Question

Mike Morgan, a sales representative for a major food service distributor of Betty Crocker's Warm Delights, wanted to encourage repeat purchases by his grocery customers—supermarkets, mass merchandisers, etc. In order to accomplish this objective, Morgan offered the following discounts to his customers: a 10 percent discount for buying 1-49 cases of Warm Delights within a calendar month. The discount increases to 12 percent if 50-99 cases of Warm Delights are purchased and to 15 percent if 100 or more cases of Warm Delights are purchased within the same calendar month. What type of discount was Morgan offering his customers?

Answer 1

Answer:

Morgan is offering his customers Trade Discounts

Explanation:

Discounts are a reduction in selling prices that are offered to customers.

Mike Morgan is offering discounts based on varying amounts of quantity purchased by customer.Discounts based on Varying quantities are also known as Trade Discounts. Trade Discounts encourage customers to buy in bulk.

Answer 2

Answer:

quantity discount

Explanation:

Quantity discounts are generally offered by wholesalers or distributors to customers that purchase goods in bulk, or in large quantities. Generally the larger the quantity that you purchase, the higher the discount. This type of policy applies to virtually every good sold, from candies to cars, e.g. when cars are sold in fleets (a fancier term for bulk of cars), they are usually sold with a steep discount and only a limited amount of models are included.

In this case, Morgan offers his products with different discounts depending on the number of units (quantity) purchased.