Question
Two car dealerships have similar annual net sales. One car dealership has a gross profit rate of 52.6%, whereas the other car dealership has a
Two car dealerships have similar annual net sales. One car dealership has a gross profit rate of 52.6%, whereas the other car dealership has a gross profit rate of 23.7 percent. Which of the following explanations is the most likely reason for this difference?
A : The car dealership with a gross profit rate of 52.6% has lower inventory turnover, whereas the car dealership with a gross profit rate of 23.7% has higher inventory turnover.
B : The car dealership with a gross profit rate of 52.6% sells high-end sports and luxury vehicles, whereas the car dealership with a gross profit rate of 23.7% sells sedans and used vehicles.
C : The car dealership with a gross profit rate of 52.6% sells sedans and used vehicles, whereas the car dealership with a gross profit rate of 23.7% sells high-end sports and luxury vehicles.
D : The car dealership with a gross profit rate of 52.6% has higher inventory turnover, whereas the car dealership with a gross profit rate of 23.7% has lower inventory turnover.
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