Many Products, Such as Candy, Soft Drinks, and Gum, Are

question 13

Multiple Choice

Many products, such as candy, soft drinks, and gum, are sold via intensive distribution. However, this strategy has a major drawback. What is it?

• A) It maximizes profit margin rather than sales volume.
• B) It encourages customers to shop around for the lowest price.
• C) It promotes a very high degree of brand switching.
• D) The manufacturer must give up a good degree of control over pricing and product display.
• E) It gives customers fewer opportunities to find the product.

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Definitions:

Domestic Output

The comprehensive total of all goods and services' value created inside a country's limits during a certain timeframe.

Average Tax Rate

The fraction of total income that is paid as taxes, calculated by dividing the total amount of taxes paid by the taxpayer's total income.

Marginal Tax Rate

The tax rate that applies to the next dollar of taxable income, indicating the percentage of any additional earnings that will be paid in taxes.

Progressive Tax

A tax system in which the tax rate increases as the taxable amount goes up, making higher earners pay a larger percentage of their income than lower earners.