Question

building a business
businesses aim to make the most profit by reducing costs and increasing revenue. a business model is a
step-by-step plan that describes the company’s strategies and the projected costs, revenues, and profit. in
this task, you will analyze a business model and create one yourself.
question 1

question
which three items directly contribute to increasing profits?
providing just enough inventory to satisfy demand for the product
selling at low prices
buying inventory in bulk, rather than individually
selling a product similar to a competitor’s product
advertising and marketing the product

Explanation:

To determine which items increase profit, we analyze each option:

1. Providing just enough inventory to satisfy demand: Reduces excess inventory costs, so it helps increase profit.
2. Selling at low prices: Usually reduces revenue per unit, likely decreasing profit (unless volume is extremely high, but generally not a direct profit - increasing strategy here).
3. Buying inventory in bulk: Often gets lower unit costs (bulk discounts), reducing costs and increasing profit.
4. Selling a product similar to a competitor’s product: Increases competition, likely leads to price wars or reduced market share, not a direct profit - increasing strategy.
5. Advertising and marketing the product: Increases brand awareness and sales volume, which can increase revenue and thus profit.

So the three items that directly contribute to increasing profits are "providing just enough inventory to satisfy demand for the product", "buying inventory in bulk, rather than individually", and "advertising and marketing the product".

Answer:

• providing just enough inventory to satisfy demand for the product
• buying inventory in bulk, rather than individually
• advertising and marketing the product