Cambridge International A Level · Business (9609)
5 multiple-choice questions marked as you go, and 5 written questions with worked solutions. All on Marketing analysis (A Level).
A business observes that when average consumer income rises from \$20,000 to \$22,000, the quantity demanded for its premium organic fruit baskets increases from 1,000 units to 1,250 units per month. What is the Income Elasticity of Demand (YED) for this product?
Which of the following statements best explains why a marketing manager would use a moving average in time series analysis for sales forecasting?
A manufacturer of luxury electric vehicles identifies that its product has a Price Elasticity of Demand (PED) of \( -3.0 \) and an Income Elasticity of Demand (YED) of \( +4.5 \). If the national economy enters a period of rapid expansion with high income growth, which combination of marketing analysis and strategy would most likely lead to the highest increase in total revenue?
Which of the following is a qualitative method used by businesses for sales forecasting?
A marketing manager calculates the Price Elasticity of Demand (PED) for a product to be \( -2.5 \). If the manager decides to reduce the selling price by \( 10\% \), what is the most likely outcome for the business?
Define the concept of price elasticity of demand.
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A company reports its quarterly sales as follows: Q1 = \( 210 \), Q2 = \( 240 \), Q3 = \( 270 \), and Q4 = \( 300 \). Calculate the four-period moving total for the first year of operations.
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Analyze one reason why qualitative sales forecasting might produce more accurate results than quantitative time-series analysis when a business is preparing to launch a completely new, innovative product.
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The process of product development is vital for the survival of businesses in the pharmaceutical industry.
(a) Discuss the importance of Research and Development (R&D) in ensuring the safety and marketability of a new drug before its official launch.
(b) Assess the extent to which a business can rely on elasticity measures when predicting the potential sales volume of a completely new and innovative product that has no direct competitors.
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A firm facing intense competition has a Price Elasticity of Demand (PED) of \( -1.5 \) and a Promotional Elasticity of Demand of \( +0.6 \). The firm is considering a strategy that involves increasing its advertising spend by \( 20\% \) and simultaneously increasing the price by \( 4\% \).
(a) Calculate the expected net percentage change in quantity demanded resulting from this combined strategy.
(b) Evaluate whether this combined pricing and promotional strategy is likely to improve the firm's total revenue and market share.
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