Sales of telephones have incread dramtically over the year. In order to take advantage of this increase, Mammothe Industries plans to expand production of its own model of telephone, while continuing its already very extensive advertising of this product.
Which of the following , if true, provides most support for the view that Mammothe Industries cannot increase its sales of telephones by adopting the plan outlined above?
A) Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year
B) Mammoth Industries' average inventory of telephones awaiting shipment to retailers has declined slightly over the last year
C)Advertising has made the brand name of Mammoth INdustries' telephones widely known, but few consumers know that Mammoth Industries owns this brand
D)Mammoth INdustries' telephone is one of three brands of telephone that have together accounted for the bulk of the last year's increase in sales
E) Despite a slight decline in the retail price, sales of Mammoth Industries' telephones have fallen in the last year
My answer is E
Sales of telephone have increased dramatically and that's why Mammoth Ind. is increasing production. But if Mammooth Industries's telephone sales decreased in the last year, their plan for expansion would not work.