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Scenario 16

question 33

Multiple Choice

Scenario 16.1 Use the following to answer the questions.
When introducing a new vehicle targeted to the under-30 population, Toyota used several different methods of communication. First, it did research in several large cities to find out who the opinion leaders were in that age group. By visiting the local nightlife, one or two people in each city were selected and given a new vehicle to drive for two weeks. They were told to share information about this new vehicle with their friends. After a few weeks, then a television campaign was launched with commercials introducing the new vehicle. Toyota also placed ads in magazines that were targeted to the under-30 age group, and used drive-by billboards in the large cities near the nightclub areas.
Refer to Scenario 16.1. Suppose Toyota also offered the dealership salespeople a trip to Hawaii for anyone who could sell ten of the new vehicles within the first month they were available? This tactic would be an example of ____ marketing, while the TV commercials described above would be an example of ____ marketing.

Definitions:

Industrial Regulation

Involves government rules and policies aimed at controlling the practices, standards, and market entry of firms in specific industries to prevent unfair practices and promote competition.

X-Inefficiency

An economic concept that captures inefficiencies in a firm's operations due to factors such as a lack of competitive pressure.

Principal-Agent Problems

Issues that arise when a principal hires an agent to perform tasks, and the agent's self-interest does not align with the principal's, leading to potential conflicts.

Social Regulation

Government-imposed rules and regulations designed to protect public health, safety, and well-being, affecting how businesses can operate.