Roberto, the marketing manager of Absola Foods Co., a food processing company, reduces the prices of the firm's line of breakfast cereals in an attempt to increase the number of products sold. However, contrary to Roberto's prediction, sales of the breakfast cereals drop, and upon further investigation, Roberto discovers that the company's target consumers are buying more expensive competitor brands instead of Absola food products. Which of the following could be a possible explanation for this?

A. The company didn't cut the prices low enough.
B. Most of the consumers were repeat customers.
C. Most of the customers were bargain seekers.
D. The consumers perceived the higher priced products as having better quality.
E. Customers that went to the competition were price sensitive.


Answer: D

Business

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