Which of the Following Is a Disadvantage of Jettisoning Low-Value

question 40

Multiple Choice

Which of the following is a disadvantage of jettisoning low-value customers?

• A)High-value customers tend to become unprofitable.
• B)The total value of individual customers, in terms of profits, falls.
• C)Competitors become aware of the company's customer base.
• D)The company loses its focus on the high-value consumers.

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Definitions:

Minimum Bid

The lowest price that a seller is willing to accept for an item being sold at auction.

Net Working Capital

The variance between an organization's immediate assets and its short-term obligations, reflecting its short-term fiscal well-being.

Straight-Line Depreciation

A method of evenly distributing the cost of a tangible asset over its useful life, resulting in a fixed annual depreciation expense.

Required Rate Of Return

The minimum annual percentage earned by an investment that will induce individuals or companies to put money into a particular project or investment.