A Company That Uses a Grote-Brand Meat-Slicing Machine Typically Buys

question 122

Multiple Choice

A company that uses a Grote-brand meat-slicing machine typically buys a replacement blade once a year, and it has done so for the last five years. A new company is offering a blade for the Grote machine for $200, which is less expensive than buying one from Grote (a savings of about $50) . It is time to buy a new blade, and you are in charge of the purchase. What will you most likely be engaging be in?

• A)a contingency buy
• B)a modified rebuy
• C)a straight rebuy
• D)a derived buy

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Definitions:

Capital Market

The input/factor market in which households supply their savings, for interest or for claims to future profits, to firms that demand funds to buy capital goods.

Investment

New capital additions to a firm’s capital stock. Although capital is measured at a given point in time (a stock), investment is measured over a period of time (a flow). The flow of investment increases the capital stock.

Demand Curve

A graph showing the relationship between the price of a good and the amount of it that consumers are willing to purchase at various prices.

Hoverboards

Self-balancing scooters that use gyroscopic technology to allow users to move based on the direction and speed of their body lean.