EBK ECONOMICS
4th Edition
ISBN: 8220101443649
Author: KRUGMAN
Publisher: YUZU
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Question
Chapter 15, Problem 9P
To determine
Concept Introduction:
Advertising: It is one of the ways of promoting goods so that consumers are aware of the product quality and how it is better than its closest substitute.
Role of Advertising:
- Advertisements are worth only in those markets where the sellers have some market power which means that the price must be above the marginal cost.
- The main role of advertisements is to convince consumers to buy a specific seller's product at the going prices.
- However, it is seen that some of the advertisements are a waste of resources based on the social point of view because they are just done to attract consumers without any information.
- From an economical point of view, advertisement always shifts the
total average cost downwards and it also helps in increasing the sale of the product.
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Importance And Benefits Of Advertising; Author: Explified;https://www.youtube.com/watch?v=sUPdwHFO3Do;License: Standard Youtube License