Question

If retail stores experience a decrease in revenues during this holiday season, then either attitudes toward extravagant gift giving have changed or prices have risen beyond the level most people can afford. If attitudes have changed, then we all have something to celebrate this season. If prices have risen beyond the level most people can afford, then it must be that salaries have not kept pace with rising prices during the past year.

Answer 1

The statement is: True.

Step-by-step explanation:

Several factors influence the revenues of a business. Change in consumers' patterns is one of them. Individuals' behavior, needs, and expectations are not static. They vary over time. Firms must be aware of what tendencies are in the market to keep up with the changes. Otherwise, a company can lose its market share because of not knowing what is driving consumer purchases.

Another factor influencing institutions' profits is consumer income. If income decreases or if price rises but income keeps the same level, consumers will lose purchasing power decreasing the quantity demanded in different products which are translated in losses for companies.