There is generally a critical link among channel length, the final sel

QUESTION

There is generally a critical link among channel length, the final selling price, and the firm’s profit margin because each intermediary in a channel adds its own markup to the products.

Indicate whether the statement is true or false.

ANSWER

TRUE
Because each intermediary in a channel adds its own markup to the products, there is generally a critical link among channel length, the final selling price, and the firm’s profit margin. The longer a channel, the greater the aggregate markup, and the higher the price that consumers are charged for the final product.