C201 Business Acumen 327 Questions and Answers 2024 Western Governors University, Exams of Business Statistics

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C201 Business Acumen 327 Questions

and Answers 2024 Western Governors

University

1. Which part of the organizing process aids in effective and efficient progress toward planned goals and often results in changes within the organization? a. Evaluating results
2. What is the result of a company increasing the delegation of authority and the span of control? a. Increased number of direct reports per manager
3. Which 2 key elements does an effective organization include? a. Human interaction, structure
4. Why does a line organizational structure function most effectively in a crisis situation? a. It established a direct flow of authority.
5. Number the 7 steps in the recruiting and interviewing process from first to last. a. Define job requirements , 2) Contact and visit colleges for applicants/interns , 3) Conduct employment tests , 4) Review resumes , 5) Conduct candidate interviews , 6) Follow up interviews, 7) Hiring determination
6. Which primary driver does management use for an organization's structure? a. Achievement of company goals
7. Which step in the organizing process results in management group work activities into units within the organization? a. Departmentalization
8. A high-tech startup company is launching a marketing campaign for its new social media portal by highlighting how the portal exceeds the connectivity and collaboration capabilities of all other social media sites. Which type of competitive advantage is this company leveraging? a. Customer loyalty
9. Which marketing strategy is devoted to maintaining continuous bottom line prices than relying on short-term price- cutting tactics such as cents off coupons, rebates, and special sales? a. Everyday low pricing
10. When would a pull promotional strategy enhance a competitive advantage to market a product better than a push strategy? a. When demand for the product is driven by the end-user
11. Which marketing tool is essential to building an effective relationship marketing campaign? a. An affinity program
12. Which element of the promotional mix has the advantage of messaging that can be tailored for each customer, but the disadvantage of a high cost per contact? a. Personal Selling
13. What 3 factors should be addressed in a successful marketing plan? Choose 3 answers. a. Target Market, Sales revenue goals, Plan implementation timeline (not on list, marketing budget)
14. Which 3 characteristics are measured in demographic segmentation? Choose 3 answers a. Race and ethnicity, Income, Household size
15. In which 3 ways does business-buying behavior differ from consumer-buying behavior? Choose 3 answers a. Buyers face organizational influences in addition to their own preferences, purchasers often invite selected providers to bid on a purchase, and a group or committee often makes decisions
16. Which 3 conditions, in a global selling environment, should a small company leverage to create a competitive advantage? a. cultural homogeneity, mobility of labor, local labor costs
17. With which 2 types of products does a marketing strategy rely on advertising more than personal selling? Choose 2. a. Consumable supplies, accessories to primary products
18. After years of marketing a body lotion, a cosmetics company begins promoting the lotion as an insect repellent as well. In which 3 product life cycle extension strategies did this company engage? Choose 3 answers a. Adding new users, finding new uses for the product, and increasing frequency of use.
19. What are 3 ways that an effective brand name can influence consumer product recognition? Choose 3 answers a. It conveys an image, loyalty, awareness
20. A customer has purchased a product twice and intends to do so again. Which stage of brand loyalty is this customer in? a. Brand preference
21. Which manufacturer distribution model is enhanced by the shipping & tracking capabilities of a global package delivery service? a. retail
22. Which 3 tasks are key responsibilities of operations managers? Choose 3 answers

