Question

Advertising allowances offered by producers can be ILLEGAL unless they are made available:A. for products of "like grade and quality."
B. to all customers on proportionately equal terms.
C. to all buyers in equal dollar amounts.
D. on all products sold by the producer.
E. within an FTC approved agreement.

Answer 1

Answer:

Option B: to all customers on proportionately equal terms.

Explanation:

Advertising Allowances can be termed to be monies or promotional services in the form of discounts etc paid by a supplier/manufacturer to a retailer/wholesaler to advertise their products or pay for advertising cost.

The Robinson-Patman Act clearly stipulates that the producer provide customers with equal advertising allowances. This is to reduce or avoid discrimination in price.

Criminal sanctions may arise on sales that violates this Act. If this Act injured parties may bring an action under the Act.