Read the following statements and answer the question.

Assertion: Product Concept assumes that availability and affordability of the product are the key to the success of a firm and puts greater emphasis on improving the production and distribution efficiency of the firms.

Reasoning: Product Concept assumes that product improvement is, the key to profit maximization of a firm.

Assertion (A) is not true but Reasoning (R) is correct.

The correct answer is option 4- Assertion (A) is not true but Reasoning (R) is correct.

Assertion: Product Concept assumes that availability and affordability of the product are the key to the success of a firm and puts greater emphasis on improving the production and distribution efficiency of the firms. THIS IS INCORRECT as production concept lays emphasis on improving the production and distribution efficiency of the firms not product concept.

Reasoning: Product Concept assumes that product improvement is, the key to profit maximization of a firm. THIS IS CORRECT.

The Product Concept- As a result of emphasis on production capacity during the earlier days, the position of supply increased over period of time. Mere availability and low price of the product could not ensure increased sale and as such the survival and growth of the firm. Thus, with the increase in the supply of the products, customers started looking for products which were superior in quality, performance and features. Therefore, the emphasis of the firms shifted from quantity of production to quality of products. The focus of business activity changed to bringing continuous improvement in the quality, incorporating new features, etc. Thus, product improvement became the key to profit maximisation of a firm, under the concept of product orientation.