45. What should a firm do to manage the risk of using leverage when exploring long-term funding options? a. Ensure that earnings remain larger than interest payments
46. Which financial statement should an investor examine to identify the liabilities of a firm? a. The balance sheet
47. A company wishes to determine if it should fund a project with bonds or equity. Which business concept would it most likely use to assist in the decision? a. leverage
48. Which calculation determines a firm's return on equity? a. net income / average equity
49. Why should companies that are conservative investors with liquidity concerns invest their excess cash in money market funds? a. it converts easily to cash
50. Which regulatory relationship with the Securities and Exchange Commission (SEC) historically has acted to prohibit the U.S. from adopting the International Financial Reporting Standards (IFRS)? a. FASB requires companies to comply with GAAP that differ from IFRS
51. Which users of financial statements use the financial statements to evaluate operations of the firm and to make investment decisions? a. owners and creditors
52. What is considered the heart of any information system? a. The Database
53. Which type of information system should be accessed by the vice president of sales for a national department store chain who wants to see the previous day's sales receipts? a. A transaction processing system
54. How does a virtual private network contribute to a firm's workforce productivity? a. employers are enabled to work remotely with secure connectivity to the corporate network via the internet
55. What are 3 ways cloud computing services enhance company productivity? Choose 3 answers a. Through better resource utilization, through elimination of application downtime, through dedication of resources to each user
56. For which type of communication should employees have an ethical expectation of privacy from company monitoring? a. Personal letters sent through the company mail room
57. Which activity raises ethical issues heightened by the capabilities of data mining? a. Selling customer data for external marketing research
58. Which intent of spyware creates a company security issue? a. The intent to report on a user's internet activity
59. A company might divide itself into smaller groups that best match the types of customers it service. this is an example of a. departmentalization.
60. Total productivity a. output (goods or services) / input (human, natural resources, capital)
61. Liquidity ratio a. current assets / current liabilities
62. acid test a. current assets - inventory / current liabilities
63. inventory turnover a. cost of goods sold / average inventory (average of 2013 + 2014)
64. receivables turnover a. credit sales / average account receivables (average of 2013 + 2014)
65. total assets turnover a. sales / average total assets
66. what ratios are considered liquidity ratios a. the firm’s abilities to meet its short-term obligations and include the liquidity ratio and acid test
67. what ratios are considered activity ratios a. measure managements use of the firm’s resources and include all turnover ratios
68. what ratios are considered profitability ratios

a. gross profit, net profit, and return on equity

69. gross profit margin a. gross profit/sales
70. net profit margin a. net income/sales
71. return on equity a. net income / average equity
72. what are leverage ratios a. measure the extent to which a firm relies on debt financing and includes debt ratio and long-term debt to equity
73. debt ratio a. total liabilities / total assets
74. long-term debt to equity a. long-term debt/owner’s equity
75. what do management use support systems for a. decisions
76. information systems for activities fall under which support system a. operational support systems
77. which of the 2 information systems are operational support systems a. process control system, transaction process system
78. a decision support system (DSS) belongs to which support system a. management
79. is ethical and legal the same thing a. no
80. when two or more users connect using Ethernet or WiFi to the same server to share printers or other information a. local area network (LAN
81. what are advantages to WiFi a. mobility, expansion of LAN
82. the coordination of all promotional activities - media advertising, direct mail, personal selling, sales promotion, and public relations - to produce a unified, customer-focused message. a. integrated marketing communications IMC
83. what is used in the growth and maturity stage of the product life cycle to improve the competitive status of a product. a. persuasive advertising
84. compares products directly with their competitor either by name or by inference a. comparative advertising
85. advertising to maintain awareness of the importance and usefulness of a product a. reminder-oriented
86. potential buyers will request that their suppliers-retailers or local distributors - carry the products thereby pulling it through the distribution channel a. pulling strategy
87. companies promote the product to members of the marketing channel, not to end users a. pushing strategy
88. concentrating marketing efforts on the product (features, quality, value), distribution, and promotional elements of the marketing mix. a. competitive pricing
89. 3 different product types a. specialty, shopping, convenience
90. which of the product types is purchased most infrequently a. specialty
91. what are the 4 stages of the product life cycle a. introductory, growth, maturity, decline
92. which stage of the product life cycle requires focusing on attracting the competitor’s customers a. maturity
93. which advantage does brand loyalty provide

