Which of the following statements illustrates the 80/20 rule?
A) "80 percent of our target market doesn't respond to our marketing mix, and we only have a 20 percent market share."
B) "Of the hundred retailers who carry our products, the top twenty account for nearly 80 percent of our total business."
C) "20 percent of our marketing effort is wasted, but we don't know which 20 percent."
D) "We don't know whether our profits are 20 percent higher than we deserve, or only 80 percent of what might be easily obtained."
E) None of the above.

Question

Quizplus · Accepted Answer

The 80/20 rule (also known as the Pareto principle) states that 80 percent of effects come from 20 percent of causes. In this case, the statement "Of the hundred retailers who carry our products, the top twenty account for nearly 80 percent of our total business" illustrates the 80/20 rule, as it shows that a majority of the company's business comes from a minority of its clients. The other statements do not directly mention this principle.

Which of the Following Statements Illustrates the 80/20 Rule