Marketing management global 15th edition kotler test bank

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Marketing Management, 15e, Global Edition (Kotler) Chapter 6 Analyzing Consumer Markets 1) ________ is the study of how individuals, groups, and organizations select, buy, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and wants.

A) Target marketing B) Mind mapping C) Consumer activism D) Consumer behavior E) Product differentiation Answer: D Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 2) Which of the following would be the best illustration of a subculture?

A) a religion B) a group of close friends C) your university D) a fraternity or sorority E) your occupation Answer: A Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Application of knowledge 3) The relatively homogeneous and enduring divisions in a society, which are hierarchically ordered and whose members share similar values, interests, and behavior constitute a ________.

A) culture B) subculture C) social class D) family E) group Answer: C Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking

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4) A person's ________ consist(s) of all the groups that have a direct (face-to-face) or indirect influence on his/her attitudes or behavior.

A) subculture B) family C) social class D) reference groups E) social networks Answer: D Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 5) A(n) ________ group is one whose values or behavior an individual rejects.

A) aspirational B) dissociative C) membership D) primary E) procreational Answer: B Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 6) Joe is a computer service technician. People in his neighborhood usually depend on his suggestions for purchasing any computer accessory or hardware, as they believe that he has access to far more information on computer technology than the average consumer. The neighbors are also aware that Joe has the required knowledge and background for understanding the technical properties of the products. Within this context, Joe can be called a(n) ________.

A) transactional leader B) opinion leader C) role model D) gate-keeper E) international marketer Answer: B Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge

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7) For a high school student, Tim is highly concerned about environmental issues. He is a strong supporter of the garbage recycling and afforestation campaigns taken up by the environmental activists in his neighborhood. He wants to become a full time volunteer for their upcoming wildlife protection program and has even saved money to contribute to the cause. This group of environmental activists can be categorized under which of the following reference groups?

A) primary group B) secondary group C) aspirational group D) dissociative group E) cognitive group Answer: C Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge 8) Jason writes a weekly column in his school's newspaper about movies he has seen, books he has read, and concerts he has attended. His column provides information and opinions. Feedback from his fellow students is positive, and they are appreciative of the advice that is given. Which of the following would be the most apt description of the role played by Jason?

A) silent majority B) protestor C) protector D) adapter E) opinion leader Answer: E Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge 9) Social classes differ in media preferences, with upper-class consumers often preferring ________ and lower-class consumers often preferring television.

A) movies B) radio C) video or computer games D) magazines and books E) music downloads Answer: D Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking

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10) If a direct-mail marketer wished to direct promotional efforts toward the family of ________, efforts need to be directed toward parents and siblings of the family members.

A) orientation B) procreation C) immediacy D) intimacy E) reference Answer: A Diff: 3 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Application of knowledge 11) The family in a buyer's life consisting of parents and siblings is the ________.

A) family of procreation B) family of influence C) family of efficiency D) family of orientation E) purchasing family Answer: D Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 12) When Gary was a high school student, he enjoyed rock music and regularly purchased hip clothing sported by his favorite rock band. However, five years later, when Gary became an accountant, his preference shifted toward formal clothing. Which of the following personal characteristics is likely to have had the most influence on Gary's preferences during his high school days?

A) education B) age C) income D) gender E) physiological needs Answer: B Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge

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13) Marriage, childbirth, and divorce constitute the ________ that shape the consumption pattern of individuals.

A) psychological life cycle B) product life cycle C) social status D) post-puberty cycles E) critical life events Answer: E Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 14) Identify an economic circumstance that can greatly affect any product or brand choice.

A) retirement B) values C) lifestyle D) borrowing power E) relocation Answer: D Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Application of knowledge 15) ________ refers to a set of distinguishing human psychological traits that lead to relatively consistent and enduring responses to environmental stimuli.

A) Image B) Personality C) Psychological transformation D) Lifestyle E) Acculturation Answer: B Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 16) Brand personality analysts identified the popular music channel MTV as daring, spirited, and highly imaginative. As per Jennifer Aaker's research, which of the following brand personality traits best suits MTV? A) excitement B) sincerity C) competence D) ruggedness E) sophistication Answer: A Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Application of knowledge 5 Copyright © 2016 Pearson Education Limited

17) The Marlboro Man was depicted in the advertisements of Marlboro cigarettes as a rugged outdoor, tough cowboy type. This was done to establish what is called ________.

A) trademarking B) a brand name C) a brand personality D) co-branding E) a brand reference Answer: C Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge 18) Consumers often choose and use brands that have a brand personality consistent with how they see themselves, also known as the ________ self-concept.

A) actual B) ideal C) others' D) prohibitive E) suggestive Answer: A Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking 19) Consumers often choose and use brands that have a brand personality consistent with how they think others view them, also known as the ________ self-concept.

A) actual B) others' C) ideal D) dual E) perceptual Answer: B Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking

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20) Consumers who are highly sensitive to how others see them and who choose brands whose personalities fit the consumption situation are called ________.

