Studio executives carefully examine how a film performs on its opening weekend in order to determine whether – and how – to invest more in that film.
Many decisions are best made after reaction can be gathered from audience who actually purchased tickets.
Therefore, to maximize returns on their marketing investments,
studios should initially release all their films on a small number of screens and with a limited advertising campaign.The plan to maximize returns by initially releasing films on only a small number of screens and limiting advertising depends on which of the following assumptions?
A. Large marketing investments made before the opening weekend never eventually yield greater profits than small initial marketing investments............
sounds good but not sure so keep it asideB. New advertising technique such as web-based viral marketing, haven’t substantially reduced the average marketing cost for films............
out of scopeC. A film’s prior performance in noncommercial settings, such as festivals, is not well correlated with how the general public tends to react to than film.............
settings are not of concern OFSD. Across the movie industry, marketing investments do not influence the eventual financial returns of films in predictable way..........
weakenerE. How a film performs during its opening weekend is a strong indicator of the film’s financial performance over its lifetime.
looks really fine to meI was stuck between A and E and eventually I chose E since I felt like never in A is too strong
but here is an explanation from
MGMAT below which clears the air.
Quote:
However, the argument itself focuses on when decisions are best made. For example, the argument allows the possibility that a film is test-released on few screens and makes only a mediocre financial return. But the information gathered by that release could allow the studio to adjust its campaign, thereby making more money over the remaining life of the movie.
Thus, it is not necessary to assume that the opening weekend is a strong predictor of later financial performance by a film.