Homework Help: Marketing

Posted by Charles on Monday, December 14, 2009 at 9:29pm.

A) Explain why the return on investment diminishes as more is invested in advertising.

I understand that ROI= (Gain from investment – Cost of Investment)/Cost of Investment. I guess I could say that the more you invest in advertising (Cost of Investment) the more it pulls away from your Gain from investment. Seems like I need a better way to explain this and I’m not sure how to go about explaining the answer.

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