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2007 DECA Ontario Provincials ASMTest 901 AUTOMOTIVE SERVICES MARKETING 1

1. John is a recent college graduate with very little experience in operating a business, but he wants to own an automotive services business that has a well-known trade name. If he has sufficient capital to invest, what type of business ownership should he consider?

A. Limited liability company C. Business-format franchiseB. Sole proprietorship D. General partnership

2. What is one way businesspeople can improve their active listening skills?A. Paying more attention to the speaker's nonverbal cues than to her/his tone of voiceB. Asking questions during the speaker's message to reduce barriersC. Controlling the conversation by monitoring their own nonverbal languageD. Concentrating on remembering what the speaker says

3. One reason why oil-change shop employees often are able to follow written directions more easily than they are able to follow verbal directions is because most employees are able to

A. use body language to indicate that they understand. B. remember only so much information at one time. C. ask questions during the explanation. D. provide feedback about the presentation.

4. One factor that affects the decision an automotive services company makes about its distribution system isA. warehouse size. C. production.B. staffing arrangements. D. company size.

5. Which of the following channels of distribution allows the auto-parts producer to share its responsibilities for distribution with the maximum number of intermediaries:

A. Producer to agent to wholesaler to retailer to consumerB. Producer to agent to retailer to consumerC. Producer to wholesaler to retailer to consumerD. Producer to retailer to consumer

6. Tying agreements are considered legal except whenA. an automotive company has just entered the market. B. the supplier alone can provide the automotive products. C. an intermediary is free to carry competing automotive products. D. the supplier employs full-line forcing without allowing competing automotive products.

7. An auto-parts store receiving clerk may determine whether the contents of a shipment require priority processing by reading the

A. claim form. C. packing slip.B. mailing label. D. price tags.

8. What might a store do with an automotive accessory that a customer would prefer to keep, but returns because it is functioning improperly?

A. Place in storage for next season C. Resell at a discounted priceB. Send to manufacturer for repair D. Put on shelf with similar goods

9. Which express mail service might an auto-parts store use if it needs to ship a few packages quickly?A. Water transportation C. Pipelines B. Parcel Post D. FedEx

10. When new shipments of auto parts are received, receiving employees should make room for the goods byA. rotating stock on a last-in, first-out basis.B. planning to stack the new items on top of current stock.C. moving as much current stock as possible to the sales area.D. preparing to store as much as possible near the loading dock.

Copyright © 2007 by Marketing Education Resource Center®, Columbus, Ohio


11. Which of the following is a true statement about inventory levels:A. There are costs involved in carrying too much inventory.B. Having too little stock makes a tire store more efficient. C. There is no risk in maintaining minimum stock levels.D. Having too much stock may cause a tire store to raise its prices.

12. What do many auto-parts stores use to maintain an up-to-date inventory count?A. Electronic marking machines C. Receiving recordsB. Model stock plans D. Computerized cash registers

13. Providing quality customer service is one reason why tire and battery stores often coordinate distribution with otherA. marketing activities. C. staffing procedures.B. operating techniques. D. business objectives.

14. Cooperative relationships with third-party organizations, such as trucking companies and warehouses, that are intended to reduce marketing channel costs and improve service and customer satisfaction are known as

A. electronic data interchange. C. market research.B. outsourcing. D. shipping terminals.

15. Goods that are used in the operation of an automotive business are called __________ goods.A. scarce B. industrial C. consumer D. specialty

16.Which of the following activities is an economic activity:A. Sitting beside a friend C. Taking a ride in a friend's vehicle B. Buying a new automobile D. Complimenting a friend's purchase

17.Demand for an automotive good is more likely to be elastic when the good isA. inexpensive. C. a necessity.B. essential. D. a luxury.

18.A group of individuals wants to open a museum that will display antique cars and accessories. The group will charge just enough admission to pay the expenses of operating the museum. Will the museum be a business?

A. Yes, the museum will be a not-for-profit business. B. No, the museum will be a charitable institution.C. No, the museum will not be considered a business.D. Yes, the museum will be a for-profit business.

19. Which of the following is not an objective of the Federal Trade Commission:A. Patenting new automotive products C. Regulating false advertisingB. Promoting free competition D. Preventing price discrimination

20. Automotive businesses that allow their employees to set their own schedules are offeringA. time off. C. flextime. B. job sharing. D. part-time status.

21. Based on the following chart, at which level of employment is the tire manufacturer the most productive:

Number of Employees

Units Produced Per Day

1 12 43 94 165 186 207 19


A. 5 employees B. 3 employess C. 4 employees D. 6 employees

22. The picture or image that you have of yourself is referred to as yourA. role. C. self-concept. B. self-esteem. D. composite.

23. A muffler shop employee who offers assistance to others after completing his/her job ahead of schedule is demonstrating

A. responsibility. C. honesty.B. assertiveness. D. integrity.

24. An increase in the amount of income tax people must pay is a change brought about byA. society. C. government. B. individuals. D. technology.

25. What should auto-parts store employees try to avoid so that they can give customers their full attention?A. Distractions C. EmotionsB. Impressions D. Aggravations

26. Ann dropped her head as the tire and battery store manager explained why she would not receive a promotion. What type of communication is Ann using?

A. Role-play C. WrittenB. Verbal D. Nonverbal

27. Ruth wants to do the jobs she likes best and leave the ones she doesn't like for coworkers to do. Is this fair?A. Yes, this evens out the workload.B. Yes, Ruth is doing what she does best.C. No, each worker should do his/her fair share.D. No, Ruth should not expect coworkers to help her.

28. Insecure people are often afraid to become assertive because they think they willA. have to please others. C. be considered childish.B. damage their relationships. D. lose their independence.

29. Why should tire and battery store employees possess adequate product knowledge in order to handle customers' inquiries?

A. To sell successfully C. To plan effectivelyB. To organize inventory D. To develop promotions

30. Carpeting had been installed in an automobile dealership's offices on Friday afternoon. The next day, the owner noticed that along one wall, the carpeting was not laid properly. The owner called the installer to have the problem corrected. The carpet installer should first

A. listen to the owner and see the problem through the owner's eyes. B. provide alternative solutions to the problem.C. state the company's policy about carpet installation.D. ask the owner to please hold while he gets the store manager.

31. Using the cash accounting method, determine the amount of sales that an automotive accessory store would record for one day if it makes $2,300 in cash sales, has COD sales of $450, and places a $300 special order.

A. $2,600 C. $2,750B. $2,300 D. $3,050


32. An oil-change shop had gross sales of $14,959 and tax-exempt sales of $1,628. What is the amount of sales on which the shop must report sales tax?

A. $13,331 C. $15,706 B. $14,959 D. $16,587

33. How much is the total bank deposit for an auto-repair business depositing $2,594.00 in cash and checks in the amount of $4,973.68?

A. $7,747.68 C. $7,567.68 B. $7,387.68 D. $7,972.68

34. Marketing information obtained from trade publications for use by an automotive business is consideredA. primary data. C. a trademark.B. secondary data. D. internal information.

35. Which of the following is an example of an auto-parts store obtaining marketing information about consumers in a way that might be considered unethical:

A. Developing a scientific experiment B. Conducting a random survey C. Sending questionnaires to a specific audience D. Offering a free product in exchange for personal data

36. Which of the following is information contained in sales records that an auto-parts store usually monitors in order to make marketing decisions:

A. Inventory C. Personnel B. Advertising D. Investment

37. The Henry Smith Car Dealership wants to select a representative group of consumers to survey. What part of marketing research is it doing?

A. Sampling C. Analyzing B. Observation D. Experimentation

38. Which of the following is a consideration in the place element of marketing:A. Using sales promotion C. Choosing distribution channelsB. Offering warranties or guarantees D. Extending credit to customers

39. A target market can be described as theA. group of customers the muffler shop seeks to attract. B. direction the market is headed.C. way a muffler shop draws its customers. D. sample of the market.

40. Which of the following do automotive businesses use to identify developing changes so that they can make adjustments to remain competitive:

A. Demographic segmenting C. Environmental scanning B. Geographic monitoring D. Psychological profiling

41. Determine a tire and battery store's sales forecast for next year based on the following information: This year's sales are expected to be $425,000, which is 6% higher than the previous year, and the same amount of growth is projected for next year.

A. $450,500 C. $446,250 B. $448,375 D. $452,625


42. Applying the customer-orientation element of the marketing concept benefits an automotive accessory store by enabling it to

A. offer products that consumers want to buy.B. persuade customers to buy its products. C. provide more products than consumers need.D. coordinate its marketing activities.

43. Which of the following statements is true about marketing functions:A. Some of the marketing functions are much more important than others.B. Marketing functions work together to get products from producers to consumers.C. The marketing functions are important to producers but not to consumers.D. Each of the marketing functions is independent of the others.

