Which of the following, if true, strengthens the argument for keeping

QUESTION

Which of the following, if true, strengthens the argument for keeping the traditional product line?

A) The aging product line is disproportionately taking up management’s time.
B) Other companies are keeping their competing product lines intact using promotion tactics and aggressive price cutting.
C) A miniscule band of loyal customers still prefers the company’s brand over competition.
D) The demand for the product may decline further, as advanced substitutes are about to hit the market.
E) The demand for such products has not changed much over the past year, and most competitors have exited this business.

ANSWER

Answer: E
Explanation: E) A product in the decline stage of the product life cycle can still be profitable. A company might decide to maintain such a product if some demand is likely to continue to exist and if competitors have left the market. Choice E points to such a scenario, with other marketers of traditional photographic products exiting and demand for the product remaining low but constant. Choice A is an argument for discontinuing the line. Choice B merely talks about how competition is trying to stay afloat; it doesn’t tell us whether it is best for Lanen to take a similar approach. Choice C doesn’t make the market—”a miniscule band”—sound very attractive. Choice D indicates a further decline in prospects for the line of traditional photographic products.