List three costs that would be included in the cost of advertising.

US. Internet advertising revenue grew at the rate of $R(t)=0.82 t+1.14$ $(0 \leq t \leq 4)$ billion dollars/year between 2002 (t=0) and 2006 (t=4). The advertising revenue in 2002 was $5.9 billion. If the trend continued, what was the Internet advertising revenue in 2007?

Jim Dandy Auto Sales uses all types of media to advertise its products (television, radio, newspaper, Internet, and so on). At the end of 2016, the company president, Jim McKinley, decided that all advertising costs would be incurred by corporate headquarters and allocated to each of the company’s four sales locations based on number of vehicles sold. Jim was confident that his corporate purchasing manager could negotiate better advertising contracts on a corporate-wide basis than each of the sales managers could on their own. McKinley budgeted total advertising cost for 2017 to be $1.6 million. He introduced the new plan to his sales managers just before the New Year. The managers had already drawn up their advertising plans for 2017 and the corporate plan would do the same advertising for them as they had planned. Total advertising costs for 2017 were$1,600,000. If the managers had done this same advertising on their own, their advertising costs would be as follows:

$$\begin{matrix} \text{Sales Location} & \text{Actual number of Cars Sold in 2017} & \text{Advertising Costs in 2017 if Divisions Had Bought the advertising}\\ \text{East} & \text{5.600} & \text{\$ 279.500}\\ \text{West} & \text{1.440} & \text{473.000}\\ \text{North} & \text{3.200} & \text{580.500}\\ \text{South} & \text{5.760} & \text{817.000}\\ \text{ } & \text{16.000} & \text{\$ 2.150.000}\\ \end{matrix}$$

The manager of the East sales location, Tom Stevens, was not happy. He complained that the new allocation method was unfair and increased his advertising cost significantly. The East location sold high volumes of low-prices used cars and most of the corporate advertising budget was related to new car sales. 1. Show the amount of the 2017 advertising cost ($1.600.000) that would be allocated to each of the divisions under the following criteria: a. McKinley's allocation method based on number of cars sold. b. The stand-alone method if divisions had done their own advertising. c. The incremental-allocation method, with divisions ranked on the basis of dollars they would have spent on advertising in 2017. 2. Which method do you think is most equitable to the divisional sales managers? What other options might President Jim McKinley have for allocating the advertising costs?

A model for advertising response is given by the function

$$N(a)=1000+200 \ln a, \quad a \geq 1,$$

where $N(a)$ is the number of units sold when $a$ is the amount spent on advertising, in thousands of dollars.

a) How many units were sold after spending $\$ 1000(a=1)$ on advertising?

b) How many units were sold after spending $\$ 5000 ?$

Explain the eight major steps in developing an advertising campaign.

The profit P(x) of a cosmetics company, in thousands of dollars, is given by

$$P ( x ) = - 5 x ^ { 2 } + 400 x - 2550$$

, where x is the amount spent on advertising, in thousands of dollars. a) Determine the maximum profit the company can make. b) Determine the amount spent on advertising that will result in the maximum profit. c) What amount must be spent on advertising to obtain a profit of at least $4 000 000?

Allegience Insurance Company's management is considering an advertising program that would require an initial expenditure of $\$ 165,500$ and bring in additional sales over the next five years. The projected additional sales revenue in year $1$ is $\$ 75,000$, with associated expenses of $\$ 25,000$. The additional sales revenue and expenses from the advertising program are projected to increase by $10$ percent each year. Allegience's tax rate is $40$ percent. (Hint: The $\$ 165,500$ advertising cost is an expense.)

$1.$ Compute the payback period for the advertising program.

$2.$ Calculate the advertising program's net present value, assuming an after-tax hurdle rate of $10$ percent.

What U.S. government agency regulates price advertising?

What are the issues regarding the impact of advertising on adults' values?

The revenue in millions of dollars for the first five years of Internet advertising is given by $A(x)=25(2.95)^x$, where $x$ is years after the industry started.

(a) What was the Internet advertising revenue after $5$ years?

(b) Determine analytically when revenue was about $\$ 250$ million.

(c) According to this model, when did the Internet advertising revenue reach $\$ 1$ billion?

A consumer goods company has been studying the effect of advertising on total profits. As part of this study, data on advertising expenditures (1,000s) and total sales (1,000s) were collected for a 5-month period and are as follows:

$$(10,100)(15,200)(7,80)(12,120)(14,150)$$

The first number is advertising expenditures and the second is total sales. Plot the data.

Answer this question , and explain your answer: Can advertising exhort?

What are the issues regarding the impact of advertising on children's values?

How do the different models of persuasion work in advertising?