The principle that decreasing the money spent on purchasing functions increases profit FASTER than increasing revenue as a result of marketing and sales is called the: A.Supply Importance Factor B.Supply Bonus Effect C.Profit Leverage Effect D.Profit Speed Effect E.Purchasing Importance Factor

• Profit Leverage Effect

Explanation:

This is line with the profit-leverage effect which translates the impact that saving on purchasing functions has compared to generating revenue from marketing and more sales. According to this concept, a dollar saved in purchasing has a greater impact on profits compared to a dollar saved on revenue from sales. Thus, this focuses on reducing the cost of purchases more than focusing on increasing sales and marketing to raise profits.