Selective Distribution

question 213

Multiple Choice

Selective distribution:

• A) is likely to reduce high administrative expenses caused by a large proportion of small orders.
• B) may be suitable for all categories of products.
• C) is becoming more popular.
• D) is a good idea if some of the available intermediaries are not financially solid.
• E) All of these alternatives are correct.

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Definitions:

Herfindahl Index

A parameter for comparing the dimensions of enterprises within their industry, revealing the competition scope.

Concentration Ratio

A measure of the market share or dominance controlled by the largest firms within an industry, used to assess market competitiveness.

Herfindahl Index

A measure of market concentration that sums the squares of the market shares of all firms within an industry.