Some Sales Managers Are Talking Shop

question 341

Multiple Choice

Some sales managers are talking shop. Which of the following quotations refers to a movement along the demand curve?

• A) ʺIt has been an unusually mild winter; our sales of wool scarves are down from last year.ʺ
• B) ʺSince our competitors raised their prices our sales have doubled.ʺ
• C) ʺWe decided to cut our prices, and the increase in our sales has been remarkable.ʺ
• D) none of the above

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Definitions:

IRR

Internal Rate of Return, a financial metric used to estimate the profitability of potential investments, calculating the interest rate at which the net present value of all cash flows (both positive and negative) from a project or investment equals zero.

Required Rate of Return

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

NPV

Net Present Value, a financial metric used to assess the profitability of an investment, calculated as the difference between the present value of cash inflows and outflows.

IRR

Internal Rate of Return is a financial metric used to evaluate the profitability of potential investments, representing the discount rate that makes the net present value of all cash flows from a particular project equal to zero.