According to the Text, Segmenting

question 270

Multiple Choice

According to the text, segmenting:

• A) is a disaggregating or "breaking down" process.
• B) assumes that each person should be treated as a separate target market.
• C) assumes that all customers can be clustered into profitable market segments.
• D) is an aggregating process.
• E) uses scientific rules to decide how many submarkets exist.

---

Definitions:

Contribution Margin

The amount remaining from sales revenue after variable costs have been deducted, indicating how much contributes to covering fixed costs.

Total Gross Margin

This is the difference between sales revenue and the cost of goods sold, before deducting administrative and selling expenses.

Absorption Costing

An accounting method that includes both variable and fixed production costs in the cost of goods sold.

Total Gross Margin

A financial metric that measures the difference between revenue and the cost of goods sold, indicating the profitability of sales before deducting operating expenses.