Which Statement Concerning Trade Credit Is True

question 49

Multiple Choice

Which statement concerning trade credit is true?

• A)One business's trade creditor is the other's trade debtor.
• B)In a period of inflation, it is better to pay off goods bought on credit faster.
• C)In most businesses, an extra charge is made to those who choose to pay on credit.
• D)All of the statements are true.

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Definitions:

Wasted Capacity

The portion of production or storage capacity that goes unused or underutilized, often resulting in increased costs and inefficiencies.

Pricing

The process of determining the cost at which a product or service will be sold to consumers.

Influence Demand

The ability to affect consumer desire or need for products and services through marketing efforts, quality improvements, or price adjustments.

Supply Chain Costs

Supply Chain Costs encompass all expenses incurred in the creation and delivery of a product, from procurement of raw materials to transportation, handling, storage, and distribution.