Chapter 20 Flashcards
What are Key Performance Indicators (KPIs) primarily used for?
a) Long-term strategic planning
b) Daily operational tasks
c) Monitoring business performance
d) Employee performance evaluation
C
How are KPIs typically presented for easy monitoring?
a) Annual reports
b) Whitepapers
c) Dashboards
d) PowerPoint presentations
C
What is the main purpose of displaying KPIs on dashboards?
a) To confuse managers
b) To demonstrate data visualization skills
c) For regular monitoring by managers
d) To impress stakeholders
C
Which of the following are examples of KPIs for an online retailer brand?
a) Quarterly profits
b) Social media likes
c) Daily visitors
d) Employee satisfaction
C
What role do KPIs play in guiding organizational direction?
a) They are irrelevant for strategic planning
b) They provide insights into performance trends
c) They are only used for marketing purposes
d) They hinder decision-making processes
B
What is the primary difference between unit margin and markup?
a) Unit margin is based on selling price, while markup is based on acquisition cost.
b) Unit margin is used for long-term planning, while markup is used for short-term analysis.
c) Unit margin is calculated after taxes, while markup is calculated before taxes.
d) Unit margin is only applicable to service industries, while markup is used in retail
A
How is the unit margin percentage calculated?
a) (Selling price per unit - Cost per unit) / Selling price per unit
b) (Selling price per unit - Cost per unit) * 100 / Selling price per unit
c) (Cost per unit - Selling price per unit) * 100 / Selling price per unit
d) (Cost per unit - Selling price per unit) / Cost per unit
B
Which of the following statements accurately describes unit margin?
a) It indicates how much extra profit is gained from selling each unit.
b) It is calculated based on the acquisition cost of each unit.
c) It represents the percentage of the selling price that is profit.
d) It remains constant regardless of changes in selling price.
C. the unit margin for this product is 40%. This means that for each unit sold, 40% of the selling price contributes to profit after subtracting the unit cost.
What does the markup percentage indicate?
a) The percentage increase in cost per unit.
b) The percentage of profit relative to the selling price.
c) The percentage of selling price above the cost per unit.
d) The percentage of tax included in the selling price
c
Which formula correctly represents the calculation of markup percentage?
a) Markup % = (Selling price per unit - Cost per unit) / Cost per unit
b) Markup % = (Selling price per unit - Cost per unit) * 100 / Selling price per unit
c) Markup % = (Selling price per unit - Cost per unit) * 100 / Cost per unit
d) Markup % = (Cost per unit - Selling price per unit) * 100 / Selling price per unit
C
What is the primary purpose of calculating price elasticity of demand?
a) To determine the absolute change in demand
b) To assess the sensitivity of demand to price changes
c) To predict future demand trends
d) To analyze supply chain efficiency
B
How is price elasticity of demand affected by a higher value?
a) Demand becomes less sensitive to price changes
b) Demand becomes more sensitive to price changes
c) Demand and price changes are inversely related
d) There is no relationship between price elasticity and demand sensitivity
B
Which formula correctly represents the calculation of price elasticity of demand?
a) Elasticity = ((Final price - Initial price) / Initial demand) / ((Final demand - Initial demand) / Initial price)
b) Elasticity = ((Final demand - Initial demand) / Initial demand) / ((Final price - Initial price) / Initial price)
c) Elasticity = ((Final demand - Initial demand) / Final price) / ((Final price - Initial price) / Initial demand)
d) Elasticity = ((Final price - Initial price) / Initial demand) / ((Final demand - Initial demand) / Final price)
B
Why is price elasticity typically negative in most cases?
a) Because demand always increases with price
b) Because demand decreases with price
c) Because an increase in price is likely to reduce demand
d) Because consumers prefer lower prices regardless of demand
C
How does the availability of substitutes impact price elasticity?
a) Higher availability of substitutes leads to lower price elasticity
b) Higher availability of substitutes leads to higher price elasticity
c) Availability of substitutes has no impact on price elasticity
d) Availability of substitutes leads to negative price elasticity
B