IMANET IMANET Certifications IMANET-CMA Questions & Answers

• Question 1051:

  Assuming other factors are held constant, the dollar value of the firm's overall market share will increase when

  A. Customer penetration decreases

  B. The average purchases from the average firm increases

  C. Total purchases from seller of the same products increases

  D. Price selectively increases

  Correct Answer: D

  An increases in price selectively (firm's average price / average price of all firms) results in an increase in the dollar value of the overall market share. Thus, the firm's average price may have risen , or the average price of its competitors may have fallen.

• Question 1052:

  In a market-share analysis, the relative market share equals

  A. Sales divided by total market sales

  B. Sales divided by sales of largest competitor

  C. Sales divided by the served market

  D. Firm customers divided by all customers

  Correct Answer: B

  The relative market share measures a firm's competitive position. If it exceeds 1.0, the firm is the market larder. A rising measurement signifies that the firm is gaining.

• Question 1053:

  The served market share

  A. Decrease when profits decrease

  B. Measure customer loyalty

  C. Always exceeds overall market share

  D. Must be less than overall market share

  Correct Answer: C

  Served market share (sales/ the served market, i.e., all buyers willing and able to product) must exceed the overall market share. The served market is smaller than the total market.

• Question 1054:

  Folsom Fashions sells a line of women's dresses. Folsom's performance report for November is shown below. The company uses a flexible budget to analyze its performance and to measure the effect on operating income of the various factors affecting the difference between budgeted and actual operating income.

  

  What additional information is needed for Folsom to calculate the dollar impact of a change in market share on operating income for November?

  A. Folsom's budgeted market share and the budgeted total market size

  B. Folsom's budgeted market share, the budgeted total market size, and average market selling price

  C. Folsom's budgeted market share and the actual total market size

  D. Folsom's actual market share and the actual total market size

  Correct Answer: C

  A change in market share reflects a change in relative competitiveness. To isolate the effect on operating income of an increase or a decrease in market share, the company must know its budgeted and actual market shares, the actual size of the market for November, and the budgeted weighted-average unit contribution margin. Such computations may help Folsom to determine whether its decline in sales resulted from a loss of competitiveness or shrinkage of the market.

• Question 1055:

  The gross profit Reade Company for each of the years ended December 361, Year 2 and Year 1, was as follows:

  

  Assuming that Year 2 selling prices were 10% lower, what was the decrease in gross profit caused by the charge in selling prices?

  A. $8,000

  B. $72,000

  C. $79,200

  D. $ 88,000

  Correct Answer: D

  With a 10% decrease in prices in Year 2, that year's sales were 90% of the amount at Year 1 prices. Dividing Year 2 sales of $ 792,000 by 90% gives $880,000 of sales at Year 1 prices. Thus, sales and gross profit were $88,000 ($880,000-$792,000) lower because of the 10% decrease in selling price.

• Question 1056:

  Which necessary approach to marketing control is the responsibility of senior and middle management and is directed toward achievement of planned objectives?

  A. Annual-plan control

  B. Profitability control

  C. Efficiency control

  D. Strategic control

  Correct Answer: A

  Annual-plan control should be overseen by senior and middle management. It is supplied at all levels of the firm using management-by-objective (MBO) methods. Annual plan control is directed toward reaching sales, profitability, and other objective defined in the annual plan. Interim-period objectives are set, performance is monitored, the causes of variances are identified, and corrective action is taken.

• Question 1057:

  The marketing organization may take which forms?

  l.

  A cross-disciplinary team ll. A sales department team lll. Separate sales and marketing departments lV. Sales and marketing reporting to a vice-president

  A.

  l and lV only

  B.

  l and ll only

  C.

  ll, lll, and lV only

  D.

  l, ll, ll, iV

  Correct Answer: D

  The marketing organization should be able to implement the marketing plan. The following are types of marketing organizations: sales department only, sale department with some marketing functions, such as advertising and research, marketing department separate from sales; marketing and sales departments reporting to a vice-president of marketing and sales, the same, except that everyone is customer- and market-centered, and process and outcome organizations, with departments replaced by cross-disciplinary teams managed by process leaders.

• Question 1058:

  Which of the following is accomplished during the process of planning the marketing program and mix?

  A. Organizing resources

  B. A SWOT analysis

  C. Determining when, where, how, and by whom plans will be executed

  D. Conducting sales variance analysis

  Correct Answer: B

  Planning the marketing program and mix is the process of determining how marketing strategies formulated in accordance with a SWOT (strengths, weaknesses, opportunities, and threats) analysis may be implemented. The firm must decide what resources should be devoted to the marketing effort, for example, budgeting outlays as a percentage of sales. Total expenditures may be increased to secure a larger market share. The next step is to locate the budgeted resources to the elements of the marketing mix(the 4Ps of 4 Cs of marketing)

• Question 1059:

  According to Japanese researchers, an objective of the marketing program should include

  A. Determining the optimal level of inventory

  B. Intermittent receipt of feedback

  C. The earliest possible implementation of improvements

  D. Treating product defects as a function of the production process

  Correct Answer: C

  Japanese writers suggest that the objectives of the marketing process should include continuous receipt of feedback as a basis for better products and marketing efforts, implementing improvements as quickly as feasible, using-in-time inventory systems, minimizing production set-up time and cost, and minimizing product defects.

• Question 1060:

  Strategic marketing involves

  A. Market opportunity analysis

  B. Developing a brand

  C. Developing a brand mage D. Delivering value

  Correct Answer: A

  The strategic marketing stage includes choosing target markets. These signets provide the best marketing opportunities. A "marketing opportunity is an area of buyer need or potential interest in which a company can perform profitably" (Kotler, Marketing Management). Market opportunity analysis determines whether benefits (value) can be communicated effectively to the target markets, the communication can be done with a cost effective promotional mix and distribution strategy, the firm has the necessary resources, and the firm can provide the chosen value better than its possible competitors.