A Profit Ratio for a Retailer of 4

question 24

Multiple Choice

A profit ratio for a retailer of 4.1% in year 2 compared to 5.5% for the previous year indicates:

• A) an improving profit margin.
• B) a declining profit margin.
• C) no change in the profit margin.
• D) impending bankruptcy.

---

Definitions:

Laws

The system of rules that are recognized as regulating the actions of a country's or community's members and enforced by the imposition of penalties.

Forces of Competition

Forces of competition pertain to the external pressures in a marketplace from other firms that affect a company's ability to compete, often described in Porter’s Five Forces model.

Industry

A group of companies that operate in a specific sector of the economy, producing or supplying goods, services, or related technologies.

Strategic Plans

Long-term goals and the actionable steps designed to achieve an organization's objectives.