Which of the Following Is a Quantitative Model to Budgeting

question 71

Multiple Choice

Which of the following is a quantitative model to budgeting advertising expenditures?

• A)ROI budgeting model
• B)Competitive parity model
• C)Computer simulation model
• D)Arbitrary allocation model
• E)Percentage-of-sales model

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Definitions:

Payback Period

The time required for an investment to generate cash flows sufficient to recoup the initial investment cost.

Rate of Return

A measure of the profit or loss on an investment over a specific period, expressed as a percentage of the investment's initial cost.

Minimum Required Rate

The lowest return rate necessary for an investment to be considered acceptable.

Net Present Value

Net Present Value (NPV) is a calculation used to determine the current value of a series of future cash flows, taking into account a specified rate of return.