Page 621 - Business Principles and Management

C HAPTER 22 A SSESSMENT

DETERMINE THE BEST ANSWER

13. A price reduction that manufacturers give to their channel partners,
such as wholesalers or retailers, in exchange for additional services
is a
a. manufacturer’s discount
b. trade discount
c. sales promotion
d. wholesale discount
14. Reductions taken from the price of a product to encourage cus-
tomers to buy is known as a
a. selling price
b. markdown
c. markup
d. trade discount
15. A price reduction offered for ordering or taking delivery of products
in advance of the normal buying period to encourage buyers to pur-
chase earlier than necessary or at a time when orders are normally
low is called a(n)
a. quantity discount
b. seasonal discount
c. annual discount
d. special discount
16. The costs of operating a business, not including costs involved in the
actual production or purchase of merchandise, are the
a. cost of goods sold
b. normal expenses
c. operating expenses
d. operating costs
17. If a company violates federal law by “misleading in a material
respect” or in any way that could influence the customer’s purchase
or use of the product, it could be forced to
a. cease and desist
b. use corrective advertising
c. pay a fine
d. all of the above
18. Subtracting any discounts from a product’s list price yields the actual
price customers pay for the product, or its
a. actual price
b. sale price
c. selling price
d. trade price
19. Advertising designed to change false impressions left by misleading
information is called
a. corrective advertising
b. false advertising
c. normal advertising
d. misleading advertising

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