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NNADVOKAT [17]
3 years ago
13

Tread Inc. is the market leader for sports shoes in the subcontinent of Gavon. Though the brand has not introduced any new produ

ct lines over the past decade, its signature products enjoy a high demand and have always remained popular. According to the concept of advertising response function, which of the following should be Tread Inc.'s advertising strategy _________.a.​ Its advertisements should easily affect target consumers' deeply rooted values and attitudes.
b. ​It should spend proportionately less on advertising than on a newer line.
c. ​It should penetrate consumers' perceptual defenses and affect purchase intentions.
d. ​It should have a large budget for advertising expenditures.
Business
1 answer:
Harman [31]3 years ago
5 0

Answer: The answer is b

Explanation:

The concept of advertising response function is based on the theory of marginal physical product and shows the relationship between advertising and the level of consumption of the goods by the consumers. The theory of marginal physical product states that when there is a change in total product resulting from one unit change in the quantity of the resources used per unit of time. When average product is increasing ,marginal physical product is greater than average product,when average product is maximum ,marginal physical equals average product .when average product is decreasing marginal physical product is less than average product.The theory of marginal physical product can also be called the law of diminishing return which states that if increasing quantities of one factor of production are used in conjunction with a fixed quantity of other factors then, after a certain point each successive unit of the variable factor will make smaller and smaller addition to the total output. In this case, the law tells the Trend Inc when to stop adding more input of the variable factor to a fixed factor.

Invariably, we are saying that it high time for Trend Inc, should spend proportionately less on advertising than on newer line. It should now spend more money on bringing of new product into the market than spending more on the advertisement of the sport shoes because at a certain point the demand for the old product will fall when diminishing return must have set in on the product demand.

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During the first month of operations ended August 31, Kodiak Fridgeration Company manufactured 80,000 mini refrigerators, of whi
andrew-mc [135]

Answer:

Absorption Costing Net Income  1008,000

Variable Costing Net Income     976,000

Explanation:

<u><em>Kodiak Fridgeration Company</em></u>

Units Produced = 80,000

Units Sold = 72,000

Ending Inventory = 8000

<u>Per Units Cost </u>

Direct materials $6,400,000/80,000 = $ 80

Direct labor 1,600,000 /80,000= $ 20

Variable manufacturing cost 1,280,000/80,000= $ 16

Fixed manufacturing cost 320,000 /80,000 = $ 4            

Absorption Manufacturing Cost  per unit= 9,600,000/80,000= $ 120

Variable Manufacturing Costs per unit = $ 116

<u><em></em></u>

<u><em>Kodiak Fridgeration Company</em></u>

<u><em>Income Statement </em></u>

<u><em>Absorption Costing</em></u>

<u>Sales                                                              $10,800,000 </u>

Manufacturing costs:

Direct materials $6,400,000

Direct labor 1,600,000

Variable manufacturing cost 1,280,000

Fixed manufacturing cost 320,000                 9,600,000

Less Ending Inventory (8000*120)                     (960,000)

<u>Cost of Goods Sold                                           86,40,000</u>

Gross Profit                                                         2160,000

Selling and administrative expenses:

Variable $ 72,000* 13.5=                                    972,000

Fixed                                                                      180,000                                                  

Net Income                                                        1008,000

<em><u>Kodiak Fridgeration Company</u></em>

<em><u>Income Statement </u></em>

<em><u>Variable Costing</u></em>

Sales                                                              $10,800,000

Variable manufacturing cost

(80,000*116)                                                       9280,000

Less Ending Inventory ( 8000*116)                     928,000

<u>Cost of Goods Sold                                           83,52,000</u>                  

Gross Contribution Margin                                 2448,000

Variable Selling and administrative expenses

(72000 * $1,080,000/80,000)                              972,000

Contribution Margin                                            1476,000

Less Fixed Expenses

Fixed manufacturing cost 320,000

Fixed 180,000                                                    500,000

Net Income                                                          976,000

3. The difference in absorption and variable costing income is because in absorption costing the fixed costs are treated as unit cost and in variable costs the fixed costs are treated as period costs. Also the fixed costs of the ending units is deducted in absorption costing where it is not deducted in variable costing.

5 0
3 years ago
Julie Brown is a single woman in her late 20s. She is renting an apartment in the fashionable part of town for $1,000 a month. A
Yakvenalex [24]

Answer:

a. Julie should continue live in her own apartment.

b. She should then purchase the condo

c. Home maintenance cost and tax benefit.

d. She should live in her own apartment and rent the condo after purchase.

Explanation:

Buying cost of condo $175,000

Loan interest amount  $8,400 [ $175,000 * 80% * 6%]

Insurance premium $10  [560 - 550]

Property taxes $1,000

Maintenance expense $875  [$175,000 * 0.5%]

Total additional cost per year $10,280

If Julie plans to buy the condo she will have to incur additional cost of $10,280 per annum.

b. If the price of condo increases by 3.5% per year then she should consider buying the condo.

5 0
3 years ago
During 2020, Sam and Libby, a married couple, decided to sell their residence, which had a basis of $200,000. They had owned and
baherus [9]

Answer:

$50,000:$400,000

Explanation:

Based on the information given we were told that the Broker's commissions and other selling expenses was the amount of $50,000 in which They as well made purchased of a new residence in July for the amount of $400,000 which means that the recognized gain will be $50,000 the amount of Broker's commissions and other selling expenses and the adjusted basis of the new residence will be $400,000 which is the cost of purchasing a new residence.

6 0
2 years ago
The basic price that equates the demand for and supply of loanable funds in the financial markets is the __________:
Helen [10]

Answer: a

Explanation:

The interest rate is the amount a lender charges for the use of assets expressed as a percentage of the principal. The interest rate is a rate of return that lenders demand for the ability to borrow their money. A loan that is considered high risk will have a higher interest rate. Interest rates are prices for loanable funds prices of funds invested, lent out or borrowed for various periods of time.

The supplier or lender of funds normally wants to earn an income and the user or borrower will generally be prepared to pay for the right to use the accumulated funds.

Interest rates apply to most lending or borrowing transactions. Individuals borrow money to purchase homes, fund projects, launch or fund businesses, or pay for college tuition.

3 0
3 years ago
When money serves as a common denominator for measuring the exchange rates among goods and services, it performs as a
Aleks [24]

Answer:

Standard of value.

Explanation:

When money serves as a common denominator for measuring the exchange rates among goods and services, it performs as a standard of value.

Standard of value is an agreed-upon worth for a transaction in a country's medium of exchange, such as the U.S. dollar or Mexican peso. A standard of value allows all merchants and economic entities to set uniform prices for goods and services

4 0
2 years ago
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