Answer to Test #10: Zero Sales Growth, Negative Company Volatility

Volatility and Sales GrowthAnswer to Test #10: Zero Sales Growth, Negative Company Volatility

Yellow Highlighting=Change from Beginning of Period

End of Period
Customers in Market	Amt Purch from all Suppliers	Primary Supplier	Primary Supplier % of Cust Purch	Units of Sale by Primary Supp	Secondary Supplier	Secondary Supp % of Cust Purch	Units of Sale by Secondary Supp
Customer A	1500	Supplier 1	40%	600	Supplier 2	60%	900
Customer B	1200	Supplier 1	80%	960	Supplier 2	20%	240
Customer C	1000	Supplier 2	50%	500	Supplier 3	50%	500
Customer D	0	None	0%	0	None	0%	0
Total	3700			2060			1640
Suppliers in Market	Amount Sold	% Total Market Share
Supplier 1	1560	42.2%
Supplier 2	1640	44.3%
Supplier 3	500	13.5%
Total	3700	100.0%
*Summary of Changes During Period*
Supplier	Change in Unit Sales Volume	% Volume Change from Beginning to End	Net Unit Volatility in Volume Change	Volatility as % of Unit Sales Volume Change	Customer Growth in Volume Change	Customer Growth as % of Unit Sales Volume Change
Supplier 1	-300	-16.1%	-300	100%	0	0%
Supplier 2	300	22.4%	300	100%	0	0%
Supplier 3	0	0%	0	0%	0	0%
Total	0	0%	0	0%	0	0%

Explanation: In order for this condition to hold, customers must purchase the same amount from the company but allocate a lower percentage of their purchases to the company. We reached our answer by having Customer A allocate only 40% of its purchases to Supplier 1.