CLEP Principles of Marketing Study Guide
CLEP Principles of Marketing Study Guide
Principles of Marketing
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Principles of Marketing
Description of the Examination 1724% Role of Marketing in a Firm
The Principles of Marketing examination covers the Marketing concept
material that is usually taught in a one-semester Marketing strategy
introductory course in marketing. Such a course is Marketing environment
usually known as Basic Marketing, Introduction to Marketing decision system
Marketing, Fundamentals of Marketing, Marketing,
Marketing research
or Marketing Principles. The exam is concerned
with the role of marketing in society and within a Marketing information system
firm, understanding consumer and organizational
markets, marketing strategy planning, the marketing 2227% Target Marketing
mix, marketing institutions, and other selected
topics, such as international marketing, ethics, Consumer behavior
marketing research, services and not-for-profit Segmentation
marketing. The candidate is also expected to have a Positioning
basic knowledge of the economic/demographic, Business-to-business markets
social/cultural, political/legal, and technological
trends that are important to marketing.
4050% Marketing Mix
The examination contains 100 questions to be
answered in 90 minutes. Some of these are pretest Product and service management
questions that will not be scored. Any time candi- Branding
dates spend on tutorials and providing personal Pricing policies
information is in addition to the actual testing time. Distribution channels and logistics
Integrated marketing
Knowledge and Skills Required communications/Promotion
The subject matter of the Principles of Marketing Marketing application in e-commerce
examination is drawn from the following topics.
The percentages next to the main topics indicate
the approximate percentages of exam questions on
those topics.
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7. A fertilizer manufacturer who traditionally 10. In which of the following situations is the
markets to farmers through farm supply dealers number of buying influences most likely to be
and cooperatives decides to sell current greatest?
products to home gardeners through lawn and
garden shops. This decision is an example of (A) A university buys large quantities of paper
for computer printers on a regular basis.
(A) market penetration (B) A computer manufacturer is building a new
(B) market development headquarters and is trying to choose a line
(C) product development of office furniture.
(D) diversification (C) A consumer decides to buy a different brand
of potato chips because they are on sale.
(E) vertical integration
(D) A retail chain is searching for a vendor of
lower-priced cleaning supplies.
8. A manufacturer who refuses to sell to dealers its (E) A purchasing manager has been asked to
popular line of office copiers unless the dealers locate a second source of supply for
also agree to stock the manufacturers line of corrugated shipping cartons.
paper products would most likely be guilty of
which of the following?
11. Roy Smith sells sets of encyclopedias door-to-
(A) Deceptive advertising door to families in low-income neighborhoods.
(B) Price discrimination Although the encyclopedias are priced above
$300, they can be purchased for weekly
(C) Price fixing installments of only $3. Roys favorite sales
(D) Reciprocity pitch is Would you deny your child a chance to
(E) Tying contracts become President of the United States someday
just to save $3 per week? Roys selling
approach appears to be an example of
9. Prior to consumption by a final consumer, the
last member in an indirect distribution channel (A) deceptive advertising
is the
(B) questionable ethics
(A) retailer (C) trade promotion
(B) wholesaler (D) bait-and-switch pricing
(C) manufacturer (E) mass-selling approach
(D) factor
(E) freight forwarder 12. Cooperative advertising is usually undertaken
by manufacturers in order to
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13. A marketer usually offers a noncumulative 16. The demand for industrial goods is sometimes
quantity discount in order to called derived because it depends on
14. A toy manufacturing firm sold its product (A) do not change very easily or quickly
through a toy wholesaler, who in turn sold to (B) are very easy to change through promotion
appropriate retailers. The manufacturers price
is $20 to the wholesaler, whose markup is (C) cannot ever be changed
usually 20 percent on the selling price to the (D) can only be developed through actual
retailer. If the retailers markup on the selling experience with products
price to the customer is 50 percent, what is the (E) are very accurate predictors of actual
price to the customer? purchasing behavior
(A) $24.00
18. A channel of distribution refers to the
(B) $30.00
(C) $36.00 (A) routing of goods through distribution
(D) $37.50 centers
(E) $50.00 (B) sequence of marketing intermediaries from
producer to consumer
15. Missionary salespersons are most likely to do (C) methods of transporting goods from producer
which of the following? to consumer
(D) suppliers who perform a variety of functions
(A) Sell cosmetics directly to consumers in their (E) traditional handlers of a product line
own homes
(B) Take orders for air conditioners to be used 19. A major advantage of distributing products by
in a large institution truck is
(C) Describe drugs and other medical supplies
to physicians (A) low cost relative to rail or water
(D) Secure government approval to sell heavy (B) low probability of loss or damage to cargo
machinery to a foreign government (C) accessibility to pick-up and delivery
(E) Take orders for custom-tailored garments or locations
other specially produced items (D) speed relative to rail or air
(E) ability to handle a wider variety of products
than other means
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20. If a firm is using penetration pricing, the firm is 24. Market segmentation that is concerned with
most likely trying to achieve which of the people over 65 years of age is called
following pricing objectives?