120. what increases satisfaction and dependability a. increased quality at a lower cost
121. no more than 3-4 defects per 1 million opportunities is the best outcome of which quality methodology a. six-sigma
122. which policy is used to manage the economy using government spending and taxation a. fiscal
123. which type of unemployment is the employee expecting to be unemployed for a portion of the year a. seasonal
124. which type of unemployment is a result of not having the necessary skills for a job a. structural
125. a specific economic situation when price and demand rise together a. inflation
126. as a business is it best to reduce spending or increase spending in a high-inflation environment a. reduce
127. as a business which environment is best to make capital improvements a. low inflation
128. which type of competition requires government regulation for entry a. monopoly
129. which type of competition is the easiest to enter a. pure
130. what is the name of the graph that we use to demonstrate demand a. demand curve
131. what is the point where supply and demand curves intersect? a. equilibrium price
132. Is the study of supply and demand a micro or macro-economic issue a. micro
133. when federal taxes are reduced is that micro or macro a. macro
134. when a tariff is increased on importing produce, is that micro or macro a. macro-economics
135. name the 3 tiers of management a. middle, supervisory, top
136. management is the process of a. achieving organizational objects
137. which level of planning does the middle manager complete a. tactical
138. what levels of management contribute to the contingency plan a. all levels
139. skill required for managers a. technical, human, conceptual
140. Departmentalizing based by domestic and international is which kind of departmentalization? a. geographical
141. Pick 2 types of departmentalization. a. functional, process
142. An organizational structure that is slow to make decisions because they look for consensus. a. committee
143. You may report vertically and horizontally in this organizational structure, a. matrix
144. what group likes structure a. millennials
145. What is the earliest year a Millennial would have been born? a. 1980
146. There are 3 key elements to an organization. What are they

a. Human interaction, Goal-directed activities, structure

147. Who uses the sales forecast that indicates where necessary funds will come. a. CFO
148. what revenue is not considered by the CFO for origin of necessary funds for the planning period. a. non-sales
149. The amount of assets a firm will need to support the forecast for a planning period. a. asset intensity
150. A firm pays taxes on profits that are repatriated as part of global operations. (yes or no) a. Yes
151. What is the difference between pure competition and monopolistic competition? a. Pure competition is a market structure in which large numbers of buyers and sellers exchange homogeneous products, and no single participant has a significant impact on price. Monopolistic competition is a market structure in which large numbers of buyers and sellers exchange differentiated (heterogenous) products, so each participant has some control over price.
152. On which economic system is the U.S. economy based? a. The U.S. economy is based on the private enterprise system.
153. What is privatization? a. Privatization is the conversion of government-owned and operated companies into privately held businesses.
154. Describe the 4 stages of the business cycle. a. The four stages are prosperity, recession, depression, and recovery. Prosperity is characterized by low unemployment and strong consumer confidence. Recession may include consumers postponing major purchases, layoffs, and decreased household savings. A depression occurs when an economic slowdown continues in a downward spiral over a long period of time. In recovery, consumer spending increases and business activity accelerates.
155. What are some measures that economists use to determine the health of an economy? a. Gross domestic product (GDP), general level of prices, core inflation rate, the Consumer Price Index, and the unemployment rate are all measures used to determine the health of an economy.
156. What is the difference between an expansionary monetary policy and a restrictive monetary policy? a. An expansionary monetary policy increases the money supply in an effort to cut the cost of borrowing. A restrictive monetary policy reduces the money supply to curb rising prices, overexpansion, and concerns about overly rapid economic growth by increasing the cost of borrowing.
157. What are the 3 primary sources of U.S. Government funds? a. taxes, fees, and borrowing.
158. Does a balanced budget erase the national debt? a. No, a balanced budget does not erase the national debt; it just doesn't increase it.
159. Why is virtually no country an economic island these days? a. No business or country is an economic island because many goods and services travel across national borders. Companies now are becoming multinational firms.
160. Describe 2 ways in which global expansion can benefit a U.S. firm. a. A firm can benefit from global expansion by attracting more customers and using less expensive labor and production in other parts of the world to produce goods and services.
161. What is management? a. Management is the process of achieving organizational objectives through people and other resources. The manager's job is to combine human and technical resources in the best way possible to achieve the company's goals.
162. How do the jobs of top managers, middle managers, and supervisory managers differ? a. Top managers develop long-range strategic plans, set a direction for their organization, and inspire all employees to achieve the company's vision. Middle managers focus on specific operations, products, or customers. They develop procedures to implement the company's strategic plans. Supervisory managers interact directly with nonmanagerial employees who produce and sell the company's goods and services. They are responsible for implementing the plans developed by middle managers and motivating workers to accomplish daily, weekly, and monthly goals.
163. What is the relationship between the manager's planning and controlling functions?

