Give an example of how a hypothetical firm can use advertising to convey the quality of its product.
What will be an ideal response?
Examples will vary, but should show a thorough understanding of how a firm can use advertising to convey the quality of its product. For example, Thai Eats Inc. is starting a chain of fast-food restaurants that sell Thai food. To convey quality, they hire a movie star to endorse the product on TV ads. Also, the ads focus on the high quality of ingredients used for the various dishes. Finally, the firm comes up with a catchy slogan and cute logo that it uses constantly in its ads. By doing this, Thai Eats hopes to create brand name recognition. If the firm succeeds, consumers will have confidence that the chain presents consistent, high quality food.
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The ability to produce a good using fewer resources than someone else is called
A) absolute advantage. B) comparative advantage. C) specialization. D) protectionism.
At what price would Juan and the other producers supply the largest quantity of coffee?
a. $2 per pound
b. $3 per pound
c. $4 per pound
d. $5 per pound
Increasing the transfers from workers to the unemployed counts as:
A) fiscal policy. B) monetary policy. C) neither fiscal nor monetary policy. D) both fiscal and monetary policy.
In the Staples/Office Depot Case, the government:
A. blocked a merger. B. allowed a merger but regulated the resulting firm. C. allowed a merger and did not regulate the resulting firm. D. prosecuted the two firms for collusion.