Why Is the Ultimate Objective to Achieve Brand Loyal Consumers

question 28

Multiple Choice

Why is the ultimate objective to achieve brand loyal consumers? 

• A) It is much cheaper to retain present customers than it is to continuously prospect for new ones. 
• B) Competitors will go out of business once consumers are loyal to your brand. 
• C) Switching costs are too high for consumers once they become brand loyal. 
• D) Brand loyal consumers are a "captive audience," which reduces marcom expenditures in the future. 
• E) Brand loyal consumers are more satisfied consumers.

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Definitions:

Fair Value

Fair value is the estimated market price of an asset or liability, reflecting the amount for which it could be exchanged or settled in a transaction between knowledgeable, willing parties under no compulsion.

Adjusting Entry

A journal entry made at the end of an accounting period to allocate revenue and expenses to the appropriate period, ensuring accurate financial reporting.

Long-Term Investment

Investments held for an extended period, typically exceeding one year, such as stocks, bonds, or real estate, aiming for prolonged growth.

Fair Value

A valuation of an asset or liability determined by the price it would fetch if sold, or the cost to transfer it, in a smooth transaction among participants in the market.