Neco Model Questions Vol1 2017 Commerce Question 23

Practice objective / multiple choice question 23 from the 2017 Neco Model Questions Vol1 Commerce examination.

Neco Model Questions Vol1 2017 Commerce Objective / Multiple Choice Easy Difficulty

Question 23 NECO_MODEL_QUESTIONS_VOL1 • 2017 • COMMERCE • objective

Briefly explain two reasons why wholesalers prefer to purchase goods in large quantities.

Answer Options

Correct Answer A. 1. Economies of scale - lower unit cost due to trade discounts. 2. Fewer orders lower handling, storage and administrative costs.

B. 1. Improved cash flow from delayed payments. 2. Increased marketing opportunities through bulk buying.

C. 1. Access to exclusive brands - limited competition. 2. Ability to negotiate higher selling prices with customers.

D. 1. Reduced transportation costs due to bulk shipping. 2. Lower taxes on large inventory purchases.

Correct Answer

Correct Option:

1. Economies of scale - lower unit cost due to trade discounts. 2. Fewer orders lower handling, storage and administrative costs.

About This Question

This is Neco Model Questions Vol1 2017 Commerce Question 23. It is one of the objective questions from the 2017 Neco Model Questions Vol1 Commerce examination.

Difficulty level: Easy .

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