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Notes:

To be able to sell more at the same price, you have to shift the demand curve to the right.

Advertising is another determinate of demand. Retailers demand functions are more price elastic than those of manufacturers because retailers have more competition. Thus retailers customers are more responsive to changes in price, and price advertising therefore draws in retail customers.

If we can make the demand curve steeper, we will have more control over the price of the products we sell. In other words, we can change prices more and have a smaller change of the quantity demanded.

Retailers advertising has a shorter lead time. Price advertising generates retail traffic.

Manufacturers advertising has a longer lead time. They are reluctant to advertise prices which may have changed by the time the ad is run. They have little control over actual retail prices. They are very concerned with changing the slope of the demand curve. This gives them more pricing flexibility