Harley-Davidson's Entry into the Web for Their Parts and Accessory

question 21

Multiple Choice

Harley-Davidson's entry into the Web for their parts and accessory business called for them to "protect" their retailers by referring customers to the local Harley-Davidson dealer.One additional strategy available to firms wishing to protect their channels of distribution yet capitalize on Internet sales is ________.

• A) offer fewer services to Web customers than retail customers
• B) offer online partners higher commission rates
• C) offer off-line partners higher commission rates
• D) sell identical brands/products
• E) do not allow customers to order through the Web site

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Definitions:

Cost Curves

Graphical representations that show how the cost of producing goods changes with changes in the quantity of production.

Profit Maximization

The system by which a business calculates the price and output that lead to the highest earnings.

Marginal Revenue

The extra revenue generated from the sale of an additional unit of a product or service.

MC = MR

The condition where a firm's marginal cost equals its marginal revenue, often used to determine the optimal level of production.