Many firms advertise. What effect does advertising have on firm profits? One pos

Question

Many firms advertise. What effect does advertising have on firm profits? One possible effect of advertising is to O A. increase profits by decreasing the cost of production. O C. increase profits by shifting the demand curve for the product to the right. O B. increase profits by making the demand curve for the product more elastic. O D. increase profits by making the supply curve for the product more inelastic E. increase profits by allowing the firm to produce the same amount of output with fewer inputs.

Explanation / Answer

The aim of advertising is both to shift to the right the demand curve faced by the individual seller and to make it less elastic

so answer is option C.

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