NECO 2005 Economics · Question 22

Which of the following is the correct order in the chain of distribution?

Options

  1. A.Consumer —> Distributor → Retailer → Producer
  2. B.Producer → Consumer → Retailer → Wholesaler
  3. C.Producer → Wholesaler → Retailer → Consumer
  4. D.Retailer → Consumer → Producer → Wholesaler
  5. E.Wholesaler → Retailer → Producer → Consume

Answer: C. Producer → Wholesaler → Retailer → Consumer

Explanation written with AI and checked against the answer key

Analyze the question: You are asked for the correct sequence of the traditional channel of distribution, which is how goods move from where they are made to the people who use them.

Concept: The chain of distribution is the path goods follow from the producer to the final consumer. Each middleman has a role:

  • Producer (manufacturer): makes the goods.
  • Wholesaler: buys in bulk from producers and sells in smaller lots to retailers. They also store the goods and break bulk.
  • Retailer: buys from wholesalers and sells in small quantities to consumers.
  • Consumer: the final user, who is always at the end of the chain.

Step-by-step solution:

  1. The chain must start with the producer, because goods originate there. This rules out A (starts with the consumer), D (starts with the retailer) and E (starts with the wholesaler).
  2. The chain must end with the consumer. Option B puts the consumer in the middle, so it is wrong.
  3. Option C follows the correct flow: Producer → Wholesaler → Retailer → Consumer.

Correct answer: C

Tip: Remember the order with "P-W-R-C" (Producer, Wholesaler, Retailer, Consumer). The goods start at the maker and end with the user, and the middlemen sit in between, from largest quantity (wholesaler) to smallest (retailer). In NECO and WASSCE, shorter channels, such as Producer → Retailer → Consumer or Producer → Consumer, may also appear as "direct" or "shortened" chains, but the full traditional chain is always P → W → R → C.

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