A) change agents B) self motivators C) self monitors D) self adapters E) opinion leaders Answer: C Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 21) Within the context of Jennifer Aaker's analysis, identify the brand personality that can be associated with a new product whose promotional messages consistently portray it as being reliable, intelligent, and successful.

A) sincerity B) excitement C) competence D) sophistication E) ruggedness Answer: C Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 22) Ford Motors uses the ad caption "Magnify the Adventure" to promote its latest SUV, the Ford Endeavour. The ad features the car traveling through an uneven, rocky terrain. Within the context of Jennifer Aaker's brand personality analysis, Ford Endeavour is most likely to be strong on which of the following traits?

A) sincerity B) intelligence C) imagination D) sophistication E) ruggedness Answer: E Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge

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23) ________ portrays the "whole person" interacting with his or her environment.

A) Attitude B) Personality C) Lifestyle D) Self-concept E) Subculture Answer: C Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 24) IKEA has achieved global recognition by offering consumers leading-edge Scandinavian furniture at affordable prices. IKEA is delivering value to consumers who are ________ constrained.

A) money B) time C) brand D) value E) self-concept Answer: A Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge 25) Marketers who target consumers on the basis of their ________ believe that they can influence purchase behavior by appealing to people's inner selves.

A) time famine B) sophistication C) money constrain D) social class E) core values Answer: E Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 26) Social class is the fundamental determinant of a person's wants and behavior.

Answer: FALSE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 27) An example of a subculture would be a person's geographic region.

Answer: TRUE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 8 Copyright © 2016 Pearson Education Limited

28) Groups that have an indirect influence on a person's attitude or behavior can be a part of his or her reference groups.

Answer: TRUE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 29) Members within a social class tend to behave more alike compared to members from two different social classes.

Answer: TRUE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 30) Secondary groups require continuous interaction to be effective and meaningful.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 31) When Ketan went to college he had a burning desire to join a social fraternity; for Ketan, the fraternity would be a dissociative group.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking; Application of knowledge 32) A person's position in a group is defined in terms of role and status.

Answer: TRUE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 33) Marketers need to be aware of the status-symbol potential of brands because people usually choose products which reflect their role and their actual or desired status in a society.

Answer: TRUE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 34) The behavior people exhibit as they pass through certain life-cycle stages, such as becoming a parent, is largely fixed and does not change over time.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

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35) For an employee at an organization, an annual appraisal can be considered a critical life event that impacts his or her consumption behavior.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking 36) Whereas economic circumstances can have a profound effect on consumption, occupation does not impact how people spend their money and what they buy.

Answer: FALSE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 37) According to the research conducted by Jennifer Aaker, one of the five traits of a product's brand personality is its physical structure.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Analytical thinking 38) Brand personality is the specific mix of human traits that may be attributed to a particular brand.

Answer: TRUE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 39) The five brand personality traits identified by Jennifer Aaker are consistently observed regardless of nationality or culture.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Diverse and multicultural work environments 40) A person's personality portrays the "whole person" interacting with his or her environment.

Answer: FALSE Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

AACSB: Reflective thinking 41) Consumers who experience money constraints are prone to multitasking.

Answer: FALSE Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

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42) Explain the differences between culture, subculture, and social class.

Answer: Culture is the fundamental determinant of a person's wants and behavior. Subcultures provide more specific identification and socialization of their members. Subcultures include nationalities, religions, racial groups, and geographic regions. Social class is a relatively homogeneous and enduring division in a society, that are hierarchically ordered and whose members share similar values, interests, and behaviors.

Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

43) What is a reference group? Describe three different types of reference groups that can have an impact on a consumer's purchasing behavior.

Answer: Reference groups consist of all the groups that have a direct (face-to-face) or indirect influence on attitudes or behavior. Types of reference groups that can impact a consumer's purchasing behavior include membership groups, primary groups, secondary groups, aspirational groups, and dissociative groups. Membership groups are the groups which have a direct influence on the person. Primary groups are the groups with whom the person interacts fairly continuously and informally, such as family, friends, neighbors, and coworkers. Secondary groups tend to be more formal and require less continuous interaction. Aspirational groups are those a person hopes to join; and dissociative groups are those whose values or behavior an individual rejects.

Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

44) The family is the most important consumer buying organization in society, and family members constitute the most influential primary reference group. We can distinguish between two family categorization in the buyer's life. Name the two families and their impact on buying behavior.

Answer: The family of orientation consists of parents and siblings. From parents a person acquires an orientation toward religion, politics, and economics and a sense of personal ambition, self-worth, and love. Even if the buyer no longer interacts very much with his or her parents, their influence on behavior can be significant. A more direct influence on everyday buying behavior is the family of procreation — namely, one's spouse and children.

Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

45) Each person has personality characteristics that influence his or her buying behavior. What does personality mean in terms of buying traits?

Answer: Personality is often described in terms of such buying traits as self-confidence, dominance, autonomy, deference, sociability, defensiveness, and adaptability. Personality can be a useful variable in analyzing consumer brand choices. The idea is that brands also have personalities, and consumers are likely to choose brands whose personalities match their own.

Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

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46) Culture is the fundamental determinant of a person's wants and behavior. The growing child acquires a set of values, perceptions, preferences, and behaviors through his or her family and other key institutions. What values are typical American young children exposed to?

Answer: According to the text, a child growing up in the United States is exposed to values such as achievement and success, activity, efficiency and practicality, progress, material comfort, individualism, freedom, external comfort, humanitarianism, and youthfulness.

Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

47) An opinion leader is the person in informal, product-related communications who offers advice or information about a specific product or product category, such as which of several brands is best or how a particular product may be used. According to the text, how do marketers try to reach opinion leaders?

Answer: Marketers try to reach opinion leaders by identifying demographic and psychographic characteristics associated with opinion leadership, identifying the media read by opinion leaders, and directing messages at opinion leaders.

Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

48) Explain the differences between a role and status.

Answer: A role consists of the activities a person is expected to perform. Each role carries a status. For example, a senior vice-president has more status than a sales manager.

Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

49) Mention the personal factors that can influence the decision of a buyer.

Answer: Personal characteristics that influence a buyer's decision include age and stage in the life cycle, occupation and economic circumstances, personality and self-concept, and lifestyle and values. Because many of these have a direct impact on consumer behavior, it is important for marketers to follow them closely.

Diff: 2 LO: 6.1: How do consumer characteristics influence buying behavior?

50) What is brand personality and what are the five traits that have been linked to it?

Answer: Brand personality is the specific mix of human traits that may be attributed to a particular brand. Traits that have been associated with brand personality are sincerity, excitement, competence, sophistication, and ruggedness.

Diff: 1 LO: 6.1: How do consumer characteristics influence buying behavior?

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51) The starting point for understanding consumer behavior is the ________ model in which marketing and environmental stimuli enter the consumer's consciousness, and a set of psychological processes combine with certain consumer characteristics to result in decision processes and purchase decisions.

A) self-reliance B) self-perception C) psychogenic D) stimulus-response E) projective Answer: D Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 52) In the exact moment you run out of laundry detergent and realize you need to pick some up at the store, you are in the ________ stage of the buying decision process.

A) information search B) evaluation of alternatives C) problem recognition D) purchase decision E) postpurchase behavior Answer: C Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Application of knowledge 53) ________ assumed that the psychological forces shaping people's behavior are largely unconscious, and that a person cannot fully understand his or her own motivations.

A) Abraham Maslow B) Frederick Herzberg C) Sigmund Freud D) John Cacioppo E) Karl Marx Answer: C Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking

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54) Which of the following techniques was suggested by Freud to trace a person's motivations from the stated instrumental ones to the more terminal ones?

A) laddering B) word association C) role playing D) casting E) selective attention Answer: A Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 55) Which of the following theories developed by Frederick Herzberg distinguishes dissatisfiers from satisfiers?

A) trait-role theory B) psychological constraint theory C) probability theory D) leadership model E) two-factor theory Answer: E Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 56) At the top of Maslow's hierarchy of needs (shown as a pyramid in the text) are ________ needs.

A) esteem B) self-actualization C) social D) safety E) physiological Answer: B Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking

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57) ________ is the process by which we select, organize, and interpret information inputs to create a meaningful picture of the world.

A) Consumption B) Perception C) Acculturation D) Assimilation E) Cognitive dissonance Answer: B Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 58) ________ can work to the advantage of marketers with strong brands when consumers make neutral or ambiguous brand information more positive.

A) Selective attention B) Selective distortion C) Selective retention D) Selective choice E) Selective embellishment Answer: B Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking 59) ________ is the tendency to interpret information in a way that will fit our preconceptions.

A) Selective retention B) Cognitive dissonance C) Selective distortion D) Subliminal perception E) Selective embellishment Answer: C Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking

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60) Marketers embed covert messages in ads or packaging of which the consumers are not consciously aware, yet it affects their behavior. This technique employed by the marketers targets the ________ of a consumer.

A) selective attention B) selective distortion C) subliminal perception D) voluntary attention E) selective retention Answer: C Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 61) ________ theory teaches marketers that they can build demand for a product by associating it with strong drives, using motivating cues, and providing positive reinforcement.

A) Demand B) Learning C) Economic D) Psychological E) Demographic Answer: B Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking 62) Anne is a frequent purchaser of Yoplait strawberry yogurt. For once, she decides to try a different flavored yogurt. Instead of trying out the flavors offered by competing brands, Anne selects a different flavor offered by Yoplait. Here, her past experience with the brand prompts her to make the choice. Anne's behavior can be best described as ________.

A) fallacy of proposition B) associative networking C) generalization D) heuristic thinking E) self-actualization Answer: C Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking; Application of knowledge

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63) The ________ says people have a general tendency to attribute success to themselves and failure to external causes.

A) availability heuristic B) trait-role theory C) awareness set D) generalization theory E) hedonic bias Answer: E Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking 64) As Rita scans the yellow pages section of her phonebook looking for a florist, she sees several other products and services advertised. Though interesting on first glance, she quickly returns to her primary task of finding a florist. The items that distracted her from her initial search were most likely stored in which of the following types of memory?

