How does advertising signal to consumers that the product is a good one?
a. By seeing famous people using the product, consumers infer that they too can be famous.
b. By being willing to spend money on advertising, firms let consumers know the product is likely a good one since firms would not likely advertise a poor product.
c. By making consumers laugh during commercials, firms are associating positive experiences with the product.
d. Without allowing consumers to actually use the product, it is not possible for firms to signal to consumers the product's quality.
b
You might also like to view...
If your wealth is held as currency or in checking accounts, or other assets that you can convert to money on short notice, your assets are considered to be
A) abundant. B) interest bearing. C) liquid. D) fast moving.
In September of 2007, the Federal Reserve Board Open Market Committee voted to lower interest rates for the first time that year. Explain how lower interest rates affect the aggregate demand curve
What will be an ideal response?