For Many Years, Pepsi Operated a 'Taste-Test' Booth Across the US.Visitors

question 125

Essay

For many years, Pepsi operated a 'taste-test' booth across the US.Visitors to the booth would be encouraged to take a blind 'taste-test' between Pepsi and its primary market competitor, Coke.Pepsi then used the taste-test results in advertising Pepsi.What advertising theory does such an approach support? Pepsi no longer uses this as an advertising strategy, instead relying on celebrity endorsements and other forms of advertising.What advertising theory do you think now dominates the market between Pepsi and Coke? Explain.

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Definitions:

Labor Efficiency Variance

A measure used in budgeting and cost management to analyze the difference between the actual hours worked and the hours that should have been worked, according to standards, for the actual level of production.

Direct Labor

Workers or employees directly involved in the production of goods and services, whose wages are considered a direct cost of production.

Direct Labor Variances

The differences between the actual costs of direct labor and the standard or expected costs.

Direct Labor Standards

Established benchmarks that specify the amount of direct labor time and the cost that should be involved in producing one unit of finished goods.