In which of the following conditions does arbitrage occur?
A)When a firm offers a product at low prices through discount coupons and promotions
B)When a firm sells a product at higher prices to make a profit from relatively fewer sales
C)When a firm imports products from a manufacturer and distributes them directly through retail outlets
D)When a firm purchases products in a country where prices are lower and resells them in a country where prices are higher
E)When a firm prices its products at the least cost,risking losses,in order to grab market share

Question

Quizplus · Accepted Answer

Arbitrage occurs when a firm takes advantage of price differences in different markets by purchasing products in a market where the price is lower and selling them in a market where the price is higher. This allows the firm to make a profit from the price difference.

In Which of the Following Conditions Does Arbitrage Occur