164. Outline the planning process. a. Some plans are very broad and long range, focusing on key organizational objectives; others are more detailed and specify how particular objectives will be achieved. From the mission statement to objectives to specific plans, each phase must fit into a comprehensive planning framework.
165. Describe the purpose of tactical planning. a. The purpose of tactical planning is to determine which short-term activities should be implemented to accomplish the company's overall strategy.
166. Compare the kinds of plans made by top managers and middle managers. How does their focus differ? a. Top managers focus on long-range, strategic plans. In contrast, middle-level managers focus on short-term, tactical planning.
167. What is meant by a vision for the company? a. A vision serves as the target for a company's actions, helping direct the company toward opportunities and differentiating it from its competitors.
168. Why is it important for a top executive to set high ethical standards? a. High ethical standards often result in a stable workforce, job satisfaction, and customer loyalty.
169. What is the purpose of a mission statement? a. A mission statement is a written explanation of a company's purpose, the reason it exists, the customers it will serve, and how it is different from competitors. A mission statement guides the actions of company managers and employees.
170. Which of a company's characteristics does a SWOT analysis compare? a. A SWOT analysis determines a company's strengths, weaknesses, opportunities, and threats relative to its competitors.
171. How do managers use objectives? a. Objectives set guideposts by which managers define the organization's desired performance in such areas as new- product development, sales, customer service, and employee satisfaction.
172. Distinguish between programmed and nonprogrammed decisions. a. Programmed decisions, such as reordering office supplies, are simple and happen frequently, so procedures for them can streamline the process. Nonprogrammed decisions, such as entering a new market or developing a new product, require more individual evaluation.
173. What are the 5 steps in the decision-making process? a. Recognition of a problem or opportunity, development of alternatives, evaluation of alternatives, selection & implementation of the chosen alternative, and follow-up to determine effectiveness of the decision.
174. How is leadership defined? a. Leadership means directing or inspiring people to attain certain organizational goals. Effective leaders share several traits, such as empathy, self-awareness, and objectivity in dealing with others. Leaders also use the power of their jobs, expertise, and experience to influence others.
175. Identify the styles of leadership as they appear along a continuum of greater or lesser employee participation. a. At one end of the continuum, autocratic leaders make decisions without consulting employees. In the middle of the continuum, democratic leaders ask employees for suggestions and encourage participation. At the other end of the continuum, free-rein leaders leave most decisions to their employees.
176. What is the relationship between leadership style and corporate culture? a. The best leadership style to adopt often depends on the organization's corporate culture and its system of principles, beliefs, and values. Managerial philosophies, communications networks, and workplace environments and practices all influence corporate culture.
177. How do managers reinforce corporate culture? a. Managers use symbols, rituals, ceremonies, and stories to reinforce corporate culture.
178. What is the purpose of an organization chart? a. An organization chart is a visual representation of a company's structure that illustrates job positions and functions.
179. What are the 5 major forms of departmentalization? PGCFP a. Product departmentalization organizes units by the different goods and services a company offers. Geographical departmentalization organizes units by geographical regions. Customer departmentalization organizes units by different types of customers. Functional departmentalization organizes units by business activities such as finance,

marketing, human resources, and production. Process departmentalization organizes units by the steps or work processes it takes to complete production or provide a service.