(A) geographic
(A) Product quality leadership (B) socioeconomic
(B) Market-share maximization (C) demographic
(C) High gross margin (D) psychographic
(D) Status quo (E) behavioral
(E) Geographic flexibility
25. The XYZ Corporation has two chains of
21. The marketer of which of the following products restaurants. One restaurant specializes in family
would be most likely to use a promotional mix dining, with affordable meals. The second
with a heavy emphasis on personal selling? restaurant targets young, single individuals, and
offers a full bar and small servings. The XYZ
(A) Life insurance Corporation uses which form of targeted
(B) Pencils marketing strategy?
(C) Transistor radios (A) Mass marketing
(D) Bread (B) Differentiated marketing
(E) Crackers (C) Undifferentiated marketing
(D) Customized marketing
22. Marketing strategy planning includes (E) Concentrated marketing
(A) supervising the activities of the firms
sales force 26. The marketing director of a manufacturing
(B) determining the most efficient way to company says, If my wholesaler exceeds the
manufacture products sales record from last month, I agree to give
him a paid trip to the Bahamas. This technique
(C) selecting a target market and developing the is a form of
marketing mix
(D) determining the reach and frequency of (A) sales promotion
advertising (B) advertising
(E) monitoring sales in response to a price (C) personal selling
change
(D) direct marketing
(E) public relations
23. A brand that has achieved brand insistence
and is considered a specialty good by the target
market suggests which of the following 27. Using a combination of different modes of
distribution objectives? transportation to move freight in order to exploit
the best features of each mode is called
(A) Widespread distribution near probable
points of use (A) conventional distribution
(B) Exclusive distribution (B) developing dual distribution
(C) Intensive distribution (C) selective distribution
(D) Enough exposure to facilitate price (D) intermodal transportation
comparison (E) freight forwarding
(E) Widespread distribution at low cost
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28. Which of the following is a major disadvantage 32. Reference groups are more likely to influence a
associated with the use of dual distribution? consumers purchase when the product being
purchased is
(A) It is usually very expensive.
(B) It can cause channel conflict between (A) important
members. (B) expensive
(C) It provides limited market coverage. (C) familiar
(D) It is only appropriate for corporate channels. (D) intangible
(E) Some distribution channel functions are (E) socially visible
not completed.
33. Which of the following is true of the product
29. The three strategic options of distribution life cycle?
intensity are
(A) It can accurately forecast the growth of
(A) concentrated, exclusive, and intensive new products.
(B) intensive, extensive, and selective (B) It reveals that branded products have the
(C) intensive, exclusive, and selective longest growth phase.
(D) extensive, concentrated, and selective (C) It cannot be applied to computer products
that quickly become obsolete.
(E) extensive, integrated, and concentrated
(D) It is based on the assumption that products
go through distinct stages in sales and profit
30. Which of the following would be considered a performance.
nonprofit organization? (E) It proves that profitability is highest in the
mature phase.
