In Advertising to Children, Even When Marketers Use Disclaimers, One

question 6

Multiple Choice

In advertising to children, even when marketers use disclaimers, one ethical problem centres on the fact that:

• A) parents really want kids to learn to use ads for making decisions on their own
• B) kids tend to interpret what they see on television as real; they do not necessarily understand the persuasive intent of commercials
• C) the largest advertising budget usually wins the kids' market
• D) kids get disappointed when parents won't buy everything shown on TV
• E) most ads are environmentally insensitive

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Definitions:

Direct Materials

These are the raw materials that are directly incorporated into a finished product.

Prime Cost

The combined direct costs of raw material and labor that are directly associated with the production of a product.

Discretionary Fixed Costs

Those fixed costs that arise from annual decisions by management to spend on certain fixed cost items, such as advertising and research.

Committed Fixed Costs

Expenses that a company has to pay regardless of its level of production or sales, such as leases and long-term contracts, which cannot be easily changed in the short term.