A) short-term memory B) long-term memory C) middle memory D) subconscious memory E) subliminal memory Answer: A Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking; Application of knowledge 65) Betsy, a teenager, uses most of her after-school hours in either playing tennis or watching movies. She barely manages to concentrate on her lessons for a couple of hours before exams.

Being questioned about her substandard performance in school, she points out the teacher's inability to complete the entire course during the school hours as the possible reason. Betsy's behavior is most likely to be associated with ________.

A) generalization B) hedonic bias C) discrimination D) selective attention E) psychological repositioning Answer: B Diff: 3 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking

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66) The associative network memory model views long-term memory as ________.

A) a subliminal perception B) the interplay of drives C) a strong internal stimulus impelling action D) a temporary and limited repository of information E) a set of nodes and links Answer: E Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 67) ________ refers to the process in which information gets out of memory.

A) Memory encoding B) Memory decoding C) Memory classification D) Memory retrieval E) Memorization Answer: A Diff: 3 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking 68) Amtex electronics, a consumer products brand, frequently advertises its products inside supermarkets and retail stores to promote the process of memory ________ and stimulate purchase.

A) verification B) retrieval C) decoding D) formation E) augmentation Answer: B Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Analytical thinking

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69) Cognitive psychologists believe that memory is ________, so that once information becomes stored in memory, its strength of association decays very slowly.

A) highly perceptual B) somewhat collective C) highly communicative D) often reflective E) extremely durable Answer: E Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 70) Psychogenic needs arise from the physiological states of tension such as hunger or discomfort.

Answer: FALSE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 71) Sigmund Freud assumed that the psychological forces shaping people's behavior are largely unconscious, and that people cannot fully understand their motivations.

Answer: TRUE Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 72) When Chrysler decided to offer the PT Cruiser, they did so based on the recommendations of Ernest Dichter, who helped them unlock the code, or the unconscious meaning people give to a particular market offering.

Answer: FALSE Diff: 3 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Application of knowledge 73) In Maslow's Hierarchy of Needs, a sense of belonging and love are examples of social needs.

Answer: TRUE Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking

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74) Sensory memory is the virtually unlimited repository where information that we encounter as we go through life ends up.

Answer: FALSE Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 75) When State Farm uses consumer research to create a mental map of consumers that indicates that consumers perceive State Farm as conservative, safe, responsive, and convenient, they are interested in subliminal perceptions.

Answer: FALSE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Application of knowledge 76) According to Maslow's hierarchy of needs model, recognition, self-esteem, and status constitute a person's social needs.

Answer: FALSE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 77) According to Herzberg's two-factor theory, satisfiers will make the major difference as to which brand the customer buys.

Answer: TRUE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 78) Perception depends only on the physical stimuli experienced by the person.

Answer: FALSE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 79) People are more likely to notice stimuli whose deviations are large in relation to the normal size of the stimuli.

Answer: TRUE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 20 Copyright © 2016 Pearson Education Limited

80) Selective attention is the tendency to interpret information in a way that will fit our preconceptions.

Answer: FALSE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 81) Selective retention works to the advantage of strong brands.

Answer: TRUE Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 82) Because of selective retention, we are likely to forget about the good points of competing products.

Answer: TRUE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 83) Consistent with the elaboration memory model, consumer brand knowledge in memory can be conceptualized as consisting of a brand node in memory with a variety of linked associations.

Answer: FALSE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 84) Brand associations consist of all brand-related thoughts, feelings, perceptions, images, experiences, beliefs, attitudes, and so on that become linked to the brand node.

Answer: TRUE Diff: 1 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking

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85) Memory is a very constructive process. This means people do not remember information and events completely and accurately and often remember only bits and pieces that they fill in based on whatever else they know.

Answer: TRUE Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

AACSB: Reflective thinking 86) Frederick Herzberg developed a two-factor theory that distinguishes dissatisfiers and satisfiers. How does Herzberg's theory affect sellers' marketing strategy?

Answer: Herzberg's theory has two implications. First, sellers should do their best to avoid dissatisfiers (for example, a poor training manual or a poor service policy). Although these things will not sell a product, they might easily unsell it. Second, the seller should identify the major satisfiers or motivators of purchase in the market and then supply them. These satisfiers will make the major difference as to which brand the customer buys.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

87) People can emerge with different perceptions of the same object because of three perceptual processes. List and briefly describe these processes.

Answer: The three processes are selective attention, selective distortion, and selective retention.

Selective attention occurs because a person cannot possibly attend to all the stimuli that he or she is exposed to during an average day. Some will be screened out. Selective distortion is the tendency to interpret information in a way that will fit our perceptions. Selective retention occurs because people will fail to register much information to which they are exposed in memory, but will tend to retain information that supports their attitudes and beliefs.

Diff: 3 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

88) Explain the concept of selective retention and its association with marketing.

