When a Product Reaches the Decline Stage of the Product

question 185

Multiple Choice

When a product reaches the decline stage of the product life cycle, a firm has two choices. One choice involves product deletion-dropping it from a firm's product line. The other is called ________, which retains the product in the product line but reduces marketing costs.

• A) skimming
• B) paring
• C) divesting
• D) milking
• E) harvesting

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Definitions:

Leverage

The use of borrowed money to supplement existing funds for purposes of investment.

Bank Investments

Financial assets purchased or held by banks, including bonds, stocks, real estate, and other securities, with the aim of generating income or capital appreciation.

Leverage Ratio

The ratio of assets to bank capital.

Reserves

Assets held by a bank or financial institution, often to meet regulatory requirements or as a safeguard against potential crises.