(A) A homeless shelter that charges a fee for its
services and uses the proceeds for the
upkeep of the shelter 34. The best way to segment consumer markets is by
(B) A drug rehabilitation center in which (A) age, gender, income, and geographic area
revenues in excess of cost go to the owners
(B) a combination of psychographic and
(C) A vaccination clinic owned by an geographic variables
individual entrepreneur
(C) product benefits
(D) A bookstore open to the public for business
(D) selecting important target groups
(E) A hospital that has a publicly traded
common stock (E) the variables affecting purchase and con-
sumption behavior of the target group
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36. The process of ensuring that people or companies 40. The ability to tailor marketing processes to fit
may have a need for a salespersons product is the specific needs of an individual customer in
known as Internet marketing is called
37. Which of the following is a primary disadvan- 41. Which of the following would most likely be
tage of direct marketing? considered a form of direct marketing?
38. A formal statement of standards that governs 42. ABC Company agrees to pay a certain amount
professional conduct is called a of a retailers promotional costs for advertising
ABCs products. This is an example of
(A) customer bill of rights
(B) business mission statement (A) cooperative advertising
(C) corporate culture (B) reminder advertising
(D) code of ethics (C) comparison advertising
(E) caveat emptor (D) slotting allowance
(E) a premium
39. Maxine suddenly realizes that she is out of paper
towels. She remembers that she last bought 43. To save time and money, a marketing research
Max Dri Towels, so she stops at the store and team uses data that have already been gathered
picks up another roll of Max Dri on her way for some other purpose. Which type of data is
home from work. In this example, Maxine uses the team using?
what form of information search in her decision
process? (A) Sample
(B) Primary
(A) Limited problem solving
(C) Secondary
(B) Extended problem solving
(D) Survey
(C) Internal information search
(E) Experiment
(D) Compensatory information search
(E) Information search by personal sources
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Study Resources
Most textbooks used in college-level principles of
Answer Key
marketing courses cover the topics in the outline
given earlier, but the approaches to certain topics 1. E 25. B
and the emphasis given to them may differ. To 2. D 26. A
prepare for the Principles of Marketing exam, it is 3. D 27. D
advisable to study one or more college textbooks, 4. C 28. B
which can be found in most college bookstores. 5. D 29. C
When selecting a textbook, check the table of 6. E 30. A
contents against the Knowledge and Skills Required 7. B 31. C
for this test. Please note that textbooks are updated 8. E 32. E
frequently; it is important to use the latest editions 9. A 33. D
of the textbooks you choose. Most textbooks now 10. B 34. E
have study guides, computer applications, and 11. B 35. A
case studies to accompany them. These learning 12. A 36. D
aids could prove useful in the understanding and 13. C 37. D
application of marketing concepts and principles. 14. E 38. D
You can find textbooks used for college-level 15. C 39. C
marketing courses in most college bookstores. 16. B 40. A
17. A 41. A
You can broaden your understanding of marketing 18. B 42. A
principles and their applications by keeping abreast 19. C 43. C
of current developments in the field from articles 20. B 44. A
in newspapers and news magazines as well as in 21. A 45. C
business publications such as The Wall Street 22. C 46. A
Journal, Business Week, Harvard Business Review, 23. B 47. D
Fortune, Ad Week, and Advertising Age. Journals 24. C 48. D
found in most college libraries that will help you
expand your knowledge of marketing principles
include Journal of Marketing, Marketing Today,
Journal of the Academy of Marketing Sciences, 49. Define the problem.
American Demographics, and Marketing Week. Determine the research design.
Books of readings, such as Annual Editions Choose the data collection method.
Marketing, also are sources of current thinking. Collect data.
The Internet is another resource you could explore.
Additional suggestions for preparing for CLEP 50.
exams are given in Preparing to Take CLEP
Sociocultural Economic Technological
Examinations. Environment Environment Environment
The development
of new production
techniques
The growing
Latino population
Rising mortgage
rates
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I. Preparing to Take CLEP Examinations
Having made the decision to take one or more CLEP exams, most people then want to know how to prepare
for themhow much, how long, when, and how should they go about it? The precise answers to these
questions vary greatly from individual to individual. However, most candidates find that some type of test
preparation is helpful.