Answer: Selective retention says that consumers are likely to remember good points about a product we like and forget good points about competing products. Selective retention works to the advantage of strong brands. It also means that marketers need to use repetition in sending messages to their target markets to make sure their message is not overlooked.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

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89) Briefly explain Freud's theory on human motivation and explain how this might be related to marketing.

Answer: Sigmund Freud assumed that the psychological forces shaping people's behavior are largely unconscious, and that a person cannot fully understand his or her own stated capabilities.

When a person examines specific brands, he or she will react not only to their stated capabilities, but also to other, less conscious cues.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

90) Within the context of the Freudian theory, explain how the laddering technique can be used.

Answer: Shape, size, weight, material, color, and brand name can all trigger certain associations and emotions. A technique called laddering can be used to trace a person's motivations from the stated instrumental ones to the more terminal ones. Then the marketer can decide at what level to develop the message and appeal.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

91) Abraham Maslow sought to explain why people are driven by particular needs at particular times. Describe Maslow's hierarchy of needs. How does Maslow's theory help marketers?

Answer: Maslow's hierarchy of needs in order of importance are physiological needs, safety needs, social needs, esteem needs, and self-actualization needs. Maslow's theory helps marketers understand how various products fit into the plans, goals, and lives of consumers.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

92) List and briefly define Maslow's Hierarchy of Needs.

Answer: Beginning with the most basic needs to the most advanced, the need structure is as follows: 1. physiological needs — food, water, shelter 2. safety needs — security, protection 3. social needs — sense of belonging, love 4. esteem needs — self-esteem, recognition, status 5. self-actualization needs — self-development and realization Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

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93) Perception is the process by which an individual selects, organizes, and interprets information inputs to create a meaningful picture of the world. For a marketer, what is the key point of perception?

Answer: The key point is that perceptions can vary widely among individuals exposed to the same reality. In marketing, perceptions are more important than the reality, as it is perceptions that will affect consumers' actual behavior.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

94) What does the learning theory teach marketers about demand for products?

Answer: The learning theory teaches marketers that they can build demand for a product by associating it with strong drives, using motivating cues, and providing positive reinforcement.

Diff: 2 LO: 6.2: What major psychological processes influence consumer responses to the marketing program?

95) The milder information search state where a person simply becomes more receptive to information about a product is called ________.

A) active information search B) information search C) heightened attention D) purchase decision E) dynamic information search Answer: C Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 96) The buying process starts when the buyer recognizes a(n) ________.

A) product B) advertisement for the product C) salesperson from a previous visit D) problem or need E) internal cue Answer: D Diff: 1 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking

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97) Which of the following is considered to be a more advanced form of information search wherein the person might phone friends or go online to search for information about a product or service?

A) heightened attention B) short-term memory processing C) subliminal processing of information D) long-term memory processing E) active information search Answer: E Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 98) Of key interest to marketers are the major informational sources to which the consumer will turn and the relative importance of each. Which of the following can be considered an experiential information source?

A) consumer-rating organizations B) mass media C) acquaintances D) Web sites E) personal handling and examination Answer: E Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Application of knowledge 99) Brands that meet consumers' initial buying criteria are called the ________ set.

A) total B) awareness C) consideration D) choice E) decision Answer: C Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking

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100) Maria considers buying a car for herself, after she notices the advantages experienced by her best friend from his new car. Which of the following forms of stimulus has activated Maria's problem recognition process?

A) external stimuli B) internal stimuli C) peer stimuli D) secondary stimuli E) marketing induced stimuli Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking; Application of knowledge 101) A consumer who uses Google to find comparative reports on new automobiles, is most likely using which of the following information sources for assistance?

A) personal B) public C) experiential D) commercial E) under-the-radar Answer: D Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Application of knowledge 102) With respect to consumer decision making, the ________ set is the set of strong contenders from which one will be chosen as a supplier of a good or service.

A) total B) awareness C) consideration D) choice E) decision Answer: D Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 103) A(n) ________ is a descriptive thought that a person holds about something.

A) attitude B) belief C) desire D) feeling E) emotion Answer: B Diff: 1 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 26 Copyright © 2016 Pearson Education Limited

104) A(n) ________ puts people into a frame of mind, such as liking or disliking an object, moving toward or away from it.

A) attitude B) belief C) feeling D) position E) stance Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 105) Marketers need to identify the hierarchy of attributes that guide consumer decision making in order to understand different competitive forces and how these various sets get formed. This process of identifying the hierarchy is called ________.

A) market partitioning B) brand association C) market valuation D) market estimation E) market identification Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking 106) ________ are a person's enduring favorable or unfavorable evaluations, emotional feelings, and action tendencies toward some object or idea.

A) Discriminations B) Values C) Beliefs D) Feelings E) Attitudes Answer: E Diff: 1 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking

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107) The expectancy-value model of attitude formation posits that consumers evaluate products and services by combining their ________.

A) needs B) wants C) desires D) brand beliefs E) consuming attitudes Answer: D Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 108) Gordon Jones is considering purchasing a computer from Best Buy. He has created a scale for rating eight different computers on three different characteristics. He plans to make a short list of only those computers that score at least a 7 on his scale on all three characteristics. Which of the following choice heuristics has he chosen?

