At one time, definitely. Now though? We all carry around all of humanity's collective knowledge in our pockets. If you need a solution to a problem you have, if you need a plumber, if you need a new car... you an get unlimited information for the asking.
I don't remember the last time I responded to an advertisement. If I need things, I search Amazon/Etsy/local retailer apps or just go to a store. If I need contractors, I check local review pages to find good ones or just call ones I've used before. And some of that I guess you could call ads, but I mean in the traditional sense, where someone has paid to have someone put a product in front of me that I wasn't already looking for? Nah. Never happens.
2. Competition If you know better alternatives might exist, yes, you can search for them. But how do you search for better deals, services, or products for every little thing in your life? You don’t. Nobody has the time (or cognitive bandwidth) to proactively research every option. When done right, advertising helps level the playing field by putting alternatives in front of customers. And in doing so, it also pushes businesses to keep their offerings competitive.
I think we would be fine without ads.
I'm not convinced #2 is true — all ads imply the thing advertised is the best deal (where "best" is somewhere on cheap-quality spectrum), and the same limits to cognitive bandwidth mean we can't easily guess whatever points were missing from, at best, a 30-second highlights reel.