180. What does span of management mean? a. The span of management, or span of control, is the number of employees a manager supervises.
181. What is mass production? a. Mass production is a system for manufacturing products in large quantities through effective combinations of employees with specialized skills, mechanization, and standardization.
182. What is the difference between flexible production and customer-driven production? a. Flexible production generally involves using technology to receive and fulfill orders and skilled people to carry out tasks needed to fill a particular order. Customer-driven production evaluates buyer demands in order to make the connection between products manufactured and products purchased.
183. What are the 2 main production systems? a. Analytic production and synthetic production.
184. What are the 2 time-related production processes? a. The continuous production process and the intermittent production process.
185. List some of the reasons businesses invest in robots. a. Businesses use robots to free people from boring, sometimes dangerous assignments and to perform tasks that require repeated manipulation of materials and tools.
186. What is a flexible manufacturing system (FMS)? a. An FMS is a production facility that can be quickly modified to manufacture different products.
187. What are the major benefits of computer-integrated manufacturing (CIM)? a. The main benefits are increased productivity, decreased design costs, increased equipment utilization, and improved quality.
188. How does an environmental impact study influence the location decision? a. An environmental impact study influences the location decision because it outlines how transportation, energy use, water and sewer treatment needs, and other factors will affect plants, wildlife, water, air, and other elements of the natural environment.
189. What human factors are relevant to the location decision? a. Human factors include an area's labor supply, labor costs, local regulations, taxes, and living conditions.
190. List the 4 major tasks of production and operations managers. a. Planning the overall production process, determining the best layout for the firm's facilities, implementing the production plan, and controlling manufacturing to maintain the highest quality.
191. What is the difference between a traditional manufacturing structure and a team-based structure? a. In the traditional structure, each manager is given a specific area of authority. In a team-based structure, all workers are responsible for their output.
192. What factors affect the make, buy, or lease decision? a. The costs of leasing or purchasing parts from vendors, versus producing them in-house, the availability of dependable outside suppliers, and the need for confidentiality affect this decision.
193. What 5 steps are involved in controlling the production process? a. Planning, routing, scheduling, dispatching, and follow-up.
194. What is the difference between a Gantt chart and a PERT chart? a. Gantt charts, which track projected and actual work progress over time, are used for scheduling relatively simple projects. PERT charts, which seek to minimize delays by coordinating all aspects of the production process, are used for more complex projects.
195. What are some ways in which a company can monitor the quality level of its output? a. Benchmarking, quality control, Six Sigma, and ISO standards are ways of monitoring quality.
196. List some of the benefits of acquiring ISO 9000-certification. a. These standards define how a company should ensure that its products meet customers' requirements. Business partners, customers, suppliers, and consumers may prefer to deal with or buy products from a certified organization.
197. How do consumer products differ from business products? a. Consumer products, such as personal-care items, are sold to end users. Business products, such as copying machines, are sold to companies or organizations.

a. Convenience products are items the consumer seeks to purchase frequently, immediately , and with little effort. Shopping products are typically purchased after the buyer has compared competing products in competing stores. Specialty products are those a purchaser is willing to make a special effort to obtain. Unsought products are goods and services that consumers either do not know about or know about but don't think of buying until a need arises.

