Final answer:
Free samples are likely more effective in low-income countries, due to consumer financial constraints making free product trials more appealing than methods requiring an initial purchase. These countries rely more on international trade for economic growth, making appropriate promotional tools critical for businesses.
Step-by-step explanation:
The statement 'In a low-income country, free samples are likely to be a more effective promotional tool than coupons or on-pack premiums' can be considered true.
In low-income countries, consumers may have limited disposable income, thus the allure of free samples can be particularly compelling as it allows them to try new products without financial risk. On the other hand, coupons or on-pack premiums often require an initial purchase or are perceived as less valuable, making them less attractive promotional methods in such markets.
Low-income countries benefit more from trade than high-income countries because they have fewer opportunities for internal trade and competitive firms. These countries rely heavily on international trade to take advantage of comparative advantage, engage in the value chain, and achieve economies of scale.
For businesses operating within these markets, understanding consumer behavior - such as the preference for direct product trials over potential savings - is essential for successful marketing strategies.