When a retailer's actual results fall short of planned results, ...

[crazycityslicker]

When a retailer's actual results fall short of planned results, North America's retailing philosophy is to place blame on:
 a. external factors.
  b. management/employees.
  c. the economy.
  d. merchandisers.
  e. decline in target markets.

Question 2

Explain the difference between disposable and discretionary income. Which is more important to retailers?

[Andromeda18]

Answer to Question 1

B

Answer to Question 2

Economists tend to view income from two different perspectives: disposable and discretionary. Disposable income is simply all personal income minus personal taxes. For most consumers, disposable income is their take-home pay. Discretionary income is disposable income minus the money needed for necessities to sustain life, such as minimal housing, minimal food, and minimal clothing. Retailers who sell necessities, such as supermarkets, like to see incomes rise and taxes decrease. These retailers know that while consumers will not spend all their increased disposable income on the retailer's merchandise, they will nevertheless increase spending. Retailers who sell luxury goods want to see discretionary income increase. However, the recent economic slowdown has had a negative effect on both types of incomes as the value of the houses and stock market portfolios declined during this slowdown.

[crazycityslicker]

Thanks for the timely response, appreciate it

[yeungji]

TYSM