Refer to the Scenario Below to Answer the Following Questions

question 87

Multiple Choice

Refer to the scenario below to answer the following questions.
Herb Marks built his enterprise on the faithful patronage of four specialty shops and a large contract from Elmore Distributors.But after two years,the maker of novelty pens and pencils had to rethink his strategy when his contract with Elmore ended.
Herb built a company reputation on the manufacturing and distribution of a variety of wooden writing utensils with customized engravings.Specialty shops loved to display the products in their fancy,lighted showcases,but such specialty shops alone were not profitable.Herb Marks established a brand name,known merely as Marks,and decided to expand on it.
Herb extended his writing utensil lines to include quills,felt- tip pens,and multiple- cartridge pens that write in different colors.He even added a line of various grades of personalized stationery and business cards.Perhaps Herb's biggest added touch,however,was the addition of two salespeople who would work to explain the diverse array of products offered by Marks,as well as nurture existing accounts.
"We make an excellent product," Herb Marks stated,"and we honor a good guarantee on everything we sell.But let's face it-we face hundreds of competitors! We need Marks representatives out there to help prospects understand what they should demand in something as simple as a writing tool."
The Marks brand was fast- becoming synonymous with top- notch customer service.Part of the purchase package brought personal visits from the Marks representative,before the purchase and long after.
-What type of consumer products does Marks manufacture?

• A)unsought
• B)convenience
• C)specialty
• D)shopping
• E)industrial

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Definitions:

Required Rate of Return

The minimum annual percentage return an investor expects to earn when investing in a particular asset or project.

Sales Revenue

The income received by a company from its sales of goods or the provision of services.

Operating Assets

Assets that are used in the daily operations of a business to generate revenue, excluding investment and financial assets.

Flexible Budget Graphs

Visual representations that display the relationship between budgeted and actual results over a range of activity levels, helping to analyze performance.