Answer: Razor and blade strategy
Explanation:
The Razor Blade Model is a model that is used by companies to deeply discount or give away a core product hoping that the consumers will buy the more expensive and complementary dependent products.
The razor and blades business model is a model whereby one item is sold at a cheaper price or sometimes given for free so as to increase the sales of its complementary good. For example, ink catridges are required for inkjet printers and software and accessories are used for game consoles. So, selling ink catridges at a low rate can lead to more sales for inkjet printers.
Answer: Forward Integration
Explanation:
Forward integration is a process where a company takes over the control of another company that is further along in the value chain so that it might be able to sell or distribute is goods more effectively. For example, an oil company taking over a petroleum products company.
In this scenario, the Brazilian company purchased a huge part of a company further along in distribution in order to facilitate better sales so this is forward integration.
Answer:
The Margin of safety is $100,000
Explanation:
Price = Sales / number of units = $1,700,000 / 8500 = $200
Contribution margin ratio is the ratio of contribution margin to the sales value. It measure the ratio that contributes in the recovery of fixed cost and making profit.
Contribution margin ratio = Contribution margin / Sale price = $60 / $200 = = 0.3 = 30%
Break-even is the level of sales at which business has no profit no loss situation.
Break-even point = Fixed cost / Contribution margin ratio = $480,000 / 30% = $1600,000
Margin of safety is the level of sales at which the business is safe from making loss. Margin of safety measures the profit after the break-even point.
Margin of Safety = Total sales - Break-even point = $1,700,000 - $1,600,000
= $100,000
Answer:
B) Price of the unit minus cost of goods sold per unit.
Explanation:
A)
Costs involving monetary payments are explicit costs. Labor costs and total debt payments, both are explicit costs.
B)
The difference between revenue earned and cost of goods sold is our profit margin. Price of the unit is revenue earned and deducting cost of goods sold per unit from it will give us profit margin of an item.
C)
The unit price of an item is called the price of the unit, also called sales price. It could in Kilogram, Liter, etc. The price of the unit is considered part of the profit margin but not actually comprise profit margin itself.
D)
The unit cost of an item is called the cost of goods sold per unit. The unit could be in Kilogram, Liter, etc. The cost of goods sold is usually deducted from the price of the unit to derive to the profit margin. Hence a part of profit margin but not actually a profit margin itself.
Answer:
B. market segment
Explanation:
The Market segment is a term which is used to define a collection of people who tends to have one or more common characteristics.
These common characteristics are grouped together for the purpose of marketing.
Each market segment is different, thus marketers utilities various criteria to create a target market for their goods.
