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Ag Marketing Test 2
Ch 4-7
| Question | Answer |
|---|---|
| 3 basic factors that influence customer food preferences and demands | demographic factors economic factors socio-cultural factors |
| The Ag Marketing System and the Food Marketing system are driven by.. | consumers' tastes and preferences |
| In the past decades, there was a shift in consumers' budget dollars from food, clothing, housing, and transport. toward... | health care, education, and personal care |
| 3 factors that contribute to consumers' total food spending and per capita food expenditure that rose significantly... | increased populations and quantities of food eaten rising food prices consumer preferences for more expensive foods and marketing services |
| factors that contribute to the rise of food price | more expensive food in diets eating away from home more often |
| t/f: food spending rose more rapidly than consumer's income | false- it rose less rapidly |
| t/f: the change in consumption for individual food indicates that no food has a guaranteed market | true |
| t/f: in the past 3 decades, consumption of chicken, turkey, low-fat milk, veggies, cheese, processed potatoes, and sugar increased while consumption of beef, eggs, whole milk, corn sweeteners, and fresh potatoes decreased | false |
| reasons for changes in consumption | need for convenience response to change in price change in attitude towards health |
| the study of populations-size, income, work patterns, race, and household size | demographics |
| these caused the increased demand for convenience foods | technology increased income increase in small households more people living in metropolitan areas increase in single and dual parent households |
| today, US population is about | 300 million |
| today, about ____% of the population lives in metropolitan areas | 80% |
| every year, about _____% of Americans move | 20% |
| about _____% of Americans move to another state each year | 3% |
| ____% of the population has completed 4 or more years of college today | 22% |
| What percent of the population is living in poverty today? | 14% |
| Do demographic factors affect food consumption and marketing? | no |
| this is growing rapidly in the US at a declining rate | the US population |
| the basic unit of food consumption | household |
| trends indicate that no food has a | guaranteed market |
| typically pool their income, buy as a unit, and share some food similarities | household members |
| number of households is growing _____ compared to population growth | at a lower overall rate |
| households in which both parents are in labor force | dual-parent household |
| in past several decades, these families are increasing drastically | female-headed families |
| The main impact of various demographic changes is found in increased demand for | convenience foods |
| Major sources of growth in food consumption | population and income growth |
| Says in general, as income increases, the ratio of food spending to income falls | Engel's Law |
| consumption of a given food decreases with an increase in income for a | inferior good |
| conumption of a given food increases with an increase in income | normal good |
| four marketing strategies adopted by food processors | product pricing place promotional |
| name, symbol, or design that identifies that seller and differentiates the product from those competitors | brand |
| discovery and application of new idea innovation | innovation |
| product that buyers are indifferent to seller from whom they purchase if the price charged by all sellers is the same | homogeneous product |
| four life cycles of a product life cycles(in order): | 1. initiation 2. growth 3. maturity 4. decline |
| utility most closely associated with food processors | form |
| according to the marketing concept, who decides the success of a new food product like fat substitute, low calorie product, or restructured foods | the consumer |
| branding helps to | certify quality, differentiate, and transfer good will of the firm |
| 3 possible new types of innovation for food processors | new products/services new marketing methods new business organizations |
| US food processors introduce about ______ new food products to the marketplace every year | 15,000 |
| the failure rate for US food processors when introducing new food products is | 90% |
| t/f: all food products have product life cycles | false |
| early stage of food products life cycle | innovation |
| t/f: consumers always buy the lowest cost food products | false |
| these have become more innovative than larger companies | smaller companies |
| strategy with high price and high quality | gourmet |
| strategy with low price and quality appeal | value pricing |
| forces that reduce the average cost of producing a product as a firm expands size of its plant in the long run | economies of size |
| two input factors of the production process | fixed and variable |
| the basic rule for the food processor to locate a plant is to minimize the | combined costs of raw product and finished product transportation |
| factors that have to be maintained in the short-run even if production is zero | fixed |
| factors that vary as output level change | variable |
| states that the territorial boundary between two or more markets or plants is a locus of points, such that the final selling price, including transport. costs, are equal for sellers in each market | Law of Marketing Areas |
| major advertiser in America | the food sector |
| food processors attempt to build brand loyalty via | product differentiation |
| as a firm becomes bigger, it can achieve efficiency through | saving labor costs and management costs |
| when no in-puts are fixed | the long run |
| these are not rare in the food industry | mergers |
| t/f: market concentration is high and increasing in all sectors of the food industry | false |
| t/f: food processors always locate close to the farms and in the country | false |
| this affects location of plants, especially in perishable goods | technology |
