In which situation should an entrepreneur consider discontinuing a product?
Answer and explanation
Correct answer: When demand remains low and losses continue even after improvement
An entrepreneur should consider discontinuing a product only after examining evidence such as sales, costs, customer response, and the results of corrective measures. If demand remains consistently low and the product continues to cause losses even after reasonable improvements, continuing it may waste scarce resources. A single suggestion or a first launch is not sufficient evidence, while positive market research supports continuation rather than discontinuation.
Frequently asked questions
What is the correct answer to this question?
When demand remains low and losses continue even after improvement
Why is this the correct answer?
An entrepreneur should consider discontinuing a product only after examining evidence such as sales, costs, customer response, and the results of corrective measures. If demand remains consistently low and the product continues to cause losses even after reasonable improvements, continuing it may waste scarce resources. A single suggestion or a first launch is not sufficient evidence, while positive market research supports continuation rather than discontinuation.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: MSME and Business Entrepreneurship. Topic: Entrepreneurship Development.
