If marketing expenses to sales ratio is 4.2% in period 1 and 5.1% in period 2,this indicates that:
A)the firm has become more efficient in controlling its marketing expenses over the period.
B)the firm has become less efficient in controlling its marketing expenses over the period
C)marketing expenses are a lower percentage of sales revenue
D)the firm is more profitable in period 2

Question

Quizplus · Accepted Answer

The increase in the marketing expenses to sales ratio from period 1 to period 2 indicates that the firm has become less efficient in controlling its marketing expenses over the period. This could mean that they are spending more on marketing initiatives or that their sales revenue has decreased. The other options are not necessarily true based on this ratio change alone.

If Marketing Expenses to Sales Ratio Is 4