Promotional Expenditures at the Introduction Stage of the Product Life

question 147

Multiple Choice

Promotional expenditures at the introduction stage of the product life cycle are best spent on

• A)contests and sweepstakes.
• B)creating selective demand.
• C)creating primary demand.
• D)personal endorsements.
• E)maintaining brand loyalty.

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Definitions:

Average Total Cost

The per-unit cost of production, obtained by dividing total costs by the total quantity of goods or services produced.

Marginal Cost

The expenditure for assembling another unit of a product or service.

Short-Run Equilibrium

A state in which market supply and demand balance each other, and as a result, prices become stable for a short period.

Constant Returns

A situation in economics where increasing the scale of production does not affect the long-run average cost of production, implying it remains constant.