advertising campaigns.

DIF: HARD REF: 12.2 Product Life Cycle

Pg. 396 AACSB Reflective Thinking BT: AP

21. Differentiate among a brand, a brand name, and a trademark.

ANS:
A brand is a name, term, sign, symbol, design (or a combination) used to identify the products of one
firm and differentiate them from competing products. A brand name is that part of the brand consisting
of words or letters included in a name used to identify and distinguish the firm’s products from those
of competitors. A trademark is a brand that has been given legal protection.

DIF: MEDIUM REF: 12.3 Product Identification

Pg. 397 AACSB Analytic BT: K

22. Describe the three levels of brand loyalty.

ANS:
Brand recognition is brand acceptance strong enough so that the consumer is aware of the brand, but
not strong enough to cause a preference over other brands. Brand preference occurs when a consumer
chooses one firm's brand over a competitor's. Brand insistence is the ultimate degree of brand loyalty,
in which the consumer will accept no substitute for the preferred brand.

DIF: MEDIUM REF: 12.3 Product Identification

Pg. 399 AACSB Analytic BT: K

23. What are the two categories of marketing intermediaries? Discuss how marketing intermediaries add
value to a product as it moves through the distribution channel.

ANS:
The two main categories of marketing intermediaries are wholesalers and retailers. Marketing
intermediaries, also known as middlemen, move goods between producers and consumers or business
users. Marketing intermediaries perform various functions that help the distribution channel operate
smoothly, such as buying, selling, storing, and transporting products.

DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg. 404 BT: AACSB Reflective Thinking BT: AP

24. Explain the difference between direct and indirect distribution channels. Provide an example of each
type.

ANS:
A direct distribution channel is one that moves goods and services directly from the producer to the
ultimate user. Consumers and businesses that purchase computers directly from manufacturers, such as
Dell computers, are using a direct distribution channel. An indirect distribution channel is one where
the goods and services move first to an intermediary, such as a wholesaler or retailer, before moving to
the ultimate user. For example, a grocery store is the intermediary between Del Monte and consumers.
 DIF: HARD REF: 12.4 Distribution Strategy
Pg. 402 AACSB Reflective Thinking BT: AP

25. Differentiate between a merchant wholesaler and an agent or broker in terms of title to the goods.

ANS:
Merchant wholesalers take legal title to the goods they handle. Agents or brokers may or may not take
possession of the goods they handle, but they never take title.

DIF: MEDIUM REF: 12.5 Wholesaling

Pg. 407 AACSB Reflective Thinking BT: AP

26. Explain the wheel of retailing.

ANS:
The wheel of retailing is a theory that explains how and why retailing strategies change over time.
According to the theory, new types of retailers enter the market and gain a competitive foothold by
offering low prices and limited services. Once they become established, these companies gradually add
more services, forcing them to raise prices and making them vulnerable to newer retailing models with
appeals based on low prices.

DIF: MEDIUM REF: 12.6 Retailing

Pg. 409 AACSB Reflective Thinking BT: AP

27. Provide examples of products using the three levels of distribution intensity.

ANS:
Products such as milk and newspapers use intensive distribution. Products such as Porsche
automobiles use exclusive distribution. Estee Lauder cosmetics use selective distribution.

DIF: HARD REF: 12.7 Distribution Channel Decisions and Logistics

Pg. 415 AACSB Analytic BT: K

28. Describe the supply chain.

ANS:
The supply chain is the complete sequence of suppliers that contribute to creating and delivering a
good or service to business users and final consumers. The supply chain begins when raw materials
used in production are delivered to the manufacturer and continues with the actual production
activities that create finished goods. Finally, the finished goods move through the producer's
distribution channels to end users.

DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics

Pg. 416 AACSB Analytic BT: K

MULTIPLE CHOICE

29. A bundle of physical, service, and symbolic attributes designed to satisfy customer wants is called
________.
a. the marketing mix
b. packaging
 c. a product
d. a brand name
ANS: c DIF: EASY REF: 12.1 Product Strategy
Pg. 388 AACSB Analytic BT: K

30. A marketer focuses on a product's ________.

a. physical characteristics
b. service attributes
c. symbolic attributes
d. benefits
ANS: d DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Analytic BT: K

31. Goods and services are classified as either consumer or business, depending on the ________.
a. amount of service required on the item
b. buying motives of the purchasers
c. cost of the particular item
d. purchasers of the particular item
ANS: d DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Analytic BT: K

32. Consumer products are usually classified as ________.

a. expense items and capital items
b. convenience products and expense items
c. convenience products, shopping products, and specialty products
d. capital items, convenience items, and specialty products
ANS: c DIF: EASY REF: 12.1 Product Strategy
Pg. 389 AACSB Analytic BT: K