44. Shopping carts equipped with a small computer screen that delivers messages to auto-parts store customers when they stop in front of an in-store display are

A. cart vision. C. videocarts. B. electronic kiosks. D. smart carts.

45. When conducting a web search, keywords entered into the query field shouldA. contain fewer than 10 characters. C. be very broad or general. B. be entered as all lower case letters. D. be as specific as possible.

46. Which of the following is an example of a current trend in the automotive services business:A. Developing market research C. Protecting consumer privacy B. Expanding economic growth D. Promoting private enterprise

47. Why does the muffler shop's security policy instruct employees to hand over the shop's money in the event of a robbery?

A. To protect employees and customers C. To build a good image of the business B. To help identify the robbery suspect D. To assist with the crime investigation

48. Before deciding what goods to buy, automotive accessory stores often review past sales records in order toA. select qualified vendors. C. organize storage facilities.B. analyze transportation schedules. D. determine customer preferences.

49. To prevent point-of-sale fraud, auto-parts stores usually developA. procedures for making bank deposits.B. specific credit-card procedures.C. guidelines for unlocking display cases.D. techniques for monitoring hard-to-see areas on the sales floor.

50. Which of the following is a component that is necessary for the production of automotive goods and services:A. Tangible items C. Purchasing plansB. Natural resources D. Research facilities

51. Which of the following is not a time waster:A. Procrastinating C. Building in planning time B. Gossiping with coworkers D. Refusing to delegate

52. Which of the following is an area in which expense control can help to create an appropriate image for an automobile dealership:

A. Geography C. AppearanceB. Diversity D. Culture


53. Which of the following is an example of an internal source that Eli can use to develop a project that he needs to complete for his supervisor:

A. Sales reports C. Competitors' advertisements B. Public library D. Trade associations

54. The physical image that you present to others is known asA. posture. C. proper weight.B. personality. D. personal appearance.

55. Tim was able to keep track of how much advancement he was making towards his goal because a benefit of goal setting is that it

A. helps you to stay on task. C. gives you a way to measure your progress.B. raises your level of self-esteem. D. helps you understand yourself.

56. A local auto-parts store would benefit professionally by deciding to join which of the following:A. Phi Beta KappaB. The Consumer Product Safety CommissionC. The local chamber of commerceD. The Occupational Health and Safety Administration

57. Which of the following is a good source of detailed information about specific career opportunities in the automotive business:

A. Community-college student centers C. Web sites of professional organizationsB. Classified ads in urban newspaper D. Corporate human-resource departments

58. Before Clark's interview, he developed a list of questions to ask his potential employer. He wanted to know: Why is this job open? What are the benefits? What additional training will be required? Who will supervise my work? Which of the questions should Clark avoid asking?

A. What are the benefits? C. Who will supervise my work?B. Why is this job open? D. What additional training will be required?

59. Max put together a list of references to include on his resume. Which of the following individuals would be most appropriate for him to include:

A. Relative C. FriendB. Parent D. Teacher

60. Becoming a problem solver helps you toA. make more money. C. meet your personal goals.B. get what you want from other people. D. stay out of tough situations.

61. A downturn in the economy has forced a tire manufacturer to lower its prices. This company has __________ prices.

A. inflexible C. flexible B. realistic D. competitive

62. Which of the following is a tactic that some automotive businesses use that might be considered predatory pricing:A. Meeting with competitors to agree on prices B. Lowering prices to drive out competitors C. Developing complex pricing structures D. Offering discounts on some items to attract customers

63. Business competitors who discuss their costs and the amount of markup on their automotive products may be involved in

A. flexible pricing. C. price lining.B. variable pricing. D. price fixing.


64. Which of the following is a factor that often causes an increase in the selling price of automotive goods and services:

A. Elastic demand C. Economic growth B. High unemployment D. Abundant supply

65. In product/service management, product positioning is concerned withA. the differences between pure automotive services and product-related services. B. eliminating automotive products that are no longer selling well. C. how consumers perceive the automotive product as compared to competitive products. D. the success rate of the venture teams.

66. During the growth stage of the product life cycle, a tire and battery store's marketing efforts usually involve advertising

A. that customers are satisfied with the product.B. the discounts that are being offered.C. that competitors' products are not as popular.D. the unique benefits of the product.

67. Which of the following is an example of a potential ethical issue in product packaging:A. A pharmaceutical company adds a protective seal to its over-the-counter product line.B. A headlight manufacturer changes its packaging from cardboard boxes to Styrofoam containers. C. A sports beverage manufacturer includes product discounts on the cap of the drink's bottle.D. A hair-spray manufacturer packages its products in pump dispensers instead of aerosol cans.

68. One benefit of using group creative-thinking techniques is thatA. businesses usually develop new product ideas much faster.B. each member usually contributes the same number of ideas.C. each member possesses a unique perspective.D. group brainstorming situations tend to be more productive.

69. When an auto-parts company offers warranties and guarantees on its products in order to create confidence in the company itself, the company is using the warranties and guarantees as

A. sales incentives. C. image builders.B. promotional tools. D. protective devices.

70. A warranty practice that would be approved by the Federal Trade Commission isA. asking consumers to figure out how to resolve product complaints.B. giving consumers a chance to read the warranty before buying the item.C. omitting the exceptions to a warranty's coverage from the warranty.D. providing limited information for consumers to read.

71. Which of the following goods or services are most likely to be bundled products:A. Digital cameras and rolls of film C. Event tickets and hotel accommodationsB. Motor oil and lawn maintenance tools D. Health club membership and ice cream

72. What is the central role of brand identity elements?A. The name, logo, and possibly a brand character influence consumers' feelings about a brand more than its

values. B. The name, logo, and possibly a brand character are displayed on employees' clothing.C. The name, logo, and possibly a brand character are the deciding factors in the success of the brand.D. The name, logo, and possibly a brand character work together to represent the brand.

73. Why is it important for an automotive accessory store to maintain an adequate stock level?A. To accommodate sales C. To estimate profitsB. To satisfy vendors D. To calculate prices


74. Determine an auto-parts store's planned purchases for next month based on the following information: planned monthly sales of $9,675; planned reductions of $720; desired end-of-month stock of $42,225; and planned beginning-of-the-month stock of $21,300.

A. $33,450 C. $32,275B. $30,300 D. $31,320

75. A local tire and battery store sends promotional messages to customers who respond by making purchases. The purchases provide the store with

A. markets. C. feedback.B. publicity. D. resources.

76. Promotions that are often criticized are those which make false claims about automotive products. These are examples of __________ promotion.

A. offensive C. manipulativeB. fearful D. deceptive

77. The nonpersonal promotional method which is not paid for by the automotive business or individual who receives it is called

A. public relations. C. advertising.B. publicity. D. sales promotion.

78. One way that new technology is impacting the promotion function is by allowing oil-change shops to createA. attractive commercials. C. publicity campaigns.B. individualized messages. D. personalized premiums.

79. Which of the following statements applies to telemarketing:A. It has overcome the consumer resentment it once faced.B. Its use is expected to double in the coming years.C. It is used to reach mass audiences at a low cost.D. It enables customers to find out more about products.

80. Determine which of the following is a true statement about print ads:A. Ad copy is intended to catch the reader's attention.B. Advertisers like to use as much copy as possible.C. Ad copy can be any length that the advertiser wants. D. Advertisers must include the price of products in ads.

81. One advantage in using databases when developing advertising strategies is that automotive businesses canA. increase the reach and frequency rates of their promotional efforts.B. presume that all the information is relevant and accurate.C. boost costs associated with direct advertising strategies.D. rank and analyze information to facilitate decision making.

82. One of the major purposes of visual merchandising is toA. create interest in a product. C. use a harmonious color scheme.B. follow a simple arrangement. D. use formal balance.

83. If the left side of a display arrangement is identical to the right side, the display has __________ balance.A. informal C. poorB. formal D. casual

84. Why is it important for automotive accessory stores to maintain their displays?A. To promote special events C. To organize the selling area B. To keep merchandise fresh D. To store additional goods


85. What type of signs might a muffler shop create to use in its windows to introduce a new service?A. Structural C. Promotional B. Departmental D. Directional

86. What is one way that chains of auto-parts stores coordinate promotional activities?A. Establish sales objectives C. Select display goodsB. Prepare flexible budgets D. Inform all departments

87. Which of the following is one way that selling has a positive effect on the economy:A. Raises prices C. Reduces incomeB. Decreases competition D. Increases employment

88. A salesperson contacts several people within the automotive business on a regular basis to discuss their specials needs and introduce other products. This service method used to maximize sales is called

A. account penetration. C. account retention.B. sales supplementation. D. sales infiltration.

89. Morgan works for a telemarketing firm and each day she calls all of the people listed on one page of the local telephone book. What is Morgan using to identify potential clients?

