An Assessment of Sales Results Is Common in Evaluation Systems

question 48

Multiple Choice

An assessment of sales results is common in evaluation systems. Assume that you find that 20 percent of the territories, products, or customers produce 80 percent of the revenues. What conclusion(s) can you draw?

• A) This situation might represent a misallocation of selling effort because the concern is with the number of customers rather than the potential of each prospect.
• B) This situation suggests that marketing efforts should be concentrated on a few customers and products.
• C) This situation suggests that marketing efforts should be spread evenly across all areas.
• D) Both a and b of the above.
• E) None of the above.

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Definitions:

Variable-Rate Assets

Assets that earn interest at rates which adjust over time based on prevailing market conditions.

Cash Equivalent

Short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value.

Treasury Bills

are short-term government securities with maturity dates typically one year or less, often used as a risk-free benchmark in financial markets.

Corporate Bonds

Debt securities issued by corporations to finance their operations, expansions, or projects, which pay interest to the holder until maturity.