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Unformatted text preview: e 4. A(n) _____ is a subgroup of individuals or organizations sharing one or more characteristics that cause them to have similar product needs.
e. market universe
population sample ANS: B
This is the definition of a market segment.
KEY: CB&E Model Customer OBJ: 08-1 TOP: AACSB Reflective MSC: BLOOMS Knowledge 5. A group of middle school students stop by a bicycle store. The store has just received a new
shipment of high-end racing bicycles. The bicycles range in price from $1,200 to $3,000. All of
the students want one of these new bikes, but none has the means to buy one. Is this group of
consumers a potential market for the expensive bikes?
Yes, they are a potential market since they are
all about the same age.
No, they do not have the ability to purchase at
No, to qualify as a market, they must need the
Yes, they are a market because this product
could satisfy their consumer wants and
Yes, they are a market because this group
shares relatively similar product needs and
A market is a group of people or organizations that has wants and needs that can be satisfied by
particular product categories, has the ability to purchase these products, and is willing to
exchange resources for the products. There is no suggestion of ability to purchase in this case.
KEY: CB&E Model Customer OBJ: 08-1 TOP: AACSB Reflective MSC: BLOOMS Application 6. Ford Motor Company produces passenger cars, commercial trucks and specialty vehicles,
performance vehicles, and race cars. Ford uses a procedure called _____ to divide its large
ANS: C Dividing one large market into divisions based on a variable such as product usage is called
KEY: CB&E Model Strategy OBJ: 08-1 TOP: AACSB Reflective MSC: BLOOMS Application 7. _____ is the process of dividing a market into meaningful groups that are relatively similar and
This is the definition of market segmentation.
KEY: CB&E Model Strategy
8. The purpose of market segmentation is to:
e. OBJ: 08-1 TOP: AACSB Reflective MSC: BLOOMS Knowledge
reduce the market down to a size the firm can
divide the market into equal size and profit
regions for sales territories
group a large number of markets together,
enabling a company to serve them
develop a generalized definition of the market
as a whole
enable the marketer to tailor marketing mixes
to meet the needs of one or more specific
groups ANS: E
The purpose of segmentation is to group similar consumers and to serve their needs with a
specialized marketing mix.
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- Fall '13