Many Manufacturers Do Not Select Product Sampling as a Sales

question 64

Multiple Choice

Many manufacturers do not select product sampling as a sales promotion strategy

• A) because product sampling has no proven effect on trial purchase.
• B) because sampling is difficult logistically.
• C) because the redemption rate for product samples is low.
• D) due to the high costs involved.
• E) due to the difficulty in producing samples.

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Definitions:

Deadweight Loss

A decrease in economic efficiency occurring when a good or service does not reach its free market equilibrium.

Economic Profits

The difference between total revenue and total economic costs (including both explicit and implicit costs), representing the additional income above the opportunity cost.

Monopoly

A market structure characterized by a single seller who has exclusive control over the supply of a good or service, and where the entry of new firms is hindered.

Monopolist's Profit

The excess revenue a monopolist earns over its costs, attributable to its ability to set prices above competitive levels due to lack of competition.