Marketing Awareness Questions and Answers

Answer: C

Correct answer: They reduce the total number of transactions and increase the total amount of exchange

Count the transactions. With \(n\) buyers and \(m\) sellers dealing directly, \(n \times m\) contacts are needed; with a merchant in the middle, only \(n + m\). The intermediary therefore cuts the number of transactions sharply, and because trading becomes so much cheaper and easier, the volume of exchange rises. That efficiency is the economic justification for wholesalers, retailers and marketplaces.

Answer: C

Correct answer: Nascent Market

A nascent market is one that has only just come into existence and is still small - demand is unproven, few competitors are present, and the rules of the business are not yet settled. It is the riskiest kind of market to enter and, if it grows, the most rewarding.

Answer: A

Correct answer: a movement up along the supply curve

The wording matters. An increase in quantity supplied is a response to a higher price, so it is a movement along the existing curve. A shift of the curve is what economists call a change in supply, and it is caused by something other than price - input costs, technology, the number of sellers.

Answer: B

Correct answer: Production

The four Ps are Product, Price, Place and Promotion. Production is not among them - it is a manufacturing function, not a marketing variable. (“Placement” here is loose wording for Place, which is why it is not the answer.)

Answer: C

Correct answer: Maturity

Competition is fiercest at maturity. The market has stopped growing, so every competitor can only gain by taking share from another - hence price cutting, heavy promotion and the shake-out that ends the stage. In growth there is room for everyone; in decline the weaker firms have already left.

Answer: D

Correct answer: To integrate various consumer groups as segments

Segmentation divides a heterogeneous market into groups whose members have similar needs and respond similarly to a given offer. Each group can then be served with a mix suited to it, instead of one compromise aimed at everybody. It is about the customers, not about the product or about saving money.

Answer: A

Correct answer: How consumers perceive the product

Positioning is the place a product occupies in the customer’s mind, relative to competing products. It is a perception, not a physical arrangement - which is why positioning is achieved through the whole mix, and why a firm can be positioned quite differently from how it sees itself.

Answer: C

Correct answer: Profits become minimal

In the introduction stage sales are small while the costs of development, production start-up and heavy promotion are at their highest, so profits are minimal or negative. The money spent here is an investment in a market that does not yet exist.

Answer: B

Correct answer: PEST Analysis

PEST examines the macro-environment: Political, Economic, Social and Technological factors - the forces outside the firm that it cannot control but must anticipate. SWOT covers strengths and weaknesses, which are internal, alongside external opportunities and threats.

Answer: A

Correct answer: customer retention

Customisation tailors the offering to the individual customer, which raises satisfaction and makes switching to a competitor less attractive - so it results in retention. Better financial results may follow from that, but they are a consequence, not the direct effect.