Rapid Call is a private limited company. It manufactures a range of cell (mobile) phones. The demand for these is increasing. Its products have several special features that are not available from other phone manufacturers. It sells its products directly to retail shops. Rapid Call uses competitive pricing for all products. The Finance Director has been looking at the accounts. A summary is shown in Table 2. In 2011 the gross profit margin was 40%. Table 2: Profit/Loss Account for Rapid Call for year ending 30 April 2012 ($000s) Sales 450 Cost of Sales 300 Gross Profit 150 Overheads 95 Net Profit 55

1. (a)What is meant by 'private limited company'?[2]
2. (b)Calculate the gross profit margin for the year ending 30 April 2012.[2]
3. (c)Identify and explain two ways in which Rapid Call's Finance Director could use the information in Table 2.[4]
4. (d)The Marketing Director is thinking about changing the channel of distribution. Identify and explain three factors that Rapid Call should consider when choosing a suitable channel of distribution.[6]
5. (e)How important is increased competition in influencing the marketing strategy of Rapid Call? Justify your answer.[6]

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