Which of the following statements regarding brand names in advertising is not correct?
a. Brand names provide consumers with information about quality when quality cannot be easily judged in advance of purchase.
b. Brand names give firms an incentive to maintain high quality to maintain the reputation of the firm.
c. Brand names allow firms to produce and sell inferior products in the long run since people will continue to purchase the brand-name product.
d. Brand names can cause consumers to perceive differences in products that do not actually exist.
c
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Diversification refers to the
A) splitting of wealth into many assets. B) difference between the liquidity of an asset and its risk. C) difficulty of converting investments in common stocks into investments in bonds. D) difficulty of selling common stocks in a weak market.
If the Fed purchases securities worth $10 million from a commercial bank, the banking system's balance sheet will show
A) an increase in securities held of $10 million and an increase in bank reserves of $10 million. B) an increase in securities held of $10 million and a decrease in bank reserves of $10 million. C) a decrease in securities held of $10 million and an increase in bank reserves of $10 million. D) a decrease in securities held of $10 million and a decrease in bank reserves of $10 million.