A) elimination-by-aspects heuristic B) lexicographic heuristic C) conjunctive heuristic D) anchoring and adjustment heuristic E) representativeness heuristic Answer: C Diff: 3 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking; Application of knowledge 109) With the ________ heuristic, the consumer sets a minimum acceptable cutoff level for each attribute and chooses the first alternative that meets the minimum standard for all attributes.

A) conjunctive B) lexicographic C) elimination-by-aspects D) primary E) secondary Answer: A Diff: 3 LO: 6.3: How do consumers make purchasing decisions?

110) ________ are rules of thumb or mental shortcuts in the decision process.

A) Attitudes B) Beliefs C) Heuristics D) Discriminations E) Biases Answer: C Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

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111) If a consumer is shopping for a smart phone, all of the smart phone options available in the market — whether a consumer knows about them or not — is called the ________ set.

A) awareness B) total C) consideration D) choice E) inept Answer: B Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Application of knowledge 112) If Ty chooses a smart phone simply because he perceives it to be rated highest on megapixels, which he believes is the most important attribute in a smart phone, he is using a(n) ________ to help make his purchase decision.

A) compensatory model B) conjunctive heuristic C) elimination-by-aspects heuristic D) affect referral rule E) lexicographic heuristic Answer: E Diff: 3 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Application of knowledge 113) Jeremy is concerned about his selection of a new hair spray because he is concerned it will not perform as well as his usual brand, which may result in embarrassing, flat hair in front of others. The type of risk Jeremy perceives is ________ risk.

A) physical B) time C) financial D) social E) psychological Answer: D Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Application of knowledge

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114) Even if consumers form brand evaluations, two general factors can intervene between the purchase intention and the purchase decision: one is unanticipated situational factors; what is the other factor?

A) amount of purchasing power B) attitudes of others C) short-term memory capabilities D) ability to return merchandise E) the self-concept Answer: B Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking 115) A mobile phone manufacturing company observes that the main reason for an abrupt fall in sales volume is the unconventional design of their phones that consumers found inconvenient and unattractive. The findings prompt the company to adopt a new strategy. They redesigned the product models keeping the requirements of the end-user in mind. According to the expectancy value-model, the company's strategy can be termed as ________.

A) psychological repositioning B) real repositioning C) competitive depositioning D) physiological depositioning E) prescriptive method Answer: B Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking; Application of knowledge 116) Ford believes its cars to be of higher quality than General Motor's but thinks that consumers wrongly believe the opposite. Ford might employ a(n) ________ strategy to change buyers' perceptions of its competition.

A) real repositioning B) competitive depositioning C) psychological repositioning D) biased repositioning E) attribute repositioning Answer: B Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking; Application of knowledge

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117) When a marketer tries to alter a consumer's beliefs about a company's brand to get the consumer to rethink a purchase decision, the marketer is using ________.

A) psychological repositioning B) competitive depositioning C) positioning D) repositioning E) biased positioning Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking 118) With the ________ heuristic, the consumer chooses the best brand on the basis of its perceived most important attribute.

A) lexicographic B) conjunctive C) elimination-by-aspects D) availability E) representativeness Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 119) ________ risk occurs if the product fails to perform up to expectations.

A) Physical B) Financial C) Social D) Psychological E) Functional Answer: E Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking

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120) Steve has only 20 minutes to have lunch. Although he really likes McDonald's, the line is very long and he is concerned that he will not have a chance to get through the line and eat his lunch before he is due back at work. Steve perceives ________ risk in going to McDonald's today.

A) time B) functional C) physical D) psychological E) social Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking; Application of knowledge 121) A key driver of sales frequency is the product ________ rate.

A) consumption B) disposal C) refusal D) utility E) option Answer: A Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 122) The level of engagement and active processing undertaken by the consumer in responding to a marketing stimulus is called ________.

A) elaboration likelihood B) consumer disengagement C) consumer involvement D) variety seeking E) low involvement Answer: C Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking

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123) A consumer is persuaded to buy a product by a message that requires little thought and is based on an association with a brand's positive consumption experiences from the past. In this situation, the consumer used a ________ route to arrive at this purchase decision.

A) central B) peripheral C) behavioral D) subjective E) objective Answer: B Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 124) Richard Petty and John Cacioppo's ________ model, an influential model of attitude formation and change, describes how consumers make evaluations in both low- and highinvolvement circumstances.

A) introspective B) elaboration likelihood C) stimulus-response D) associative network memory E) expectancy-value Answer: B Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 125) Every consumer must pass through all five stages of the buying process when in a buying situation.

Answer: FALSE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 126) The buying process starts when the buyer decides to, or enters, a store or service provider's facility.

Answer: FALSE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 127) A belief is a person's enduring favorable or unfavorable evaluation, emotional feeling, and action tendency toward some object or idea.

Answer: FALSE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

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128) The expectancy-value model of attitude formation posits that consumers evaluate products and services by combining their brand beliefs according to importance.