A. Personal sources C. Cold callingB. Company leads D. External sources

90. Which of the following are the general rules set down by management to guide the personal selling effort:A. Probes C. Buying motivesB. Selling policies D. Follow-up techniques

91. What is an advantage of using spreadsheet software programs to track and evaluate sales?A. Identifies potential customers C. Quickly analyzes numerical dataB. Easily generates purchase orders D. Creates future sales contracts

92. Salespeople who promise customers that their profits will increase by a certain amount if the customers buy a specific automotive product may be guilty of

A. discrimination. C. sales puffery.B. incentive selling. D. misrepresentation.

93. An auto-parts store salesperson's most accessible resource person for product information is usually a(n)A. area manager. C. manufacturer.B. customer. D. coworker.

94. Which of the following is a component of an automobile's electrical system:A. Disc C. AxleB. Fuse D. Jack

95. What type of brands do tire and battery stores often sell in order to offer lower prices to customers while earning higher profits?

A. Generic C. PrivateB. Manufacturer D. National

96. What do auto-parts store salespeople need to possess to effectively recommend substitute items to customers?A. Selling ability C. Product knowledgeB. Pleasant personality D. Aggressive behavior

97. Service station employees should recommend that customers replace their windshield wiper bladesA. every two or three years. C. before the rainy season begins.B. when the water reserve is empty. D. when the rubber tips are brittle.


98. An important factor for automobile salespeople to emphasize when suggestion selling to customers is theA. availability of credit terms. C. profitability to the business.B. benefits of the suggested products. D. high percentage of commission rate.

99. What type of credit requires only that the customer sign the sales check?A. Signature charge C. Retail credit cardsB. Bank cards D. Travel and entertainment cards

100. It is important for auto-parts store employees who take telephone orders to read the order back to the customer in order to

A. follow telephone etiquette. C. make sure the order is correct. B. allow themselves time to write. D. give the customer extra attention.


Copyright © 2007 by Marketing Education Resource Center®, Columbus, Ohio

Test 901 AUTOMOTIVE SERVICES MARKETING — KEY 12

1. CBusiness-format franchise. A business-format franchise is a franchise arrangement in which the franchisee must operate under the trade name of the parent company which provides continuous assistance in setting up and operating the business. It is a popular type of franchise arrangement that is usually available to most anyone who has the capital to invest. A general partnership is an agreement in which all partners are liable for a business's losses. A sole proprietorship is a business owned by one person. A limited liability company is a form of business ownership in which members of a corporation experience limited liability.SOURCE: BL:003SOURCE: BA LAP 7—Own It Your Way

2. DConcentrating on remembering what the speaker says. One technique people use to improve listening skills is to make a conscious effort to try to focus and remember what the speaker says. Staying focused on the message and filtering out noise as much as possible improves the chances of remembering and accurately understanding the message. Listeners may want to be aware of their own body language (e.g., facial expressions, crossed arms) because their nonverbal cues are also being interpreted by the speaker and can affect communication. However, monitoring one's own nonverbal cues does not necessarily mean that the listener takes control of the conversation. Asking questions during the speaker's message does not necessarily reduce listening blocks or barriers. To decipher a message accurately, the listener must not only pay attention to the speaker's words but also to her/his nonverbal cues and voice tone. Nonverbal cues are not necessarily more important than tone of voice.SOURCE: CO:017SOURCE: Lesikar, R.V., Pettit, J.D., Jr., & Flatley, M.E. (1999). Lesikar's basic business communication

(8th ed.) [pp. 432-433]. Boston: Irwin/McGraw-Hill.

3. BRemember only so much information at one time. It is usually effective to verbally explain simple directions or instructions. However, if the directions or instructions are more complicated, oil-change shop employees usually are better able to follow written directions. The human brain is capable of remembering only so much information at one time. If the verbal directions or instructions are long and complicated, many employees will have difficulty remembering and following them. On the other hand, employees can refer to written directions or instructions at any time if they forget a step or a process. Body language might indicate if employees understand verbal directions or instructions. Employees usually are encouraged to ask questions and provide feedback to clarify their understanding of directions or instructions.SOURCE: CO:119SOURCE: Hyden, J.S., Jordan, A.K., Steinauer, M.H., & Jones, M.J. (1999). Communicating for

success (2nd ed.) [pp. 112-114]. Cincinnati: South-Western Educational.

4. DCompany size. Company size is very important to the distribution decision. A large automotive services company would have more assets to work with and may distribute goods to a larger area than would a small company. A small company might need to lease rather than own space. Warehouse size is one of those decisions made based on company size. Staffing arrangements and production are other decisions that depend on company size.SOURCE: DS:001SOURCE: DS LAP 1—Distribution


5. AProducer to agent to wholesaler to retailer to consumer. This is the longest channel. To reach small retailers, auto-parts producers contract with agents to sell their goods to wholesalers. Wholesalers, in turn, buy large quantities of the goods and sell smaller amounts to retailers who sell them to consumers. In producer to agent to retailer to consumer channels, producers contract with agents to sell the merchandise to retailers. In producer to wholesaler to retailer to consumer channels, producers use wholesalers to sell to smaller retailers who sell to consumers. In producer to retailer to consumer channels, retailers deal directly with producers and buy in large quantities due to the size of their business and the demand for the product.SOURCE: DS:055SOURCE: MB LAP 3—Channels of Distribution

6. DThe supplier employs full-line forcing without allowing competing automotive products. The practice of full-line forcing by a supplier is designed to ensure that intermediaries acquire new automotive products and make available to customers a suitable range of products. Suppliers requiring channel members to purchase their entire line to obtain any of their products is a type of tying agreement and is legal as long as competitive brands are also allowed to be carried. Tying agreements are legal when the supplier alone can provide the products and when a company has just entered the market.SOURCE: DS:058SOURCE: Pride, W.M., & Ferrell, O.C. (2000). Marketing: Concepts and strategies (2000e)

[pp. 366-367]. Boston: Houghton Mifflin.

7. CPacking slip. Most shipments include a packing slip which is a copy of the items listed on the purchase order or on the invoice. Auto-parts store receiving clerks may read the packing slip to find out which items are contained in the shipment and to process any that are valuable, fragile, or needed immediately. Mailing labels list the names and addresses of the sender and the receiver. Price tags are attached after the shipment is unloaded. Claim forms are used to return damaged goods to the sender.SOURCE: DS:085SOURCE: Lambert, D.M., Stock, J.R., & Ellram, L.M. (1998). Fundamentals of logistics management

(pp. 275, 408, 522). Boston: Irwin/McGraw-Hill.

8. BSend to manufacturer for repair. Automotive accessory stores often return malfunctioning merchandise to the manufacturers for repair if customers indicate that they would prefer to keep the items. Arranging for repairs is one way that stores process returned or damaged products. Many items are sold with some type of guarantee that they will operate correctly for a certain period of time. If they malfunction during that time, customers often expect the store to return the items to the manufacturer for repair. A product that is not functioning properly would not be sold at a discounted price, placed in storage for next season, or put on a shelf with similar goods.SOURCE: DS:009SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)

[pp. 28, 175-176]. Upper Saddle River, NJ: Prentice Hall.

9. DFedEx. Express mail services such as FedEx, UPS, Airborne Express, or Emery Worldwide specialize in air transportation and overnight delivery. Although more expensive than other forms of transportation, they are widely recognized as the quickest. Pipelines are used to transport oil and natural gas, not packages. Parcel Post is the U.S. Postal Service's fourth-class mail—very affordable but not very quick. Water transportation, although reliable in some instances, is a very slow way to ship products across waters.SOURCE: DS:044SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.) [p. 402].

Woodland Hills, CA: Glencoe/McGraw-Hill.


10. CMoving as much current stock as possible to the sales area. All stock that is needed in the sales area should be taken there in order to make room for the new auto parts. Stock is usually rotated on a first-in, first-out basis so that it does not become stale or outdated. New goods should be behind or below older items so that the first-in, first-out system will work effectively. Stock should not be held near the loading dock as this makes it vulnerable to theft.SOURCE: DS:015SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)

[pp. 372-374]. Upper Saddle River, NJ: Prentice Hall.

11. AThere are costs involved in carrying too much inventory. Costs to the tire store include higher storage costs, increased thefts, losses from markdowns, and reduced profits from slow turnover of stock. A store that has too much stock may have to mark down prices to get rid of excess stock. A store should strive to match inventory levels with customer demand. Having minimum levels of stock is risky because the store may lose sales and profits and may not be able to operate efficiently.SOURCE: DS:023SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)


12. DComputerized cash registers. Computerized cash registers are point-of-sale terminals that automatically transmit data about each transaction directly to a computer. The computerized cash register tells the computer that a sale has occurred and that specific goods should be deleted from inventory. By using computerized cash registers, auto-parts stores are able to maintain up-to-date inventory counts because each time a sale is processed, the purchased item is removed from the inventory. A model stock plan is a list of items a store always keeps in stock. Receiving records are forms containing data about shipments of goods. Electronic marking machines are used to add prices to goods.SOURCE: DS:091SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)


13. AMarketing activities. Distribution is one of the marketing functions that must work with the other marketing activities to get goods and services from producers to consumers. The goal of marketing is to satisfy consumer wants and needs while achieving company goals. Tire and battery stores cannot satisfy those needs and provide quality customer service unless all the marketing activities work together. For example, stores are only able to serve customers when they have the advertised items on hand and at the right price. Business objectives are the goals that a store wants to reach. Operating techniques are the ways that a store functions on a daily basis. Staffing procedures involve finding workers for the store.SOURCE: DS:048SOURCE: Evans, J.R., & Berman, B. (1997). Marketing (7th ed.) [pp. 431-432]. Upper Saddle River,

NJ: Prentice Hall.

