Zara's Store Managers Place Orders That Reflect Their Localized Needs

question 15

Multiple Choice

Zara's store managers place orders that reflect their localized needs. However, order fulfillment is ultimately the responsibility of the commercial team in headquarters because:

• A) Store managers have no real decision rights.
• B) The commercial team does not trust the store managers.
• C) Store managers do not have visibility into regional demands but the commercial team does.
• D) The commercial team has more direct contact with the designers and production.
• E) Store managers have no access to sales information for their store.

---

Definitions:

Common Dividends

Payments made to shareholders out of a corporation's earnings, reflecting the portion allocated to holders of common shares.

Liquidation

The process of converting assets into cash, often during the winding down of a business or the selling off of stock.

Preferred Stock

Preferred stock is a class of ownership in a corporation that has a higher claim on its assets and earnings than common stock. Preferred shareholders typically receive dividends before common shareholders.

Cumulative Dividends

Dividends that are owed and accumulate if not paid in a given period, typically associated with preferred shares.