Amgen and Genentech are competitors in the biotechnology market. In a recent yea

Question

Amgen and Genentech are competitors in the biotechnology market. In a recent year, Amgen reported a gross profit percentage of 87.2% while Genentech's percentage was 71.5%. What is the most likely cause of Amgen's higher gross profit percentage?
Answer
A.
Lower product selling prices for Amgen.
B.
Lower product costs for Amgen.
C.
Genentech's inability to control selling and administrative expenses.
D.
Both B and C led to a higher gross profit percentage for Amgen.
E.
All of the above caused the higher percentage.

Explanation / Answer

gross profit percentage = ( Sales - cost ) / sales If product selling prices were low for amagen, then sales would be less and profit percentage would also be less. But here profit percentage of amagen is more than genetech Costs for amgen are less then its profit percentage would be more If genetech could nt control sales and admin expenses, then its cost would increase and it ll have less profit percentage. There for both B and C led to higher gross profit percentage for amgen

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