Consumer surplus and advertising revenue29 نوفمبر 2021 2021-11-25 20:52
Consumer surplus and advertising revenue
Do you agree with the following statement and why?
There is a direct relationship between consumer surplus and advertising revenue, so many ads appear in popular digital services
In general advertising revenue and consumer surplus need not be correlated with each other since platform might earn the same advertising revenue from two user while one of them might value it much higher than the other
One might argue that the value generated by Facebook is reflected in its advertising however. research indicates that Facebook generated over 500 of consumers surplus per year for the average user and average revenue per user is only 140 per year in us and advertising revenue are only fraction of total consumer surplus
I disagree as it’s not a direct relation between consumer surplus and advertising revinue as the advertising may like the consumer or make him dislike it and it may give the consumer have false info
No i disagree as the advertising may make the consumer to buy the good or not
I disagree as sometimes advertising misleads consumers and makes them use products or services that are useless which implies to having an indirect relationship between consumer surplus and advertising revenues
no I don’t agree
consumers should rationally infer that only high-quality products would spend significantly on advertising, because only high-quality brands can count on obtaining a sig- nificant number of repeat purchases.
advertising is always untrue and consumer after buying the product realizes that he spent money on something he didn’t want