The American Red Cross Creates Advertisements to Encourage People to Donate

question 172

Multiple Choice

The American Red Cross creates advertisements to encourage people to donate blood.After viewing one,Amanda decided to donate a pint of blood.After she did,Amanda felt happy that she had performed a good deed.Did an exchange occur in a marketing sense?

• A)Yes,because the blood was donated to the Red Cross based on an advertisement,a marketing activity.
• B)Yes,because the donated blood was exchanged for a feeling of satisfaction.
• C)No,because the Red Cross is a nonprofit organization.
• D)No,because no money changed hands.
• E)No,because the Red Cross,a service organization,did not provide Amanda with a product.

---

Definitions:

Intermediate Input

Goods or services used in the production process of another good or service which is itself not a final product.

Marginal Profit

The additional profit gained from producing or selling one more unit of a good or service.

Vertically Integrated

A business strategy where a company controls multiple stages of production within the same industry.

Transfer Price

The price at which goods or services are transferred between departments or subsidiaries within the same company.