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Management Questions and Answers for Competitive Exams | MBA BBA Quiz Set 39

1 Which one of the following marketing practices is outside the purview of the Competition Commission ?
1 Exclusive dealing
2 Misleading advertising
3 Predatory pricing
4 None of the above

Answer: Misleading advertising
2 The major advantage of the direct mail marketing is :
1 High target - market selectivity
2 Low cost of transaction
3 Privacy of the buyer
4 Speedy delivery

Answer: High target - market selectivity
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3 EBIT - EPS indifference point is the level of :
1 EBIT that produces the same level of EPS for two alternative capital structures.
2 EBIT that maximises EPS
3 EPS that optimises EBIT
4 Capital structure that does not affect Kd

Answer: EBIT that produces the same level of EPS for two alternative capital structures.
4 When the target company uses the tactic of divestiture, to defend itself from a hostile takeover, it is said to sell the :
1 Crown jewels
2 Green mail
3 Golden parachutes
4 White knight

Answer:Crown jewels
5 The average spread between the cost of goods sold and the sales revenue is indicated by :
1 Operating Expense ratio
2 Gross Profit ratio
3 Net Profit ratio
4 Return on Equity

Answer:Gross Profit ratio
6 If the rate of return on investment opportunity is likely to be 15 percent, the opportunity cost of capital is 10 percent, the earnings per share is ` 10 and if the pay-out ratio is 40 percent, the price of share according to Walter Model will be :
1 40
2 130
3 148
4 400

7 If the total cash requirement of a company is ` 2 crore next year, the opportunity cost of funds is 15 percent per annum and the cost of conversion from securities to cash per transaction is ` 150, the optimum cash balance as per Baumol’s Model will be : `
1 2 lakhs
2 4 lakhs
3 20 lakhs
4 40 lakhs

Answer: 2 lakhs
8 An Indian company is importing machine at a price of $ 5,00,000, payable after six months. The current exchange rate is ` 63 per US $. The forward contract for six months is available @ ` 64 per US $. If the rate turns out to be ` 64.25 per US $, the net gain to the importer in case he has entered into contract will be :
1 $ 1,25,000
2 $ 2,50,000
3 $ 5,00,000
4 $ 6,25,000

Answer: $ 1,25,000
9 Consider the following statements : (a) Brand equity is essentially the same as brand valuation. (b) Market segmentation and product differentiation are alternative marketing strategies. (c) Durable goods normally require less personal selling, after sales service and seller guarantees, than the non-durable goods. (d) Price discrimination in all forms is illegal in India. Indicate the correct statements :
1 (a) and (b)
2 (b) and (d)
3 Only (d)
4 None

Answer: None
10 A consumer consults the company websites to gather information about various models of a car. Which type of source of information is he using ?
1 Commercial
2 Experimental
3 Personal
4 Public

11 Consider the following statements :

(a) All marketing strategy is built on segmentation, targeting and positioning.

(b) A brand mantra must communicate both what a brand is and what it is not.

(c) Goal incompatibility is one of the major causes of conflict among distribution channel members.

(d) Physical goods, services and stores can have a brand name, but ideas and people cannot.

Which of these statements are true ?

1 All of them
2 (a) and (b)
3 (b) and (c)
4 (a), (b) and (c)

Answer: (a), (b) and (c)
12 The practice of selling below cost, with an intention to destroying the competitor is referred to as :
1 Loss - leader pricing
2 Predatory pricing
3 Price discrimination
4 Penetration pricing

Answer: Predatory pricing
13 After determining its pricing objectives, what is the next logical step a company should take in setting its pricing policy ?
1 Analyse its competitor’s cost, price and offer
2 Determine the demand of the product
3 Estimate the cost of the product
4 Select the pricing method

Answer:Determine the demand of the product
14 Marketers have traditionally classified products on the basis of three characteristics : __________ , tangibility and use.
1 availability
2 affordability
3 durability
4 necessity

15 Which one of the following can be legally protected ?
1 Brand name
2 Trade Mark
3 Brand mark
4 Package

Answer:Trade Mark

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