Rising promotion costs and shrinking profit margins are the result of ________.

Question

Quizplus · Accepted Answer

Heightened competition in the market leads to rising promotion costs as companies invest more to grab the attention of customers. This puts pressure on profit margins as companies have to spend more on marketing and promotions but may not be able to raise prices significantly due to the competitive environment. Changing technology, globalization, deregulation, and privatization may have an impact on business operations, but they may not necessarily lead to rising promotion costs and shrinking profit margins.

Rising Promotion Costs and Shrinking Profit Margins Are the Result