The S-Shaped Response Function Implies That

question 32

Multiple Choice

The S-shaped response function implies that:

• A)initial advertising expenditures will have little impact on sales.
• B)initial advertising expenditures will have major impact on sales.
• C)sales effects will follow the microeconomic law of diminishing returns.
• D)small advertising budgets have a high impact on sales when word of mouth is the only promotional tool used.
• E)small advertising budgets have a high impact on sales when public relations is the only promotional tool used.

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Definitions:

Time

A measurable period during which events occur, processes take place, or conditions exist.

Slope

In mathematics and economics, it's the measure of the steepness or incline, often used to describe a change in a variable in relation to a change in another variable.

45-degree Line

In economics, a reference line that represents where the quantity demanded equals the quantity supplied.

Indeterminate

A state in which something cannot be exactly established, known, or decided.