To set an advertising budget,the marketer of filing cabinets examines advertising to sales ratios published in trade magazines,and then allocates a percentage of sales dollars to the advertising effort.Which two budgeting methods are being employed?
A)competitive parity and percent of sales
B)competitive parity and payout planning
C)payout planning and percent of sales
D)percent of sales and objective and task
E)payout planning and arbitrary allocation

Question

Quizplus · Accepted Answer

The marketer is using the "percent of sales" method by allocating a percentage of sales dollars to advertising. The examination of advertising to sales ratios in trade magazines suggests the use of "competitive parity," as this involves comparing with industry standards or competitors.

To Set an Advertising Budget,the Marketer of Filing Cabinets Examines