ECONOMICS 1
Natural resources are provided by nature, and capital resources are provided by
A. machinery.
B. people.
C. technology.
D. automation.
Who owns a good if the good is used in performing a service for a customer?
A. The business performing the service
B. The customer who buys the service
C. The producer of the good
D. The supplier of the good to the business
A: The business performing the service.
Which step in the new-product development process involves seeking feedback from consumers in order to know what response they would give to a proposed product?
A. Idea generation
B. Product screening
C. Concept testing
D. Feasibility analysis
C: Concept Testing
Concept testing is when a company shows a product idea to customers and asks what they think about it before it’s actually made.
A. Idea generation
This is just coming up with ideas, not asking customers yet.
B. Product screening
This is when the company internally decides which ideas are worth continuing.
D. Feasibility analysis
This checks if the product is possible to make and profitable, not what customers think.
Which of the following is an example of a product decision?
A. Choosing the brand name for a new energy drink
B. Deciding where to advertise a product
C. Setting a discount for a seasonal sale
D. Training staff to answer customer questions
A. Choosing the brand name for a new energy drink.
Product decisions focus on the product itself—features, design, and brand.
Businesses often obtain marketing information to
A. monitor trends.
B. implement procedures.
C. delegate authority.
D. investigate terms.
A. Monitor trends.
Marketing information is all of the marketing-related data available from inside and outside the business.
Why is it important for businesses to monitor customer purchases?
A. To satisfy consumers' needs and wants
B. To block consumers' economic votes
C. To promote slow-selling merchandise
D. To classify their products
A. To satisfy consumers' needs and wants
Which of the following is a function that is an important part of the human resources management activities of business:
A. Promoting
B. Pricing
C. Selling
D. Staffing
D: Staffing.
Human resources management is the process of planning, staffing, leading, and organizing employees. Staffing is an important part of that.
What is one question that a company needs to answer about a product that is in the introductory stage of its life cycle?
A. Should we regionalize the product?
B. Does the product need to be modernized?
C. Should we take the product off the market?
D. How can we make the public aware of our product?
D. How can we make the public aware of our product?
The introductory stage is when a product is brand new and just entering the market.
At this point, most people don’t even know the product exists yet.
Nike releases a line of sports headphones under the Nike brand. Why?
A. To lower production costs
B. To use the existing brand to attract customers
C. To test a new market without risk
D. To improve employee satisfaction
B. To use the existing brand to attract customers.
A brand extension uses an already known brand to make a new product more appealing.
In planning marketing activities and in making marketing decisions, marketers use a variety of data gathered by a(n)
A. marketing-information management system.
B. double-entry bookkeeping system.
C. file of employee records.
D. inventory control system.
A. Marketing-information management system.
A marketing-information management system is an organized way of continuously gathering, accessing, synthesizing, evaluating, and disseminating information for use in making business decisions.
What might cease if producers decide that their incomes are inadequate to continue making goods and services?
A. Consumption
B. Competition
C. Compensation
D. Communication
A. Consumption. (Consumption is the process of using the goods and services. If we don't have the goods or services, we can't use them.)
Which of the following types of economic systems would offer the most benefits to business owners and to their employees:
A. Market
B. Socialist
C. Communist
D. Traditional
A: Market.
A market economy is an economic system in which the means of production and distribution are owned and controlled by individuals and businesses.
Many businesses are using the technology developed by the space program to create
A. advanced new products.
B. marketing strategies.
C. updated brand names.
D. advertising techniques.
A. Advanced new products.
The space program creates new technology to help astronauts and space missions.
Businesses then take that technology and use it to invent new or improved products for people on Earth.
A company that sells 3 types of chips adds 2 new flavors. This affects the:
A. Product mix width
B. Product mix depth
C. Product line consistency
D. Product life cycle
B: Product mix depth
Depth = number of products within a product line. how many versions/flavors/choices are in each type.
- Product mix = everything a company sells.
