Tire Corral Has $6,000 Available Per Month for Advertising

question 53

Multiple Choice

Tire Corral has $6,000 available per month for advertising. Newspaper ads cost $100 each and can occur a maximum of 21 times per month. Radio ads cost $300 each and can occur a maximum of 28 times per month at this price. Each newspaper ad reaches 6,750 men over 20 years of age, and each radio ad reaches 8,500 of these men. The company wants to maximize the number of ad exposures to this group. How many of each ad should it purchase? What is the maximum possible number of exposures? Round your answers to the nearest whole number if necessary. ​

• A)21 newspaper ads and 28 radio ads for maximum exposure of 379,750 people
• B)28 newspaper ads and 21 radio ads for maximum exposure of 367,500 people
• C)13 newspaper ads and 21 radio ads for maximum exposure of 266,250 people
• D)21 newspaper ads and 13 radio ads for maximum exposure of 252,250 people
• E)20 newspaper ads and 15 radio ads for maximum exposure of 262,500 people

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Definitions:

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or service is not achieved or is unattainable.

Units Bought

Refers to the quantity of a particular good or service purchased by consumers or businesses.

Tax Imposed

A financial charge or other levy placed upon an individual or a legal entity by a state or a functional equivalent of a state.

Consumer Surplus

The difference between the amount consumers are willing to pay for a good or service versus what they actually pay.