199. What are the 4 stages of the product life cycle? a. In the introduction stage, the company attempts to promote demand for the new product. In the product's growth stage, sales climb, and the company earns its initial profits. In the maturity stage, sales reach a saturation level. In the decline stage , both sales and profits decline.
200. What are the marketing implications of each stage? a. Marketers sometimes employ strategies to extend the product life cycle, including increasing frequency of use, adding new users, finding new uses for the product, and changing package size, labeling, or product design.
201. Differentiate among a brand, a brand name, and a trademark. a. A brand is a name, term, sign, symbol, design, or some combination thereof used to identify the products of one company and differentiate them from competitive offerings. A brand name is that part of the brand consisting of words or letters used to identify and distinguish the company's offerings from those of competitors. A trademark is a brand that has been given legal protection.
202. Define brand equity. a. Brand equity is the added value that a respected and successful name gives to a product.
203. Define distribution channels. a. Distribution channels are the paths that products, and legal ownership of them, follow from producer to consumer or business user.
204. What is a marketing intermediary? a. A marketing intermediary (also called a middleman) is a business that moves goods between producers and consumers or business users.
205. Define wholesaling. a. Wholesaling is the process of selling goods primarily to retailers, other wholesalers, or business users.
206. Differentiate between a merchant wholesaler and an agent or broker in terms of title to the goods. a. Merchant wholesalers are independently owned wholesaling intermediaries that take title to the goods they handle. Agents and brokers may or may not take possession of the goods they handle, but they never take title, working mainly to bring buyers and sellers together.
207. Define retailer. a. Retailers are distribution channel members that sell goods and services to individuals for their own use rather than for resale.
208. What are the elements of a retailer's marketing strategy? a. After identifying their target markets, retailers must choose merchandising, customer service, pricing, and location strategies that will attract customers in those market segments.
209. What is distribution intensity? a. Distribution intensity is the number of intermediaries or outlets through which a manufacturer distributes its goods.
210. Define supply chain. a. A supply chain is the complete sequence of suppliers that contribute to creating a good or service and delivering it to business users and final consumers.
211. What do customer service standards measure? a. Customer service standards measure the quality of service a company provides to its customers.
212. How has the smart phone impacted business? a. The smart phone is a game-changing technological innovation. On a global basis and at lightning speed, the smart phone has contributed to an increased flow of ideas and improved knowledge exchange, resulting in growth and productivity for both businesses and the global economy.
213. What is disruptive innovation? a. Disruptive innovation refers to a theory that describes the impact an innovation has when a new market and value are created that “disrupt” an existing market and its value. Disruptive innovations are less expensive and simpler versions of existing products and services that target entirely new customers, many times replacing industry leaders. Examples include smart phones replacing personal computers, downloadable digital media replacing CDs

and DVDs,

systems to protect

the privacy and confidentiality of employee and customer data and records. Another ethical issue is the use of computer technology to monitor employees while they are working.

