profitability Flashcards
1
Q
Increasing profitability
A
An enterprise can increase its profitability by raising prices without demand falling or lower its costs without a noticeable change to the product or service.
2
Q
What is profitability?
A
Profitability is the ability of an enterprise to turn revenue into profit. This is know as its profit margin. It is the amount of profit generated from each £1 generated in saes revenue. So, a profit margin of 20% means the enterprise is generating £0.20 from each £1 of sales revenue.
