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Scenario 10-4 In the "Chicago Shopping" Section of the Chicago Tribune Website

question 76

Multiple Choice

Scenario 10-4
In the "Chicago Shopping" section of the Chicago Tribune website, the following ads were listed: 1. An ad for the last day to save 10 percent on all purchases at Target.com. Readers are urged to act quickly because the deadline for the deal, which is boldly listed in red ink, is today. The ad also features a picture of a 40" LCD television showing the company's name and "bull's-eye" logo on the screen. 2. An ad for a pair of basketball shoes accompanied by a positive endorsement from a satisfied customer. The customer states, "I have never had a shoe like this one. I jump higher and run faster, and I am able to play longer than I ever have in the past." The ad offers a $19 coupon for use at participating Foot Locker stores. 3. An ad encouraging consumers to shop at Adidas because of its low sale prices. The ad reads, "Adidas brand apparel will increase your athletic performance. Give yourself the competitive advantage you've always wanted and shop our selection of running, soccer, basketball, and golf apparel." 4. An ad listing a limited time offer for a pair of expensive jeans. The ad shows a fictional character being laughed at by an attractive female because of his old, raggedy jeans. The man being laughed at appears incredibly embarrassed. Marketers want consumers to feel more accepted in society when they wear this particular pair of jeans. (ChicagoTribune.com, October 26, 2010)
-(Scenario 10-4) In ad #4,which type of ad are the marketers using to appeal to consumers?

Definitions:

Accumulated Benefit Obligation

The actuarial present value of all benefits attributed by the pension benefit formula to employee service rendered prior to that date, whether or not the benefits are vested.

Plan Assets

Assets that are held by a retirement plan, which can include stocks, bonds, and cash, intended to fund the future benefit payments to participants.

Defined Benefit Pension Plan

A retirement plan where employer commitments are based on a formula considering factors like salary history and duration of employment, with the company bearing investment risk.

Prior Service Cost Amortization

The process of expensing the costs of retroactive benefits granted in a pension plan over a period of time.