| t/f: the larger the firm, the more efficient it is | false |
| basic ways for a firm to remain competitive in the market are | increase output produced and size of the farm |
| US agricultural production and processing firms are moving | Westward |
| these two factors influence the location of the food processors | technology growth of US ag production and consumption capabilites |
| business which sells majority of its food products to a middle man | food wholesaling |
| buy, sell, and store grocery products and perform numerous other marketing functions | merchant wholesalers |
| Merchant wholesalers can be classified as | full service and limited function |
| can be used to measure the market competition in food wholesaling | market concentration |
| t/f: food wholesalers and retailers are simply pass-through agents in the food marketing system | false |
| in the past, food wholesaling was dominated by | independent wholesalers distributing to small, independent retailers |
| this is determined by how efficiently they provide products/services to their suppliers and retail customers | food wholesalers market success |
| Who currently dominates the food wholesaling industry? | large chain retailers receiving products from distributors under common ownership |
| t/f: in recent years, the number of food wholesalers has decreased while the average size has increased | true |
| perform a wide variety of sales-related market activities for client | wholesale agents and brokers |
| tasks of food wholesalers is to provide the consumers with the right foods | at the right time, place, and at a profit |
| changes seen in the past decades to the structure of food wholesaling are a result of | consumer demands and firms needing to gain efficiency through economies of size |
| what utilities do food wholesalers add to food products? | place and possession |
| about what percent of food wholesalers are classified as merchant wholesalers? | 75% |
| two food retailing sectors | food stores and foodservice firms |
| the two revolutions(movements) in the food retailing industry | chainstore movement and supermarket movement |
| when on food retailer buys another retailer | horizontal expansion |
| when a food retailer buys a food wholesaler, or even a processor | vertical expansion |
| extensions of the food processing firms marketing activities to the whole sale level | manufacturers sales branches and sales offices |
| dominant form of food retailing today | supermarkets |
| describe the food retail sector | increased number of items sold per store |
| which food industry hires more workers than any other industry in the food marketing system? | retailing-80% of workers in food marketing system |
| t/f: all large supermarkets are chain stores | false |
| chainstores had the fastest growth in | 1920s |
| consumer food expenditures account for what percent of total retail sales | 25% |
| on average, consumer food expenditures account for what percentage of consumer's disposal income? | 10% |
| today, supermarket accounts for what percentage of overall retail sales? | 70% |
| group of 11 or more related grocery stores | chainstore operation |
| grocery store with more than 2.5 million in annual sales | supermarket |
| this says in order to maintain the market balance between supply and demand, selling prices related to purchase price & farm and retial prices should move together | price efficiency |
| relies on customers preference for one-stop shopping and uses temporary price cuts to differentiate their store and attract customers | value price merchandising |
| best way to describe the conventional supermarket | full-line, self-service |
| why have retailers gained control in the marketing system? | next to consumer growth in size consumers acceptance of private label brands |
| growth of supermarkets is driven by | growth of income, mobility, mass media, and new product development, urbanization |
| which movement was cost driven | chain store |
| maintains low prices on every item year round | everyday low pricing strategy |
| major food services chains flourish due to | economies of size in buying and advertising |
| foodstores industry is changing rapidly to better serve two distinct types of consumers: | economizers and convenience-oriented |
| t/f: both chain stores and supermarket movements were motivated by improving operational efficiency | false |
| t/f: most supermarkets provide a variety of products to consumers and do not care about operational efficiency | false |
| t/f: manufacturers have become the channel captains of the food industry | false |
| many premium brands are losing market share to | private labels |
| Largest ag product exporter in the world and a major importer | Us |
| Market policies and devices that prevent free trade among nations | Trade protectionism |
| These have a smaller share of nature resource costs and a larger share of marketing costs in their final value than traditional crops | High value export product |
| Under free trade, countries produce what their resources allow them to produce efficiently and trade with other countries for what they produce most efficiently | Principles of comparative advantage |
| Can have an impact for a country in the advantage of producing certain goods | Climate |
| Does the us have comparitive advantage for all products? | No |
| Overall, does the us have a trade surplus with other countries | No |
| Does not have to only happen for good to get to a country which cannot produce | Trade |
| These two things can increase total world food output and in turn, the lstandard of living | Trade and specialization |
| What percent of today's world population is trading across the border? | 15 |
| Tariffs Quotas Licenses are all related to | Restrictions |
| Why should a country trade with others? | Specialization Unevenly distributed resources |
| For ag trade balance, overall the us has a _____ in the past 30 yrs | Surplus of food |
| Value of exports (-) value of imports | Balance of trade |
Created by:
bayli729