Trade (functional) discounts
A) are illegal unless they are offered to meet a competitor's price.
B) are not offered by sellers who use administered prices.
C) are a type of cash discount.
D) reflect the fact that marketing activities can often be shifted and shared in the channel in different ways.
E) are typically offered to consumers but not to intermediaries.

Question

Quizplus · Accepted Answer

Trade discounts are offered by manufacturers to intermediaries in the distribution channel such as wholesalers and retailers. These discounts are based on the volume of goods purchased and reflect the fact that marketing activities can often be shifted and shared in the channel in different ways. This helps to align incentives and promote cooperation among channel members.

Trade (Functional) Discounts