Marty runs a book shop in the city centre. He has been looking at how financially successful his business is. Table 1.1 shows an extract from the accounts. Over the last 2 years, revenue has fallen by 50%. Marty believes that rising competition is one cause of this. He intends to alter his pricing strategy. He is also thinking about the different promotion methods he could use to boost sales.
(a)[2]
Define the term ‘cost of sales’.
(b)[2]
Calculate the values of X and Y.
(c)[4]
Outline two possible problems that the drop in revenue might create for Marty’s business.
(d)[6]
Explain two pricing methods that Marty could use.
(e)[6]
Explain two promotion methods that a small retail business could use to raise sales. Justify which method is the best one to use.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Money spent on buying / producing the materials used in the final product sold” …