33. Items that consumers purchase frequently, immediately, and with little effort are ________ products.
a. convenience
b. shopping
c. specialty
d. capital
ANS: a DIF: EASY REF: 12.1 Product Strategy
Pg. 389 AACSB Analytic BT: K

34. Which of the following is a specialty product?

a. Insurance policy
b. Gallon of milk
c. Armani clothing
d. Dining room set
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 386 AACSB Analytic BT: K

35. Products purchased only after the consumer has compared competing products in competing stores on
the basis of price, quality, style, and color would be classified as ________.
a. supplies
b. shopping products
c. specialty products
 d. convenience products
ANS: b DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 38 AACSB Analytic BT: K

36. A new refrigerator falls into which of the following classifications of goods?
a. Specialty products
b. Accessory equipment
c. Shopping products
d. Convenience products
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Reflective Thinking BT: K

37. Only a few Jaguar dealers are located in the Chicago metropolitan area. For buyers who will accept no
substitute, Jaguar automobiles are ________.
a. specialty products
b. convenience products
c. shopping products
d. capital items
ANS: a DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Reflective Thinking BT: K

38. Maria owns a store that prepares gourmet chocolates, which are hand-made and sold on the premises.
What type of product is Maria selling?
a. Convenience
b. Shopping
c. Specialty
d. Accessory
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Reflective Thinking BT: K

39. Travis wants to replace his old mattress with a new soft-foam mattress, and has spent almost a week
researching different brands and prices. When he’s ready to buy, Travis will be purchasing a(n)
________ product.
a. Convenience
b. Shopping
c. Specialty
d. Accessory
ANS: b DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 389 AACSB Reflective Thinking BT: K

40. Jan takes her car to Oil Express for an oil change. This is an example of a(n) ________.
a. consumer service
b. specialty product
c. convenience product
d. business service
ANS: a DIF: EASY REF: 12.1 Product Strategy
Pg. 391 AACSB Reflective Thinking BT: AP

41. Which of the following classifications of products apply to business goods and services?
a. Supplies and specialty products
 b. Specialty products and convenience products
c. Installation and accessory equipment
d. Shopping products and expense items
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 391 AACSB Analytic BT: K

42. The purchase of a new jet by Delta Airlines is an example of a(n) ________ purchase.
a. installation
b. supply
c. specialty good
d. component part
ANS: a DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 390 AACSB Reflective Thinking BT: AP

43. Which classification of business goods is usually consumed over a long period and usually involves
large sums of money?
a. Convenience items
b. Capital items
c. Installations
d. Expense items
ANS: b DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 390 AACSB Analytic BT: AP

44. Fax machines are classified as which of the following?

a. Specialty products
b. Capital items
c. Accessory equipment
d. Shopping products
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 390 AACSB Reflective Thinking BT: AP

45. An example of supply items would be ________.

a. computers
b. paper clips
c. cotton
d. hand tools
ANS: b DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 390 AACSB Analytic BT: AP

46. The tires built by Michelin that appear on Formula 1 race cars are classified as ________.
a. accessory equipment
b. component parts and materials
c. supplies
d. specialty products
ANS: b DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 390 AACSB Reflective Thinking BT: AP

47. When Smith Glass Factory purchases light bulbs for everyday use, it is purchasing ________.
a. expense items
b. component parts
 c. raw materials
d. supplies
ANS: d DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 390 AACSB Reflective Thinking BT: AP

48. Natural resources, such as iron ore used in producing finished goods, are classified as ________.
a. supplies
b. accessory equipment
c. component parts and materials
d. raw materials
ANS: d DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 90 AACSB Reflective Thinking BT: AP

49. A combination of product lines represents a company's ________.

a. product mix
b. product cluster
c. product lifecycle
d. distribution strategy
ANS: a DIF: EASY REF: 12.1 Product Strategy
Pg. 391 AACSB Analytic BT: K

50. General Mills products include Betty Crocker, Pillsbury, Häagen-Dazs, Green Giant, Hamburger
Helper, and Progresso. These examples constitute General Mills' ________.
a. product line
b. product cluster
c. product mix
d. distribution strategy
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 391 AACSB Reflective Thinking BT: BT: AP

51. A product line is a group of ________ products marked by physical ________.

a. related; similarities
b. unrelated; similarities
c. related; differences
d. unrelated; differences
ANS: a DIF: HARD REF: 12.1 Product Strategy
Pg. 391 AACSB Analytic BT: K

52. Coke, Diet Coke, Cherry Coke, Coke Zero, and Coke with Lime constitute Coca Cola's ________ of
soft drinks.
a. distribution strategy
b. product mix
c. product line
d. product cluster
ANS: c DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 391 AACSB Reflective Thinking BT: AP

