A national big box retailer is able to purchase automotive tires directly from the manufacturer. The retailer
Question:
A national "big box" retailer is able to purchase automotive tires directly from the manufacturer. The retailer pays $172.35 for a performance tire that lists for $382.99. A small local tire shop does not have sufficient purchasing power to deal directly with the manufacturer, and must purchase the same tire from a distributor for $248.94.
a. What rate of trade discount is the national retailer eligible for?
b. What rate of trade discount is the local tire shop eligible for?
c. The local tire shop approached its distributor and negotiated a "seasonal" discount that would bring the price of the tire down to the same price currently being paid by the "big box" retailer. What additional "seasonal" discount did the local tire shop negotiate?
Step by Step Answer:
Fundamentals Of Business Mathematics In Canada
ISBN: 9781259370151
3rd Edition
Authors: F. Ernest Jerome, Jackie Shemko