INTRODUCTION TO ENTREPRENEURSHIP
IMPORTANCE OF ENTREPRENEURSHIP IN ECONOMIC DEVELOPMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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In order for a business to generate a profit, its operating costs must be ____ the gross margin.
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Equal to
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Identical to
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Less than
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Greater than
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Explanation:
Detailed explanation-1: -Gross profit margin is always higher than the operating margin because there are fewer costs to subtract from gross income. Gross margin offers a more specific look at how well a company is managing the resources that directly contribute to the production of its salable goods and services.
Detailed explanation-2: -Gross margin shows how profitable a company is above and beyond how much they spend to create and sell their products. Profit margin measures how much a company earns from each sale they make.
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