The theory of transaction cost analysis states that:
A. Short-term increases in sales volume will eliminate any switching costs acquired as the result of replacing an independent agent with an internal sales force
B. The costs of product failure will be minimized with the use of an independent agent and maximized with an internal sales force
C. When substantial transaction-specific assets are necessary to sell a manufacturer's product, the costs of using and administering independent agents is likely to be higher than the costs of hiring and managing an internal sales force
D. Costs of using and administering independent agents tend to rise faster as the manufacturer's sales volume increases
E. When substantial transaction-specific assets are necessary to sell a manufacturer's product, the costs of using and administering independent agents is likely to be lower than the costs of hiring and managing an internal sales force
Ans: C. When substantial transaction-specific assets are necessary to sell a manufacturer's product, the costs of using and administering independent agents is likely to be higher than the costs of hiring and managing an internal sales force
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Which of the following is general information collected by specialized firms on a regular basis and then sold to other firms?
A) syndicated research B) custom research C) competitive research D) perceptual tracking E) marketing decision support research
Concentrated marketing is used because
a. risks are lower than normal b. Operating economies can be achieved through specialization in production, distribution and promotion. c. markets are fairly homogenous d. its audience falls into several identifiable segments e. It allows production of the offering "on demand"