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Does advertising tend to decrease competition

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Reference no: EM131600169

Question: You are watching a sporting event on television. An advertisement featuring Tiger Woods (a famous golfer) is broadcast during a commercial break. In the ad, Tiger Woods does nothing but hit golf balls. He never speaks. There is no written copy. At the end of the advertisement, the Nike "swoosh" appears on the screen along with the words "Nike Golf." A short time earlier, you read in a newspaper that Tiger Woods received $40 million to be the spokesperson for Nike golf equipment.

In general, does advertising tend to decrease competition and raise prices to consumers or increase competition and reduce prices to consumers? Why?

Reference no: EM131600169

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