Brand names are associated with which of the following arguments?
(i) brand names provide information about quality, when quality cannot be easily judged
(ii) firms that promote brand names have strong incentives to monitor product quality
(iii) firms that promote brand names face an elastic demand for their product

Question

Quizplus · Accepted Answer

Brand names are associated with both (i) and (ii) arguments. Brand names can provide information about quality, particularly when quality cannot be easily judged by the consumer. Firms that promote brand names have strong incentives to monitor product quality to protect their brand name reputation. However, there is no clear link between brand names and elasticity of demand, so (iii) is not a commonly associated argument with brand names.

Brand Names Are Associated with Which of the Following Arguments