Answering: “Consider the following three statements:”

The site’s answer is to invest in Product A, since it has the larger potential market and the most room to improve satisfaction and revenue. The trap is chasing current revenue in Product B when the bigger opportunity sits in Product A.

Exam Question

Consider the following three statements:
– Product A has a greater potential market than Product B.
– Product A has a lower customer satisfaction than Product B.
– Product B produces more revenue at the present time.
Given this information, which of the following investment strategies should you consider for these two products?
(choose the best answer)
A. For both products, continually measure the impact of any new investments or marketing.
B. Invest in Product A to increase its market share, customer satisfaction, and revenue.
C. Increase marketing for Product B to grow its market share.
D. All of the above.

Correct Answer

B. Invest in Product A to increase its market share, customer satisfaction, and revenue.

Why This Is the Correct Answer

Evidence-Based Management separates Current Value, what a product delivers today, from Unrealized Value, the extra value that could be captured. Product B earns more now and has happier customers, so it shows higher current value. Product A has a larger potential market and lower satisfaction, which points to high unrealized value and a clear gap to close. A Product Owner thinking about long-term value would direct investment toward the product with more room to grow. Improving satisfaction in Product A is also a sensible first step, because satisfied customers drive both retention and new market share. Measuring the results of that investment is still good practice, since every investment is a hypothesis.

Why the Other Options Are Wrong

A. Continually measure the impact of new investments in both products. Measuring is good practice, but on its own it does not say where to invest. The question asks for an investment strategy.

C. Increase marketing for Product B to grow its market share. Product B already has the smaller potential market. Pushing marketing there targets the lower opportunity.

D. All of the above. Option C conflicts with focusing on the larger opportunity in Product A, so not every option fits.

Exam Tip

For PSPO II portfolio questions, translate each statement into EBM terms. Potential market and low satisfaction suggest unrealized value; current revenue suggests current value.

Key Takeaways

• Current Value and Unrealized Value lead to different investment choices.
• A larger potential market signals room to grow.
• Treat every investment as a hypothesis and check its results.