Scenario 2-4 Advertising Is a $300-Billion-Per-Year Business in the United States. Understandably

question 18

Multiple Choice

Scenario 2-4
Advertising is a $300-billion-per-year business in the United States. Understandably, competition for clients is fierce among advertising agencies. There are many different reasons why a client may choose to move its business to a new agency, but there is one constant. The agency that wins the business is celebrated by the press; the agency that loses the business, however, is typically forgotten fairly soon.
-(Scenario 2-4) During a new business presentation, an agency says that one reason it should get the business is that all of its different department teams are so well coordinated. The department that brings all the different efforts together on a day-to-day basis is

• A) creative services.
• B) account services.
• C) administrative services.
• D) marketing services.

---

Definitions:

Present Value Factor

A factor used to calculate the present value of a future amount of money or stream of cash flows given a specific rate of return.

Straight-Line Depreciation

A process of dividing the expense of a substantial asset into identical annual portions over its useful duration.

Net Income

The net income of a firm after deducting all expenses and taxes from its gross revenue.

Cash Payback Period

A rephrased term for Payback Period, this is the duration required for an investment to generate cash flows that cover its initial expense.