Disintermediation Refers to Channel Conflict That Arises When

question 129

Multiple Choice

Disintermediation refers to channel conflict that arises when

• A) a channel member severs relationships with other channel members to work for or with a competing manufacturer.
• B) channel conflicts are resolved by a third party.
• C) a channel member bypasses another member and sells or buys product directly.
• D) channel conflicts are resolved through a binding arbitration from a panel of representatives from all channel members involved.
• E) the entire distribution chain is eliminated, such as when a company sets up its own wholesaler and retailer network.

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Definitions:

Revenues

The income generated from normal business operations and includes discounts and deductions for returned merchandise.

Required Rate

A specific rate of return or interest rate required by investors or lenders to compensate for the risk of an investment or loan.

Net Present Value

A financial metric used to determine the current value of a series of future cash flows, adjusted for time and interest.

Distributorship

An arrangement in which a business grants another business the right to sell its products or services in a particular area.