Self-study
Consumer demand for personal computers continues to increase each year, which might lead one to think that the profits earned selling personal computers at the retail level are very high relative to total retail sales of personal computers. ███ ███ ██████ ██████ ██████ ██ ████████ ████████ █████ ██ █████████ ███ ████████ ██ ████ ██ █████ ███████ ███████████████ ██████
"Surprising" Phenomenon
Why is the retail profit margin on personal computers very low compared to other popular hi-tech items, even though demand for personal computers increases every year?
Objective
This is an EXCEPT question. The four wrong answers will help explain why retail profits on personal computer sales might not be as high as we would expect given the demand for personal computers.
18.
Each of the following, if █████ █████ ██ ███████ ███ ████████ ███████████ █████████ █████ ███████
a
Rapid innovation in ████████ ██████████ █████████ ███ ██████████ ██ █ ███████ █████ ████████ █████████
This suggests computers purchased by a store for sale to consumers quickly become obsolete, which could make them harder to sell. If stores carry obsolete computers, this could depress the profits earned on the sale of computers.
b
Satisfaction with their █████ ████████ ████████ █████ ██ ████ █████████ ████ █████ ██ ████ ██████████ ██████
This suggests brands want first-time customers to have a good experience. But this doesn’t suggest that profits would be lower for personal computers than we would otherwise expect. If anything, brand loyalty might allow for higher prices on popular brands, increasing profits.
c
A customer needs ████ ████ ████ █████ █████████ ████ ██████ █ ████████ ████████ ████ ████ ██████ █████ ███████████████ ██████
This raises a reasonable possibility that selling personal computers requires hiring more employees, which raises the costs of selling those computers.
d
Many retail stores ████ ███ ██████ ██ ████████ █████████ ██ █████ ██ █████ ██ █████████ ███ █████ ███ ████████ ███ ████████████
Stores might choose lower profits from personal computer sales in order to increase profit from other products.
e
An increase in ███ ██████ ██ ████████ ██████ ███████ ███████ ████████ █████████ ███ ███████████ ███ ███████████ ███ ██████████
Greater competition for personal computer sales will likely lead to lower prices, which reduces profit margin.