The Advertising Manager at Lariat Pizza,who Wants the Company to Be

question 22

Multiple Choice

The advertising manager at Lariat Pizza,who wants the company to be on the cutting edge of current trends in advertising,feels strongly that the focus should be on consumer-generated advertising via YouTube,Twitter,and Facebook.But the CEO wants to focus on mainstream media like radio,television,and magazines.If the following facts were known,which one would support the position of the advertising manager?

• A) The number of television cable channels has skyrocketed in recent years.
• B) During the past five years,the major television networks have suffered a 20 percent decrease in viewership,and this has led to a reduction in advertising rates.
• C) The production cost for a 30-second television commercial has declined.
• D) Networks are trying to ban electronic devices that allow viewers to record television shows while deleting the commercial messages.
• E) People under the age of 30 consume the largest amount of pizza per capita,and are the greatest users of social media.

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Definitions:

Paid-In Capital

The total amount of money investors have contributed to a company in exchange for equity.

Retained Earnings

The portion of net income that is not distributed to shareholders but instead retained by the company to reinvest in its core business or to pay debt.

Treasury Stock

Shares that were once part of the outstanding stock but were bought back by the issuing company, reducing the amount of outstanding stock.

Preferred Stock

Preferred stock is a class of shares that offers dividends and ownership in a company but typically does not confer voting rights, with dividends received before common shareholders.