A flower delivery business wants to raise their overall sales volume to increase profit. After analyzing their costs, they choose their most popular line of flower arrangements and run a promotion on those arrangements. How would this promotion lead to higher profits?

C) By lowering the price of the flower arrangements to increase demand.

Explanation:

Sales promotions generally should include some type of benefit for the customer and increasing the price of your product doesn't increase the benefits of your customers (options B and D), and lowering the costs of producing the arrangements might benefit the company but not the consumers.

The only possible option is C, since a lower price usually increases the quantity demanded of a product. By increasing the quantity demanded, total sales and total revenue should increase (as long as the demand is elastic). And most importantly, lowering the price increases the consumer surplus, therefore, increasing the benefits received by your customers, which is exactly what a promotion does.

The promotion would lead to a higher profit making current and potential customers more aware of the flower arrangement.

Explanation:

First of all, in business, it is beneficial to focus more energy on the product or service that yields the most revenue (if the business involves diverse commodities).

Now let us define Promotion.

- Promotion is the marketing strategy that is employed to inform target audiences of the specific merits of a particular commodity, this is done in order to drive sales up.

Bearing all these in mind, we can see that the flower delivery business has chosen to run a promotion on their most popular flower arrangement.

The promotion will therefore create more awareness of the merits of that particular flower arrangement and this will lead to higher sales, and therefore, higher profits.

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