Question : Which of the following statement is correct?
Statement 1: During inflation, business considers choosing small channel of distribution.
Statement 2: The government rules affect the choice of the channel of distribution.
Option 1: Both are true
Option 2: Both are false
Option 3: Statement 1 is true and statement 2 is false.
Option 4: Statement 1 is false and statement 2 is true.
Correct Answer: Statement 1 is false and statement 2 is true.
Solution : Economic conditions and legal constituents are the environmental factors affecting the choice of channel of distribution. During deflation businessman considers using of small channel of distributions useful because this channel cost less. The government rules affect the choice of channel of distribution .
Hence, option D is correct.