229. What are the types of disasters to which information systems are vulnerable? a. Natural disasters, power failures, equipment malfunctions, software glitches, human error, and even terrorist attacks can disrupt even the most powerful, sophisticated computer information systems.
230. List the 5 considerations for off-site data storage. a. Planning & deciding which data to back up, establishing & following a backup schedule, protecting data when they are transmitted off-site, selecting the right security vendor, and continually testing & evaluating the backup system.
231. What Is Artificial Intelligence and Machine Learning? a. Artificial Intelligence (AI) and Machine Learning (ML) have seen considerable advancement. AI involves machines that can perform tasks characteristic of human intelligence—things like planning, understanding language, recognizing objects and sounds, learning, and problem solving. Machine learning is simply a way of achieving AI by “training” an algorithm so that the algorithm can “learn how.” “Training” involves feeding huge amounts of data to the algorithm and allowing the algorithm to adjust itself and improve.
232. Explain the Internet of Things (IoT) and Blockchain. a. The Internet of Everything or the Internet of Things (IoT) refers to a move beyond stand-alone devices and toward an entire Internet-connected ecosystem of everyday items such as TVs, cars, household appliances, and wearable tech devices. Blockchains will see their value grow beyond their use in cryptocurrency and digital currency. As data is stored across a decentralized network of millions of computers, the influence of blockchain will expand and transform the Internet of Things—and hopefully, reduce the risk of data hacking.
233. What is Augmented and Virtual Reality? a. Augmented Reality (AR), Virtual Reality (VR), and mixed reality, which combines the two, will be used by 20% of all businesses to create immersive experiences with the help of head-mounted displays. Virtual and augmented reality technologies are removing the distance to people, information, and experiences, transforming the ways people live and work.
234. What is utility? a. Utility is the ability of a good or service to satisfy the wants and needs of customers.
235. Identify 3 ways in which marketing creates utility. a. Marketing creates time utility by making a good or service available when customers want to purchase it, place utility by making the product available in a convenient location, and ownership utility by transferring the product from the seller to the buyer.
236. What is the marketing concept? a. A companywide customer orientation with the objective of achieving long-run success, marketplace success begins with the customer.
237. How is the marketing concept tied to the relationship and social eras of marketing? a. Most marketing now centers on the satisfaction of customers & building long-term relationships with them through several channels including the Internet & social media, rather than simply producing and selling goods and services.
238. Why do not-for-profit organizations engage in marketing? a. To reach audiences, secure funding, and accomplish their overall missions.
239. What are the 5 types of nontraditional marketing used by not-for-profit organizations? a. person, place, event, cause, and organization marketing. PPECO
240. Distinguish between consumer products and business products. a. Consumer products are goods and services purchased by end users. Business products are goods and services purchased to be used, either directly or indirectly, in the production of other goods for resale.
241. What are the steps in developing a marketing strategy? a. The 2 steps are (1) studying and analyzing potential target markets & choosing among them and (2) creating a marketing mix to satisfy the chosen market.
242. What is the difference between primary data and secondary data? a. Primary data are collected firsthand through observation or surveys. Secondary data are previously published facts that are inexpensive to retrieve and easy to obtain.
243. What is data mining? a. Data mining is the task of using computer technology to evaluate data in a database and identify useful trends.

a. Demographics is the most commonly used consumer market segmentation method.

245. What are the 3 approaches to product-related segmentation? a. benefits sought, product usage rate, and brand loyalty levels.
246. What is end-use segmentation in the B2B market? a. End-use segmentation focuses on the precise way a B2B purchaser will use a product.
247. Define consumer behavior. a. Consumer behavior refers to the actions of ultimate consumers directly involved in obtaining, consuming, and disposing of products, along with the decision processes that precede and follow these actions.
248. What are some determinants of consumer behavior? a. Both personal and interpersonal factors influence the way buyers behave. Personal influences include an individual's needs and motives; perceptions, attitudes, and learned experiences; and self-concept. Interpersonal influences include cultural, social, and family influences.
249. What is the lifetime value of a customer? a. The lifetime value of a customer incorporates the revenues and intangible benefits from the customer over the life of the relationship with a company minus the amount the company must spend to acquire and serve the customer.
250. Discuss the increasing importance of one-on-one marketing efforts. a. One-on-one marketing is increasing in importance as consumers demand more customization in goods and services. It is also increasingly dependent on technology such as computer-aided design and manufacturing (CAD/CAM). The Internet also offers a way for businesses to connect with customers in a direct and personal manner.
251. What is the objective of an integrated marketing communications program? a. An IMC strategy focuses on customer needs to create a unified promotional message about a company's goods or services.
252. Why do companies pursue multiple promotional objectives at the same time? a. Companies pursue multiple promotional objectives because they may need to convey different messages to different audiences.
253. What are product placement and guerrilla marketing? a. Product placement involves paying a fee to have a product showcased in various types of media. Guerrilla marketing consists of innovative, low-cost marketing efforts designed to get consumers' attention in unusual ways.
254. What are the 2 basic types of advertising? Into what 3 categories do they fall? a. Product and Institutional. The categories are informative, persuasive, and reminder-oriented advertising.
255. What is the leading advertising medium in the United States? a. Listed in Figure 13.2, television is the leading advertising medium in the United States.
256. In what 2 major ways do companies benefit from sponsorship? a. They gain exposure to the event's audience, and they become associated with the activity's image.
257. Why do retailers and manufacturers use sales promotions? a. Retailers and manufacturers use sales promotions to offer consumers extra incentives to buy their products.
258. When does a company use personal selling instead of nonpersonal selling? a. Companies generally use personal selling when customers are few and geographically concentrated; the product is technically complex, involves trade-ins, or requires special handling; the price is high; or the product moves through direct-distribution channels.
259. How does public relations serve a marketing purpose? a. Public relations can be an efficient, indirect communications channel for promoting products. It can publicize products and help create and maintain a positive image of the company.
260. Give an example of a pushing strategy. a. Is one used by drug manufacturers, which is used to market solely to physicians & hospitals.
261. Give an example of a pulling strategy. a. Are used by retailers and by manufacturers of consumer goods such as cosmetics, automobiles, & clothing.
262. Define price. a. Price is the exchange value of a good or service.
263. In addition to profitability, what is another approach to pricing strategy? a. A second approach to pricing strategy is volume objectives, which bases pricing decisions on market share.
264. What is a cost-based pricing formula?

a. A cost-based pricing formula calculates the total costs per unit and then adds markups to cover overhead costs and generate profits.

265. Why do companies implement competitive pricing strategies? a. Companies use competitive pricing strategies to reduce the emphasis on price competition by matching other companies' prices and concentrating their own marketing efforts on the product, distribution, and promotional elements of the marketing mix.
266. How does the price–quality relationship affect a company's pricing strategy? a. Consumers must believe that the price of an item reflects its quality, except in extreme cases. So a company must try to set its prices accordingly.
267. Why is odd pricing used? a. Retailers believe that consumers favor uneven amounts or amounts that sound like less than they really are. Odd pricing may also be used to suggest an item is on sale.
268. Define accounting. a. Measuring, interpreting, and communicating financial information to enable people inside and outside the company to make informed decisions.
269. Who uses accounting information? a. Managers of all types of organizations use accounting information to help them plan, assess performance, and control daily and long-term operations. Outside users of accounting information include government officials, investors, creditors, and donors.
270. What are the 3 business activities that involve accounting? a. Financing, investing, and operating activities.
271. List the 3 services offered by public accounting firms. a. Auditing, tax services, and management consulting.
272. What tasks do management accountants perform? a. Management accountants work for the organization and are responsible for collecting and recording financial transactions and for preparing and interpreting financial statements.
273. Define GAAP. a. GAAP stands for generally accepted accounting principles and is a set of standards or guidelines that accountants follow in recording and reporting financial transactions.
274. What are the 4 basic requirements to which all accounting rules must adhere? a. Consistency, relevance, reliability, and comparability.
275. What is the role played by the FASB? a. The Financial Accounting Standards Board (FASB) is an independent body made up of accounting professionals and is primarily responsible for evaluating, setting, and modifying GAAP.
276. List the 4 steps in the accounting cycle. a. Recording transactions, classifying the transactions, summarizing transactions, and using the summaries to produce financial statements.
277. What is the accounting equation? a. The accounting equation states that assets (what a company owns) must always equal liabilities (what a company owes) plus owners' equity. Therefore, if assets increase or decrease, there must be an offsetting increase or decrease in liabilities, owners' equity, or both.
278. Briefly explain double-entry bookkeeping. a. Double-entry bookkeeping is a process by which accounting transactions are recorded. Each transaction must have an offsetting transaction.
279. List the 4 financial statements. a. Balance sheet, the income statement, the statement of owners' equity, and the statement of cash flows.
280. How is the balance sheet organized? a. Assets (what a company owns) are shown on one side of the balance sheet and are listed in order of convertibility into cash. On the other side of the balance sheet are claims to assets, liabilities (what a company owes), and owners' equity. Claims are listed in the order in which they are due, so liabilities are listed before owners' equity. Assets always equal liabilities plus owners' equity.
281. Define accrual accounting.