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Ads are as likely to decrease the price of the product as increase it. Advertising leads to new customers which may lead to economies of scale that reduce the unit price enough to offset the ad outlay. In fact, if the company in question has to increase their prices to cover advertising, it's probably an irrational investment, unless the alternative is to go out of business, or they manage to drum up enough demand that the market bears a higher price. In the last case, competition is likely to bring the price to a reasonable level.


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