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# Television executives recently annonced that advertising

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Director
Joined: 17 Oct 2005
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06 Dec 2005, 02:38
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Television executives recently annonced that advertising time on television will cost 10 to 15 percent more next fall than it cost last fall. The executives argued that in spite of this increase, advertisers will continue to profit from television advertising, and so advertising time will be no harder to sell next fall than it was last fall.

Which of the following, if true, would most suppor the television executives' argument?

A) Most costs of production and distribution of products typically advertised on television are expected to rise 3 to 7 percent in the next year.

B) The system for rating the size of the audience watching any given televion advertisement will change next fall.

C) Next fall advertising time on television will no longer be available in blocks smller than 30 seconds.

D) The amount of television advertising time purchased by providers of services is increasing, while the amount of such time purchased by providers of products is decreasing

E) A recent survey has shown that the average number of hours people spend watching television is increasing at a rate of 2 percent every two months

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Director
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06 Dec 2005, 05:07
IMO E.

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SVP
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06 Dec 2005, 10:37
E.

more people are watching television means the cost can be spread.

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SVP
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06 Dec 2005, 10:49
Though 'E' looks good to me too, let me take different stand...

It's 'C'.

'C' says, slots will be available in blocks of more than 30sec, last fall it was less than 30secs. So if block size is increased & there is also increase in advt. cost, it's balanced...

What is the OA? & OE?

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Current Student
Joined: 23 Oct 2005
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06 Dec 2005, 13:55
vivek123 wrote:
Though 'E' looks good to me too, let me take different stand...

It's 'C'.

'C' says, slots will be available in blocks of more than 30sec, last fall it was less than 30secs. So if block size is increased & there is also increase in advt. cost, it's balanced...

What is the OA? & OE?

But that doesn't necessarily mean that advertisers will continue to profit from television advertising. It would only increase the cost of advertising. No info can be gathered on profits realised by as companies.

Hence "e". Since if more people are watching there are chances that you will increase revenue by TV ads.

Other options

A - Again rejected for same reason as C
B and D - Out of scope.

Anyway, OA and OE?

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SVP
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06 Dec 2005, 14:12
I got E.
_________________

hey ya......

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Director
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06 Dec 2005, 17:24
The OA is E

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Senior Manager
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07 Dec 2005, 06:48
Late, but agree with E.

How do you justify increasing the rate?
If viewership is increasing, then more ppl are watching advertisments, so you have the opportunity to sell more.

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07 Dec 2005, 06:48
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