The type of distribution system in which intermediaries are independent but agree to cooperate are participating in a contractual distribution system. Thus second option is correct.
Distribution system refers to the transmission of the goods and services and equipment to the end users from the manufacturer. It involves all the methods, logistics and the procedures which is required for the flow of the goods and services to the users.
In the contractual distribution system, intermediaries are dependent upon the manufacturers but agree to transfer and deliver the goods due to the contract signed by both the parties.
Thus second option is correct.
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