The S-shaped response function implies that:
A)initial advertising expenditures will have little impact on sales.
B)initial advertising expenditures will have major impact on sales.
C)sales effects will follow the microeconomic law of diminishing returns.
D)small advertising budgets have a high impact on sales when word of mouth is the only promotional tool used.
E)small advertising budgets have a high impact on sales when public relations is the only promotional tool used.

Question

Quizplus · Accepted Answer

The S-shaped response function suggests that at low levels of advertising expenditure, there is little impact on sales, which corresponds to the initial flat part of the "S" curve.

The S-Shaped Response Function Implies That