To Be Useful, Market Segments Must Rate Favorably on Five

question 131

Essay

To be useful, market segments must rate favorably on five key criteria. What are those criteria?

---

Definitions:

Break-even Point

The point where total sales revenue is equal to total expenses, yielding neither profit nor loss.

Sales Mix

Sales mix is the proportion of different products or services that a business sells, impacting the overall profitability based on the differing margins of each item.

Operating Income

Profit realized from a business's core operations, calculated before taxes and interest.

Contribution Margin Ratio

A financial metric showing the percentage of sales revenue remaining after variable production costs have been deducted, indicating how much contributes towards covering fixed costs and generating profits.