The Cost of Sales for a Company Is $400,000 and Its

question 25

Multiple Choice

The cost of sales for a company is $400,000 and its net sales are $800,000. What would its stockturn rate be if its average inventory at cost is $100,000?

• A) 3
• B) 2
• C) 1
• D) 8
• E) 4

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Definitions:

Oligopoly

A market structure characterized by a small number of firms controlling a large portion of the market share.

Collude

To collude means to come to a secret understanding for a harmful purpose; collaboration typically occurs between firms to set market prices unfairly.

Tacit Collusion

An unspoken, implicit agreement among competitors to not compete aggressively, often leading to higher prices and less competition without explicit communication or agreements.

Price Leadership

A pricing strategy where one leading company sets the price of products or services, and other competitors in the market follow.