Most people who take CLEP exams do so to show that they have already learned the key material taught
in a college course. Many of them need only a quick review to assure themselves that they have not forgotten
what they once studied, and to fill in some of the gaps in their knowledge of the subject. Others feel that
they need a thorough review and spend several weeks studying for an exam. Some people take a CLEP
exam as a kind of final exam for independent study of a subject. This last group requires significantly
more study than do those who only need to review, and they may need some guidance from professors of
the subjects they are studying.
The key to how you prepare for CLEP exams often lies in locating those skills and areas of prior learning
in which you are strong and deciding where to focus your energies. Some people may know a great deal
about a certain subject area but may not test well. These individuals would probably be just as concerned
about strengthening their test-taking skills as they would about studying for a specific test. Many mental
and physical skills are used in preparing for a test. It is important not only to review or study for the exams
but also to make certain that you are alert, relatively free of anxiety, and aware of how to approach
standardized tests. Suggestions about developing test-taking skills and preparing psychologically and
physically for a test are given in this chapter. The following section suggests ways of assessing your
knowledge of the content of an exam and then reviewing and studying the material.
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familiar with nearly all the material, you will probably need a minimum of review; however, if topics and
terms are unfamiliar, you will probably require substantial study to do well on the exam.
If, after reviewing the test description provided in the exam guide, you fi nd that you need extensive
review, put off answering the sample questions until you have done some reading in the subject. If you
complete them before reviewing the material, you will probably look for the answers as you study, and they
will not be a good assessment of your ability at a later date. Do not refer to the sample questions as you
prepare for the exam. None of the sample questions appear on the CLEP exam, so concentrating on them
without broader study of the subject wont help you.
If you think you are familiar with most of the test material, try to answer the sample questions, checking
your responses against the answer key. Use the test-taking strategies described in the next chapter.
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Do Not
Understand Terms
Understand Terms
Most
Sample Questions
Answered Difficulty Answering
Correctly Sample Questions
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I . P R E P A R I N G T O T A K E C L E P E X A M I N A T I O N S
Check with your librarian about locating study aids relevant to the exams you plan to take. These
supplementary materials may include, for example, videos or DVDs made by education-oriented
companies and organizations; language tapes; and computer software. And dont forget that what you
do with your leisure time can be very educational, whether its surfing current-events Web sites,
watching a PBS series, reading a fi nancial newsletter, or attending a play.
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b. Next, convert the section or paragraph headlines into questions. For example, if you are reading a
section entitled The Causes of the American Revolution, ask yourself, What were the causes of
the American Revolution? Compose the answer as you read the paragraph. Reading and answering
questions aloud will help you understand and remember the material.
c. Take notes on key ideas or concepts as you read. Writing will also help you fix concepts more firmly
in your mind. Underlining key ideas or writing notes in your book can be helpful and will be useful
for review. Underline only important points. If you underline more than a third of each paragraph,
you are probably underlining too much.
d. If there are questions or problems at the end of a chapter, answer or solve them on paper as if you
were asked to do them for homework. Mathematics textbooks (and some other books) sometimes
include answers to some or all of the exercises. If you have such a book, write your answers before
looking at the ones given. When problem solving is involved, work enough problems to master the
required methods and concepts. If you have difficulty with problems, review any sample problems or
explanations in the chapter.
e. To retain knowledge, most people have to review the material periodically. If you are preparing for
an exam over an extended period of time, review key concepts and notes each week or so. Do not
wait for weeks to review the material or you will need to relearn much of it.
1. Familiarize yourself as much as possible with the test and the test situation before the day of the exam.
It will be helpful for you to know ahead of time:
a. How much time will be allowed for the test and whether there are timed subsections. (This
information is included in the examination guides and in the CLEP Sampler.)
b. What types of questions and directions appear on the exam. (See the examination guides and the
CLEP Sampler.)
c. How your test score will be computed.
d. In which building and room the exam will be administered. If you dont know where the building is,
get directions ahead of time.
