What Is the Most Logical Explanation for Why Retailers Carry

question 62

Multiple Choice

What is the most logical explanation for why retailers carry private-label brands?

• A)to eliminate the need for competitive advantages
• B)to encourage transaction marketing
• C)to support trade promotions
• D)to earn more profit
• E)to prevent sales cannibalization

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Definitions:

Economic Profit

Profit that accounts for both explicit costs and opportunity costs.

Economic Profit

The financial gain made in a transaction after subtracting both the explicit and implicit costs.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.

Variable Costs

Costs that change in proportion to the level of output or activity in a business.