A Law That Restricts the Ability of Hotels/motels to Advertise

question 58

Multiple Choice

A law that restricts the ability of hotels/motels to advertise on billboards outside of a resort community would likely lead to

• A)no change in profits for all hotels/motels.
• B)reduced efficiency of local lodging markets.
• C)a request by consumers to increase the number of billboards.
• D)increased price competition among hotels/motels in the community.

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Definitions:

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue contributes to covering fixed costs and generating profit.

Indirect Expenses

Indirect expenses are costs that cannot be directly attributed to a specific cost object, such as overhead or administrative expenses.

Direct Expenses

Direct expenses are costs that can be directly tied to the production or procurement of specific goods or services, such as raw materials and labor.

Direct Expense

Costs that can be directly traced to a product, service, or project, such as raw materials and labor.