Sam, the Owner of a Small Company, Learned That a Competitor

question 14

Multiple Choice

Sam, the owner of a small company, learned that a competitor was planning to spend $150,000 on promotion in the next financial year. As soon as he learned this, Sam called his finance manager and said, "I want to spend $150,000 on promotion next year." In this case, which method of promotional budgeting does Sam use?

• A) the objective-and-task method
• B) the competitive-parity method
• C) the percentage-of-sales method
• D) the affordable method
• E) the pull-push method

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Definitions:

Franchising

A method of expanding a business and distributing goods and services through a licensing relationship.

Franchisee

A franchisee is an individual or company that has been granted the right by a franchisor to carry out business under the franchisor's brand and operational system.