- Product line = a group of similar products (like all types of chips).
- Width= how many different types of products a company sells. (E.G. - Target sells clothing, electronics, and toys.)
Computerized databases make it possible for marketing researchers to
A. obtain desired information immediately.
B. limit their use of biographical databases.
C. gain unrestricted access to statistical data.
D. reduce the use of off-line data collection methods.
A. Obtain desired information immediately.
Businesses often use computers to store large amounts of information.
T-shirts sold at music concerts that are imprinted with a rock group's name are examples of products that have __________ utility.
A. service
B. form
C. price
D. intangible
B. Form. (Form utility is usefulness created by altering or changing the form or shape of a good to make it more useful to the consumer.)
The differences in the education and skills of the workforce are reasons why market economies usually experience
A. unequal income distribution.
B. low unemployment levels.
C. unpredictable taxation rates.
D. minimal profit margins.
A: Unequal income distribution.
Unemployment fluctuates in market economies. Sometimes unemployment levels arelow and sometimes they are high, depending on the stage of the business cycle.
The government sets the taxation rates, which vary by jurisdiction or where people live and work. A market economy allows the
freedom for individuals and businesses to make a profit, but a particular business's goals and sales influence the profit margin the business makes.
The Underwriters Laboratory seal on an electrical product indicates
A. quality and safety backed by a testing organization.
B. a guarantee by the manufacturer.
C. the product can be returned.
D. standard grades established by the federal government.
A. Quality and safety backed by a testing organization.
The UL seal means the product has been tested to make sure it won’t easily cause things like electrical fires or safety problems.
Examples:
- A phone charger
- A lamp
- A power strip
A restaurant wants to improve customer satisfaction. Which should they focus on?
A. Staff training and consistent service
B. Changing the building color
C. Printing more menus
D. Reducing the number of seats
A. Staff training and consistent service.
Service quality comes from staff and experience, not just products.
A marketing-research project that gathers sufficient information to help the business in its decision making would be described as
A. predictive.
B. efficient.
C. tedious.
D. thorough.
D. Thorough.
An important characteristic of effective marketing research is that it should be thorough. Incomplete or insufficient research won't give the business enough information to enable it to make good decisions.
What type of market likely exists when a local automobile dealer has many cars for sale at low prices but demand is low?
A. Elastic
B. Buyer's
C. Seller's
D. Inelastic
B. Buyer's.
A buyer's market is the best time for buyers to buy. It is characterized by large supply, small demand, and low prices.
A seller's market is characterized by large demand, small supply, and high prices.
Elastic is not a type of market but a type of demand that changes according to changes in price.
Inelastic is not a type of market but a type of demand in which changes in price do not affect demand.
Which of the following does not give exclusive ownership of certain types of property to individuals:
A. Patent
B. Trademark
C. License
D. Copyright
C: License.
A license does not give ownership. It only gives someone permission to use something that belongs to someone else.
Think of it like borrowing vs. owning.
Patent → You own an invention (like a new machine or product idea).
Trademark → You own a brand name, logo, or symbol (like the Nike swoosh).
Copyright → You own creative work (like music, movies, books, or photos).
A warranty that covers the entire product is known as a(n) __________ warranty.
A. full
B. limited
C. express
D. implied
A. Full
A full warranty means the entire product is covered if something goes wrong.
- Limited warranty → Only certain parts or problems are covered
- Express warranty → A specific written or spoken promise
- Implied warranty → An automatic expectation that a product should work
A company studies if a product is profitable and possible to make. This step is called:
A. Idea generation
B. Product screening
C. Feasibility analysis
D. Concept testing
C. Feasibility analysis
They check if the product can actually be made and sold successfully.
Is it feasible?
Before introducing a product to the marketplace, a business might monitor its competitors' ___________ strategies.
A. training
B. scheduling
C. auditing
D. pricing
D. Pricing.
When conducting marketing research, businesses often gather information about their competitors.