The case for investing in advertising is based on the belief that it can increase profitability and thus increase revenue beyond the incremental advertising expense by _____.
A) increasing sales volume
B) enabling higher selling prices
C) reducing promotion costs
D) a and b only
E) a, b, and c

Question

The case for investing in advertising is based on the belief that it can increase profitability and thus increase revenue beyond the incremental advertising expense by _____.
A) increasing sales volume 
B) enabling higher selling prices 
C) reducing promotion costs 
D) a and b only 
E) a, b, and c

Quizplus · Accepted Answer

Investing in advertising can increase sales volume by increasing brand awareness and driving customer traffic. It can also enable higher selling prices by creating a perception of value or quality that justifies higher prices. However, it is not likely to directly reduce promotion costs. Therefore, the correct answer is a and b only.

The Case for Investing in Advertising Is Based on the Belief