Which of These Statements Best Describes the Key Difference Between

question 177

Multiple Choice

Which of these statements best describes the key difference between merchant wholesalers and agents and brokers?

• A) Merchant wholesalers don't perform all channel functions, whereas agents and brokers do.
• B) Agents and brokers only deal with consumer channels.
• C) Agents and brokers make their profits based on the sales of merchandise they own, while merchant wholesalers make profits based on fees paid for their services.
• D) Merchant wholesalers take title to merchandise, whereas agents and brokers do not.
• E) Agents and brokers take title to merchandise, whereas merchant wholesalers do not.

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Definitions:

Capital Cost Allowance (CCA)

A tax deduction available in Canada for depreciable property that can be used to reduce taxable income.

Straight-line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts.

Projected Cash Flows

Estimated cash movements over a future period, based on expected income and expenses.

NPV

Net Present Value; the difference between the present value of cash inflows and the present value of cash outflows over a period of time.