Which of the Following Is a Drawback of Selling Private-Label

question 42

Multiple Choice

Which of the following is a drawback of selling private-label merchandise?

• A) Vendors that sell private labels still view national brands as their priority
• B) National brands are still produced with better quality
• C) Sales associates need additional training to sell them against national brands
• D) Gross margins are lower than margins with national brands
• E) They are limited to being sold only in department stores

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Definitions:

Residual Value

is the estimated amount that an entity would currently obtain from disposing of the asset, after deducting the estimated costs of disposal, at the end of its useful life.

Asset's Economic Life

The period over which an asset is expected to be economically useful to the owner.

Inception Date

The date on which an agreement, policy, or financial instrument becomes effective or is entered into.

Fair Value

A projected price for an asset or liability that could be transferred between agreeable, well-informed participants in a transaction that is free from any special relationship.