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PCM Sales Management study materials
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PCM Sales Management practice questions

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Question 1Sales Management

A sales manager is setting a quota for a territory with predictable, repeatable demand from a stable customer base. Which quota type best fits this situation?

  1. A quota based on new-account acquisition count
  2. A quota based on activity call counts
  3. A quota based on gross margin percentage
  4. A quota based on prior-period sales volume Correct answer.

Explanation

When demand is stable and repeatable, volume-based quotas tied to historical sales are the most reliable and easy to administer. New-account and margin quotas suit growth or profitability priorities, and activity quotas are used when outcomes are hard to measure directly.

Question 2Sales Management

In a sales organization, the span of control refers to which of the following?

  1. The length of the sales cycle
  2. The number of salespeople reporting to a single manager Correct answer.
  3. The geographic size of a sales territory
  4. The number of products a rep may sell

Explanation

Span of control describes how many direct reports a manager supervises and is a core design choice in sales force structure. Territory size, product breadth, and cycle length are separate structural variables.

Question 3Sales Management

Which compensation element is most directly designed to align a salesperson's pay with the profitability of the deals they close?

  1. A commission on gross margin Correct answer.
  2. A commission on revenue
  3. A fixed car allowance
  4. A straight salary

Explanation

Commissioning on gross margin ties variable pay to the profit each deal generates, encouraging better pricing and mix. Revenue commission rewards volume regardless of margin, salary and allowances are not tied to deal profitability.

Question 4Sales Management

A firm wants to forecast sales for a new product with no historical data. Which approach is most appropriate?

  1. A regression on the product's own past sales
  2. A moving-average forecast of prior periods
  3. A judgmental forecast built from salesforce and expert estimates Correct answer.
  4. A seasonal index from the product's history

Explanation

Without historical data for the product, quantitative time-series and regression methods have nothing to model. Judgmental methods such as expert opinion and salesforce composite estimates are the appropriate choice.

Question 5Sales Management

Which of the following best describes the purpose of a sales call plan?

  1. To document the firm's overall marketing budget
  2. To allocate selling time across accounts according to opportunity and cost to serve Correct answer.
  3. To record the outcome of every past customer visit
  4. To calculate the salesperson's commission for the period

Explanation

Call planning allocates limited selling time to accounts based on potential value and cost to serve, improving productivity. It is forward-looking and distinct from record-keeping, pay calculation, and budget documentation.

Question 6Sales Management

A sales manager uses a CRM dashboard to review each rep's pipeline coverage ratio weekly. This practice primarily supports which management function?

  1. Recruiting new sales talent
  2. Designing the compensation plan
  3. Monitoring and controlling sales performance Correct answer.
  4. Selecting distribution channels

Explanation

Reviewing pipeline metrics against targets is a monitoring and control activity that tracks performance and triggers corrective action. Recruiting, compensation design, and channel selection are separate planning functions.

Question 7Sales Management

Which leadership approach is most consistent with a sales manager coaching a seasoned, high-performing rep?

  1. A delegating style with light-touch support Correct answer.
  2. A directive style with close task supervision
  3. A hands-off style with no feedback at all
  4. A coercive style focused on compliance

Explanation

Experienced high performers typically need autonomy and periodic support rather than close direction, matching a delegating style. Directive or coercive styles fit inexperienced or underperforming reps, and no feedback at all forgoes development.

Question 8Sales Management

The break-even point in a sales territory is the level of sales at which which condition holds?

  1. Pipeline value equals the annual quota
  2. Gross margin equals the salesperson's salary
  3. Total territory revenue equals total territory cost Correct answer.
  4. Commission equals base pay

Explanation

Break-even occurs where revenue exactly covers the costs assigned to the territory, yielding zero profit. The other conditions describe pay or pipeline relationships, not the cost-recovery threshold.

Question 9Sales Management

A company sells complex, high-value enterprise solutions requiring deep technical expertise. Which sales force specialization is usually most appropriate?

  1. Random assignment of accounts to reps
  2. A single generalist rep per region
  3. Specialization by product or technical solution Correct answer.
  4. Specialization by geographic territory only

Explanation

Complex technical solutions are best sold by reps specialized in the relevant product or solution area so they can credibly address buyer needs. Pure geographic or generalist structures may lack the depth, and random assignment ignores fit.

