According to one theory, advertising sends a signal to consumers about the quality of the product being offered. An implication of this theory is that
A)the actual quality of the product is irrelevant.
B)the content of the advertisement is irrelevant.
C)advertising is not in the best interest of society.
D)it is irrational for firms to pay famous people large amounts of money to appear in their advertisements.

Question

Quizplus · Accepted Answer

The theory suggests that the mere act of advertising, regardless of content, signals to consumers that the product is of high quality, as firms would not invest in advertising if their product were poor.

According to One Theory, Advertising Sends a Signal to Consumers