A Company That Is Introducing a New Product Would Like

question 4

Essay

A company that is introducing a new product would like to generate maximum market exposure.The marketing department currently has $100,000 of advertising budget for the year and is considering placing ads in three media: radio,television,and newspapers.The cost per ad and the exposure rating are as follows:
$\begin{array}{lll} &\text { Cost/ad } & \text { Exposure/ad } \\\text { Radio } & \$ 10,000 & 30,000 \text { individuals }\\\text { Television } & \$ 25,000 & 50,000 \text { individuals } \\\text { Newspaper } & \$ 5000 & 20,000 \text { individuals }\end{array}$

The marketing department would like to place twice as many radio ads as television ads.They also would like to place at least 4 ads in each advertising media.What is the optimal allocation to each advertising medium to maximize audience exposure?

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Definitions:

Expected Income

The amount of money one anticipates earning over a specific period, considering various factors like salary, investments, and other income sources.

Probability

An indicator of the probability that a particular event will happen, denoted as a value ranging from 0 to 1.

Certain Income

refers to money or revenue that is guaranteed or highly likely to be received, with minimal risk of variation or loss.

Fair Insurance Policy

Describes an insurance contract that provide coverage at reasonable, transparent, and equitable terms for both parties.