Question 10Sales Management

A sales manager wants to reduce turnover among new hires. Which action most directly addresses a common early-tenure cause of quitting?

  1. Adding more products to each rep's line
  2. Providing structured onboarding and early coaching Correct answer.
  3. Increasing the commission rate for all reps
  4. Extending the sales cycle length

Explanation

New hires often leave because they feel unsupported or unable to succeed early; structured onboarding and coaching build competence and confidence. Pay changes, line breadth, and cycle length do not target the onboarding experience.

Question 11Sales Management

A firm uses a salesforce composite forecast. Which statement best characterizes this method?

  1. A statistical model extrapolates past sales trends
  2. Each rep estimates expected sales for their accounts and managers aggregate and adjust the estimates Correct answer.
  3. Buyers are surveyed about their purchase intentions
  4. A panel of outside experts reaches a consensus estimate

Explanation

The salesforce composite builds a forecast bottom-up from rep estimates that managers review and adjust for bias. Trend extrapolation, expert panels, and buyer surveys are distinct methods.

Question 12Sales Management

A sales manager wants to evaluate a rep's effectiveness in winning deals rather than just generating activity. Which metric is most appropriate?

  1. Total travel miles logged
  2. Number of calls made
  3. Number of emails sent
  4. Opportunity win rate Correct answer.

Explanation

Win rate measures how often pursued opportunities convert to closed business, reflecting deal effectiveness. Calls, emails, and travel are activity inputs that do not by themselves indicate winning outcomes.

Question 13Sales Management

In designing territories, which principle most improves fairness among reps?

  1. Making territories equal in geographic area
  2. Assigning territories strictly by seniority
  3. Balancing territories on workload and sales potential Correct answer.
  4. Giving the largest accounts to the newest reps

Explanation

Fair territory design balances workload and potential so reps have comparable opportunity to earn. Seniority, equal area, or assigning big accounts to novices can create inequity and misallocate effort.

Question 14Sales Management

A sales manager notices a rep's close rate is high but average deal size is low. Which coaching focus is most likely to improve total revenue?

  1. Reducing the rep's follow-up frequency
  2. Shortening the rep's sales presentations
  3. Qualifying and pursuing larger opportunities with higher potential Correct answer.
  4. Increasing the number of cold calls per day

Explanation

A high close rate with small deals suggests the rep is winning easy, low-value business; coaching toward larger, well-qualified opportunities can raise revenue. More activity or faster presentations do not address deal size.

Question 15Sales Management

Which compensation mix is generally most appropriate for a sales role with a long, team-based sales cycle and heavy pre-sales support?

  1. A large commission with a low base
  2. A higher salary proportion with smaller variable pay Correct answer.
  3. A straight commission with no base
  4. Pay tied solely to individual short-term volume

Explanation

Long, team-based cycles make individual outcomes hard to attribute and slow to realize, so a salary-heavy mix provides stability and supports collaboration. Commission-heavy plans fit short, individually attributable cycles.

Question 16Sales Management

A sales manager is building a motivation program. According to expectancy theory, which condition must hold for a rep to be motivated to exert effort?

  1. The rep is paid a straight salary with no variable component
  2. The rep's territory is the largest in the region
  3. The rep believes effort leads to performance, performance to reward, and the reward is valued Correct answer.
  4. The rep's manager sets quotas without input

Explanation

Expectancy theory holds that motivation depends on effort-performance expectancy, performance-reward instrumentality, and reward valence. Salary structure, territory size, and quota-setting style are not the theory's core conditions.

Question 17Sales Management

A firm's sales forecast is consistently 15% above actual results across several periods. Which corrective action is most appropriate?

  1. Abandon forecasting altogether
  2. Apply a documented adjustment to remove the systematic bias Correct answer.
  3. Reduce the sales force size
  4. Increase the quota by an additional 15%

Explanation

A consistent directional error indicates systematic bias that can be corrected with a documented adjustment factor. Abandoning forecasting, compounding the error into quotas, or cutting staff are not reasoned responses to bias.

Question 18Sales Management

Which activity best exemplifies a sales manager performing a developmental rather than evaluative role?

