Question

Manufacturers often use intermediaries to distribute their products because intermediaries:

A) Increase the cost of the products.
B) Create a direct link between manufacturers and consumers.
C) Facilitate efficient and widespread distribution.
D) Eliminate the need for marketing.

Answer 1

Intermediaries help manufacturers distribute their products by facilitating efficient and widespread distribution, lowering transaction costs, and making transactions safer and easier.

Step-by-step explanation:

Manufacturers often use intermediaries such as banks and other financial institutions to distribute their products because intermediaries facilitate efficient and widespread distribution. These intermediaries can lower transaction costs, make transactions safer, and more accessible, and increase the availability of products for consumers. Intermediaries like banks act as financial institutions that operate between savers, who deposit money, and borrowers, who receive loans.

By doing so, they enable the flow of capital which can be used for various economic activities, including the production and distribution of goods and services. Similarly, in the context of product distribution, intermediaries reduce the distance between the producers and the consumers, thereby making products widely available while also managing the complexities of logistics and market penetration.