Sales of telephones have increased dramatically over the last year. In order to take advantage of this increase,Mammoth Industries plans to expand production of its own model of telephone, while continuing its already very extensive advertising of this product.Which of the following, if true, provides most support for the view that Mammoth Industries cannot increase its sales of telephones by adopting the plan outlined above?

A. Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year. --> Share has decreased. That does not say mean that MI's sales have decreased. Maybe others' sales have increased.

B. Mammoth Industries' average inventory of telephones awaiting shipment to retailers has declined slightly over the last year. --> This strengthens IMO. Low inventory may mean that sales have increased because of greater demand.

C. Advertising has made the brand name of Mammoth Industries' telephones widely known, but few consumers know that Mammoth Industries owns this brand. --> The issue here is sales. No one cares what the public perception is.

D. Mammoth Industries' telephone is one of three brands of telephone that have together accounted for the bulk of the last year's increase in sales. --> Clearly strengthens.

E. Despite a slight decline in the retail price, sales of Mammoth Industries' telephones have fallen in the last year. --> Weakener. The price was decreased. Logically, that should have been an incentive for increased sales but the reverse happened. Ominous!

Answer (E);

A similar question from knewton:

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OA is option E

C. Advertising has made the brand name of Mammoth Industries' telephones widely known, but few consumers know that Mammoth Industries owns this brand. => whether the brand name of Mammoth Industries' telephone does not show the taking advantage of selling phone. And topic in this sentence is about advertising. So, this answer is wrong.