Directions: In the question below are given a statement followed by two courses of action numbered I and II. A course of action is a step or administrative decision to be taken for improvement, follow-up or further action in regard to the problem, policy, etc. On the basis of the information given in the statement to be true, then decide which of the suggested courses of action logically follow(s) for pursuing.

Statement:

Firm F is a small manufacturing unit which produces yoga mats. Recently, the sales of their yoga mats has been experiencing a downfall. On investigating, the results show that the quality of their product is top-notch and the selling price is also not too high. The firm started looking into their competitor’s products, only to realize that they were selling the same product at the same price as their firm but their annual sales was higher than Firm F’s sales. The competitor firm was spending more money on advertisement and was also publicizing its CSR activities.

Course of Actions:

I. Firm F uses cheaper quality of raw material and lowers the selling price of its yoga mats.

II. Firm F spends more money on advertising its product.