Author Question: A company that manufactures designer jeans is contemplating whether to increase its advertising ... (Read 112 times)

@Brianna17 · **on:** Jun 24, 2018

A company that manufactures designer jeans is contemplating whether to increase its advertising budget by 1 million for next year. If the expanded advertising campaign is successful, the company expects sales to increase by 1.6 million next year. If the advertising campaign fails, the company expects sales to increase by only 400,000 next year. If the advertising budget is not increased, the company expects sales to increase by 200,000. Identify the payoffs in this decision-making problem.

A) Two choices: (1 ) increase the budget and (2 ) do not increase the budget.
B) Two possibilities: (1 ) campaign is successful and (2 ) campaign is not successful.
C) Four consequences resulting from the Increase/Do Not Increase and Successful/Not Successful combinations.
D) The increase in sales dollars next year.

Question 2

A company that manufactures designer jeans is contemplating whether to increase its advertising budget by 1 million for next year. If the expanded advertising campaign is successful, the company expects sales to increase by 1.6 million next year. If the advertising campaign fails, the company expects sales to increase by only 400,000 next year. If the advertising budget is not increased, the company expects sales to increase by 200,000. Identify the outcomes in this decision-making problem.

A) Two choices: (1 ) increase the budget and (2 ) do not increase the budget.
B) Two possibilities: (1 ) campaign is successful and (2 ) campaign is not successful.
C) Four consequences resulting from the Increase/Do Not Increase and Successful/Not Successful combinations.
D) The increase in sales dollars next year.