53. Coppertone manufactures sunscreens with various SPF factors, which constitutes the company’s
________.
a. product line
 b. product cluster
c. distribution strategy
d. product mix
ANS: a DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 391 AACSB Reflective Thinking BT: AP

54. Sharper Image’s collection of high-tech gadgets and electronic equipment encompasses the company’s
________.
a. product mix
b. product line
c. product cluster
d. distribution strategy
ANS: a DIF: MEDIUM REF: 12.1 Product Strategy
Pg. 391 AACSB Reflective Thinking BT: AP

55. In a process called ________, products pass through a series of stages from their initial appearance to
their decline.
a. wheel of retailing
b. promotional cycle
c. pricing cycle
d. product life cycle
ANS: d DIF: EASY REF: 12.2 Product Life Cycle
Pg. 392 AACSB Analytic BT: K

56. Since potential customers are unaware of a product during its introductory stage, initial promotion
concentrates on ________.
a. informing the market about the item and explaining its features, uses, and benefits
b. reducing the size of an available market through selective advertising
c. word-of-mouth referrals
d. communicating new uses for the product
ANS: a DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Analytic BT: K

57. In which stage of the product life cycle do profits generally first appear?
a. Decline stage
b. Introductory stage
c. Growth stage
d. Maturity stage
ANS: c DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Analytic BT: K

58. In which stage of the product life cycle do competitors enter the field with similar offerings?
a. Maturity stage
b. Growth stage
c. Introductory stage
d. Decline stage
ANS: b DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Analytic BT: K
59. In which stage of the product life cycle do sales reach a saturation level, making further sales
expansion difficult?
a. Maturity stage
b. Growth stage
c. Introductory stage
d. Decline stage
ANS: a DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Analytic BT: K

60. Greta has been analyzing the competitive standings of one of her products. Since she began her
operation, 20 similar products have appeared, forcing her to change distribution strategies. Greta has
also needed to change pricing strategies in order to remain competitive. Sales volume has dipped, and
she suspects sales of her product have reached a saturation level. At what stage of the product life
cycle is this item?
a. Introductory stage
b. Maturity stage
c. Decline stage
d. Growth stage
ANS: b DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Reflective Thinking BT: AP

61. Cell phones are an example of a product in the _________ stage.

a. growth
b. introductory
c. decline
d. maturity
ANS: d DIF: HARD REF: 12.2 Product Life Cycle
Pg. 393 AACSB Reflective Thinking BT: AP

62. The combination of industry saturation and intense competition indicates that a product has reached
the ________ stage of its product life cycle.
a. early
b. decline
c. maturity
d. growth
ANS: c DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Analytic BT: K

63. e-readers were introduced a few years ago with great success. Additional companies have entered the
market, and sales have continued steadily. e-readers are an example of a product in the ________ stage
of the product life cycle.
a. growth
b. introduction
c. maturity
d. decline
ANS: a DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Reflective Thinking BT: AP
64. Genuine Products has been involved in intensive price competition with one of its products. Profits are
low and market researchers are concerned that losses will soon occur due to a reduced market for the
item. This product has reached the ________ stage of the product life cycle.
a. introductory
b. growth
c. decline
d. maturity
ANS: c DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 393 AACSB Reflective Thinking BT: AP

65. Which of the following is inconsistent with a product in its decline stage?
a. Producers are beginning to leave the industry.
b. Prices begin to decline sharply.
c. Few changes occur in the product features.
d. Promotion activities are kept to a minimum.
ANS: b DIF: HARD REF: 12.2 Product Life Cycle
Pg. 393 AACSB Analytic BT: K

66. The new-product development stage that deals with the elimination of ideas that do not mesh with
overall company objectives is ________.
a. testing
b. screening
c. commercialization
d. product development
ANS: b DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 395 AACSB Analytic BT: K

67. Rachael is developing a new product and is working with specialists from her organization to eliminate
ideas that cannot be developed within the company’s resources. Rachael is in what stage of product
development?
a. Test marketing
b. Product development
c. Screening
d. Commercialization
ANS: c DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 395 AACSB Reflective Thinking BT: AP

68. Deshauna is assessing a new product’s potential sales and competitive strengths and will obtain initial
consumer reaction before the product is sold. Deshauna is in what stage of product development?
a. Screening
b. Test marketing
c. Commercialization
d. Concept development and business analysis
ANS: d DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 396 AACSB Reflective Thinking BT: AP

69. Charles works for Whirlpool and is producing a new washer/dryer unit. He is collaborating with the
marketing staff to arrange for a series of designs, tests, and functioning prototypes. Charles is working
in which stage of new-product development?
a. Test marketing
 b. Screening
c. Commercialization
d. Product development
ANS: d DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 396 AACSB Reflective Thinking BT: AP

