Schemes in which salespersons are paid to recruit other salespeople, and each new salesperson pays for the right to recruit other salespeople, with some of that money going to earlier recruiters is called:
A)bid rigging.
B)bait-and-switch.
C)predatory pricing.
D)referral selling.
E)pyramid selling.

Question

Quizplus · Accepted Answer

This scheme is commonly known as pyramid selling or multi-level marketing, where the emphasis is on recruiting new members rather than selling products. Each recruit pays for the right to recruit others, and the money flows up the pyramid to the earlier recruiters. This often leads to a never-ending chain of recruitment and very little actual product sales, resulting in unsustainable business models and potential legal scrutiny.

Schemes in Which Salespersons Are Paid to Recruit Other Salespeople