  1. Setting the rep's compensation level
  2. Reviewing a recorded call to identify skills the rep can practice Correct answer.
  3. Deciding whether to terminate a rep
  4. Assigning a final performance rating for the year

Explanation

Developmental management focuses on building skills and future capability, such as coaching from a call review. Ratings, termination decisions, and pay setting are evaluative or administrative actions.

Question 19Sales Management

A firm sells through both direct reps and distributors. Which issue is most important to manage to prevent channel conflict?

  1. Defining account coverage rules and rules of engagement between channels Correct answer.
  2. Eliminating all distributor margins
  3. Maximizing the number of channels used
  4. Setting identical prices for every channel

Explanation

Channel conflict is best managed by clear rules of engagement that define which channel serves which accounts and how disputes are resolved. Adding channels or forcing identical pricing can worsen conflict, and eliminating distributor margin is often infeasible.

Question 20Sales Management

A sales manager is forecasting with a weighted pipeline. Which factor most improves the accuracy of the weighting?

  1. Weighting every opportunity equally at 50%
  2. Using stage-specific historical conversion rates Correct answer.
  3. Using the rep's optimistic self-assessment
  4. Ignoring deal age in the pipeline

Explanation

Stage-specific historical conversion rates ground the weighting in observed outcomes at each pipeline stage. Equal or optimistic weights and ignoring deal age introduce bias and reduce accuracy.

Question 21Sales Management

A sales manager must decide whether to add a rep to a territory. Which analysis best supports the decision?

  1. Reviewing the rep's expected call volume only
  2. Comparing incremental margin from added coverage against the fully loaded cost of the rep Correct answer.
  3. Counting the number of accounts in the territory
  4. Comparing the new rep's salary to the highest-paid rep

Explanation

The decision should weigh the incremental gross margin generated by added coverage against the fully loaded cost of the rep. Salary comparisons, account counts, and call volume alone do not capture the economic trade-off.

Question 22Sales Management

A firm shifts from individual quotas to team quotas for a complex solution sale. Which outcome is the most likely intended benefit?

  1. Sharper individual accountability for each rep's numbers
  2. Lower total compensation cost
  3. Faster individual deal cycles
  4. Greater collaboration and information sharing across the selling team Correct answer.

Explanation

Team quotas encourage cooperation and information sharing, which suits complex solutions requiring coordinated expertise. They typically blur individual accountability and do not inherently lower cost or speed individual cycles.

Question 23Sales Management

A sales manager observes that a star rep's performance declined after a territory reassignment. Which diagnostic step is most sound?

  1. Conclude the rep's skills have degraded
  2. Reduce the rep's quota without analysis
  3. Check whether the new territory's potential and account mix differ materially from the prior one Correct answer.
  4. Assume the rep has lost motivation and begin discipline

Explanation

A performance change following a structural change should first be tested against territory potential and account mix before attributing it to the individual. Assuming motivation loss, skill decay, or adjusting quotas without analysis skips the diagnostic step.

Question 24Sales Management

A manager is choosing between a capped and an uncapped commission plan for a role where overachievement is highly valuable but cost must be controlled. Which design best balances these goals?

  1. A capped plan with a flat rate
  2. A commission paid only on the first 80% of quota
  3. An uncapped plan with a decelerating rate above quota Correct answer.
  4. A straight salary with no commission

Explanation

An uncapped plan preserves upside motivation while a decelerating rate above quota moderates cost on very large overachievement. Capping limits motivation, straight salary removes incentive, and paying only to 80% discourages full attainment.

Question 25Sales Management

A sales manager wants to improve the link between training and field performance. Which approach is most likely to transfer learning to the job?

  1. Deliver training once with no follow-up
  2. Follow training with manager coaching and practice on live accounts Correct answer.
  3. Rely solely on e-learning modules
  4. Test reps on theory without field application

Explanation

Learning transfer is strongest when training is reinforced by manager coaching and applied to real accounts. One-off delivery, e-learning alone, and theory-only testing rarely change field behavior.

Question 26Sales Management

A sales manager is defining the ratio of selling time to total working time for the field team. Which term describes the proportion of a rep's total available hours actually spent in face-to-face or remote selling activity?