Answer: TRUE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 129) If a company finds that a consumer has chosen a competitive product over their company's offering, one way to get the consumer back could be by developing a strategy wherein the company "shifts the buyer's ideals" on one or more levels.

Answer: TRUE Diff: 3 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking 130) With noncompensatory models of consumer choice, positive and negative attribute considerations usually net out.

Answer: FALSE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 131) Volvo has the reputation of being one of the safest cars on the road. For those that value safety, Volvo would be the logical choice. This is an example of the lexicographic heuristic of consumer choice.

Answer: TRUE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking; Application of knowledge 132) When consumers evaluate the risks associated with a purchase, only real risks with a high likelihood of occurrence should be considered.

Answer: FALSE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 133) Some brands have tapped into the hip-hop culture to market a brand in a modern multicultural way, as Apple did with its iPod. Answer: TRUE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Diverse and multicultural work environments

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134) With respect to a consumer buying situation that involves variety-seeking behavior, the market leader generally encourages variety seeking by offering lower prices or deals.

Answer: FALSE Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Reflective thinking 135) Identify three types of risk consumers might perceive in the context of purchasing a car.

Answer: Consumers might perceive physical risk (an unsafe car poses a safety risk to the physical well-being of the driver and passengers), a financial risk (the car might be overpriced or may decline in value so rapidly that it will have minimal resale value when the consumer tries to resell it), and a functional risk (the car may not perform to the expectations of the consumer).

Students may identify other risks, including social, psychological, and time risks.

Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Analytical thinking

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136) Define sensory marketing and identify at least one consideration for each of the five senses.

Answer: Student answers will vary. Sensory marketing is marketing that engages the consumer's senses to affect their perceptions, judgments, and behaviors.

Touch is the first sense to develop and the last sense we lose with age. People vary in their need for touch, and Peck and Childers have developed a scale to capture those differences. In one application, high need-for-touch (NFT) individuals were more confident and less frustrated about their product evaluations when they could actually touch a product than when they could only see it. For low NFT individuals, touching did not matter one way or another. Written product descriptions helped alleviate the NFT's level of frustration, though only for more concrete product attributes (such as the weight of a cell phone).

Smell — Scent-encoded information has been shown to be more durable and last longer in memory than information encoded with other sensory cues. People can recognize scents after very long lapses of time, and using scents as reminders can cue all kinds of autobiographical memories. Pleasant scents have also been shown to enhance evaluations of products and stores.

Consumers also take more time shopping and engage in more variety seeking in the presence of pleasant scents.

Sound (audition) — Marketing communications by their very nature are often auditory in nature.

Even the sounds that make up a word can carry meanings. One study showed that Frosh-brand ice cream sounded creamier than Frish-brand ice cream. Language too can have its own associations. In bilingual cultures where English is the second language — such as Japan, Korea, Germany, and India — use of English in ads signals modernity, progress, sophistication, and a cosmopolitan identity. Ambient music in a store has also been shown to influence consumer mood, time spent in a location, perception of time spent in a location, and spending.

Taste — Humans can distinguish only five pure tastes: sweet, salty, sour, bitter, and umami.

Umami comes from Japanese food researchers and stands for "delicious" or "savory" as it relates to the taste of pure protein or monosodium glutonate (MSG). Taste perceptions themselves depend on all the other senses — the way a food looks, feels, smells, and sounds to eat. Thus many factors have been shown to affect taste perceptions, including physical attributes, brand name, product information (ingredients, nutritional information), product packaging, and advertising. Foreign-sounding brand names can improve ratings of yogurt, and ingredients that sound unpleasant (balsamic vinegar or soy) can affect consumers taste perceptions if disclosed before product consumption.

Vision — Visual effects have been studied in detail in an advertising context. Many visual perception biases or illusions exist in day-to-day consumer behavior. For example, people judge tall thin containers to contain more volume than short fat ones, but after drinking from the containers, people actually feel they have consumed more from short fat containers than tall thin containers, over-adjusting their expectations. Even something as simple as the way a mug is depicted in an ad can affect product evaluations. A mug photographed with the handle on the right side was shown to elicit more mental stimulation and product purchase intent from righthanded people than if shown with the handle on the left side.

Diff: 3 LO: 6.3: How do consumers make purchasing decisions?

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137) Describe how the problem recognition process works in the five-stage model of the consumer buying process.

Answer: The buying process starts when the buyer recognizes a problem or need. With an internal stimulus, one of the person's normal needs — hunger, thirst, sex — rises to a threshold level and becomes a drive; or a need can be aroused by an external stimuli such as an advertisement.

Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

138) Through market research a consumer gathers information about the competing brands of a product and their features. The consumer then advances through four sets with respect to brands before a decision is reached. What are those four sets?

Answer: The four sets are: 1. total set 2. awareness set 3. consideration set 4. choice set Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

139) Explain the differences between a belief and an attitude.

Answer: A belief is a descriptive thought that a person holds about something. An attitude is a person's enduring favorable or unfavorable evaluation, emotional feeling, and action tendencies toward some object or idea.

Diff: 1 LO: 6.3: How do consumers make purchasing decisions?

