JAMB Economics 1990 Question 23

Question 23

Distributive Trade

Which of the following reasons could induce a manufacturer to bypass the wholesaler in the distribution chain?

  1. A.To provide the quantity needed by retailers
  2. B.To collect useful information on his product
  3. C.To provide warehousing facilities
  4. D.To violate government regulation on distribution
Show the answer and explanation

Answer: B (To collect useful information on his product)

Explanation

Selling directly brings the manufacturer close to retailers and consumers, so he gets first-hand information about how his product is received.