A Strategy of Dropping a Product from the Product Line

question 63

Multiple Choice

A strategy of dropping a product from the product line, usually in the decline stage of the product life cycle, is referred to as _________.

• A)diversification
• B)aggregation
• C)paring down
• D)deletion
• E)harvesting

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Definitions:

Variable Production Costs

Variable production costs are those costs that vary directly with the level of production output, such as raw materials and direct labor.

Traceable Fixed Advertising

Costs of advertising that can be directly associated with a specific product or segment of the business.

Fixed General Factory Overhead

Costs associated with operating a factory that do not vary with the level of production, such as factory rent, insurance, and salaries of managers.