140) What do you understand by the term market partitioning?

Answer: Marketers need to identify the hierarchy of attributes that guide consumer decision making in order to understand different competitive forces and how these various sets get formed. This process of identifying the hierarchy is called market partitioning.

Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

141) How is the expectancy-value model used in the evaluation of alternatives as a consumer engages in a buying process?

Answer: The expectancy-value model of attitude formation posits that consumers evaluate products and services by combining their brand beliefs — the positives and negatives — according to importance. The model assists consumers in making choices.

Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

142) Describe the lexicographic heuristic used to make consumer choices.

Answer: The lexicographic heuristic is in use when the consumer chooses the best brand on the basis of its perceived most important attribute.

Diff: 1 LO: 6.3: How do consumers make purchasing decisions?

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143) What four strategies can marketers of low-involvement products employ in an effort to convert their products into ones of higher involvement?

Answer: The four strategies are: 1. linking the product to some involving issue 2. linking the product to some involving personal situation 3. designing advertising to trigger strong emotions related to personal values or ego defense 4. adding important features to the product.

Diff: 3 LO: 6.3: How do consumers make purchasing decisions?

144) Elmer is focused on how much he likes the jingle for the advertised product and evaluates the product using his association of this brand with his positive feelings toward the song playing in the background. Explain how Elmer is processing the advertisement, using the elaboration likelihood model as a base.

Answer: Elmer is using what is described as peripheral route processing from the elaboration likelihood model. If he was focused on the message, or central brand claims, he would be using the central route.

Diff: 2 LO: 6.3: How do consumers make purchasing decisions?

AACSB: Application of knowledge 145) Which of the following products is most likely to be characterized by low involvement but significant brand difference?

A) toothpastes B) digital cameras C) packet of salt D) a milk carton E) furniture Answer: A Diff: 2 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Analytical thinking 146) With the ________ heuristic, predictions of usage are based on quickness and ease of use.

A) availability B) representative C) anchoring D) adjustment E) semantic Answer: A Diff: 2 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Reflective thinking

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147) A consumer tells another consumer, "Every time I eat at Big Bill's Steakhouse, I get poor service." Whether this is true or not, it is the consumer's perception. This is an example of consumers basing future predictions on the quickness and ease with which a particular example of an outcome comes to mind. This scenario would be an illustration of the ________ heuristic.

A) discrimination B) differentiation C) availability D) screening E) representativeness Answer: C Diff: 3 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Analytical thinking 148) Ben always reaches for the bright blue and yellow box of Ritz crackers when he visits the snack food aisle in the grocery store. He rarely even reads the box or checks the price. Which of the following heuristics is most likely being used by Ben? A) availability B) representative C) anchoring D) adjustment E) semantic Answer: B Diff: 3 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Analytical thinking 149) ________ accounting refers to the manner in which consumers code, categorize, and evaluate financial outcomes of choices.

A) Cost B) Financial C) Behavioral D) Mental E) Factual Answer: D Diff: 1 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Reflective thinking 150) Anchoring heuristic comes into play when consumers base their predictions on the quickness and ease with which a particular example of an outcome comes to mind.

Answer: FALSE Diff: 2 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Analytical thinking

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151) Prospect theory maintains that consumers frame decision alternatives in terms of gains and losses according to a value function.

Answer: TRUE Diff: 2 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

AACSB: Reflective thinking 152) What is mental accounting? What, according to Thaler, are the core principles on which mental accounting is based? Explain with examples.

Answer: Mental accounting refers to the way consumers code, categorize, and evaluate financial outcomes of choices. Formally, it is "the tendency to categorize funds or items of value even though there is no logical basis for the categorization, e.g., individuals often segregate their savings into separate accounts to meet different goals even though funds from any of the accounts can be applied to any of the goals."

According to Chicago's Thaler, mental accounting is based on a set of core principles: 1. Consumers tend to segregate gains. When a seller has a product with more than one positive dimension, it's desirable to have the consumer evaluate each dimension separately. Listing multiple benefits of a large industrial product, for example, can make the sum of the parts seem greater than the whole.

2. Consumers tend to integrate losses. Marketers have a distinct advantage in selling something if its cost can be added to another large purchase. House buyers are more inclined to view additional expenditures favorably given the high price of buying a house.

3. Consumers tend to integrate smaller losses with larger gains. The "cancellation" principle might explain why withholding taxes from monthly paychecks is less aversive than large, lumpsum tax payments — the smaller withholdings are more likely to be absorbed by the larger pay amount.

4. Consumers tend to segregate small gains from large losses. The "silver lining" principle might explain the popularity of rebates on big-ticket purchases such as cars.

Diff: 2 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

153) Heuristics can come into play when consumers forecast the likelihood of future outcomes or events. When would a consumer use an anchoring and adjustment heuristic?

Answer: Consumers will use this heuristic when the consumer arrives at an initial judgment and then makes adjustments of that first impression based on additional information.

Diff: 2 LO: 6.4: In what ways do consumers stray from a deliberative, rational decision process?

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