70. Which of the following is a reason why some firms skip test marketing?
a. Test marketing can alert competitors to a company's plans..
b. Test marketing is conducted only in selected regions.
c. Competitors can skew results by lowering prices or running special promotions.
d. Test marketing allows a company to determine the product's performance in full-scale
production.
ANS: a DIF: MEDIUM REF: 12.2 Product Life Cycle
Pg. 396 AACSB Reflective Thinking BT: K

71. While marketing a new wireless phone, Mobile Media Corporation decided to skip the ________ stage
of product development due to the expense of developing a limited production run, as well as concern
over revealing product strategies to the competition.
a. screening
b. product development
c. test marketing
d. concept development and business analysis
ANS: c DIF: HARD REF: 12.2 Product Life Cycle
Pg. 396 AACSB Reflective Thinking BT: AP

72. A brand that has been given legal protection is known as a ________.
a. patent
b. copyright
c. trademark
d. royalty
ANS: c DIF: EASY REF: 12.3 Product Identification
Pg. 397 AACSB Analytic BT: K

73. American Express is an effective brand name because it ________.

a. is easy to pronounce, recognize, and remember
b. is trademarked
c. accurately describes the product
d. has been around for decades
ANS: a DIF: EASY REF: 12.3 Product Identification
Pg. 397 AACSB Reflective Thinking BT: AP

74. When Kroger's grocery store puts its own line of detergent on the shelf next to Tide, the store is
promoting its ________ brand.
a. individual
b. private
c. manufacturer
d. family
ANS: b DIF: MEDIUM REF: 12.3 Product Identification
Pg. 398 AACSB Reflective Thinking BT: AP
75. Advertising slogans, such as “Just Do It” or “Obey Your Thirst,” are ________ that are given legal
protection solely to the brand’s owner.
a. brand names
b. trademarks
c. registered phrases
d. catchphrases
ANS: b DIF: HARD REF: 12.3 Product Identification
Pg. 397 AACSB Reflective Thinking BT: AP

76. Dole Food Company uses a(n) ________ brand to market the company’s entire line of food products,
including canned fruits and packaged salads.
a. family
b. private
c. individual
d. distribution
ANS: a DIF: MEDIUM REF: 12.3 Product Identification
Pg. 398 AACSB Reflective Thinking BT: AP

77. Procter & Gamble markets laundry soap with the brand names of Tide, Cheer, and Dash. Each brand
targets a specific market segment. Procter & Gamble is utilizing ________ branding.
a. private
b. family
c. generic
d. individual
ANS: d DIF: MEDIUM REF: 12.3 Product Identification
Pg. 398 AACSB Reflective Thinking BT: AP

78. Which of the following is a benefit of family branding?

a. Each product within the line is given a different name.
b. It builds competition within the firm.
c. Each brand markets to a unique target market.
d. When a new product is introduced, consumers and retailers recognize the brand name.
ANS: d DIF: MEDIUM REF: 12.3 Product Identification
Pg. 398 AACSB Reflective Thinking BT: AP

79. Customers who choose one brand over another are displaying __________.
a. brand comprehension
b. brand recognition
c. brand insistence
d. brand preference
ANS: d DIF: MEDIUM REF: 12.3 Product Identification
Pg. 399 AACSB Analytic BT: K

80. Luis wants a particular brand of golf ball, but his local pro shop is out of stock. Instead of buying a
substitute, Luis goes home and orders his preferred brand online. Luis is at which stage of brand
loyalty?
a. Brand awareness
b. Brand insistence
c. Brand preference
d. Brand recognition
 ANS: b DIF: MEDIUM REF: 12.3 Product Identification
Pg. 399 AACSB Reflective Thinking BT: AP

81. Roberta stops at the grocery store to purchase detergent. Tide is her favorite brand, but if another
detergent is less expensive, she buys it.
a. Brand insistence
b. Brand awareness
c. Brand preference
d. Brand recognition
ANS: c DIF: MEDIUM REF: 12.3 Product Identification
Pg. 399 AACSB Reflective Thinking BT: AP

82. Mercedes-Benz is an example of a company that benefits from the added value of its successful name.
This brand ________ can result in financial gain due to large market shares and decreased price
sensitivity.
a. Awareness
b. Recognition
c. Equity
d. Association
ANS: c DIF: HARD REF: 12.3 Product Identification
Pg. 399 AACSB Reflective Thinking BT: AP

83. Which of the following is not a role of packaging and labeling?

a. Control cost
b. Identify products and communicate usage
c. Protect the product from damage
d. Comply with government regulations
ANS: a DIF: MEDIUM REF: 12.3 Product Identification
Pg. 401 AACSB Analytic BT: K

