Which of the Following Statements About the Effects of Advertising

question 52

Multiple Choice

Which of the following statements about the effects of advertising on the business cycle is true?

• A) Historically, when business cycles dip, advertising expenditures remain high.
• B) The increased advertising expenditures that occur during business cycle dips always produce an increase in personal consumption expenditures.
• C) When business cycles are down; advertising may act as a stabilizing force.
• D) The effect of advertising on business cycles is easily determined.
• E) Businesses that continue to advertise during a recession lose market share due to puffery and overexposure.

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Definitions:

Sales Promotion

Short-term incentives to encourage the purchase or sale of a product or service.

Database Marketing

A form of direct marketing using databases of customers or potential customers to generate personalized communications to promote a product or service.

Integrated Marketing Communications

A strategic approach that aims to unify different marketing methods to promote a consistent message across all channels.

Direct Marketing

A type of advertising strategy that aims to deliver promotional messages directly to potential customers on an individual basis, rather than through a mass medium.