Assignment:
Consider the following list of retail items sold in a small neighborhood gift shop
|
Item
|
Annual Volume
|
Average Profit
per Item
|
|
Greeting cards
|
3,870
|
$ 0.40
|
|
T-shirts
|
1,550
|
1.25
|
|
Men's jewelry
|
875
|
4.50
|
|
Novelty gifts
|
2,050
|
12.25
|
|
Children's clothes
|
575
|
6.85
|
|
Chocolate cookies
|
7,000
|
0.10
|
|
Earrings
|
1,285
|
3.50
|
|
Other costume jewelry
|
1.900
|
15.00
|
a. Rank the item categories in decreasing order of the annual profit. Classify each in one of the categories as A, B, or C.
b. For what reason might the store proprietor choose to sell the chocolate cookies even though they might be her least profitable item?
Provide complete and step by step solution for the question and show calculations and use formulas.