Scenario 12-2 When Advertisers Consider Running Ads in American Life Magazine, They

question 41

Multiple Choice

Scenario 12-2
When advertisers consider running ads in American Life magazine, they have the option of buying geographic and demographic editions as well as the national edition.For instance, they can choose from editions targeted at professionals and managers, homeowners, working women, and people aged 50 and older.In addition, they are offered editions for 8 geographical regions and for the top 20 metropolitan areas.American Life also offers multiple-page discounts for advertisers buying four or more consecutive pages in any one edition, as well as other volume discounts.The basic rate to reach 2,847,600 readers in its national edition with a full-page, four-color advertisement is $91,300.The basic rate to reach the same 2,847,600 nationwide readers with a single-column, black-and-white ad is $31,300.
-(Scenario 12-2) Based on the figures provided, what is the CPM of a single-page, full-color advertisement in American Life's national edition?

• A)$ 10.99
• B)$ 31.19
• C)$ 32.06
• D)$ 90.98

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Definitions:

Corporation

Legal organization with assets and liabilities separate from those of its owner(s).

Franchise

A licensing agreement where a franchisor allows a franchisee to use its brand, products, and operating methods.

Franchising Agreement

A legal contract where a franchisor grants a franchisee the right to operate a business using the franchisor's trademark, product, and business model in exchange for fees.

Franchisor

A business entity that grants the rights to an individual or group to market its products or services in a specific territory under the business's brand and operating methods.