Management Information System (MIS) Practice Exam

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Prepare for the Management Information System Test. Boost your knowledge with flashcards and multiple choice questions, each question includes hints and explanations. Be exam-ready today!

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Which term describes the practice of marketers paying for an advertisement based on the number of clicks it receives?

Pay-per-acquisition
Pay-per-click
Cost-per-impression
Pay-per-action

The correct answer is: Pay-per-click

The correct term that describes marketers paying for an advertisement based on the number of clicks it receives is known as "Pay-per-click." This model allows advertisers to pay a fee each time their ad is clicked, making it a performance-based approach to online advertising. This method is highly popular because it provides a measurable return on investment, allowing marketers to track the effectiveness of their campaigns with greater accuracy. The more clicks an ad generates, the more the advertiser pays; however, this also implies that the advertiser is only charged when a user shows a direct interest in their offering by clicking on the ad. In contrast, the other terms mentioned refer to different payment structures in advertising. For example, "Pay-per-acquisition" is linked to paying for a specific conversion or sale rather than just a click, while "Cost-per-impression" involves paying based on the number of times an ad is displayed regardless of whether it’s clicked. "Pay-per-action" generally refers to a payment made for a specific action taken by the user, which could include filling out a form or making a purchase, rather than merely clicking on an ad.