The Probability That a New Advertising Campaign Will Increase Sales

question 64

Multiple Choice

The probability that a new advertising campaign will increase sales is assessed as being 0.80. The probability that the cost of developing the new ad campaign can be kept within the original budget allocation is 0.40. Assuming that the two events are independent, what is the probability that the cost is not kept within budget or the campaign will not increase sales?

• A) 0.68
• B) 0.32
• C) 0.12
• D) 0.88

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Definitions:

Return on Marketing Investment (ROMI)

A measurement of the profitability and effectiveness of marketing efforts, calculated by dividing the incremental financial gain from marketing by the cost of the marketing activities.

Expenses

Refers to the costs incurred in the operation of a business or the execution of a project.

Revenue Analysis

Marketing analytics tool that measures and evaluates revenue from specific products or regions.

Strategic Planning

The process of defining an organization's strategy or direction and making decisions on allocating its resources to pursue this strategy, often based on long-term goals.