  1. Pipeline velocity
  2. Account penetration rate
  3. Selling-time ratio Correct answer.
  4. Territory coverage index

Explanation

The selling-time ratio measures the share of a rep's total working hours devoted directly to selling versus administrative or non-selling tasks. It is a core productivity diagnostic because raising it multiplies effective capacity without adding headcount.

Question 27Sales Management

A sales manager wants to estimate how many sales calls a rep must make to cover a territory's workload. Which input is most essential for this workload-based sizing calculation?

  1. The historical win rate of the entire sales force
  2. The average tenure of current reps in the region
  3. The number of accounts by category and the desired call frequency for each Correct answer.
  4. The rep's base salary relative to peers

Explanation

Workload-based territory sizing multiplies the number of accounts in each category by the planned call frequency per account, then divides total required calls by the calls a rep can make per period. Account counts and call frequency are therefore the essential inputs.

Question 28Sales Management

Which statement best describes the purpose of a sales quota?

  1. It fixes the commission rate for the entire sales year
  2. It sets a minimum acceptable performance standard against which results are measured Correct answer.
  3. It replaces the need for territory design and account planning
  4. It guarantees each rep an equal share of total company revenue

Explanation

A quota is a performance target that defines the expected level of output for a rep or unit and provides the benchmark for evaluation and incentives. It is a standard, not a revenue guarantee or a substitute for planning.

Question 29Sales Management

A sales manager is preparing a recruitment profile for a new enterprise account executive. Which document defines the experience, competencies, and behaviors required for success in that role?

  1. The compensation plan
  2. The forecast roll-up
  3. The job specification Correct answer.
  4. The territory routing plan

Explanation

A job specification translates the role's requirements into the qualifications, skills, and behavioral competencies a candidate must possess. It guides sourcing, interviewing, and selection decisions.

Question 30Sales Management

A sales manager is evaluating a rep on the number of new accounts opened during the quarter relative to the assigned target. Which type of performance measure is this?

  1. A competency measure
  2. A behavioral measure
  3. An outcome measure Correct answer.
  4. A process measure

Explanation

Outcome measures capture results achieved, such as accounts opened, revenue, or units sold, against a target. Behavioral and process measures instead track activities and methods used.

Question 31Sales Management

Which element is a fixed component of a sales compensation plan?

  1. Commission paid as a percentage of revenue
  2. A base salary paid regardless of results Correct answer.
  3. A spiff paid for a short-term promotion
  4. A bonus tied to quota attainment

Explanation

Fixed pay is the portion of compensation that does not vary with performance, typically base salary. Variable elements such as commissions, bonuses, and spiffs rise or fall with results.

Question 32Sales Management

A sales manager is reviewing a rep's call report that logs each prospect contacted, the outcome, and the next step. What is the primary managerial value of this record?

  1. It replaces the need for a sales forecast
  2. It provides data to diagnose activity patterns and coach on next steps Correct answer.
  3. It documents the rep's travel expenses for reimbursement
  4. It serves as the legal contract with each prospect

Explanation

Call reports generate activity data that managers use to spot patterns, assess effort and effectiveness, and target coaching. They inform forecasting but do not substitute for it.

Question 33Sales Management

A sales manager wants to reduce the time between a rep's first contact with a lead and the first substantive sales conversation. Which metric most directly captures this?

  1. Quota attainment
  2. Lead response time Correct answer.
  3. Customer retention rate
  4. Average deal size

Explanation

Lead response time measures the interval between lead arrival or first contact and the rep's engagement, directly reflecting speed to the first sales conversation. Deal size, attainment, and retention measure different outcomes.

Question 34Sales Management

A sales manager is setting a quota for a rep in a territory where potential has grown because a competitor exited. Which basis for the quota best reflects the territory's realistic opportunity?

  1. Last year's sales plus a flat 5% across all territories
  2. A figure equal to the rep's base salary
  3. A market-potential-based estimate adjusted for the rep's historical conversion Correct answer.
  4. The average quota of the highest-performing territory

Explanation

Quotas tied to market potential, adjusted for demonstrated conversion ability, reflect what the territory can realistically yield. Uniform uplifts and peer benchmarks ignore territory-specific opportunity.

Question 35Sales Management

A sales manager observes that a rep's win rate is strong but the rep consistently avoids prospecting new logos. Which diagnosis best explains this pattern?

