A marketing firm decides to purchase media time in an attempt to sell its new product. After purchasing approximately $1 million of time, it has noticed no impact on the sales of the product. However, at $3 million, a substantial increase is shown. This might best be explained by:

Question

Quizplus · Accepted Answer

An S-shaped response curve, also known as a saturation curve, suggests that at low levels of investment, there may be little to no impact on sales, but at a certain point, there is a rapid increase in sales as the media exposure reaches a critical mass. This explains why the firm noticed no impact on sales with $1 million in media time but a substantial increase at $3 million.

A Marketing Firm Decides to Purchase Media Time in an Attempt