Page 622 - Business Principles and Management

C HAPTER 22 A SSESSMENT

APPLY WHAT YOU KNOW

20. Explain why it is important for businesses to consider both the
customer and the business when planning the sale of products.
21. Using the formula for calculating net profit, suggest several ways
that a business can increase the net profit from the sale of a product.
22. Which advertising media do you believe are most effective for the
products you purchase? Why? Would the same media be most
effective for advertising the products your parents buy? Why or
why not?
23. Explain why high-technology products are often sold initially at
very high prices but later at prices that have dropped dramatically.
24. Why do you believe that closing the sale is the most difficult step of
the selling process for many salespeople? As a customer, what would
you recommend to salespeople to make that step easier and more
successful?

MAKE CONNECTIONS

25. Math A book and gift store with average annual sales of $700,000
spends 3 percent of its sales for advertising. The store’s advertising
budget is divided as follows: catalogs, 30 percent; calendars and
other sales promotions, 7 percent; window displays, 15 percent;
newspaper advertising, 15 percent; direct mail, 20 percent; and
miscellaneous, 13 percent.
a. How much is the average annual advertising budget?
b. What is the amount spent on each type of advertising?
26. Research Use the Internet to identify the cost of ad placement in a
number of media. Identify the cost per thousand (cost/1,000 people
reached) for each medium. Identify which media have a higher cost.
Specify why these media are able to charge a higher price.
27. Technology Use the Internet to find online examples of each of the
following types of advertising: static banner, interactive banner,
button, sponsored site, and affiliate listing with another Internet
site. Using a screen capture, take an example of each online adver-
tisement you find and prepare a slide show of the various types of
Internet advertising.
28. Speaking Assume that you are a salesperson in a furniture store.
Develop a list of the buying motives you believe might be prompt-
ing each of the following types of customers to consider buying a
sofa sleeper: (a) a college student who is buying furniture for a
one-bedroom apartment, (b) a family that is outfitting a family
room they are remodeling, and (c) a motel owner who is deciding
between a less expensive sofa and the sofa sleeper for 50 rooms.
Prepare and present a sales presentation to the class that you would
use for each of these customers.

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