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Free response · 4.2 Evaluating Performance Using KPIs
Exam-style concept-application task: apply the topic to a new business scenario. Suggested time 12–13 minutes.
FRQ 3 — Concept application (3 points)
Marlowe Pet Supply runs 8 stores. This quarter's data for Store 5: gross profit margin fell from 48% to 42% (chain average: 47%); customer retention fell from 68% to 59% (chain average: 66%); customer acquisition cost rose from $9 to $21 (chain average: $10); per-unit cost and order accuracy are both at the chain average.
(A) Classify TWO of Store 5's KPIs by category (financial, marketing/sales, or operations) and identify which are below the chain benchmark. 1 pt
(B) Using the pattern across Store 5's KPIs, identify the MOST likely underlying cause and explain your reasoning. 1 pt
(C) Recommend ONE management action (tied to Topic 4.1's functions) to address the cause identified in Part B, and name ONE KPI that would be re-checked afterward to evaluate whether it worked. 1 pt