DECA Sports and Entertainment Marketing Practice Exam

What term refers to an organization of independent businesses formed to control production, pricing, and marketing of a product?

1. Co-Branding

2. Channel of Distribution

3. Cartel

4. Client-side researchers

The correct answer is: Cartel

The term that refers to an organization of independent businesses formed to control production, pricing, and marketing of a product is known as a cartel. A cartel is a formal agreement between competing firms in the same industry to control prices and limit competition, with the goal of increasing their collective profits. They often work together to manipulate market prices or restrict supply, which can have significant impacts on consumers and the market as a whole. In contrast, co-branding involves a partnership between two or more brands to create a new product or offer, enhancing brand value and sharing resources. The channel of distribution refers to the path through which goods and services flow from the producer to the consumer, focusing on logistics, wholesaling, and retailing rather than collective control by independent businesses. Client-side researchers are professionals who work within an organization to conduct research related to that organization's needs, focusing on gathering insights rather than forming a coalition to control market aspects. These definitions further clarify why cartel is the appropriate choice for the question.