If the adoption of a new product will reduce the sales of an existing product,then the:
A) new product should not be undertaken.
B) old product should be abandoned.
C) incremental benefits of the new product may be overestimated.
D) incremental benefits of the new product may be underestimated.

Question

Quizplus · Accepted Answer

The fact that the adoption of a new product will reduce the sales of an existing product suggests that the incremental benefits of the new product may be overestimated. This is because the company may not have accounted for the potential cannibalization effect on the sales of the existing product. Therefore, the company should be cautious in evaluating the expected benefits of the new product and make sure to consider the potential negative impact on the existing product. Option A and B are too extreme and do not take into account the potential benefits of introducing a new product. Option D is not a likely outcome given the premise of the question.

If the Adoption of a New Product Will Reduce the Sales