84. Which of the following is NOT a benefit of using Universal Product Codes (UPCs)?
a. Control inventory
b. Speed up retail transactions
c. Provide caloric and nutrition information
d. Evaluate customer purchases
ANS: c DIF: HARD REF: 12.3 Product Identification
Pg. 402 AACSB Reflective Thinking BT: AP

85. ________ is responsible for moving goods and services from producers to buyers.
a. Production
b. Distribution
c. Marketing
d. Logistics
ANS: b DIF: EASY REF: 12.4 Distribution Strategy
Pg. 402 AACSB Analytic BT: K

86. Raoul's job is to make sure that his company's goods get from the warehouse to retailers in a timely
fashion. Raoul's job involves the ________ function.
a. production
b. distribution
 c. management
d. finance
ANS: b DIF: EASY REF: 12.4 Distribution Strategy
Pg. 402 AACSB Reflective Thinking BT: AP

87. The two major distribution channels are ________.

a. selling and advertising
b. production scheduling and inventory control
c. branding and customer service
d. direct and marketing intermediary
ANS: d DIF: EASY REF: 12.4 Distribution Strategy
Pg. 402 AACSB Analytic BT: K

88. Marketing intermediaries include ________.

a. manufacturers and agents
b. retailers and customers
c. producers and service providers
d. wholesalers and retailers
ANS: d DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 404 AACSB Analytic BT: K

89. The use of direct distribution channels is most common in the ________ market.
a. business-to-consumer (B2C)
b. professional services
c. business-to-business (B2B)
d. automobile
ANS: c DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 403 AACSB Analytic BT: K

90. Lee purchased a new PC from Dell Computer's Web site. He purchased his product via a(n) ________.
a. direct distribution channel
b. indirect distribution channel
c. wholesaler
d. retailer
ANS: a DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 403 AACSB Reflective Thinking BT: AP

91. Which of the following is NOT a benefit of marketing intermediaries?

a. Marketing utility is created.
b. Services such as transporting merchandise to convenient locations are performed.
c. Costs of buying and selling are decreased.
d. Makers of a product can contact customers cost effectively.
ANS: d DIF: EASY REF: 12.4 Distribution Strategy
Pg. 405 AACSB Analytic BT: K

92. Which of the following is not a category of wholesaling intermediaries?

a. Manufacturer owned
b. industrial
c. independent
d. Retail owned
 ANS: b DIF: MEDIUM REF: 12.5 Wholesaling
Pg. 407 AACSB Analytic BT: K

93. ________ stock the products they distribute and fill orders from their inventories.
a. Sales branches
b. Sales offices
c. Manufacturers' reps
d. Merchant wholesalers
ANS: a DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 406 AACSB Analytic BT: K

94. A food producer's goods are carried by thousands of grocery stores across the country. Which of the
following distribution channels is the manufacturer most likely to use?
a. Producer to retailer to consumer
b. Producer to wholesaler to retailer to consumer
c. Producer to wholesaler to wholesaler to retailer to consumer
d. Producer to consumer
ANS: b DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 404 AACSB Analytic BT: AP

95. The Pampered Chef sells gourmet cooking supplies to consumers through the use of cooking parties at
the homes of its salespeople. The Pampered Chef is a ________ retailer and uses ________.
a. non-store; direct-response retailing
b. non-store; direct selling
c. store; direct-response retailing
d. store; direct selling
ANS: b DIF: HARD REF: 12.4 Distribution Strategy
Pg. 408 AACSB Reflective Thinking BT: AP

96. Vending machines are an example of ________.

a. direct selling
b. direct-response retailing
c. automatic merchandising
d. indirect selling
ANS: c DIF: EASY REF: 12.4 Distribution Strategy
Pg. 408 AACSB Analytic BT: K

97. Ordering merchandise from eBay or Amazon.com is a ________ form of non-store retailing.
a. direct-response selling
b. Internet retailing
c. automatic merchandising
d. direct selling
ANS: b DIF: HARD REF: 12.4 Distribution Strategy
Pg. 408 AACSB Reflective Thinking BT: AP

98. Stores like Costco which sell to members only are an example of a ________.
a. discount store
b. warehouse club
c. factory outlet
d. supercenter
 ANS: b DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 409 AACSB Analytic BT: K

99. The first step in developing a competitive retailing strategy is to ________.

a. decide on general product categories
b. decide on the best location
c. identify a target market
d. identify the necessary level of customer service
ANS: c DIF: EASY REF: 12.4 Distribution Strategy
Pg. 410 AACSB Analytic BT: K

100. Peapod is an online grocery service that saves customers time by selecting, packing, and delivering
groceries to customers. Peapod is utilizing a ________ retail strategy.
a. pricing
b. promotional
c. customer service
d. product
ANS: c DIF: MEDIUM REF: 12.4 Distribution Strategy
Pg. 411 AACSB Reflective Thinking BT: AP

