Which one of these is an example of erosion that should be included in project analysis?
A)The anticipated loss of current sales when a new product is launched.
B)The expected decline in sales as the market for a product becomes saturated.
C)The reduction in sales that occurs when a competitor introduces a new product.
D)The sudden loss of sales due to a major employer in your community implementing massive layoffs.
E)The reduction in sales price that will most likely be required to sell inventory that has aged.

Question

Quizplus · Accepted Answer

Erosion in project analysis refers to the loss of sales or revenue from existing products due to the introduction of a new product by the same company. Choice A, the anticipated loss of current sales when a new product is launched, directly fits this definition.

Which One of These Is an Example of Erosion That