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e. The time of the test administration. You may wish to confirm this information a day or two before the
exam and find out what time the building and room will be open so that you can plan to arrive early.
f. Where to park your car and whether you will need a parking permit or, if you will be taking public
transportation, which bus or train to take and the location of the nearest stop.
g. Whether there will be a break between exams (if you will be taking more than one on the same day),
and whether there is a place nearby where you can get something to eat or drink.
3. Be sure to:
a. Arrive early enough so that you can find a parking place, locate the test center, and get settled
comfortably before testing begins. Allow some extra time in case you are delayed unexpectedly.
b. Take the following with you:
Any registration forms or printouts required by the test center. Make sure you have filled out all
necessary paperwork in advance of your testing date.
Your drivers license, passport, or other government-issued identification that includes your
photograph and signature, as well as a secondary form of ID that includes a photo and/or your
signature, such as a student ID, military ID, social security card, or credit card. You will be asked
to show this identification to be admitted to the testing area.
A valid credit card to pay the $65 examination fee. (This fee is subject to change.) Although a
credit card is the preferred method of payment, you can also pay by check or money order
(payable to the College-Level Examination Program). Your test center may require an additional
administration fee. Contact the test center to determine the amount and the method of payment.
Two pencils with good erasers. You may need a pencil for writing an outline or figuring out math
problems. Mechanical pencils are prohibited in the testing room.
Your glasses if you need them for reading or seeing the chalkboard or wall clock.
c. Leave all books, papers, and notes outside the test center. You will not be permitted to use your own
scratch paper; it will be provided by the test center.
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d. Do not take a calculator to the exam. If a calculator is required, it will be built into the testing
software and available to you on the computer. The CLEP Sampler and the pretest tutorials will
show you how to use that feature.
e. Do not bring a cell phone or other electronic devices into the testing room.
f. Be prepared to adjust to an uncomfortable temperature in the testing room. Wear layers of clothing
that can be removed if the room is too hot but that will keep you warm if it is too cold.
Extended time
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II. Taking the Examinations
A person may know a great deal about the subject being tested but not be able to demonstrate it on the
exam. Knowing how to approach an exam is an important part of the testing process. While a command of
test-taking skills cannot substitute for knowledge of the subject matter, it can be a significant factor in
successful testing.
Test-taking skills enable a person to use all available information to earn a score that truly reflects her
or his ability. There are different strategies for approaching different kinds of exam questions. For example,
free-response and multiple-choice questions require very different approaches. Other factors, such as how
the exam will be graded, may also influence your approach to the exam and your use of test time. Thus,
your preparation for an exam should include finding out all you can about the exam so you can use the
most effective test-taking strategies.
2. Keep an eye on the clock and the timing that is built into the testing software. You have the option
of turning the clock on or off at any time. As you proceed, make sure that you are not working too
slowly. You should have answered at least half the questions in a section when half the time for
that section has passed. If you have not reached that point in the section, speed up your pace on the
remaining questions.
3. Before answering a question, read the entire question, including all the answer choices. Dont think
that because the first or second answer choice looks good to you, it isnt necessary to read the
remaining options. Instructions usually tell you to select the best answer. Sometimes one answer
choice is partially correct but another option is better; therefore, its usually a good idea to read all
the answers before you choose one.
4. Read and consider every question. Questions that look complicated at first glance may not actually be
so difficult once you have read them carefully.
5. Do not puzzle too long over any one question. If you dont know the answer after youve considered it
briefly, go on to the next question. Mark that question using the mark tool at the bottom of the screen,
and go back to review the question later, if you have time.
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7. Make educated guesses. There is no penalty for incorrect answers. It is to your benefit to guess if you
do not know an answer since CLEP CBT uses rights-only scoring. (An explanation of the
procedures used for scoring CLEP exams is given in the next chapter.) If you are not sure of the
correct answer but have some knowledge of the question and are able to eliminate one or more of the
answer choices as wrong, your chance of getting the right answer is improved.