14. BOutsourcing. At times, it is more efficient to use an outside company that specializes in a service needed by the manufacturer to deliver the product. Third-party organizations, such as trucking companies and warehouses, often are able to handle products faster and more cost-effectively than the manufacturer. EDI is the electronic sharing of information between businesses. Market research does not involve relationships with trucking companies or warehouses. Shipping terminals are the areas from which products are shipped to other locations.SOURCE: DS:049SOURCE: Pride, W.M., & Ferrell, O.C. (2000). Marketing: Concepts and strategies (2000e)

[pp. 382-384]. Boston: Houghton Mifflin..


15. BIndustrial. Industrial goods include goods and services that are purchased by producers for resale, to make other goods and services, and/or to use in business operations. Consumer goods are goods purchased and used by consumers. A scarce good is one that is in limited supply. Not all goods purchased by automotive businesses are scarce. Specialty goods are consumer goods with special or unique characteristics.SOURCE: EC:002SOURCE: EC LAP 10—Goods and Services

16. BBuying a new automobile. In order to purchase an automobile, one must spend money—a limited resource—in order to satisfy a human want or need. Exchanging money for an automobile is an economic activity. The other alternatives do not require the exchange of limited resources.SOURCE: EC:001SOURCE: EC LAP 6—Economics

17. DA luxury. Products that are not considered necessary or essential for survival usually have elastic demand. Elastic demand is a form of demand for automotive products in which changes in price correspond to changes in demand. Products that are necessary, or essential to survival, usually have inelastic demand because people must buy them even if their prices are raised. Elasticity is not tied to price.SOURCE: EC:005SOURCE: EC LAP 11—Supply and Demand

18. AYes, the museum will be a not-for-profit business. A business whose intent is to make just enough money to support its existence is considered a not-for-profit business. The organizers of the museum have stated their intention to charge visitors just enough to pay the museum's bills. A business is an organized effort to produce and/or distribute goods and services. The overall purpose of most businesses is to make a profit. A charitable institution is one that offers goods and services free to needy individuals.SOURCE: EC:071SOURCE: MB LAP 10—Business Activities

19. APatenting new automotive products. Patenting of new automotive products is handled by the U.S. Patent Office. The important objectives of the FTC are to promote free and fair competition by preventing price fixing, unfair methods of competition, and unfair or deceptive trade practices; to prevent sellers from discriminating in price negotiations with buyers; and to prevent false or deceptive advertising.SOURCE: EC:008SOURCE: EC LAP 16—Government and Business

20. CFlextime. Workers are most productive when they can work at a time that best fits their home life or other responsibilities. Therefore, some automotive businesses offer flexible working hours, or flextime, that allow employees to work at a time that is convenient for them. Job sharing is a system that allows two workers to share one job and divide the working hours between them. Time off involves an employee's using vacation, personal, or sick leave to be away from the job. Part-time status involves working fewer than the number of hours per week usually considered necessary for full-time employment.SOURCE: EC:013SOURCE: EC LAP 18—Productivity


21. C4 employees. Overall productivity reaches its highest level when there are a certain number of employees using the available resources to do the work. If businesses hire additional employees, the level of production begins to decrease because there are too many employees using the same resources, such as equipment. This is an example of the law of diminishing returns, which states that after a certain point, hiring additional employees will result in a decrease in the overall level of production. Based on the information in the chart, the business is the most productive with four employees because they are each producing four units a day for a total of 16 units. With the addition of the fifth and sixth employees, production decreases to less than four units per person per day. Three employees are able to produce three units each per day for a total of nine units.SOURCE: EC:023SOURCE: McEachern, W.A. (1997). Economics: A contemporary introduction: Annotated instructor's

edition (4th ed.) [pp. 450-451]. Cincinnati: South-Western College.

22. CSelf-concept. Your self-concept is the way you "see" yourself. It is the composite mental picture you have of all your roles, traits, and abilities. Self-esteem is pride in one's self.SOURCE: EI:016SOURCE: HR LAP 12—Self-Esteem

23. AResponsibility. Being responsible means making right choices. One type of right choice is helping when someone needs help. Therefore, a muffler shop employee who offers assistance to others is demonstrating responsibility. Assertiveness is the ability to express yourself, communicate your point of view, and stand up for your rights, principles and beliefs. Integrity involves having a code of ethics and following that code. Honesty means telling the truth.SOURCE: EI:021SOURCE: PD LAP 7—Make the Honor Role (Acting Responsibly)

24. CGovernment. New or revised laws, regulations, policies, public services, leadership, etc., are all types of change brought about by government. They are often the result of economic changes. Changes brought about by individuals are changes concerning their bodies, lifestyles, minds, etc. Changes in society are brought about by shifts in people's values, tastes, habits, etc. Changes brought about by technology are developments, breakthroughs, and discoveries in the fields of science, engineering, etc.SOURCE: EI:026SOURCE: HR LAP 8—Adjusting to Change

25. ADistractions. Distractions turn auto-parts store employees' focus away from customers and prevent them from providing quality service. In order to concentrate on devoting their full attention to customers, they should avoid becoming distracted by other things going on around them such as coworkers' conversations or the amount of work piling up on their desks. An impression is a sense or image that someone has about another person. Emotions are strong feelings. An aggravation is an irritation or annoyance. Employees routinely form impressions, feel emotions, and experience aggravations during the day, but they should try not to let these things distract them from focusing on their customers.SOURCE: EI:032SOURCE: HR LAP 32—Customer-Service Mindset

26. DNonverbal. Nonverbal communication transmits information through facial expression and body language, while verbal communication uses spoken or written language. Dropping her head expresses Ann's disappointment. Written communication includes all print correspondence. Role-play is a technique in which ideas or situations are acted out by individuals.SOURCE: EI:007SOURCE: Everard, K.E., & Burrow, J.L. (2001). Business principles and management (11th ed.)

[p. 249]. Cincinnati: South-Western.


27. CNo, each worker should do his/her fair share. Workers should always carry their fair share of the workload. This means Ruth should do all parts of her job, not just the parts that she enjoys doing. Ruth may do a better job at what she enjoys, but it would be unfair to others for her to work in this manner. Coworkers should help each other whenever it is necessary, but that does not mean they should have to take on whatever other workers don't like to do. This would create an unfair workload for some workers rather than evening out the workload.SOURCE: EI:036SOURCE: HR LAP 24—Treating Others Fairly at Work

28. BDamage their relationships. Insecure people are often anxious about their interpersonal relationships. They are afraid if they become assertive, they may ruin a friendship or end a relationship. Assertiveness is a risk they are unwilling to take. These people are dependent rather than independent and may already be considered childish because of their passive behavior that focuses on pleasing others.SOURCE: EI:008SOURCE: HR LAP 16—Assertiveness

29. ATo sell successfully. Employees are expected to possess adequate knowledge of the tire and battery store's products, policies, and capabilities in order to handle customers' inquiries. The main reason why it is important for employees to possess this information is to be able to sell successfully. Customers often have questions about products that employees need to answer in order to make the sale. Employees who are knowledgeable and well informed usually can sell successfully because they are able to handle customers' inquiries. Developing promotions, organizing inventory, and planning effectively usually are not the responsibilities of employees who regularly handle customers' inquiries.SOURCE: EI:040SOURCE: Greene, C. (2000). Selling: Business 2000 (p. 10). Mason, OH: South-Western.

30. AListen to the owner and see the problem through the owner's eyes. The first step in providing customer service is to forget any other concern and focus on the customer's problem. The customer should be listened to as long as necessary to understand the problem. To state the company's policy about carpet installation or to put the customer on hold does not allow the service provider to understand the problem. Alternative solutions to the problem will be developed, but only after the problem is understood.SOURCE: EI:043SOURCE: HR LAP 23—Handling Customer Complaints

31. B$2,300. The cash accounting method involves recording income at the time the money changes hands. In other words, the automotive accessory store enters the amount of a transaction into its records on the day the money is received from the customer. If the customer doesn't pay for the item until a later time, the sale is not recorded until that date. A store using the cash accounting method would record only the $2,300 that it makes in cash sales that day. It would record the $450 in COD sales when the items are delivered and the amount due is collected from the customers. The store would record the $300 special order after the order arrives and the customer pays for and picks up the order.SOURCE: FI:085SOURCE: FI LAP 5—Show Me the Money (Nature of Accounting)

32. A$13,331. Tax exempt sales are those on which sales tax is not charged. The amount of tax exempt sales is, therefore, subtracted from gross sales in reporting and paying sales tax to the government. In this case, $14,959 - $1,628 = $13,331.SOURCE: FI:090SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)

[p. 130]. Upper Saddle River, NJ: Prentice Hall.


