When a new product takes sales away from the firm's existing products, it is known as ______.

Question

Quizplus · Accepted Answer

Cannibalization occurs when a new product or service eats into the sales of an existing product or service. It can create internal competition and might not necessarily result in increased overall sales. Transfer pricing refers to the price set for goods or services sold between different divisions or subsidiaries of the same company. Sales creation refers to generating new sales through marketing and promotion. Opportunity cost is the cost of the next best alternative forgone when a decision is made. None of these options adequately describe the situation where a new product takes sales away from existing products.

When a New Product Takes Sales Away from the Firm's