Question

As noted in the case, HP considered approaching chain stores that sell store-brand cartridges compatible with its printers and offering them incentives if they end the practice. Considering the various types of allowances and discounts to channel members discussed within the chapter, what type of discount or allowance could the approach that HP is contemplating be most clearly identified as

Answer 1

Answer: a trade discount

Explanation:

Based on the information that was provided, the type of discount or allowance could the approach that HP is contemplating be most clearly identified as a trade discount.

A trade discount simply refers to the scenario when a manufacturer reduces the retail price it sells its good to the wholesaler or the retailer. Since HP approached chain stores, then a trade discount is considered here.