1: hapter 7 Review Questions1. Distinguish policies on external competitiveness from policies on internal alignment. Why is external competitiveness so important?2. What factors shape an organization’s external competitiveness?3. What does marginal revenue product have to do with pay?4. What pay level does the efficiency wage predict? Does the theory accurately predict organization behavior? Why or why not?5. What is a relevant market? What difference does it make when determining people’s pay?6. Can you think of any companies that follow a lag and/or lead policy? Why do they believe it pays to pay differently? Can you think of any companies that follow performance driven and/or work/life balance policies?2:Select one of your favorite products (appropriate for discussion) and what method it typically uses for advertisement (cognitive, emotional, image, or endorsement). Out of the four types, suggest how one of the other methods could be effective providing details.Imagine you were designing an ad for a (choose one): car, laptop, health clinic. What would your ad look like if you were targeting: -Older people? -Kids? -Wealthy people? -What celebrity should endorse your brand? Why?In the weekly folder, read the mini-case: AIDA and diagnose the problem (from the following choices): A. Not enough advertising, B. Ads are boring, C. Ads aren’t persuasive, D. Channels (availability), E. Poor Product. In addition, define the problem in Scenario 1-5. What additional information would help you make a decision about the Ads?In the week seven folder, review the Bank and Hotel Perceptions figure. We see that the bank and hotel had business issues that advertising could address, namely awareness and consumer attitudes, respectively. If we make assumptions and simple calculations that a brand’s market share (%) is a function of those indicators (awareness, attitudes, trial, repeat), we could set other goals for the advertising ROI. For example, say we have a simple model: %market share = %awareness x %attitude x %trial x %repeat. For the bank, we have 0.25 x 0.80 x 1.00 x 0.75 = 0.15. The bank struggled with awareness, which should be easily rectified by spending more money on advertising, e.g., by buying time in a medium that delivers more GRPs. How much would we have to increase awareness for the bank to achieve some market share goal (provide a calculation)? What else would you like to know for a more thorough assessment?