Older Consumers Spend Money

Running Head : ADVERTISINGAdvertising[Writer s Name][Name of Institution]AdvertisingAdvertising is an important tool to achieve rivalrous advantages in terms of monopolistic disputation . From this perspective , the primary(prenominal) purpose of publicizing is to inform the customers just about the benefits of the product and helper the company to sum up its market share . In different words , the companies operating in the market of monopolistic competition use advert to attract attention of the customers to the benefits and unique(predicate)s of their differentiated products , to increase the demand and receive more profitsAdvertising informs more and more customers about the product , thus the demand increases and the curve of demand shifts amend (at that price elasticity decreases , allowing the company to produce and sell greater amount of the product and receive more profits . Since advertising causes extra expenses and increases TC , AC will decrease due to growing returns of the scale and higher scotch long suit . That is wherefore advertising is likely to cause positive economic do for a company in terms of monopolistic competitionNevertheless , fit in to McConnell and Brue , there are certain disagreements between the specialists regarding economic effectiveness of advertising .

There are critics of advertising , who argue that this dodging is non an effective competitive instrument , because it causes extra expenses , results in higher prices and confusion of the customer due to overload of training , stimulates monopoly and ineffective resource allocation , etc (McConnell Brue , 2004It is possible to estimate economic effectiveness of advertising using empirical data for each specific situation : for example , by comparing the expenses for advertising campaigns and extra incomes received as a result of such campaigns . Since the majority of the players in monopolistic competition are not too large and rich , using not dear(predicate) types of advertising (posters , local media ads , etc ) or ads directed on specific target audience (old people , etc ) can be a way to minimize the expenses and maximize the returnsReferencesMcConnell , C .R Brue S .L (2004 ) economics : Principles , Problems , and Policies . 16 ed . N .Y : McGraw-HillPAGEPAGE 3Advertising...If you want to get a full essay, order it on our website: Ordercustompaper.com

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