Question 1

Liberty Medical Supply is a home delivery service that sells diabetes testing supplies, prescription drugs, and other supplies directly to consumers to assist them in the management of their health-related conditions. Since Liberty Medical does not make any changes to the supplies that it obtains from manufacturers, it would most likely be classified as
A) an industrial service provider.
B) a health care manufacturer.
C) an industrial firm.
D) a reseller.
E) a government agency.

Accepted Answer

Liberty Medical Supply does not manufacture any products, but rather obtains products from manufacturers and resells them to consumers. Therefore, it would be classified as a reseller.

Question 2

The acronym NAICS stands for
A) National Association of Industrial Compliance Standards.
B) National Association of Industrial Communication Systems.
C) North American Industrial Communication Standards.
D) North American Industry Classification System.
E) North Atlantic Industrial Classification System.

Accepted Answer

NAICS stands for North American Industry Classification System. It is a standardized system used to classify businesses in North America based on their industries and activities.

Question 3

The services market sells diverse services such as legal advice, auto repair, and dry cleaning, and this market represents 75 percent of all industrial firms. Which of the following is another such service firm?
A) communication
B) wholesalers
C) retailers
D) government units
E) educational institutions

Accepted Answer

Communication is a service industry that includes telecommunications, broadcasting, and other related services.

Question 4

Among organizational markets, the reseller market includes
A) manufacturers.
B) logistics and supply chain providers.
C) government agencies.
D) end-user service providers.
E) retailers and wholesalers.

Accepted Answer

The reseller market includes retailers and wholesalers who purchase products in bulk from manufacturers or suppliers and resell them to the end-users.

Question 5

When Louisiana State University buys new laptops for its faculty, it is operating as
A) an industrial market.
B) a business market.
C) a government unit.
D) a consumer market.
E) a service provider.

Accepted Answer

Since Louisiana State University is a publicly-funded institution, it is considered a government unit. Therefore, when it purchases laptops for its faculty, it is operating as a government buyer in the business-to-business (B2B) market.

Question 6

The system that provides common industry definitions for Canada, Mexico, and the United States, which makes it easier to measure economic activity in the three member countries of the North American Free Trade Agreement (NAFTA), is referred to as the
A) Standard Industrial Code System (SICS).
B) United Nations Central Product Classification System (UNCPCS).
C) National Codes of Industry System (NCIS).
D) North American Industry Classification System (NAICS).
E) Federal System of International Organizations (FSIO).

Accepted Answer

The system that provides common industry definitions for Canada, Mexico, and the United States is called the North American Industry Classification System (NAICS). This system is used to measure economic activity in the three member countries of the North American Free Trade Agreement (NAFTA). The other options are either unrelated or incorrect.

Question 7

European Style Furniture (ESF), headquartered in New York, acquires fine furniture from several high quality manufacturers in Europe and enjoys exclusive distribution rights from them to sell to furniture stores throughout the United States. In this context, ESF is most likely classified as
A) a producer.
B) a reseller.
C) a service provider.
D) a government agency.
E) an industrial firm.

Accepted Answer

ESF is acquiring and reselling furniture from manufacturers, making it a reseller.

Question 8

1-800 Contacts is based in Draper, Utah, and sells contact lenses manufactured by other well-known companies, including Johnson & Johnson Vision Care, Ciba Vision, Bausch & Lomb, and CooperVision. It would most likely be classified as
A) an industrial service provider.
B) a health care provider.
C) a reseller.
D) an industrial firm.
E) a government agency.

Accepted Answer

1-800 Contacts is a reseller, as they sell contact lenses manufactured by other companies.

Question 9

Keystone Foods, which invented the individual quick freeze process for beef, provides McDonald's with millions of pounds of chicken, beef, and fish annually for use in its restaurants. The firm sources the animal proteins from farms and processes them in a variety of ways, such as breading or freezing, before selling them to McDonald's. Keystone is operating in ________ market.
A) a heavy goods
B) a government
C) a service
D) an industrial
E) a reseller

Accepted Answer

Keystone Foods is operating in an industrial market as it sources animal proteins from farms and processes them before selling to McDonald's for use in its restaurants.

Question 10

The NAICS provides common industry definitions for
A) Canada, the United Kingdom, and the United States.
B) North America, Asia, and Europe.
C) North America, Central America, and South America.
D) Canada, England, and Australia.
E) Canada, Mexico, and the United States.

Accepted Answer

The answer of The NAICS provides common industry definitions for
A)...

Question 11

NAICS provides common industry definitions to facilitate the measurement of economic activity for the member countries of the
A) European Union (EU).
B) United Nations (UN).
C) North American Free Trade Agreement (NAFTA).
D) North Atlantic Treaty Organization (NATO).
E) World Trade Organization (WTO).

Accepted Answer

NAICS stands for North American Industry Classification System, which was developed by the U.S., Canada, and Mexico to provide standardized industry definitions for measuring economic activity within the North American Free Trade Agreement (NAFTA) region.

Question 12

Graham-Field Health Products makes hospital beds and wheelchairs from the component parts and materials it buys. It sells these manufactured products to hospitals, nursing homes, and retailers of health care products. Graham-Field Health Products operates in ________ market.
A) a consumer
B) a government
C) a service
D) an industrial
E) a reseller

Accepted Answer

Graham-Field Health Products sells its products to hospitals, nursing homes, and retailers of health care products, indicating that it operates in the industrial market. It does not sell directly to individual consumers or the government, indicating it is not a consumer or government market. It is also not a service or reseller market as it manufactures and sells physical products.

Question 13

The City of Denver contracts with Solid Waste Management to provide trash collection services for its citizens. The city is operating as
A) a government unit.
B) an industrial market.
C) a business market.
D) a consumer market.
E) a service provider.

