In the Target Case Study, Why Did Target Send a Teen

question 22

Multiple Choice

In the Target case study, why did Target send a teen maternity ads?

• A) Target's analytic model confused her with an older woman with a similar name.
• B) Target was sending ads to all women in a particular neighborhood.
• C) Target's analytic model suggested she was pregnant based on her buying habits.
• D) Target was using a special promotion that targeted all teens in her geographical area.

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Definitions:

Activity Cost Pool

A collection of overhead costs attributed to particular activities, used in activity-based costing to allocate costs more accurately to products or services.

Activity-Based Costing

A costing method that assigns costs to products and services based on the activities and resources that go into producing them, aiming to provide more accurate cost information.

Overhead

General business expenses that are not directly tied to specific products or services but are necessary for the overall operation of a business, such as rent, utilities, and administrative costs.

Activity-Based Costing

A costing methodology that assigns overhead and indirect costs to specific activities, improving the accuracy of product and service costing.