101. Which of the following is not a consideration when deciding which distribution channel is most
efficient?
a. product
b. producer
c. logistics
d. competition
ANS: c DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 414 AACSB Analytic BT: K

102. If a company’s target market is small and buyers are concentrated in a specific geographical area,
which distribution channel would be most effective?
a. Direct channel
b. Use of multiple market intermediaries
c. Long distribution channel
d. Producer to wholesaler to retailer to consumer
ANS: a DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 414 AACSB Reflective Thinking BT: AP

103. Media companies that consider entering into satellite radio will carefully monitor the progress of XM
and Sirius for ________ before choosing the market as a distribution channel.
a. product innovation
b. competitive performance
c. management performance
d. marketing effectiveness
ANS: b DIF: HARD REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 415 AACSB Reflective Thinking BT: AP

104. Which of the following approach is used by computer manufacturers such as Compaq and Hewlett-
Packard?
a. Intensive distribution
 b. Selective distribution
c. Exclusive distribution
d. Scrambled distribution
ANS: b DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 415 AACSB Reflective Thinking BT: AP

105. Newspapers and magazines use which approach to distribution intensity?

a. Intensive distribution
b. Selective distribution
c. Exclusive distribution
d. Scrambled distribution
ANS: a DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 415 AACSB Analytic BT: K

106. Intensive distribution is a strategy used by the marketers of which of the following products?
a. Honda Accords
b. Gateway computers
c. Pepsi
d. Cartier watches
ANS: c DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 414 AACSB Reflective Thinking BT: AP

107. Exclusive distribution is well suited for ________.

a. low-priced convenience goods
b. luxury automobiles
c. franchised specialty goods
d. products sold at superstores
ANS: b DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Reflective Thinking BT: AP

108. Which of the following approaches would result in the fewest number of intermediaries?
a. Intensive distribution
b. Selective distribution
c. Exclusive distribution
d. Scrambled distribution
ANS: c DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

109. The complete sequence of suppliers that contribute to creating and delivering a good or service is
called the ________.
a. production cycle
b. chain of command
c. supply chain
d. physical distribution process
ANS: c DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

110. Where does the supply chain begin?

a. Producer
b. Delivery of raw materials
 c. Creation of the good or service
d. Delivery of the good or service to a marketing intermediary
ANS: b DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 417 AACSB Analytic BT: K

111. Where does the supply chain end?

a. Producer
b. Wholesaler
c. Customer
d. Physical distribution system
ANS: c DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 417 AACSB Analytic BT: K

112. Yvonne's job is to coordinate the flow of raw materials from suppliers to her company's various
production facilities. Which of the following best describes what Yvonne does?
a. Physical distribution
b. Supply chain
c. Inventory management
d. Logistics
ANS: d DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Reflective Thinking BT: K

113. The activities involved with the actual movement of goods from the producer to the user are part of the
________.
a. product strategy
b. channels of distribution
c. atmospherics
d. physical distribution
ANS: d DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

114. What method of transportation accounts for the majority of finished goods finding their way to
consumers?
a. Water
b. Air freight
c. Trucks
d. Railroads
ANS: c DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 418 AACSB Analytic BT: K

115. A building contractor is creating a southwestern-style restaurant in Manhattan. Which method of

transportation would be best for shipping ceramic tile from New Mexico to New York?
a. Truck
b. Air
c. Railroad
d. Water
ANS: a DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 418 AACSB Reflective Thinking BT: AP
TRUE/FALSE

116. A product is a bundle of physical, service, and symbolic attributes.

ANS: T DIF: EASY REF: 12.1 Product Strategy

Pg. 388 AACSB Analytic BT: K

117. All products possess physical characteristics.

ANS: F DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 388 AACSB Analytic BT: K

118. The appropriate distribution, promotion, and pricing strategies are essentially the same for most
business and consumer products.

ANS: F DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 389 AACSB Analytic BT: K

119. A child care center is an example of a consumer services.

ANS: T DIF: EASY REF: 12.1 Product Strategy

Pg. 391 AACSB Analytic BT: K

120. The three categories of business products are convenience goods, shopping goods, and specialty
products.

ANS: F DIF: EASY REF: 12.1 Product Strategy

Pg. 390 AACSB Analytic BT: K

121. A shopping product for one person may be a convenience product for someone else.

ANS: T DIF: EASY REF: 12.1 Product Strategy

Pg. 389 AACSB Analytic BT: K

122. A new television set is classified as a specialty product.

ANS: F DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 389 AACSB Reflective Thinking BT: AP

123. Goods and services are classified as either consumer or business, depending on the purchaser.

ANS: T DIF: EASY REF: 12.1 Product Strategy

Pg. 389 AACSB Analytic BT: K

124. A new computer server is classified as an expense item.

ANS: F DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 389 AACSB Reflective Thinking BT: K

125. In the consumer’s mind, the service provider is the service.

ANS: T DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 3 AACSB Analytic BT: K
126. A company's product line is a group of unrelated products.

