Question

Q1. Think and state one situation where a business manager will use promotional elasticity to make
business decisions.
[10 Marks)​

Answer 1

Answer:

i hope it will help you

Answer 2

Concept Introduction:

A unit change in advertising spending that results in a proportionate change in demand. A relatively elastic demand exists if AED is larger than $1$. It implies that need is more responsive to advertising budgets and gives back more than it takes in terms of demand growth.

Explanation:

We have been given a question about promotional elasticity.

We have to state one situation where a business manager will use promotional elasticity to make business decisions.

The coefficient of cross elasticity shows the relation between the given set of goods. Promotional (Advertisement) elasticity of demand measures the responsiveness of the quantity demanded of a product due to changes in the advertisement expenditure.

Final Answer:

The final answer is if the quality and quantity of an advertisement of a product are superior to the past and at present, it is also superior to that of competitors.

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