Which of the following is consistent with the advertising = market power approach to advertising's role in the economy?
A) Consumers become more price sensitive and buy best value.
B) Advertising does not change the way consumers value product attributes.
C) Consumers become brand loyal.
D) Consumers can compare competitive offerings easily.
E) Innovation is facilitated via new entrants.

Question

Which of the following is consistent with the advertising = market power approach to advertising's role in the economy? 
A) Consumers become more price sensitive and buy best value. 
B) Advertising does not change the way consumers value product attributes. 
C) Consumers become brand loyal. 
D) Consumers can compare competitive offerings easily. 
E) Innovation is facilitated via new entrants.

Quizplus · Accepted Answer

The advertising = market power approach suggests that advertising's main function is to create brand loyalty among consumers, leading them to be less price-sensitive and more likely to stick with a particular brand, even if there are other comparable options available.

Answer: A and D 
 Both of these choices suggest that consumers are able to make informed decisions based on price and product attributes, which would counteract the idea that advertising gives companies market power by influencing consumer behavior.

Which of the Following Is Consistent with the Advertising =