Accepted Answer

The City of Denver is a government unit that has contracted with a company to provide a service to its citizens, which is trash collection services.

Question 14

Corning, Inc., which transforms an exotic blend of materials to create optical fiber capable of carrying much of the telephone traffic in the United States on a single strand, is operating in ________ market.
A) a consumer
B) a government
C) a service
D) a reseller
E) an industrial

Accepted Answer

Corning, Inc. is providing a product that is used for a specific industrial purpose (telecommunications), indicating that it is operating in an industrial market.

Question 15

The North American Industry Classification System (NAICS)
A) provides common industry definitions for North America, Central America, and South America to measure economic activity in the Western Hemisphere.
B) provides common industry definitions between Canada and the United States to measure economic activity and reduce barriers of trade for cross-border firms.
C) provides a classification system for products that is consistent worldwide.
D) provides a classification system for products that is consistent across North America, Central America, and South America to measure economic activity in the Western Hemisphere.
E) provides common industry definitions for Canada, Mexico, and the United States to measure economic activity in the three member countries.

Accepted Answer

The NAICS provides common industry definitions for Canada, Mexico, and the United States to facilitate the measurement of economic activity among these three countries.

Question 16

In terms of organizational markets, Amazon.com, Lands' End, and JCPenney would most likely be classified as
A) government units.
B) resellers.
C) manufacturers.
D) wholesalers.
E) industrial firms.

Accepted Answer

Amazon.com, Lands' End, and JCPenney are all companies that sell products to end consumers, making them resellers in the organizational market.

Question 17

Archer Daniels Midland Co. (ADM) is the world's largest cocoa-bean processor. It buys cocoa beans and converts them into cocoa powder and cocoa butter, which it then sells to companies like Hershey's that manufacture consumer products containing chocolate. ADM is operating in ________ market.
A) a consumer
B) a government
C) an industrial
D) a manufacturing
E) a reseller

Accepted Answer

ADM is operating in an industrial market because it processes raw materials (cocoa beans) into products (cocoa powder and cocoa butter) that are used by other companies to manufacture consumer goods.

Question 18

Federal, state, and local agencies that buy products and services for the constituents they serve are referred to as
A) industrial markets.
B) reseller markets.
C) consumer markets.
D) government units.
E) global markets.

Accepted Answer

The term "government units" refers to federal, state, and local agencies that purchase products and services to serve their constituents. Industrial markets are businesses that purchase goods and services to use in their own production or operation, reseller markets are intermediaries that purchase products with the intention of reselling them, consumer markets are individuals or households who buy products for personal use, and global markets refer to buying and selling between countries.

Question 19

When the General Services Administration (GSA), an agency of the federal government, purchased 116 Chevy Volts from General Motors for its vehicle fleet, it was operating as
A) an industrial market.
B) a business market.
C) a consumer market.
D) a government unit.
E) a service provider.

Accepted Answer

The GSA is a government unit, and its purchase of Chevy Volts for its fleet is a government purchase, making it a B2G (business-to-government) transaction.

Question 20

Wholesalers and retailers that buy physical products and resell them without any reprocessing are referred to as
A) industrial firms.
B) reseller firms.
C) government agencies.
D) consumer product firms.
E) nonprofit firms.

Accepted Answer

Wholesalers and retailers that buy physical products and resell them without any reprocessing are referred to as reseller firms.

Quiz 5: Understanding Organizations As Customers

The acronym NAICS stands for

The services market sells diverse services such as legal advice, auto repair, and dry cleaning, and this market represents 75 percent of all industrial firms. Which of the following is another such service firm?

Among organizational markets, the reseller market includes

When Louisiana State University buys new laptops for its faculty, it is operating as

The system that provides common industry definitions for Canada, Mexico, and the United States, which makes it easier to measure economic activity in the three member countries of the North American Free Trade Agreement (NAFTA) , is referred to as the

European Style Furniture (ESF) , headquartered in New York, acquires fine furniture from several high quality manufacturers in Europe and enjoys exclusive distribution rights from them to sell to furniture stores throughout the United States. In this context, ESF is most likely classified as

1-800 Contacts is based in Draper, Utah, and sells contact lenses manufactured by other well-known companies, including Johnson & Johnson Vision Care, Ciba Vision, Bausch & Lomb, and CooperVision. It would most likely be classified as

The NAICS provides common industry definitions for

NAICS provides common industry definitions to facilitate the measurement of economic activity for the member countries of the

Graham-Field Health Products makes hospital beds and wheelchairs from the component parts and materials it buys. It sells these manufactured products to hospitals, nursing homes, and retailers of health care products. Graham-Field Health Products operates in ________ market.

The City of Denver contracts with Solid Waste Management to provide trash collection services for its citizens. The city is operating as

Corning, Inc., which transforms an exotic blend of materials to create optical fiber capable of carrying much of the telephone traffic in the United States on a single strand, is operating in ________ market.

The North American Industry Classification System (NAICS)

In terms of organizational markets, Amazon.com, Lands' End, and JCPenney would most likely be classified as

Archer Daniels Midland Co. (ADM) is the world's largest cocoa-bean processor. It buys cocoa beans and converts them into cocoa powder and cocoa butter, which it then sells to companies like Hershey's that manufacture consumer products containing chocolate. ADM is operating in ________ market.

Federal, state, and local agencies that buy products and services for the constituents they serve are referred to as

When the General Services Administration (GSA) , an agency of the federal government, purchased 116 Chevy Volts from General Motors for its vehicle fleet, it was operating as

Wholesalers and retailers that buy physical products and resell them without any reprocessing are referred to as