Which of the Following Statements Is True of Couponing

question 63

Multiple Choice

Which of the following statements is true of couponing?

• A)Coupons always assist in providing an immediate response.
• B)Coupons are often used by consumers who are already loyal to the brand.
• C)Coupons are useless when it comes to promoting established products.
• D)Coupons are more effective than sampling for inducing initial product trial in a short period.
• E)Coupons have an extremely high redemption ratE.A problem associated with using coupons to attract new users to an established brand is that it is difficult to prevent the coupons from being used by consumers who already use the brand.Rather than attracting new users, coupons can end up reducing the company's profit margins among consumers who would probably purchase the product anyway.However, they can help retain users.

---

Definitions:

Fair Value

An estimate of the price at which an asset would trade in a competitive auction setting.

Long-Term Investments

Assets that a company intends to hold for more than one fiscal year, such as stocks, bonds, real estate, or investments in other companies.

Available-for-Sale Debt Securities

Debt securities not classified as held-to-maturity or trading securities, recorded at fair value and subject to changes in the income statement upon realization.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, profits, or losses.