  1. The rep prefers low-risk existing-account work and is under-motivated on new-business activity Correct answer.
  2. The rep's territory has too few accounts to prospect
  3. The rep's pricing authority is too limited
  4. The rep lacks closing skills and loses late-stage deals

Explanation

A high win rate paired with low new-logo activity points to behavior and motivation issues: the rep gravitates toward comfortable, higher-probability existing-account work. The manager should examine incentives and activity expectations for new business.

Question 36Sales Management

A sales manager must choose a control span for a team of field reps working in dispersed territories. Which consideration most directly argues for a narrower span of control?

  1. The reps are highly experienced and self-directed
  2. The selling task is complex and requires frequent coaching and observation Correct answer.
  3. The products are simple and transactional
  4. The compensation is heavily commission-based

Explanation

Span of control should shrink when the work demands close supervision, coaching, and observation, because the manager's time per rep rises. Routine, self-directed work supports wider spans.

Question 37Sales Management

A sales manager is analyzing why a rep's revenue is flat despite rising call volume. Which analysis most directly isolates whether the problem is effort quality rather than effort quantity?

  1. Compare the rep's calls per day to the team average
  2. Review the rep's expense report for travel costs
  3. Check the rep's attendance and time-off records
  4. Examine the rep's call-to-conversion ratio by account segment Correct answer.

Explanation

Breaking conversion down by account segment reveals whether calls are landing on the right prospects and progressing, distinguishing quality of effort from raw volume. Call counts alone cannot separate the two.

Question 38Sales Management

A sales manager is designing a mentoring program pairing new reps with veterans. Which design choice most improves the program's effectiveness?

  1. Assign mentors randomly to maximize coverage
  2. Pair mentors based on relevant territory and skill match with structured check-ins Correct answer.
  3. Limit mentoring to a single orientation session
  4. Let mentors set their own goals without manager involvement

Explanation

Mentoring works best when mentors are matched to the mentee's context and when interactions are structured and monitored. Random pairing, one-off contact, and unmonitored goals reduce transfer.

Question 39Sales Management

A sales manager is preparing a performance review and must decide how to handle a rep who met revenue targets but repeatedly submitted late reports and skipped team meetings. Which approach best reflects balanced performance management?

  1. Escalate immediately to termination without discussion
  2. Lower the rep's revenue quota to compensate for the conduct issues
  3. Address both results and the behavioral standards, documenting expectations and consequences Correct answer.
  4. Ignore the conduct issues because revenue targets were met

Explanation

Effective performance management evaluates results and behaviors together, with clear expectations and documented follow-up. Ignoring conduct erodes standards, while immediate termination skips due process.

Question 40Sales Management

A sales manager is deciding how to allocate a limited training budget. Which approach best targets the investment to the greatest performance gap?

  1. Conduct a needs analysis comparing required competencies to current team capability Correct answer.
  2. Split the budget equally across all possible topics
  3. Fund the training most requested by the loudest reps
  4. Spend on the newest training technology available

Explanation

A training needs analysis identifies the gap between required and actual competencies, directing budget to the highest-impact deficiency. Request volume, equal splits, and novelty are not gap-based.

Question 41Sales Management

A sales manager notices that a rep's pipeline has many early-stage opportunities but few that advance past qualification. Which coaching intervention is most appropriate?

  1. Increase the rep's quota to motivate more effort
  2. Reduce the rep's account list to a handful of large accounts
  3. Focus on qualification criteria and discovery questioning to improve lead quality Correct answer.
  4. Shift the rep to a purely inbound role

Explanation

A pipeline clogged at early stages signals weak qualification and discovery, so coaching should target those skills. Quota changes or structural shifts do not fix the underlying qualification problem.

Question 42Sales Management

A sales manager is evaluating whether to promote a strong rep into a first-line sales manager role. Which predictor is most relevant to managerial success?

  1. The rep's individual quota attainment over the past year
  2. The rep's demonstrated ability to coach, plan, and coordinate others' work Correct answer.
  3. The rep's tenure in the current territory
  4. The rep's personal closing rate on large deals

Explanation

First-line management requires coaching, planning, and coordination competencies that differ from individual selling skill. Strong personal attainment does not automatically predict managerial effectiveness.

Question 43Sales Management

A sales manager is building a dashboard to monitor team health. Which pairing of leading and lagging indicators is most useful?

