An Objective of a Direct-Mail Campaign Is to Solicit an Order

question 110

Multiple Choice

An objective of a direct-mail campaign is to solicit an order from the prospects. Your firm's latest direct-mail offer was mailed to 100 000-targeted consumers. To date, you have received 2000 orders to your offer. Based upon what the industry's historical order rate runs, has this campaign been successful?

• A) No, the 2000 orders do not cover the marginal costs of the mailing.
• B) Yes, a 2 percent rate is considered good.
• C) No, the 2 percent is below acceptable standards for a mailing.
• D) No, the level is below acceptable levels.
• E) Cannot tell without more information.

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Definitions:

Net Working Capital

The difference between a company's current assets and current liabilities, indicating its short-term liquidity and ability to finance its operations.

Current Assets

Current assets are a balance sheet item that represents the value of all assets that can reasonably be expected to be converted into cash within one year, including cash, marketable securities, accounts receivable, and inventory.

Total Assets

The sum of all assets owned by a business, including cash, investments, property, and equipment, representing the resources it has at its disposal.

Cash

A form of liquid asset that represents immediate purchasing power and can be used for transactions or as a reserve for future payments.