33. C$7,567.68. Cash and checks are added together on a deposit ticket to determine the amount of the total deposit. In this case, $2,594.00 + $4,973.68 = $7,567.68.SOURCE: FI:298SOURCE: Lange, W.H., Rousos, T.G., & Mason, R.D. (1998). Mathematics with business applications:

Teacher's wraparound edition (4th ed.) [pp. 126-127]. New York: Glencoe/McGraw-Hill.

34. BSecondary data. Secondary data are information that has been collected for a purpose other than the project at hand. Primary data are collected specifically for the problem or project at hand. A trademark is a symbol, design, or word used to identify a good or service and often registered with the government to prevent its use by others. Internal information is data obtained from sources within the business.SOURCE: IM:001SOURCE: IM LAP 2—Marketing-Information Management

35. DOffering a free product in exchange for personal data. Certain ways of obtaining marketing information may be considered unethical even though they are legal. An example is offering free products in exchange for personal data. Consumers may be persuaded to provide information that they normally would not provide simply because the offer is so tempting, or they need the product being offered. Furthermore, consumers have no guarantee that the auto-parts store will keep the personal data confidential. In some cases, stores try to obtain this information in order to sell it to others. Most stores follow ethical procedures when obtaining marketing information about consumers. These procedures might include conducting a random survey, sending questionnaires to a specific audience, and developing a scientific experiment.SOURCE: IM:025SOURCE: Boone, L.E., & Kurtz, D.L. (2002). Contemporary marketing (pp. 66-67). Mason, OH:

South-Western.

36. AInventory. Sales records often contain information about a business's inventory, such as which items sold well and at what price level and which items were slow moving and had to be reduced in price in order to sell. Sales records also indicate the inventory turnover rate and profitability of seasonal items. Businesses monitor this information in order to make marketing decisions such as whether to carry a larger quantity of a certain item or to discontinue some items. A business's sales records do not contain information about personnel, advertising, or investments.SOURCE: IM:184SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.) [p. 508].

Woodland Hills, CA: Glencoe/McGraw-Hill.

37. ASampling. The process of choosing a representative group of consumers to survey is sampling. It is usually impossible to study everyone, so researchers must use sampling. Observation gathers data, experimentation tests cause and effect, and analyzing interprets the data. They are all important to marketing research but are not part of sampling.SOURCE: IM:010SOURCE: IM LAP 5—Nature of Marketing Research

38. CChoosing distribution channels. The place element of marketing focuses on considerations in getting the selected product in the right place at the right time. Some of the other place considerations are storage, transportation, inventory handling and control, and choice of specific outlets to offer the products. Sales promotion is an aspect of the promotion element. Extending credit is a consideration of the price element. Warranties and guarantees are considerations in the product element.SOURCE: IM:194SOURCE: IM LAP 7—Pick the Mix (Marketing Strategies)


39. AGroup of customers the muffler shop seeks to attract. Though a target market may seem to be a sample of the market, it is actually the particular group of customers the muffler shop seeks to attract. Knowing the market's direction is helpful to any marketer. And, a discussion of the way a shop draws its customers falls under marketing promotion.SOURCE: IM:196SOURCE: IM LAP 9—Have We Met? (Market Identification)

40. CEnvironmental scanning. Automotive businesses need to understand changes in their environment in order to adapt and remain competitive. They often use a procedure known as environmental scanning to gather information about changes or trends that are beginning to develop in the marketplace. This procedure allows businesses to identify changes at an early stage and decide if they present a threat to the way the business is currently operating. Businesses do not use geographic monitoring, demographic segmenting, or psychological profiling to identify changes that are developing.SOURCE: IM:140SOURCE: Zikmund, W.G., & d'Amico, M. (1999). Marketing (6th ed.) [pp. 43-44]. Cincinnati:

South-Western College.

41. A$450,500. Tire and battery stores analyze changes in the market and trends from previous years when developing sales forecasts. If a store's sales have been increasing by 6% on a yearly basis and that amount of growth is expected to continue, the store probably would increase its sales forecast for next year by 6%. In this situation, this year's sales are expected to be $425,000, and the store expects an increase of 6% next year. To determine the sales forecast for next year, multiply this year's sales by the percentage of increase ($425,000 x 6% or .06 = $25,500). Then, add that amount to this year's sales to determine the sales forecast for next year ($425,000 + $25,500 = $450,500).SOURCE: IM:003SOURCE: IM LAP 3—Nature of Sales Forecasts

42. AOffer products that consumers want to buy. Automotive accessory stores that implement the customer-orientation element of the marketing concept base their decision making on customer wants and needs. They determine what customers want and offer that, rather than deciding on their own what they want to sell. Promotional activities help the store to persuade customers to buy. Providing more products than consumers need would not benefit a store. Having a customer orientation does not coordinate a store's marketing activities.SOURCE: MK:001SOURCE: BA LAP 11—Have It Your Way! (Marketing)

43. BMarketing functions work together to get products from producers to consumers. The functions of marketing involve activities that are interrelated. No one function is more important than another. When the marketing functions are performed well, consumers are satisfied. The functions are not independent. If any one of the functions is not performed well or is neglected, the other functions will be less effective.SOURCE: MK:002SOURCE: MK LAP 1—Work the Big Six (Marketing Functions)

44. CVideocarts. Videocarts are normal shopping carts with a small computer screen bolted on to the front bar. They deliver in-store advertisements at the time and place the purchase decision is being made by the consumer—in front of the in-store product display. Electronic kiosks allow customers to view and print out product and price information. Cart vision and smart carts do not exist in retailing.SOURCE: NF:041SOURCE: Lewison, D.M. (1997). Retailing (6th ed.) [p. 123]. Upper Saddle River, NJ: Prentice Hall.


45. DBe as specific as possible. By being as specific as possible, results are narrowed to the most relevant material, which saves the researcher time from reading through unnecessary information. For example, if an individual is researching information on George Washington, the researcher should enter the keywords "George Washington" rather than "presidents" to retrieve the most relevant information. "Presidents" is a very broad, general term. The researcher would need to sift through much more information to obtain the needed information. Generally, most search engines are not case sensitive so it does not matter how the letters are entered into the query. Most search engines can conduct searches with more than 10 characters in the query field.SOURCE: NF:006SOURCE: Google. (n.d.). The Basics of Google search. Retrieved September 29, 2005, from

http://www.google.com/help/basics.html

46. CProtecting consumer privacy. Automotive services businesses are becoming more concerned with ways of protecting consumer privacy because of the new technology that makes it easy to gather and disseminate personal information. The rapid growth of electronic commerce, which enables consumers to purchase products online, also enables businesses to collect information about credit cards, personal preferences, and buying habits that many consumers prefer to keep private. In response to a growing concern on the part of consumers, businesses are trying to develop techniques that will protect consumer privacy—not only online—but also from other types of abuses. Economic expansion and marketing research are fundamental business activities rather than current trends. Private enterprise is an economic system in which individuals and groups, rather than government, own or control the means of production.SOURCE: NF:013SOURCE: Perreault, W.D., Jr., & McCarthy, E.J. (1997). Essentials of marketing: A global-managerial

approach (7th ed.) [p. 481]. Boston: Irwin.

47. ATo protect employees and customers. Muffler shops establish procedures for employees to follow in the event of a robbery in order to safeguard customers and employees. Many shops tell employees to hand over the money and not confront a robber because safety is the main concern during a robbery situation. Handing over the money will not help to identify the suspect or assist with the crime investigation, unless the money is marked and the robber is caught with the cash. The policy would not help or harm the business's image.SOURCE: OP:113SOURCE: German-Grapes, J. (1997). The teller's handbook: Everything a teller needs to know to

succeed (pp. 180-181). New York: McGraw-Hill.