ANS: F DIF: EASY REF: 12.1 Product Strategy

Pg. 391 AACSB Analytic BT: K

127. A company's product mix is its assortment of product lines.

ANS: T DIF: EASY REF: 12.1 Product Strategy

Pg. 391 AACSB Analytic BT: K

128. Gillette produces several different types of razors. These different types of razors represent Gillette's
product mix.

ANS: F DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 391 AACSB Reflective Thinking BT: AP

129. The assortment of cereals manufactured under the Kellogg’s name, such as Corn Flakes and Raisin
Bran, constitutes the company’s product line.

ANS: T DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 391 AACSB Reflective Thinking BT: AP

130. When Arm & Hammer branches out from baking soda into laundry detergent and toothpaste, the
company is expanding its product mix.

ANS: T DIF: MEDIUM REF: 12.1 Product Strategy

Pg. 391 AACSB Reflective Thinking BT: AP

131. Most products take about the same amount of time to pass through each life-cycle stage.

ANS: F DIF: EASY REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K

132. Technological changes can compress the life cycle of products.

ANS: T DIF: EASY REF: 12.2 Product Life Cycle

Pg. 393 AACSB Technology BT: K

133. The early stages of a product's life cycle are generally the most profitable for the company because
there is little competition.

ANS: F DIF: EASY REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K

134. Most products experience the fastest sales growth during their introductory stages.

ANS: F DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K

135. Price decreases become common during a product's mature stage.

ANS: T DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K
136. During the maturity stage, firms aggressively protect their market share and distinguish their products
from those of competitors.

ANS: T DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K

137. When Subway uses selective stores around the country to introduce a new food item, the food item is
in the growth stage of its product life cycle.

ANS: F DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 393 AACSB Reflective Thinking BT: AP

138. Promotion activities increase substantially when a product begins to enter the decline stage.

ANS: F DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K

139. Some products can be highly profitable during the later stages of their life cycle because the initial
development costs already have been recovered.

ANS: T DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 393 AACSB Analytic BT: K

140. A major cause of product failure is lack of promotional support.

ANS: T DIF: HARD REF: 12.2 Product Life Cycle

Pg. 395 AACSB Analytic BT: K

141. Focus groups are sessions in which customers meet with marketers to express their opinions about
products.

ANS: T DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 396 AACSB Analytic BT: K

142. Because test marketing can be very expensive, most firms should use it only if the new product is
either expensive or innovative.

ANS: F DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 396 AACSB Analytic BT: K

143. The commercialization stage is also known as the product launch.

ANS: T DIF: MEDIUM REF: 12.2 Product Life Cycle

Pg. 396 AACSB Analytic BT: K

144. A brand may be a name, term, sign, symbol, or design used to identify a product.

ANS: T DIF: EASY REF: 12.3 Product Identification

Pg. 397 AACSB Analytic BT: K

145. Trademark protection extends to pictorial designs and slogans.

ANS: T DIF: MEDIUM REF: 12.3 Product Identification

Pg. 397 AACSB Analytic BT: K
146. Many large retailers sell both a private brand and a manufacturer's brand, which are produced by the
same manufacturer.

ANS: T DIF: MEDIUM REF: 12.3 Product Identification

Pg. 398 AACSB Analytic BT: K

147. Global brand names must be selected with care, because an acceptable name in one country may be
unacceptable in another country.

ANS: T DIF: HARD REF: 12.3 Product Identification

Pg. 397 AACSB Reflective Thinking BT: AP

148. A brand or product manager plans and implements promotional, pricing, distribution, and product
arrangements.

ANS: F DIF: EASY REF: 12.3 Product Identification

Pg. 3400 AACSB Reflective Thinking BT: AP

149. Karen is aware of both Coke and Pepsi, but she buys whichever is on sale. Karen is at the stage of
brand recognition but not yet at the stage of brand preference.

ANS: T DIF: MEDIUM REF: 12.3 Product Identification

Pg. 400 AACSB Reflective Thinking BT: AP

150. A consumer who is at the stage of brand insistence will buy a competing brand only if his or her
preferred brand is unavailable.

ANS: F DIF: MEDIUM REF: 12.3 Product Identification

Pg. 400 AACSB Analytic BT: K

151. Packaging and labeling play a major role in a firm's overall product strategy.

ANS: T DIF: HARD REF: 12.3 Product Identification

Pg. 400 AACSB Analytic BT: K

152. Marketers who ship products to other countries are required to comply with labeling requirements in
those nations.

ANS: T DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg. 401 AACSB Analytic BT: K

153. Physical distribution is the movement of products from producer to user.

ANS: T DIF: EASY REF: 12.4 Distribution Strategy

Pg. 402 AACSB Analytic BT: K

154. The two major components of an organization's distribution strategy are direct distribution and the use
of marketing intermediaries.

