What Ratio Would a Retailer Utilize to Best Compare the Performance

question 71

Multiple Choice

What ratio would a retailer utilize to best compare the performance of the brand name vendors in their assortment to one another?

• A)cost of goods sold percent
• B)gross margin percent
• C)operating expense percent
• D)fixed expense percent
• E)variable expense percent

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Definitions:

Marginal Cost

The expense incurred from manufacturing an additional unit of a product.

Marginal Revenue

The increment in revenue resulting from the sale of an additional unit of output in a market.

Marginal Cost

The budget allocation for the production of an additional unit of a product or service.

Perfect Competition

A market structure characterized by many buyers and sellers, free entry and exit, and a homogeneous product, leading to no single entity having market power.