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13. Monopolistic Competition / Advertising / Problem 5
Problem 5
A company spends a significant amount on advertising its new line of organic skincare products. How might this expenditure influence consumer perception?
A
Consumers may perceive the products as overpriced and avoid them.
B
Consumers may perceive the products as high-quality and worth trying.
C
Consumers may assume the products are low-quality due to high advertising costs.
D
Consumers may ignore the advertising and rely solely on word-of-mouth.
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