The profit maximization point is when
A) the total possible sales effort has been achieved.
B) the marginal costs of adding a salesperson are equal to the marginal profits generated by that salesperson.
C) the marginal profits for a salesperson are maximized by assigning them to a certain territory.
D) the incremental profits of a salesperson provide a return over and above the cost to employ him or her.
E) the optimal account to salesperson ratio has been determined.

Question

Quizplus · Accepted Answer

The profit maximization point is achieved when the marginal costs of adding a salesperson are equal to the marginal profits generated by that salesperson. At this point, any additional salesperson would result in a decrease in profits, as the additional cost would outweigh the additional revenue generated.

The Profit Maximization Point Is When