Which of the Following Is an Advantage of Using an Industrial

question 177

Multiple Choice

Which of the following is an advantage of using an industrial distributor?

• A) These firms are easy to control because they work directly for the producers.
• B) Inventory holding costs are minimized because they can store inventory very cheaply.
• C) They are closer geographically to all of the producers' customers.
• D) They possess a high level of technical knowledge about their products.
• E) They help reduce a producer's financial burdens by extending credit to customers.

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Definitions:

Store Traffic

The number of people who visit a retail location within a given time frame.

Penetration Pricing

A pricing strategy where the price of a new product is intentionally set lower than the competition to gain market share quickly.

Price Skimming

A pricing strategy in which a company charges the highest initial price that customers will pay for a new product, then gradually lowers the price to attract more price-sensitive customers.

Variable Costs

Costs that change in proportion to the level of activity or volume of output in a business, such as raw materials and labor costs.