A tire manufacturer supplies product to car manufacturers. Car production declin

Question

A tire manufacturer supplies product to car manufacturers. Car production declines based on the          economy. New car sales plummet. The tire manufacturer’s sales plummet. This is an example of:

                A.            Derived demand.

                B.            Inventory adjustments.

                C.            Volatile demand.

                D.            Joint demand.

Country Flavors markets a range of spices and herbs. They recently increased prices by 8% to offset increases in processing costs. They found that, surprisingly, sales increased by the same %. This is an example of:

                A.            Elastic Demand.

                B.            Averaged Demand.

                C.            Price Based Demand.

                D.            Unitary Demand.

Susan Branford, Regional Sales Manager for Excel Medical Equipment likes to use a series of pros and cons to discuss the merits of their medical equipment with hospital staffs. This, in sales vernacular, is known as:

                A.            Contingency Theory.

                B.            “T” Test.

                C.            Assumption Approach.

                D.            Choice Selection

Over time branding experiences various changes in consumer attitudes. Which of the following has seen a decline in popularity in recent years:

                A.            Generic brands.

                B.            Distributor brands.

                C.            Manufacturer brands.

                D.            Private label.

Explanation / Answer

1. The answer is Derived Demand. Because the tire manufacturer sales is dependent on the sales of car. If the sales of car declines, there would be no need of tires by the company and so the tire manufacturer sales would also decline.

2. The answer is Unitary Demand. Because the percent change in price .i.e. 8% is equal and opposite of the change in demand i.e.8%.

3. The answer is Contingency theory, because the regional sales manager uses a series of pros of cons and discuss the merits of their medical equipment with hospital staff in relation to the sales of their equipment. In this situation, the regional sales manager acts according to the situation and instead using other means of sales, he likes to discuss the merits of their medical equipment with the hospital staffs.

4. The answer is Generic brands, because over time branding has not bought any good change in generic brands. Moreover, the generic brands are not being marketed or branded and thus we see a decline in its popularity.

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