48. DDetermine customer preferences. One of the most important internal sources of information to use in deciding what goods to buy is the automotive accessory store's past sales records. These records contain a wealth of information, including statistics on customer preferences. Past sales records indicate how well certain goods sold and if discounts were needed in order to move them. Stores use this information to help them decide what goods to buy in the future. Reviewing past sales records does not help a store to select qualified vendors, analyze transportation schedules, or organize storage facilities.SOURCE: OP:090SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)



49. BSpecific credit-card procedures. To prevent point-of-sale fraud, auto-parts stores establish detailed steps or procedures to follow when accepting credit cards. These include checking the card's expiration date, the status of the card, and comparing the signature on the card with the customer's signature. Use of procedures for making bank deposits helps to prevent robberies. Development of guidelines for unlocking display cases and techniques for monitoring hard-to-see areas on the sales floor help to prevent shoplifting.SOURCE: OP:013SOURCE: RM LAP 4—Security Precautions

50. BNatural resources. In order to produce automotive goods and services, businesses need a variety of resources. One type of resource is natural resources, which includes the materials from which to make products. Without the necessary raw materials and natural resources, businesses would be unable to produce goods and services. Tangible items are outputs produced by the production process. Purchasing plans are the procedures for buying needed materials. Research facilities are used to develop new products.SOURCE: OP:017SOURCE: BA LAP 1—Nature of Production

51. CBuilding in planning time. Time management won't happen by itself. You must allocate time in your schedule for planning. Many of the things that we do during the day waste time. They might include gossiping with coworkers, starting and stopping work in order to take phone calls, talking with drop-in visitors, procrastinating, and refusing to delegate.SOURCE: OP:034SOURCE: OP LAP 1—About Time (Time Management in Business)

52. CAppearance. Appearance helps to create an appropriate image for the business. In order to maintain that appearance, automobile dealerships need to renovate or redecorate their facilities from time to time. Most dealerships use the money they save by controlling expenses to keep the facility attractive to customers and to provide a pleasant environment for workers. Dealerships that do not maintain their appearance may lose customers to the competition. Culture is the customs, habits, and traditions of a particular group of people. Diversity is all the ways in which people differ. Geography deals with market location.SOURCE: OP:025SOURCE: MN LAP 56—Employee Role in Expense Control

53. ASales reports. Internal sources are resources found within the business itself. Company sales reports are an example of a source of information that Eli can obtain within the business. The public library, competitors' advertisements, and trade associations are examples of external sources.SOURCE: OP:003SOURCE: QS LAP 19—Get What You Need

54. DPersonal appearance. Appearance reflects your self-esteem and self-confidence. Posture is the way in which you hold your body when sitting, standing, etc. Proper weight is a body weight appropriate for your height and bone structure. Both posture and weight affect one's personal appearance. Personality is the combination of an individual's characteristics that make him/her different from everyone else.SOURCE: PD:002SOURCE: PD LAP 5—Brand ME! (Personal Appearance)


55. CGives you a way to measure your progress. Having specific goals and subgoals enables you to measure your progress towards your goals. Goal setting helps you raise your level of self-esteem, helps you to stay on task, and helps you to understand yourself; but these do not necessarily give you a way to measure your progress in achieving your goals.SOURCE: PD:018SOURCE: HR LAP 6—Goal Setting

56. CThe local chamber of commerce. Most cities have a chamber of commerce, an organization of businesses and companies that make known to the government the recommendations of the business community and help local businesses solve common problems. Phi Beta Kappa is an honorary organization with educational requirements at the college level. The Consumer Product Safety Commission and the Occupational Safety and Health Administration are government agencies, not organizations.SOURCE: PD:036SOURCE: CD LAP 1—Trade Associations/Professional Organizations


57. CWeb sites of professional organizations. Most business specialties, such as automotive businesses, have a professional organization. Today, many professional organizations also have a web site that includes information about the type of jobs in the profession. Many web sites also provide information about the training necessary for jobs in the profession and a listing of members who may have positions available. Classified ads in urban newspapers and community-college student centers are not good sources of detailed information about specific careers. Corporate human-resource departments only provide information about careers in their businesses.SOURCE: PD:025SOURCE: Silva, K.E., & Howard, D.M. (2006). Hospitality & tourism (pp. 338-340). New York:

Glencoe/McGraw-Hill.

58. AWhat are the benefits? Clark should avoid asking the potential employer about the salary and benefits during the initial interview. If the employer fails to bring up the subject, Clark should wait until he is offered the job to ask. The other alternatives are acceptable questions for Clark to ask during the interview.SOURCE: PD:028SOURCE: Bailey, L.J. (1997). Working: Learning a living (2nd ed.) [pp. 58-59]. Cincinnati:

South-Western.

59. DTeacher. The list of references should include individuals who would be respected by a potential employer for providing objective information about job applicants. Employers respect the input obtained from former employers, teachers, school counselors, coworkers, and coaches. The names of parents, friends, and relatives should not be included in the reference list because they are unlikely to provide unbiased information.SOURCE: PD:031SOURCE: Daggett, W.R., & Miles, J.E. (1998). The dynamics of work: Introduction to occupations

(2nd ed) [pp. 56-57]. Cincinnati: South-Western Educational.

60. CMeet your personal goals. Becoming a problem solver helps you as you strive to accomplish your personal goals. There will always be some obstacles in the pathway to success. It will be up to you to figure out how to overcome them. Becoming a problem solver won't always help you get what you want from other people, but it might help you work out conflicts in your relationships. Becoming a problem solver will help you as you pursue a career, but it won't necessarily make you more money. Becoming a problem solver won't keep you out of tough situations—those are an inevitable fact of life. But it can help you learn what to do when you're in those situations.SOURCE: PD:077SOURCE: IS LAP 2—No Problem

61. CFlexible. Businesses often adjust their prices depending on the circumstances. Economic hardships often force companies to lower prices in order to sell their products. Realistic prices are often associated with the quality of the product. Competitive pricing occurs when you try to meet or beat your nearest competitor's prices. Inflexible pricing occurs when a company refuses to change its prices to meet customer demand.SOURCE: PI:001SOURCE: PI LAP 2—Pricing


62. BLowering prices to drive out competitors. Predatory pricing involves setting very low prices on certain goods or services in order to hurt competitors and try to drive them out of business. Predatory pricing is unethical because its only purpose is to drive out the competition. Automotive businesses that engage in predatory pricing usually do so for only the amount of time it takes to drive out competitors, and then they raise the prices. Meeting with competitors to agree on prices is price fixing. Developing complex pricing structures may be unethical because customers are unable to understand the prices. However, this practice is not considered predatory pricing. Offering discounts on some items to attract customers is a type of promotional pricing rather than predatory pricing.SOURCE: PI:015SOURCE: Kotler, P., & Armstrong, G. (1999). Principles of marketing (8th ed.) [p. 344].

Upper Saddle River, NJ: Prentice Hall.

63. DPrice fixing. Price fixing is an illegal business agreement in which businesses agree on prices of their automotive goods or services, resulting in little choice for the consumer. Businesses that discuss their costs, markups, and prices with competing businesses may be involved in price fixing. In order to avoid possible price-fixing charges, businesses should not discuss any pricing issues with competitors. Variable pricing involves changing prices according to demand. Price lining is the practice of selling goods/services at a limited number of predetermined price points. Flexible pricing involves charging different customers different prices.SOURCE: PI:017SOURCE: Evans, J.R., & Berman, B. (1997). Marketing (7th ed.) [pp. 596-597]. Upper Saddle River,

NJ: Prentice Hall.

64. CEconomic growth. In times of economic growth, both individuals and business increase their spending, which increases demand. When demand is higher than producers can meet, prices go up. During times of economic growth, people have more money to spend and are willing to pay higher prices to purchase the automotive goods and services that they want and need. As a result, the selling price often increases. High unemployment, elastic demand, and an abundant supply are factors that often cause a decrease in the selling price of goods and services.SOURCE: PI:002SOURCE: PI LAP 3— Factors Affecting Selling Price

65. CHow consumers perceive the automotive product as compared to competitive products. Positioning products appropriately is important to their success. Product positioning directs automotive products toward the particular segment of the market to which they would have the most appeal. Pure services are intangible products, such as haircuts and automobile insurance. Product-related services are those offered with a product, such as credit terms or free delivery. Venture teams are small groups formed to seek new opportunities for their companies. Product elimination removes weak products from the market.SOURCE: PM:001SOURCE: PP LAP 5—Product/Service Planning

66. AThat customers are satisfied with the product. Sales and profits increase during the growth stage of the product life cycle. Many customers are aware of the product and buy the product. To maintain sales, tire and battery stores usually start to focus on advertising that customers are satisfied with the product. It is more effective to promote customer satisfaction than to promote the product's benefits because most people are aware of the benefits. People are more likely to continue buying during the growth stage if they think that other people are satisfied with the product. Stores usually advertise the unique benefits of the product during the introduction stage. Stores often advertise that competitors' products are not as popular during the maturity stage. Stores frequently advertise discounts during the decline stage.SOURCE: PM:024SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.)

[pp. 557-558]. Woodland Hills, CA: Glencoe/McGraw-Hill.


67. BA headlight manufacturer changes its packaging from cardboard boxes to Styrofoam containers. Many consumers are very environmentally conscious. Styrofoam does not break down well when it is discarded and becomes waste. Many people feel that Styrofoam products can harm the environment since it does not break down well. Therefore, many environmentally conscious people might decide not to use a company's product if the business uses environmentally harmful products. Protective seals are used to reduce or eliminate the risk of product tampering and are not an ethical issue. Promotional discounting is common on product packaging and does not necessarily pose an ethical situation. Pump dispensers are better for the environment than aerosol cans. Therefore, packaging products in pump dispensers does not present an ethical issue.SOURCE: PM:040SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.)


