Marketing: GEICO, the number-two auto insurer with $16 billion in revenue last year, spent $1.3 billion on advertising that year and plans to continue spending the same percentage of sales on advertising next year. The average advertising-to-sales ratio for the insurance industry is 0.1 percent of sales. If GEICO projects $18 billion in sales next year, using the percentage-of-sales method of advertising budgeting, how much will the company budget for advertising if basing it on projected sales? The advertising-to-sales ratio for the last year is _____?(Round to four decimal places.)
Marketing: GEICO, the number-two auto insurer with $16 billion in revenue last year, spent $1.3 billion on advertising that year and plans to continue spending the same percentage of sales on advertising next year. The average advertising-to-sales ratio for the insurance industry is 0.1 percent of sales. If GEICO projects $18 billion in sales next year, using the percentage-of-sales method of advertising budgeting, how much will the company budget for advertising if basing it on projected sales? The advertising-to-sales ratio for the last year is _____?(Round to four decimal places.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Marketing:
GEICO, the number-two auto insurer with $16 billion in revenue last year, spent $1.3 billion on advertising that year and plans to continue spending the same percentage of sales on advertising next year. The average advertising-to-sales ratio for the insurance industry is 0.1 percent of sales. If GEICO projects $18 billion in sales next year, using the percentage-of-sales method of advertising budgeting, how much will the company budget for advertising if basing it on projected sales?
The advertising-to-sales ratio for the last year is _____?
(Round to four decimal places.)
(Round to four decimal places.)
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