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High or low sales margins.

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Which of the following types of organisations do you expect to have high or low sale margins? Why?
1) a supermarket
2) a pharmaceutical company
3) retailer of musical instruments
4) a software company

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Solution Summary

The solution provides a discussion examining if each of the industries listed would have a high or low sales margin, including the reasons why it would be high or low. This solution is written based on 25+ years of professional experience in public accounting and finance.

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The supermarket and the retailer of musical instruments would have the lowest sales margins, and the pharmaceutical company and the software company would have the highest sales margins.

The supermarket is not able to charge an excessive price for their goods. Even considering that price differences exist between different competitors in the supermarket industry, the prices are relative to the goods and/or services being sold. The same is true ...

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