Chapter 2
1. What is an advantage of an independent, single-store over other forms of retail
ownership?
Multiple Choice
• economies of scale
• ability to react quickly to market changes
• bureaucratic operation
• specialized managers to oversee specific tasks
• presence of a decision-making managerial board
2. A characteristic of service retailers is that they
Multiple Choice
• do not deal in perishables.
• are involved in the sale of tangible goods.
• must try to maintain consistent high-quality services.
• are not affected by the time and location of service.
• are not dependent on customer feedback to evaluate the quality of their offerings.
,3. A conventional supermarket
Multiple Choice
• offers at least one store brand in each product category.
• emphasizes product quality regardless of the cost.
• offers limited services to customers.
• is more likely to be located in a first-tier shopping center.
• is more likely to stock high price goods.
4. Branby’s—a famous retailer—carries groceries, sporting goods, automobiles,
electronics, housewares, health and beauty aids, apparel, footwear, jewelry, camping
gear, and more. Using the provided information, it can be concluded that Branby’s has
Multiple Choice
• broad variety.
• low inventory.
• good customer base.
• low shrinkage.
• deep assortment.
5. A ______Blank is a contractual agreement in which a company sells the rights to use
its business trademark, service mark, or trade name, or another commercial symbol of
the company, to an individual for a one-time establishment fee and an ongoing royalty
fee, typically expressed as a percentage of gross monthly sales.
Multiple Choice
• franchise
, • retail chain
• wholesale operation
• single-store establishment
• voluntary cooperative chain
6. Convenience stores
Multiple Choice
• are more likely to offer a large variety and assortment of merchandise.
• charge lesser prices than supermarkets for perishables.
• are located far away from high-traffic areas.
• are more likely to be located in warehouse-type structures with large parking facilities.
• enable consumers with speedy checkout.
7. A characteristic of full-line discount stores is that they
Multiple Choice
• offer goods belonging to a single product category.
• emphasize extensive customer service to maintain customer loyalty.
• offer exclusive designer merchandise.
• combine with a supermarket to make up a warehouse club.
• stock both private labels and national brands.
8. A characteristic of retailers that offer private-label merchandise is that they
, Multiple Choice
• incur higher promotional costs compared with national-brand retailers.
• have the ability to differentiate themselves from the competition.
• realize lower gross margins compared with national-brand retailers.
• cannot create store loyalty on the basis of their merchandise offering.
• diminish their reputation for quality by offering private-label brands.
9. With reference to categorization by ownership, which statement is true of single-
store small retailers?
Multiple Choice
• They invest in sophisticated analytical systems to help them buy and price merchandise.
• They have a broad management base with people who specialize in specific retail
activities.
• They can effectively negotiate lower prices for merchandise.
• They are more likely to get discounts in advertising.
• They are more likely to respond quickly to customer needs.
10. When it comes to service retailing, since customers cannot see, touch, or feel what
is being sold, the ________Blank of the service can sometimes be a concern for
customers in trying to decide whether to buy or not.
Multiple Choice
• intangibility
• perishability
• necessity
• durability
1. What is an advantage of an independent, single-store over other forms of retail
ownership?
Multiple Choice
• economies of scale
• ability to react quickly to market changes
• bureaucratic operation
• specialized managers to oversee specific tasks
• presence of a decision-making managerial board
2. A characteristic of service retailers is that they
Multiple Choice
• do not deal in perishables.
• are involved in the sale of tangible goods.
• must try to maintain consistent high-quality services.
• are not affected by the time and location of service.
• are not dependent on customer feedback to evaluate the quality of their offerings.
,3. A conventional supermarket
Multiple Choice
• offers at least one store brand in each product category.
• emphasizes product quality regardless of the cost.
• offers limited services to customers.
• is more likely to be located in a first-tier shopping center.
• is more likely to stock high price goods.
4. Branby’s—a famous retailer—carries groceries, sporting goods, automobiles,
electronics, housewares, health and beauty aids, apparel, footwear, jewelry, camping
gear, and more. Using the provided information, it can be concluded that Branby’s has
Multiple Choice
• broad variety.
• low inventory.
• good customer base.
• low shrinkage.
• deep assortment.
5. A ______Blank is a contractual agreement in which a company sells the rights to use
its business trademark, service mark, or trade name, or another commercial symbol of
the company, to an individual for a one-time establishment fee and an ongoing royalty
fee, typically expressed as a percentage of gross monthly sales.
Multiple Choice
• franchise
, • retail chain
• wholesale operation
• single-store establishment
• voluntary cooperative chain
6. Convenience stores
Multiple Choice
• are more likely to offer a large variety and assortment of merchandise.
• charge lesser prices than supermarkets for perishables.
• are located far away from high-traffic areas.
• are more likely to be located in warehouse-type structures with large parking facilities.
• enable consumers with speedy checkout.
7. A characteristic of full-line discount stores is that they
Multiple Choice
• offer goods belonging to a single product category.
• emphasize extensive customer service to maintain customer loyalty.
• offer exclusive designer merchandise.
• combine with a supermarket to make up a warehouse club.
• stock both private labels and national brands.
8. A characteristic of retailers that offer private-label merchandise is that they
, Multiple Choice
• incur higher promotional costs compared with national-brand retailers.
• have the ability to differentiate themselves from the competition.
• realize lower gross margins compared with national-brand retailers.
• cannot create store loyalty on the basis of their merchandise offering.
• diminish their reputation for quality by offering private-label brands.
9. With reference to categorization by ownership, which statement is true of single-
store small retailers?
Multiple Choice
• They invest in sophisticated analytical systems to help them buy and price merchandise.
• They have a broad management base with people who specialize in specific retail
activities.
• They can effectively negotiate lower prices for merchandise.
• They are more likely to get discounts in advertising.
• They are more likely to respond quickly to customer needs.
10. When it comes to service retailing, since customers cannot see, touch, or feel what
is being sold, the ________Blank of the service can sometimes be a concern for
customers in trying to decide whether to buy or not.
Multiple Choice
• intangibility
• perishability
• necessity
• durability
