Which of the Following Is a Major Problem Associated with the Percentage-Of-Sales

question 109

Multiple Choice

Which of the following is a major problem associated with the percentage-of-sales method?

• A)It reverses the cause-and-effect relationship between advertising and sales.
• B)It is financially unsafe.
• C)It is extremely tough to implement.
• D)It is used only by firms that do not understand the role of advertising and promotions.
• E)It has no theoretical basis, and the budgetary amount is often set using a flat rate.

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