ANS: T DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg. 402 AACSB Analytic BT: K
155. A marketing intermediary is a person or firm that operates between the producer and the consumer or
industrial purchaser.

ANS: T DIF: EASY REF: 12.4 Distribution Strategy

Pg. 402 AACSB Analytic BT: K

156. Wholesalers are examples of marketing intermediaries.

ANS: T DIF: EASY REF: 12.4 Distribution Strategy

Pg. 402 AACSB Analytic BT: K

157. Marketing intermediaries provide a number of services to producers, including financing .

ANS: T DIF: EASY REF: 12.4 Distribution Strategy

Pg. 406 AACSB Analytic BT: K

158. Retailers such as Home Depot and Auto Zone are examples of marketing intermediaries.

ANS: T DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg.407 AACSB Reflective Thinking BT: AP

159. Adding a marketing intermediary to the distribution process often lowers consumer prices.

ANS: T DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg. 404 AACSB Analytic BT: K

160. Sales offices typically do not store or warehouse any inventory.

ANS: T DIF: EASY REF: 12.4 Distribution Strategy

Pg. 406 AACSB Analytic BT: K

161. Merchant wholesalers are independently owned and take actual title to the goods they handle.

ANS: T DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg. 406 AACSB Analytic BT: K

162. Agents and brokers may take possession of the goods they handle, but they never take title.

ANS: T DIF: MEDIUM REF: 12.4 Distribution Strategy

Pg. 406 AACSB Analytic BT: K

163. Wholesalers are classified on the basis of their ownership.

ANS: T DIF: MEDIUM REF: 12.5 Wholesaling

Pg.406AACSB Analytic BT: K

164. Lands' End and other catalog retailers are classified as non-store, direct sellers of goods.

ANS: F DIF: MEDIUM REF: 12.6 Retailing

Pg. 408 AACSB Analytic BT: K

165. One advantage of Internet retailing is that adding a large product mix to a Web site is less costly than
making room on a store's shelves.
 ANS: T DIF: EASY REF: 12.6 Retailing
Pg. 408 AACSB Analytic BT: K

166. Vending machines are an example of automatic merchandising.

ANS: T DIF: EASY REF: 12.6 Retailing

Pg. 408 AACSB Analytic BT: K

167. According to the wheel of retailing, new types of retailers enter the market and gain a competitive
foothold by offering superior service.

ANS: F DIF: MEDIUM REF: 12.6 Retailing

Pg. 409 AACSB Analytic BT: K

168. Retailers base their pricing decisions on the costs of purchasing products from other channel members.

ANS: T DIF: MEDIUM REF: 12.6 Retailing

Pg. 411 AACSB Analytic BT: K

169. The first step in developing a competitive retailing strategy is choosing a location.

ANS: F DIF: MEDIUM REF: 12.6 Retailing

Pg. 411 AACSB Analytic BT: K

170. A firm's most important consideration in choosing a distribution channel is competition.

ANS: F DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 414 AACSB Analytic BT: K

171. To reach a target market with a small number of buyers, a direct distribution channel is often the best
choice.

ANS: T DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 414 AACSB Analytic BT: K

172. Because of their size, start-up manufacturers are almost always forced to use the services of marketing
intermediaries.

ANS: F DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 415 AACSB Analytic BT: K

173. Complex, expensive products generally require long distribution channels.

ANS: F DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 414 AACSB Analytic BT: K

174. The most common market coverage for low-priced convenience items is intensive distribution.

ANS: T DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 415 AACSB Analytic BT: K

175. An exclusive distribution contract allows the retailer to carry an adequate inventory and provide
service facilities.
 ANS: T DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

176. The end of the supply chain is when goods or services are delivered to marketing intermediaries.

ANS: F DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

177. Logistics is the process of coordinating the flow of goods, services, and information among all
members of the supply chain.

ANS: T DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

178. The major goal of logistics management is to improve the speed at which goods, services, and
information flow through the supply chain.

ANS: F DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 416 AACSB Analytic BT: K

179. Speed is the major contributor to cost.

ANS: T DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 418 AACSB Analytic BT: K

180. Transportation by truck is extremely economical.

ANS: F DIF: EASY REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 418 AACSB Analytic BT: K

181. Furniture arriving from Denmark to the United States would most likely be shipped via water
transportation.

ANS: T DIF: MEDIUM REF: 12.7 Distribution Channel Decisions and Logistics
Pg. 418 AACSB Reflective Thinking BT: AP