What Is the Greatest Shortcoming for the Percentage-Of-Sales Method of Setting

question 12

Multiple Choice

What is the greatest shortcoming for the percentage-of-sales method of setting the advertising budget?

• A)The percentage-of-sales method is too expensive to be used by small business owners.
• B)The percentage-of-sales method violates the basic marketing principle of marketing activities stimulating demand and thus sales and not occurring as a result of sales.
• C)The percentage-of-sales method assumes a certain number of dollars are needed to sell a certain number of units.
• D)The percentage-of-sales method encourages top management to think of growth in terms of percentages.
• E)The percentage-of-sales method assumes the marketplace will be dynamic.

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Definitions:

Intellectual Stimulation

The process of encouraging creativity and innovation by challenging existing ideas and encouraging new perspectives.

Leader-member Exchange Theory

A leadership concept that explores the relationship dynamics between supervisors and subordinates, focusing on the mutual exchange of benefits.

In-group Members

Individuals who belong to a particular group and share a sense of identity or common goals with other members.

Organizational Citizenship Behavior

Discretionary actions by employees that are beneficial to the organization and are not part of their formal job requirements.