A Critic of Advertising Tells You That the Costs of Advertising

question 49

Multiple Choice

A critic of advertising tells you that the costs of advertising are built into the costs for products, which are then passed on to the consumer. You have decided to argue the point with him. Which argument should you not present?

• A) This must be balanced against the time it would take a person if he or she had to search for information about products without advertising.
• B) Economies of scale spread fixed costs over a large number of production units
• C) The increased demand for products that results from advertising can lower the cost of the production of the products.
• D) This is a misconception. Often, the costs of advertising are not built into the costs for products.

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Definitions:

Vicarious Learning

Learning that occurs by observing the actions of others and the outcomes of those actions, without the observer performing the actions.

Latent Learning

The subconscious retention of information without immediate or obvious reinforcement to be applied at a later time.

Insight

The capacity to gain an accurate and deep understanding of someone or something, often involving an "aha" moment of comprehension.

Social Learning

The process of acquiring behaviors and norms through observing and imitating others within a social context.