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?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: