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Additional info for Advertising: Its Place in Political and Managerial Economics

Example text

Spending £1000 extra on the press and maintaining constant sales implies movement to point Z, a saving on TV expenditure of only XY. Given knowledge of the firm's advertising budget, we can now include a budget line in the diagram. This can be defined as the locus of all combinations of TV advertising time and press advertising space which can be bought with a fixed budget. The broken lines represent alternative budgets of £3000 and £7000. On the assumption that the costs of the media to the firm do not vary with the amount spent, the budget lines will be straight lines.

Then again it could be argued that advertising encourages consumption of goods which in the short run the consumer 'wants' but which in the long term may be positively harmful. Cigarettes and alcohol are two commodities which spring to mind. Their association with cancer and cirrhosis is quite clearly alien to long-term consumer wants. Once more the question of want creation or want reflection is posed. Smoking, drinking and advertising probably have equally long genealogies in the history of mankind.

K. advertising expenditure. Both can be categorised by editorial approach. Every magazine has a viewpoint and style which attracts a certain type of reader which, in turn, enables the advertiser to select the type of audience most suitable for his purposes. g. g. g. g. Autocar, Field, Practical Householder). g. g. g. Textile Manufacturer, British Baker). Unlike newspapers, magazines are designed for leisurely, rather than hurried reading. Photographic reproduction, in both colour and black and white, is of a high standard.

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