Instructions

Read the following information and the accompanying graphs to answer the questions that follow.
www.jay.com spent $ 5,57,000 during last 12 months for online display advertisements, also called impressions, on five websites (Website A, Website B, Website C, Website D and Website E). In this arrangement, www.jay.com is the Destination Site, and the five websites are referred to as the Ad Sites. The allocation of online display advertising expenditure is shown in Graph A. The online display advertisements helped www.jay.com to get visitors on its site. Online visitors, visiting the Ad Sites, are served display advertisements of www.jay.com and on clicking they land on the Destination Site (Graph B). Once on the Destination Site, some of the visitors complete the purchase process(Graph C)

Quality traffic = $$\frac{\text{No. of site visitors who start purchase on destination site}}{\text{No. of visitors who click the online display advertisement}}$$

Leakage in online buying = 1 − $$\frac{\text {Complete buying on the destination website}}{\text{Start buying on the destination website}}$$

Efficiency of online display advertising expenditure on an Ad Site = $$\frac{\text{No. of visitors from the Ad Site who complete the purchase process}}{\text{Amount spent on the Ad Site}}$$

Question 85

Which of following Ad Sites provide facility of least cost per advertisement?

Solution

Let's calculate the Cost per advertisement by using the formula 

Cost per advertisement = Advertising expenditure / Impressions made

For website A= 557000 * 0.27/ 240 = 626.625

For website B=557000 * 0.22 / 370 = 331.19

For website D=557000 * 0.13 / 300 = 219.42

For website E=557000*0.20 / 150 = 742.67

So the least cost per advertisement is for Website D. 

Hence C is the correct answer.

Video Solution

video

Create a FREE account and get:

  • All Quant Formulas and shortcuts PDF
  • 40+ previous papers with solutions PDF
  • Top 500 MBA exam Solved Questions for Free

cracku

Boost your Prep!

Download App