Advertising is suspected of being in excess of both its social and commercial optimum level. Profit-maximising businessmen have no reason to carry the activity beyond the point where the last pound spent on advertising brings in exactly one pound more of net revenue. Yet the late Lord Leverhulme’s statement suggests that they do exceed this point. Why should this be? How do businessmen decide on their advertising budget levels? How do they allocate their budget among the various media available? This chapter is concerned with providing answers to these questions.
KeywordsSales Level Advertising Expenditure Advertising Cost Budget Line Advertising Budget
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