Chapter 2

Question 1

_____ is the process of thoughtfully defining a firm’s objectives and developing a method for achieving those objectives.

Answer 1

Strategic planning

Question 2

The mission statement of a firm

Answer 2

is a concise affirmation of the firm’s long-term purpose.

Question 3

The mission statement of a firm

Answer 3

provides a standard to ensure that the business never strays too far from its core goals and values.

Question 4

The _____ is an action-oriented document or playbook that guides the analysis, implementation, and control of the firm’s marketing strategy.

Answer 4

marketing plan

Question 5

The primary strategic planning tool for directing and coordinating the marketing effort is the

Answer 5

marketing plan.

Question 6

Which of the following is a function of the marketing strategy in a marketing plan?

Answer 6

defining the target market

Question 7

Which of the following is a feature of the executive summary?

Answer 7

It must be done after the rest of the marketing plan has been completed.

Question 8

A firm with a “cash cow” product is most likely to

Answer 8

invest just enough money to maintain strong sales.

Question 9

Ruth designs games for mobile operating systems such as iOS and Windows. The demand for games on mobile devices is high. Ruth’s latest game, Viper Slash, is yet to generate profitable sales despite receiving rave reviews. According to the BCG matrix, Viper Slash can be classified as a

Answer 9

question mark product.

Question 10

Vida is an Italian car manufacturer with manufacturing plants all over the world, including the United States. In the context of SWOT analysis, which of the following can be classified as one of Vida’s strengths?

Answer 10

Vida recently recruited two senior engineers from one of its major competitors.

Question 11

Resco is an apparel manufacturer whose products are carried only by two major retailers in the United States. In the context of SWOT analysis, which of the following can be classified as a weakness of Resco in this scenario?

Answer 11

Resco’s manufacturing units use legacy technology that sometimes leads to backorders.

Question 12

In the context of a SWOT analysis, which of the following can be classified as an opportunity for a manufacturing firm?

Answer 12

a rise in demand for products that the firm manufactures

Question 13

A market penetration strategy

Answer 13

emphasizes selling more of existing goods and services to existing customers.

Question 14

Zbar, a mobile phone-manufacturing company, decides to pursue a market development strategy to further its business prospects. In this situation, which of the following actions falls in line with Zbar’s latest strategic direction?

Answer 14

Zbar enters a price-sensitive market with its low-end phones.

Question 15

A product possesses a competitive advantage when it enjoys a superior position over competing products because

Answer 15

consumers believe it has more value than other products in its category.

Question 16

Which of the following is a major risk associated with licensing?

Answer 16

The licensor may be inadvertently creating a future competitor in the form of the licensee.

Question 17

Franchising is an attractive method of entering foreign markets because

Answer 17

franchisees assume the majority of the capital costs and human resource issues.

Question 18

Joint ventures work best when the partners’

Answer 18

competitive goals diverge.

Question 19

A firm measures its effectiveness in using the resources it has allocated to its marketing effort by use of which tool?

Answer 19

return on marketing investment

Question 20

The two metrics used to evaluate a firm’s profitability are customer acquisition and

Answer 20

customer profitability.