8. Do not waste your time looking for clues to right answers based on flaws in question wording or
patterns in correct answers. CLEP puts a great deal of effort into developing valid, reliable, and fair
exams. CLEP test development committees are composed of college faculty who are experts in the
subjects covered by the exams and are appointed by the College Board to write test questions and to
scrutinize each question that is included on a CLEP exam. Faculty committee members make every
effort to ensure that the questions are not ambiguous, that they have only one correct answer, and that
they cover college-level topics. These committees do not intentionally include trick questions. If you
think a question is flawed, ask the test administrator to report it, or write immediately to CLEP Test
Development, P.O. Box 6600, Princeton, NJ 08541-6600. Include the name of the exam and test center,
the exam date, and the number of the exam question. All such inquiries are investigated by test
development professionals.
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II. T A K I N G T H E E X A M I N A T I O N S
1. Before you begin to respond, read all the questions carefully and take a few minutes to jot down
some ideas or create an outline. Scratch paper will be provided at the test center.
2. If you are given a choice of questions to answer, choose the questions that you think you can answer
most clearly and knowledgeably.
3. Determine the order in which you will answer the questions. First, answer those you find the easiest
so you can spend any extra time on the more difficult questions.
4. When you know which questions you will answer and in what order, determine how much testing
time remains and estimate how many minutes you will devote to each question. Unless suggested
times are given for the questions, try to allot an equal amount of time for each question.
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II. T A K I N G T H E E X A M I N A T I O N S
5. Before answering each question, read it again carefully to make sure you are interpreting it correctly.
Pay attention to key words, such as those listed below, that often appear in free-response questions.
Be sure you know the exact meaning of these words before taking the exam.
analyze demonstrate enumerate list
apply derive explain outline
assess describe generalize prove
compare determine illustrate rank
contrast discuss interpret show
define distinguish justify summarize
If a question asks you to outline, define, or summarize, do not write a detailed explanation;
if a question asks you to analyze, explain, illustrate, interpret, or show, you must do
more than briefly describe the topic.
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III. Interpreting Your Scores
CLEP score requirements for awarding credit vary from institution to institution. The College Board,
however, recommends that colleges refer to the standards set by the American Council on Education (ACE).
All ACE recommendations are the result of careful and periodic review by evaluation teams made up of
faculty who are subject-matter experts and technical experts in testing and measurement. To determine
whether you are eligible for credit for your CLEP scores, you should refer to the policy of the college you
will be attending. The policy will state the score that is required to earn credit at that institution. Many
colleges award credit at the score levels recommended by ACE. Some require scores that are higher or
lower than these.
Your exam score will be printed for you at the test center immediately upon completion of the
examination, unless you took English Composition with Essay. For this exam, your score will be mailed to
you two to three weeks after the exam date. Your CLEP exam scores are reported only to you, unless you
ask to have them sent elsewhere. If you want your scores sent to a college, employer, or certifying agency,
you must select this option through the examination software. This service is free only if you select your
score recipient at the time you test. A fee will be charged for each score recipient you select at a later date.
Your scores are kept on file for 20 years. For a fee, you can request a transcript at a later date.
The pamphlet What Your CLEP Score Means, which you will receive with your exam score, gives
detailed information about interpreting your scores. A brief explanation appears below.
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III . I N T E R P R E T I N G Y O U R S C O R E S
essays. Each essay is read and graded by two professors, the sum of the two grades is combined with the
multiple-choice score, and the result is reported as a scaled score between 20 and 80. Although the format
of the two sections is very different, both measure skills required for expository writing. Knowledge of
formal grammar is necessary for the multiple-choice section, but the emphasis in the free-response section
is on writing skills rather than grammar.
Optional essays for CLEP composition and literature examinations are evaluated and graded by the
colleges that require them, rather than by the College Board. If you take an optional essay, it will be sent
with a copy of your score report (which includes only the results of your multiple-choice test) to the
institution you designate when you take the test.
You may opt not to have your score sent to a college until after you have seen it. In this case, your
essay can still be sent to the college of your choice as long as you request a transcript within 90 days
after you take the exam. Copies of essays are not held beyond 90 days or after they have been sent to
an institution.
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