Question

which type of discounts are offered to encourage buyers to purchase greater quantities to receive a lower cost per unit?

cash discounts
customer discounts
seasonal discounts
volume discounts

Explanation:

Analyze the question prompt

The question asks for the type of discount offered to encourage buyers to purchase greater quantities to receive a lower cost per unit.

Evaluate the options

• Cash discounts are incentives offered to buyers to encourage prompt payment of invoices.
• Customer discounts are general price reductions given to specific customers or groups.
• Seasonal discounts are price reductions offered for purchasing goods out of season.
• Volume discounts (or quantity discounts) are price reductions offered to buyers who purchase large quantities of a product, lowering the cost per unit.

Select the correct option

Based on the definition, discounts for purchasing greater quantities to lower the unit cost are volume discounts.

Answer:

• Cash discounts
• Customer discounts
• Seasonal discounts
• Volume discounts (Correct answer)