68. CEach member possesses a unique perspective. When more than one person is involved in the creative-thinking process, different types of ideas are often generated because each member has a unique point of view. The success of the group creative-thinking process depends on many factors including group size, the quality and quantity of each member's contribution, and the situation requiring idea generation. Therefore, it cannot be assumed that each group member contributes in the same manner, that ideas are generated quicker, or that one technique (e.g., brainstorming) is more effective than other techniques.SOURCE: PM:127SOURCE: PM LAP 11—Unleash Your Oh! Zone

69. CImage builders. Many auto-parts companies use warranties and guarantees to build their image because they know consumers usually believe that a company that stands behind its products must be reliable. If the company used warranties and guarantees in its advertising, it would be using them as promotional tools. Warranties and guarantees serve as protective devices for consumers, sellers, and producers when consumers buy products and implement the warranties and guarantees. When warranties and guarantees are used to promote confidence in the company, they are not being used as sales incentives, sales promotion devices that encourage customer purchases.SOURCE: PM:020SOURCE: PP LAP 4—Warranties and Guarantees

70. BGiving consumers a chance to read the warranty before buying the item. The warranty laws administered by the Federal Trade Commission require that consumers have a chance to read the warranty before buying the product, that the warranty be clearly stated and provide all the information consumers need, that consumers be told how to resolve any complaints they may have, and that any exceptions to the warranty's coverage be given.SOURCE: PM:017SOURCE: PP LAP 7—Consumer Protection in Product Planning

71. CEvent tickets and hotel accommodations. Product bundling occurs when two or more complementary items are packaged together. Often, the goal is to get customers to try a product that they might not have considered purchasing. Once the customers have tried it and liked the product, companies hope that customers will purchase the goods or services at another time. In the tourism industry, it is common to put together travel packages. These packages might include hotel accommodations and sporting, theater, or concert tickets. Motor oil and lawn maintenance tools are not complementary products. Digital cameras do not use rolls of film. People who purchase health club memberships are usually interested in fitness and good health. Although ice cream is good, it would probably not be bundled with the membership since it is not considered a healthy food.SOURCE: PM:041SOURCE: Kotler, P., & Armstrong, G. (1999). Principles of marketing (8th ed.) [pp. 333-334].



72. DThe name, logo, and possibly a brand character work together to represent the brand. A brand's basic identity combines elements that are representations of the brand—a name, logo or brand symbol, and possibly a trade character, or personified symbol. These things help consumers instantly recognize brands. Brand identity elements may influence consumers' feelings toward a brand but not to the degree the brand's values do. Brand identity represents the brand's values, which are at the heart of the brand's relationship with customers. Elements of brand identity may appear on employee clothing, but this is a supplementary function. Their central purpose is to represent the brand and its values. Brand identity—name, logo, and brand character—do influence a brand's success. However, this influence is secondary to that of brand fundamentals—values, promise, touch points. Brand success is maximized when brand fundamentals and brand identity are integrated.SOURCE: PM:021SOURCE: PM LAP 6—It's a Brand, Brand, Brand World!

73. ATo accommodate sales. Automotive accessory stores try to maintain an adequate stock level in order to have sufficient goods on hand to accommodate expected sales. It is important to retailers to stock the amount and assortment of goods that they anticipate will meet customers' demands. If customers want to buy and stores do not have the goods in stock, the stores might lose sales to competitors. Stores do not maintain adequate stock levels in order to satisfy vendors, estimate profits, or calculate prices.SOURCE: PM:062SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)


74. D$31,320. The formula for determining planned purchases for a month is planned monthly sales plus planned reductions plus desired end-of-month stock minus planned beginning-of-the month stock. In this example, add planned monthly sales, planned reductions, and desired end-of-month stock ($9,675 + $720 + $42,225 = $52,620). From that figure, subtract planned beginning-of-the-month stock to determine planned monthly purchases ($52,620 - $21,300 = $31,320).SOURCE: PM:064SOURCE: Lewison, D.M. (1997). Retailing (6th ed.) [p. 404]. Upper Saddle River, NJ: Prentice Hall.

75. CFeedback. Promotional communication involves someone sending a message to someone who receives the message and gives feedback to the sender of the message. The tire and battery store is sending a message in order to sell goods to customers. Customers receive the message and provide feedback to the store by purchasing or not purchasing the goods. Publicity is any nonpersonal presentation of ideas, goods, or services that is not paid for by the company which benefits from it. The markets are the particular groups of consumers to whom businesses send promotional messages. Resources are the items used to produce goods and services.SOURCE: PR:001SOURCE: PR LAP 2—Promotion

76. DDeceptive. Deceptive promotion makes false or exaggerated claims about the benefits of the automotive product to the consumer. Offensive promotions are those that are considered to be in bad taste, vulgar, and/or insulting to human intelligence. Fearful promotions focus on the insecurities of people and unfavorable outcomes that may result from not buying a product. Some critics of promotion consider promotion to be manipulative because it influences purchase behaviors.SOURCE: PR:002SOURCE: PR LAP 4—Know Your Options (Types of Promotion)


77. BPublicity. An example of publicity would be a news story about an automotive business in the local paper. Public relations promotions are institutional promotions that deal with controversial public issues that are related to a company or its products. Advertising is any paid form of nonpersonal presentation of ideas, goods, or services. Sales promotion is promotional activities other than advertising, personal selling, and publicity which stimulate consumer purchases.SOURCE: PR:003SOURCE: PR LAP 1—Promotional Mix

78. BIndividualized messages. The new information technology that includes computerized databases allows oil-change shops to create individualized promotional messages. Shops can collect a variety of information about customers, enter that information into a database, and use the computer to sort the data. For example, a shop might track customers according to their preferences for products and then generate mailing lists and individualized messages that promote specific products to specific customers. Oil-change shops created commercials, premiums, and publicity campaigns before the new technology was developed; however, new technology makes some of these activities easier to perform.SOURCE: PR:100SOURCE: Zikmund, W.G., & d'Amico, M. (1999). Marketing (6th ed.) [pp. 233-235]. Cincinnati:

South-Western College.

79. DIt enables customers to find out more about products. Telemarketing utilizes telephone service to promote a product either by phoning prospective customers or providing a number for them to call. Dissatisfaction with its intrusion into the home has prompted more stringent regulation (e.g., no-call lists) of the telemarketing industry. As a result, a large industry expansion is not expected. As a specialized medium, it is used to target specific groups. Its cost per contact is higher than those of other media.SOURCE: PR:007SOURCE: PR LAP 3—Ad-quipping Your Business

80. CAd copy can be any length that the advertiser wants. The advertiser can use as much copy as s/he feels is needed to promote the product. This is usually limited also by the amount of money the advertiser wishes to spend. Advertisers do not use as much copy as possible, but use the amount of copy that they feel is appropriate to the product. There is no requirement that advertisers quote the price of their products, but many ads do include price. The headline rather than the copy is intended to catch the reader's attention.SOURCE: PR:014SOURCE: PR LAP 7—Parts of Print Ads

81. DRank and analyze information to facilitate decision making. Computerized databases can obtain information from different sources and sort and rank various data fields very quickly. Once the information is presented in an appropriate manner, automotive businesses can analyze the information to determine a course of action in terms of advertising efforts. For example, a company might want to send a sales brochure to its customers who purchased over $50,000 in products the previous year. Sales records stored in a database can be used to determine the appropriate customers. The use of databases aid in advertising efforts in terms of determining reach and frequency rates, but it is not always used to increase the rates. Most often, direct advertising efforts lower reach because the marketers are selecting message recipients. Direct advertising can be very expensive. Marketers should not presume that all information is relevant and accurate, particularly if the information is obtained from a secondary source that might contain outdated data.SOURCE: PR:091SOURCE: Arens, W.F. (1999). Contemporary advertising (7th ed.) [pp. 283-284]. Boston:

Irwin/McGraw-Hill.


82. ACreate interest in a product. Visual merchandising is display. Businesses hope that visual merchandising will create enough interest to sell their products. A harmonious color scheme simply means that colors are compatible. Formal balance and simple arrangements are elements of design.SOURCE: PR:023SOURCE: Lewison, D.M. (1997). Retailing (6th ed.) [pp. 282-283]. Upper Saddle River, NJ:

Prentice Hall.

83. BFormal. Formal balance creates a symmetrical display that can be very effective. Informal balance is a more casual approach in which the left side is not identical to the right side of the display, but the sides still are in balance. Neither arrangement would be described as poor.SOURCE: PR:026SOURCE: Bell, J., & Ternus, K. (2002). Silent selling: Best practices and effective strategies in visual

merchandising (2nd ed.) [pp. 38-39]. New York: Fairchild.

84. BTo keep merchandise fresh. One of the most important reasons why automotive accessory stores maintain their displays is to keep the merchandise fresh and attractive to customers. Disorderly or damaged displays often create a poor image that might discourage customers from buying. Fresh, orderly displays present merchandise in an effective manner that appeals to customers and promotes sales. Stores do not maintain their displays in order to store additional goods, promote special events, or organize selling areas.SOURCE: PR:052SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2006). Marketing essentials (p. 393).

