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The value of a product is determined by the ratio of its [#permalink]
08 Jun 2004, 00:35
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18. The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.
Which of the following, if true, would most strengthen the conclusion drawn above?
(A) It is possible to increase both the quality and the price of a product without changing its competitive position.
(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands.
(C) Competing products often try to appeal to different segments of the population of consumers.
(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty.
(E) Consumersâ€™ perceptions of the quality of a product are based on the actual quality of the product.
Please explain your answer if possible.
OA will follow.
The author assumes that consumers are capable of differentiating between, shall we say, products' various qualities; such savvy will obviously make them choose better-quality products. Therefore, if consumers base their perception of quality on the actual quality of products, increasing the quality of a product will increase the likelihood that consumers will select that product over a competing one.