Personal Selling Is an Expensive Method for Building Relationships with Customers

question 62

True/False

Personal selling is an expensive method for building relationships with customers.

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Definitions:

Net Operating Income

A measure of a company's profitability excluding interest and tax expenses.

Operating Income

This is the profit realized from a business's operations, calculated by subtracting operating expenses from gross profit.

Total Contribution Margin

The difference between total sales revenue and total variable costs, indicating the amount available to cover fixed expenses and generate profit.

Operating Leverage

A measure of how sensitive net operating income is to a given percentage change in revenue, indicating the proportion of fixed versus variable costs.