The Primary Reason for a Business to Allow Customers to Purchase

question 95

Multiple Choice

The primary reason for a business to allow customers to purchase goods or services on account is to:

• A)decrease the marketability of the company's inventory.
• B)increase cash flow from financing.
• C)decrease cost of goods sold.
• D)increase sales.

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Definitions:

Total Profit

The financial gain made by a business after subtracting all expenses, taxes, and costs from total revenues.

Profit-Maximizing

A strategy in which a firm seeks to achieve the highest possible profit from its operations, often by adjusting output or prices.

Marginal Revenue

The additional revenue that a company earns from selling one more unit of a product or service.

Marginal Revenue

The additional revenue that a company generates from selling one more unit of a good or service.