MGKT 367 Assignement2

1. During the first week of a search advertising campaign, your ad was served to 10,000 people and you are paying on average $3.35 PPC.  It the CTR is 1.35%, then how much did you spend in the first week?

2. Your display advertising campaign is priced at 13.12 CPM with a CTR of 0.05%. What is the total cost of 100,000 impressions?

3. You are deciding whether or not to purchase a display advertising campaign on a PPC or CPM basis. The PPC price is $1.53 and the CPM price is $5.67.  

   1. If the expected CTR is 0.5%, which option is less expensive?

   2. If the expected CTR is 2.5%, which option is less expensive?

4. [challenge] Suppose you are the marketing manager for MyTeam.com, an online seller of jerseys for sports teams. If Philly.com offered to sell you advertising on a pay-per-conversion basis at $10 per conversion and the gross margin on sales is 30%, how big does the average order have to be to justify the cost of the advertising?  

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