What Is the Primary Disadvantage Associated with Using Financial Incentives

question 20

Multiple Choice

What is the primary disadvantage associated with using financial incentives as a means of developing customer relationships?

• A) They take a long time to work.
• B) Customers may resist the use of financial incentives.
• C) They can be expensive to use.
• D) They can promote continual brand switching.
• E) All of the above are primary disadvantages.

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Definitions:

High-volume Products

Items that are produced in large quantities, typically benefiting from economies of scale in manufacturing processes.

Low-volume Products

Items that are produced or sold in relatively small quantities, often requiring specialized manufacturing processes.

Activity-based Costing

A costing method that assigns costs to products or services based on the activities required for their production or delivery.

Activity Cost Pools

A grouping of all costs related to a particular activity, used in activity-based costing to allocate costs more accurately.