The answer is E.
We know that the discounts may hurt the company's profitability. Therefore, an assumption exists that the company is offering the discounts for a reason other than maximizing profit.
A) Only states that the discounts were set at a price just high enough to draw attention.
-Ok, so what? You drew their attention. You have to make another assumption that drawing attention leads to sales.
-Why are you drawing attention? Is this about awareness? Raising market share? We have absolutely no idea.
-If you want to draw attention, why are you offering discounts? Does advertising alone not work? What alternatives are there? Is discounts the best alternative? We have no answers to any of these. Again, more assumptions to be made.
E) We know that if the company doesn't offer the discounts, they will lose customers to a competitor.
-Ah ha, the reason the company offers the discount despite a potential to hurt (lower) profitability. No further assumptions needed.
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