What term describes a reduction in price achieved by buying in larger quantities?

What term describes a reduction in price achieved by buying in larger quantities?

• A. Quantity Discounts
• B. Trade Discounts
• C. Seasonal Discounts
• D. Marketing Mix

Answer: (A)

A price reduction for buying larger quantities is called a quantity discount. This pricing approach encourages buyers to purchase more at one time by lowering the unit price as order size increases, helping sellers move bigger volumes and achieve economies of scale. For example, a supplier might charge a lower price per unit once a buyer reaches a certain quantity threshold. Trade discounts are reductions given by manufacturers to intermediaries such as wholesalers or retailers for distribution terms, not directly based on the buyer’s own quantity. Seasonal discounts are time-based incentives to spur demand during specific periods. The marketing mix is the broader framework of product, price, place, and promotion; it isn’t a term for a quantity-based price cut.

A price reduction for buying larger quantities is called a quantity discount. This pricing approach encourages buyers to purchase more at one time by lowering the unit price as order size increases, helping sellers move bigger volumes and achieve economies of scale. For example, a supplier might charge a lower price per unit once a buyer reaches a certain quantity threshold.

Trade discounts are reductions given by manufacturers to intermediaries such as wholesalers or retailers for distribution terms, not directly based on the buyer’s own quantity. Seasonal discounts are time-based incentives to spur demand during specific periods. The marketing mix is the broader framework of product, price, place, and promotion; it isn’t a term for a quantity-based price cut.