New York: Glencoe/McGraw-Hill.

85. CPromotional. Muffler shops create a variety of promotional signs to introduce new products and services to customers. Some promotional signs are designed to be placed in windows to attract the attention of customers as they walk by the building. Many of these promotional signs are two-sided and can be seen and read by customers both inside and outside the facility. Departmental signs identify areas within the institution, such as service department or credit department. Structural signs are usually located on the exterior of a building. Directional signs direct customers to specific locations within the building.SOURCE: PR:109SOURCE: Diamond, J., & Diamond, E. (1999). Contemporary visual merchandising (pp. 186-196).


86. DInform all departments. One way that chains of auto-parts stores coordinate promotional activities is by informing all the departments involved in the campaign. The departments responsible for advertising, visual merchandising, ordering stock, and selling need to be informed about the promotion in order to carry out their assignments. All departments need to work together to present a coordinated promotional effort to customers. Preparing flexible budgets, selecting display goods, and establishing sales objectives are promotional activities that should be coordinated.SOURCE: PR:076SOURCE: Farese, L.S., Kimbrell, G., & Woloszyk, C.A. (2002). Marketing essentials (3rd ed.)



87. DIncreases employment. Selling can have a positive effect on the economy by increasing employment. As businesses grow, they hire more salespeople and other employees to keep up with the demand for their products. This expansion creates the need not only for more employees in the business but also for more employees in the channel members that supply the business. The exchanges created by selling help businesses make a profit that enables the companies to expand and hire more employees. Selling does not necessarily raise prices and many times reduces them. Selling increases competition and often increases the income of employees.SOURCE: SE:017SOURCE: SE LAP 117—Selling

88. AAccount penetration. By communicating with several people in a single automotive business, salespeople can often increase sales by selling products to solve problems or meet the needs of other departments in the organization. In addition, the more contacts a salesperson has in an organization, the more referrals s/he is likely to receive. Account retention refers to the ability to keep a customer. Sales infiltration and sales supplementation are not terms commonly used in the selling industry.SOURCE: SE:076SOURCE: Futrell, C.M. (1999). Fundamentals of selling: Customers for life (6th ed.) [pp. 406-407].

Boston: Irwin/McGraw-Hill.

89. DExternal sources. External sources are contacts outside the business, such as specialized lists and directories, and industry trade groups. A local telephone book is an example of an external source. Company leads are sales prospects generated by company activities such as advertising or participation in trade shows. Personal sources are contacts that each individual has through his/her customers, friends, or relatives. Cold calling is the act of going into a place of business without making an appointment and making a sales presentation.SOURCE: SE:828SOURCE: SE LAP 115—Building Clientele

90. BSelling policies. These policies outline the way in which selling activities should be performed. Probes are questions that help salespersons determine what customers think, feel, or know. Follow-up techniques are methods used by salespeople to determine customer satisfaction with products. Buying motives are the reasons that customers buy.SOURCE: SE:932SOURCE: SE LAP 121—Selling Policies

91. CQuickly analyzes numerical data. Computer technology has made it possible to develop a variety of software programs. For example, spreadsheet software programs are used to organize and calculate numerical information. Spreadsheet programs can be used in sales to track and evaluate sales volume and sales dollars. By using spreadsheet programs, businesses can monitor sales and quickly determine if salespeople are achieving goals. Word-processing software might be used to create sales contracts and generate purchase orders. Spreadsheet software programs are not able to identify potential customers but are able to analyze sales figures of existing customers.SOURCE: SE:107SOURCE: Futrell, C.M. (2001). Sales management: Teamwork, leadership, and technology (6th ed.)

[pp. 110-111]. Mason, OH: South-Western.


92. DMisrepresentation. Misrepresentation involves exaggerating the capabilities of an automotive product or promising more than a product can provide. An example of misrepresentation is promising customers that profits will increase by a certain amount if they buy a specific product. If a customer buys the product based on a salesperson's statement and the product does not generate the promised profit, the customer may sue the business. Misrepresenting products is illegal and may be costly to businesses if they are sued. Salespeople should be as factual as possible and provide exact product information to avoid misleading customers. Promising more than a product can provide is not an example of discrimination, incentive selling, or sales puffery.SOURCE: SE:108SOURCE: Futrell, C.M. (2001). Sales management: Teamwork, leadership, and technology (6th ed.)

[pp. 37-38]. Mason, OH: South-Western.

93. DCoworker. This might be a more experienced salesperson or a buyer. One of the buyer's main duties is to keep auto-parts store salespeople informed about the merchandise that is for sale. Area managers, customers, and manufacturers can all be sources of information about a product, but they are not always available when the salesperson has a question.SOURCE: SE:062SOURCE: Manning, G.L., & Reece, B.L. (1998). Selling today: Building quality partnerships

(pp. 105-108). Upper Saddle River, NJ: Prentice Hall.

94. BFuse. A fuse allows a certain amount of current to flow through it, but if the flow exceeds that amount, the fuse breaks the circuit. A fuse is a safety device in an automobile's electrical system that protects other parts of the electrical circuit from being damaged. An axle is part of an automobile's wheel assembly. A disc is a component of a braking system. A jack is used to lift a car.SOURCE: SE:174SOURCE: Autoshop Online. (No date). Electrical system overview. Retrieved November 1, 2006, from

http://www.autoshop-online.com/auto101/elec.html

95. CPrivate. Tire and battery stores often sell their own private, or store, brand of certain items because they have more control over the pricing of those items. Stores arrange for the manufacture of these items and negotiate the price with the manufacturer. As a result, they are able to offer lower prices to customers while earning higher profits. Private brands are usually significantly less than national, or manufacturer, brands which allows the stores to sell them for less. Customers often become loyal buyers of private brands because of the price as well as the quality, which is often equal to the quality of national, or manufacturer, brands. Generic brands are often represented by plain packaging and are sold by supermarkets and discount stores at prices significantly lower than other types of brands.SOURCE: SE:019SOURCE: Berman, B., & Evans, J.R. (2004). Retail management: A strategic approach (9th ed.)

[p. 354]. Upper Saddle River, NJ: Prentice Hall.

96. CProduct knowledge. To point out the features and benefits of a substitute product, auto-parts store salespeople must know the product they are presenting, as well as the originally requested item. Salespeople need to possess the necessary product knowledge to answer customers' questions and reassure them that they are buying a product that will satisfy their needs. If salespeople do not have the necessary information, they may lose the sale. Successful salespeople have the ability to sell and have pleasant personalities, but they also need product knowledge in order to effectively recommend substitute items. Aggressive behavior often makes customers feel uncomfortable and prevents them from buying.SOURCE: SE:114SOURCE: SE LAP 111—Using Substitute Selling


97. DWhen the rubber tips are brittle. Windshield wiper blades usually last only three to six months before becoming brittle, due to the amount of tension and extremes in temperature. Service station employees should routinely examine customers' windshield wiper blades and recommend replacement as soon as they notice that the rubber tips are brittle. Windshield wiper blades will not last two or three years. Their replacement does not depend on the water level or the season of the year.SOURCE: SE:180SOURCE: Duffy, J.E. (2000). Modern automotive technology (pp. 656-660). Chicago:

Goodheart-Willcox.

98. BBenefits of the suggested products. Automobile salespeople should make suggestions with the customer's needs in mind. They should emphasize the benefits of the suggested products so that customers do not feel that the salespeople are trying to increase sales at their expense. Salespeople might point out the availability of credit for the entire purchase rather than just for the suggested products. Profitability is a benefit of suggestion selling to the business. Increased commission is a benefit of suggestion selling to salespeople.SOURCE: SE:875SOURCE: SE LAP 110—Using Suggestion Selling

99. ASignature charge. With this type of credit, the customer does not have a charge plate. Signature charges are offered by small, local businesses to customers they know and trust. Although the other types of credit require a customer signature, they also require an account number to which the purchase is charged.SOURCE: SE:151SOURCE: MA LAP 49—Completing Charge Sales Checks

100. CMake sure the order is correct. The order taker should make sure that all of the information needed to fill the order is correct. This includes the name of the customer, the address to which the order should be delivered, method of payment, and descriptions of the items ordered. The time spent with customers is not meant to be an effort to give them extra attention and is not defined by rules of telephone etiquette. If the order is taken by hand, it would be written down and then read back. Today, many order takers use computers to process the customer's order, and writing is not necessary.SOURCE: SE:835SOURCE: Hyden, J.S., Jordan, A.K., Steinauer, M.H., & Jones, M.J. (1999). Communicating for

success (2nd ed.) [p. 86]. Cincinnati: South-Western Educational.

Documents

Exams/Marketin… · Web viewSpreadsheet programs can be used in sales to track and evaluate sales volume and sales dollars. By using spreadsheet programs, businesses can monitor