Question 1. The distribution process includes promotion of goods and services by sellers and resellers.

1. The distribution process includes promotion of goods and services by sellers and resellers.

True False

2. The behavior of channel members in the distribution process is the result of the interactions between the

cultural environment and the marketing process.

True False

3. In an import-oriented distribution structure, supply often exceeds demand.

True False

4. Traditional channels in developing countries evolved from economies with a strong dependence on

imported manufactured goods.

True False

5. In a traditional distribution structure, distribution systems are national rather than local in scope.

True False

6. In the traditional distribution structure, independent agencies that provide facilitating functions are

nonexistent or underdeveloped.

True False

7. A distinguishing characteristic of the Japanese distribution channel system is that it is controlled by a few

small retailers found in the country.

True False

8. The Japanese distribution structure is similar to the one found in the U.S. or in Europe.

True False

9. In the context of the distribution structure in Japan, it has been observed that Japanese consumers favor

cheaper prices over personal service.

True False

10. As traditional channel structures are changing, importers and retailers are also becoming involved in new

product development.

True False

11. In the context of distribution structures, one of Walmart’s strengths is its ability to influence foreign

governments.

True False

12. In the context of distribution patterns, wholesaling shows a greater diversity in its structure than does

retailing.

True False

13. In the context of retail patterns, direct marketing works well in affluent markets as well as in markets with

underdeveloped distribution systems.

True False

14. Agent middlemen work on commission and do not take title to the merchandise.

True False

15. Merchant middlemen tend to be more controllable than agent middlemen because they take title to

manufacturers’ goods.

True False

16. The distribution channel process includes all activities, beginning with the manufacturer and ending with

the retailer.

True False

17. Domestic middlemen offer many advantages for companies with large international sales volume.

True False

18. An export management company functions as a low-cost, independent marketing department with direct

responsibility to the parent firm.

True False

19. In the context of the different kinds of middlemen, in 2003, the WTO ruled export management

companies to be in violation of international trade rules.

True False

20. Domestic middlemen are most likely to be used when the marketer desires to minimize financial and

management investment.

True False

21. Export management companies work under their own names.

True False

22. The Export Trading Company Act allows producers of similar products to form export trading companies

in the U.S.

True False

23. Trading companies provide the best means for intensive coverage of the market.

True False

24. An e-vendor in a foreign market can generally ignore culture as an important variable because the

commerce is being done via the Internet that is culturally insensitive.

True False

25. Using foreign-country middlemen moves the manufacturer away from the market and the company

becomes less involved with problems of language, physical distribution, communications, and

financing.

True False

26. Channels of distribution often pose longevity problems.

True False

27. In the U.S., if a middleman is terminated, the company is required to pay one percent of the middleman’s

average annual compensation, multiplied by the number of years the middleman served, as a final

settlement.

True False

28. Legal advice is not necessary when entering distribution contracts with middlemen.

True False

29. Ideally, a website should be translated into the languages of the target market.

True False

30. A physical distribution system involves only the physical movement of goods.

True False

31. Which of the following is true of the distribution process?

A. It does not involve the physical handling and distribution of goods.

B. It includes activities related to the promotion of goods and services.

C. The ownership title remains with the distributor even on completion of the transaction.

D. It includes buying and selling negotiations.

E. The behavior of channel members is not affected by the cultural environment.

32. In a _____ distribution structure, an importer controls a fixed supply of goods and the marketing system

develops around the philosophy of selling a limited supply of goods at high prices to a small number of

affluent customers.

A. domestic

B. traditional

C. manufacturer-oriented

D. service

E. customer-oriented

33. Which of the following statements is true of a traditional distribution structure?

A. The distribution system is national in scope.

B.

The relationship between the importer and any middleman is similar to that found in a mass-marketing

system.

C.

The idea of a channel as a chain of intermediaries performing specific activities and each selling to a

smaller unit beneath it until the chain reaches the ultimate consumer is common.

D.

Independent agencies providing functions such as advertising, marketing research, and financing are a

part of this distribution structure.

E.

The marketing system develops around the philosophy of selling a limited supply of goods at high

prices to a small number of affluent customers.

34. Which of the following distribution structures is also known as a traditional distribution structure?

A. Export-oriented

B. Import-oriented

C. Manufacturer-oriented

D. Service-oriented

E. Customer-oriented

35. Which of the following statements is true regarding an import-oriented distribution structure?

A. The importer–wholesaler traditionally performs most of the marketing functions.

B.

The relationship between the importer and any middleman is similar to that found in a mass-marketing

system.

C.

Several independent agencies providing functions such as advertising, marketing research, financing

are a part of this distribution structure.

D. The idea of a channel as a chain of intermediaries performing specific activities is common.

E. This distribution system is national in scope.

36. _____ has long been considered the most effective nontariff barrier to the Japanese market.

A. The Japanese population

B. The Japanese distribution structure

C. Japanese culture

D. The Japanese import and export procedure

E. Intense competition in Japan

37. _____ are considered to be the foundation of the Japanese distribution system.

A. Consumers

B. Brokers

C. Manufacturers

D. Small retailers

E. Wholesalers

38. Which of the following characterizes the business philosophy of the Japanese distribution channels?

A. Loyalty

B. Direct sales

C. Fast delivery

D. Variety

E. Price competition

39. Which of the following statements is true of the Japanese market?

A. The costs of Japanese consumer goods are among the lowest in the world.

B.

Manufacturers are independent of wholesalers for a multitude of services to other members of the

distribution network.

C. The Japanese distribution structure supports long-term dealer–supplier relationships.

D. Japanese law favors the establishment of large retail stores.

E. Japanese consumers favor price over personal service.

40. In Japan, under the Large-Scale Retail Store Law, all proposals for new “large” stores are first judged by

the _____.

A. Transport and Tourism Department

B. Internal Affairs and Business Council

C. Ministry of International Trade and Industry

D. Health and Welfare Committee

E. Local Retailers Union

41. In the international business arena, which of the following is considered to be one of Walmart’s

strengths?

A. Clean business reputation.

B. Internal Internet-based system.

C. Ability to beat competitors.

D. Outreach programs to placate small retailers.

E. Ability to influence foreign governments.

42. General Motors, _____, and DaimlerChrysler have created a single online site called Covisint for

purchasing automotive parts from suppliers.

A. Toyota Motor Corporation

B. Honda Motor Company

C. Ford Motor Company

D. Nissan Motor Company

E. Tata Motors

43. Which of the following countries has the largest number of retailers?

A. United States

B. Argentina

C. China

D. South Africa

E. Japan

44. In the context of distribution patterns, the rate of change in retailing around the world appears to be

directly related to the _____.

A. literacy rate

B. rate of inflation

C. population growth

D. speed of economic development

E. currency exchange rate

45. _____ is often the approach of choice in markets with insufficient or underdeveloped distribution

systems.

A. Direct marketing

B. A big wholesale store

C. Internet selling

D. A discount house

E. Television advertising

46. Which of the following has proved to be an important way to break the trade barrier imposed by the

Japanese distribution system?

A. Direct sales through catalogs.

B. Large wholesale stores.

C. Street corner kiosks.

D. Internet shopping.

E. Television advertising.

47. Which of the following are frequently criticized for not representing the best interests of a manufacturer?

A. Global wholesalers

B. Trading companies

C. Consumers

D. Merchant middlemen

E. Brokers

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