Statement: The sale of a particular product has dropped considerably, causing serious concern to the company. Courses of Action: I. Conduct a structured study of rival products (features, pricing, distribution, promotions) and customer feedback. II. Immediately reduce price and improve quality.

Introduction / Context:
Sales declines can stem from multiple causes: product–market fit, channel conflict, competitor moves, seasonality, macroeconomics, or service issues. The first course of action proposes diagnosis; the second prescribes immediate remedies without evidence.

Given Data / Assumptions:

• Magnitude and drivers of decline are unspecified.
• Competitor behaviour and customer perceptions are unknown.
• Quality upgrades and price cuts entail cost and brand implications.

Concept / Approach:
Follow an evidence-led sequence: diagnose → hypothesise → test → scale. Premature price cuts can trigger a race to the bottom and damage brand equity; blind “quality improvement” may raise costs without addressing the real barrier (e.g., distribution gaps).

Step-by-Step Solution:
1) Commission a quick win–loss and competitor audit; map price–value perception.2) Run targeted experiments (bundles, channel offers, feature tweaks) before structural changes.3) Decide on pricing and quality roadmaps post-diagnosis to avoid wasted spend.

Verification / Alternative check:
Where the decline is seasonal or due to channel stock-outs, price/quality changes won’t help. Diagnosis prevents misallocation.

Why Other Options Are Wrong:
Only II/Either/Both: they sanction action without evidence. Neither: ignores the urgent need to understand the drop.

Common Pitfalls:
Confusing symptoms with causes; over-relying on blanket discounts; neglecting post-purchase experience.

Final Answer:
Only I follows.