Sunman Inc. is a discount retailer with 1,000 stores located across North America. Sunman purchases bulk quantities of groceries and household goods, and then sells the goods directly to retail customers at a markup.
Pharmedical Inc. is a pharmaceutical company that develops medications to prevent and treat diseases. Pharmedical develops, produces, and markets medications for purchase by patients of health care professionals and customers of retail pharmacies and stores. Referring to each company\; business model, which company would have
(a) A higher gross profit percentage,
(b) A higher selling expense as a percentage of sales,
(c) A higher research and development expense as a percentage of sales, and
(d) Higher net income?