Which Type of Contractual Vertical Marketing System Involves Small Independent

question 7

Multiple Choice

Which type of contractual vertical marketing system involves small independent retailers forming an organization that operates a wholesale facility cooperatively?

• A) retailer-sponsored cooperative
• B) service-sponsored retail system
• C) administered cooperative system
• D) manufacturer-sponsored cooperative
• E) wholesaler-sponsored voluntary chain

---

Definitions:

Variable Production Costs

Costs that change in direct proportion to changes in the level of production, such as raw materials and hourly labor.

Fixed Production Costs

Expenses that do not change with the level of production or sales over a short period, such as rent, salaries, and insurance, ensuring stability in production costs despite output variations.

Net Income

The total profit of a company after accounting for all costs and expenses, including taxes, interest, and depreciation.

Direct Materials

Raw materials that are directly traceable and allocable to a finished product in the manufacturing process.