Some companies follow a strategy of sales maximization. They say that this puts them in close touch with their customers and they can better track the market, responding to needs more quickly. However, this increases costs because of the need to stock a wider variety of parts, sizes, colors, etc. What would make this strategy a profit-maximizing one?
What will be an ideal response?
The increase in revenue from this approach must exceed the increase in cost.
You might also like to view...
Refer to Table 9-10. Fill in the following table with the opportunity costs of producing bows and arrows for Tran and Farah
Pens Pencils Tran Farah
Lincoln Electric paid employees on the basis of
A) deferred compensation. B) backloaded wages. C) a piece rate. D) forward loaded wages.
In order of preference, economists would choose
A. quotas, tariffs, free trade. B. free trade, tariffs, quotas. C. tariffs, quotas, free trade. D. free trade, quotas, tariffs.
The impetus to form an administrative body in Europe after World War II to distribute Marshall Plan aid and coordinate trade and other common issues resulted in three organizations:
A) the WTO, the GATT, and the IMF. B) the European Payments Union, the UN, and the early roots of the European Union. C) the European Payments Union, the European Coal and Steel Community, and Euratom. D) the Eastern bloc, the Warsaw Pact, and NATO.