"Since a competing lower-priced newspaper, The Bugle, was started 5 years ago, The Mercury's circulation has declined by 10,000 readers. The best way to get more people to read The Mercury is to reduce its price below that of The Bugle, at least until circulation increases to former levels. The increased circulation of The Mercury will attract more businesses to buy advertising space in the paper."
Though it might seem that the argument sounds promising enough in the way The Mercury would attract more number of readers than the present number, by reducung its price than The Bugle's and the way this strategy would work in attracting more businesses to buy advertising space in the paper, it would have been more convincing if the argument had provided more information to substantiate itself.
My first reason not to agree with the argument would be considering the possibility where there might be different reasons for a reader to choose a particular newspaper than just the price. It could be the quality of the paper that allured a reader more, or even the availability of more number of interesting topics or sections like a more colorfull sports or entertainment column in The Bugle when compared to the one in The Mercury.
Second, The Bugle could have taken advantage of the situation, where it attracted The Mercury's readers, and managed to attract more readers through cheaper schemes where in the readers would get a high %of discount in taking a long-term prescription of the newspaper. In such a case, even if The Mercury would have reduced its prices, these readers would not or will not be able to prefer The Mercury to The Bugle.
Another factor which was not considered in the argument, regarding the way more businesses would be attracted towards The Mercury to buy advertising space, is the possibilty that these businesses could have made long-term deals with The Bugle already to cast their advertisements in The Bugle.
In conclusion, I would like to state that if the argument included the above factors as well then it would have sounded more consistent and convincing. Trying to follow a business plan without considering all the factors involved would usually put the business at risk.