Question

Does the data in Case Exhibit 4 indicate that Costco’s expansion outside the U.S. is financially successful? Provide a detailed analysis and interpretation of the information presented in Case Exhibit 4, considering relevant financial metrics, trends, and any other factors that contribute to the assessment of Costco's financial success or challenges in its expansion efforts outside the United States. Justify your conclusion with specific references to the data and financial indicators.

Answer 1

The data in Case Exhibit 4 indicates that Costco's expansion outside the U.S. is financially successful, as shown by increasing sales, total revenues, operating income, and net income.

Step-by-step explanation:

The data presented in Case Exhibit 4 provides valuable insights into the financial success of Costco's expansion outside the U.S. by analyzing relevant financial metrics and trends. The exhibit highlights the growth in Costco's international operations, including increasing sales and total revenues.

One key financial indicator to consider is the compound annual growth rate (CAGR) of sales, which shows the rate at which Costco's sales have been growing over a period of time. Looking at the CAGR for international sales, we can observe a positive trend, indicating that Costco's expansion efforts outside the U.S. have been financially successful.

Another important factor to consider is the profitability of Costco's international operations. The exhibit shows a steady increase in operating income and net income, which suggests that Costco's expansion outside the U.S. is yielding positive financial results.