An Ad Contains the Following: "Restaurant Critic, Jose Winfrey, on Mama

question 12

Multiple Choice

An ad contains the following: "Restaurant Critic, Jose Winfrey, on Mama Leone's Italian Eatery, 'Mama Leone's is simply the best. It is a surprising new entrant into the competitive Italian bistro market and it is a mighty one.'"   Jose Winfrey is the cousin of the owner of Mama Leone's and knows restaurants, but is not a critic for any publication or other media outlet. The ad:

• A) Creates a false impression.
• B) Raises no ethical questions.
• C) Is legal and ethical because it doesn't state where he is a critic.
• D) Both b and c
• E) None of the above

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Definitions:

Tailoring

Adjusting financial strategies or models to address specific needs or circumstances of a business or investment.

Income Stream

A series of regular payments or revenues generated over time from investments, work, or business activities.

Dividend Preference Theory

A theory suggesting that investors prefer dividends from current earnings over potential capital gains because of the perceived certainty of dividend payments.

Bird in Hand

A theory in finance that suggests investors prefer the certainty of dividend payments to the potential for future capital gains.