  1. Qualified meetings booked paired with closed revenue Correct answer.
  2. Customer complaints paired with building maintenance costs
  3. Headcount paired with office rent
  4. Revenue this quarter paired with last year's revenue

Explanation

Leading indicators such as qualified meetings predict future results, while lagging indicators such as closed revenue confirm outcomes. Pairing them gives early warning alongside results verification.

Question 44Sales Management

A sales manager must decide how to handle a territory whose potential has declined sharply due to a plant closure. Which action best aligns territory design with efficiency?

  1. Leave the territory unchanged to preserve rep familiarity
  2. Reassess account assignments and reallocate capacity to areas with stronger potential Correct answer.
  3. Add a second rep to the same shrinking territory
  4. Increase the rep's quota to offset the decline

Explanation

Territory design should track potential; when potential falls, accounts and rep capacity should be reallocated to preserve efficiency. Raising quotas or adding reps to a shrinking market misallocates resources.

Question 45Sales Management

A sales manager is reviewing a rep whose sales cycle lengthened while deal size stayed constant. Which follow-up question best tests whether the cause is a change in buyer behavior rather than rep performance?

  1. Did the rep attend the last team meeting?
  2. Is the rep using the newest laptop model?
  3. Has the rep's commission rate changed this year?
  4. Have prospects' approval processes or decision committees changed recently? Correct answer.

Explanation

If buyer approval processes or decision groups have grown more complex, cycle length rises independent of rep skill. Checking buyer-side changes isolates external causes from performance causes.

Question 46Sales Management

A sales manager is setting expectations for a rep who will manage a small set of strategic accounts. Which control approach is most appropriate?

  1. Outcome-based control with periodic strategic account reviews Correct answer.
  2. Tight supervision of daily call activity and scripts
  3. No reporting at all to preserve autonomy
  4. Hourly activity logging with manager sign-off

Explanation

Strategic account work is long-cycle and judgment-intensive, so outcome-based control with periodic reviews balances autonomy and accountability. Tight activity supervision suits more routine roles.

Question 47Sales Management

A sales manager is evaluating whether a rep's low close rate stems from poor targeting or weak closing. Which data combination best distinguishes the two causes?

  1. Number of team meetings attended and reports submitted
  2. Total calls made and total travel miles
  3. Conversion rate by lead source and stage-by-stage progression Correct answer.
  4. Base salary and years of tenure

Explanation

Conversion by lead source reveals targeting quality, while stage-by-stage progression shows where deals are lost, isolating closing weakness. Together they separate the two hypotheses.

Question 48Sales Management

A sales manager observes that two reps with identical territories and quotas achieve the same revenue, but one generates far more margin. Which conclusion is most defensible?

  1. The higher-margin rep is more effective at profitable selling and should be studied for best practices Correct answer.
  2. The lower-margin rep should receive a higher quota
  3. Margin differences are irrelevant to sales performance
  4. Both reps are equally effective because revenue is identical

Explanation

When revenue is equal but margin differs, the higher-margin rep is producing more value per sale through pricing discipline or product mix. That performance should be analyzed and shared.

Question 49Sales Management

A sales manager is deciding between two territory designs: one equalizes account counts, the other equalizes revenue potential. Which reasoning best guides the choice?

  1. Equalizing potential better aligns workload with earning opportunity when accounts differ greatly in size Correct answer.
  2. Equal account counts always produce fairer workloads
  3. Territory design should follow rep seniority
  4. Revenue potential should be ignored because it is hard to measure

Explanation

When accounts vary widely in size, equal counts create unequal opportunity, so balancing potential produces fairer workloads and comparable earning chances. Seniority is not a design criterion.

Question 50Sales Management

A sales manager must evaluate a rep who exceeded quota largely through deep discounting. Which performance conclusion is most sound?

  1. The rep met volume targets but may have damaged profitability, warranting review of pricing behavior Correct answer.
  2. Discounting has no bearing on sales performance evaluation
  3. The rep is a top performer and should be promoted
  4. The rep should be given a higher commission rate

Explanation

Quota attainment through deep discounting can erode margin and train buyers to expect concessions, so evaluation must weigh profitability alongside volume. Promotion or reward without examining pricing behavior risks reinforcing value-destroying selling.