Which of the following best describes a 'problem child' in the portfolio matrix?

A "problem child" in the portfolio matrix, often referred to in the context of the BCG (Boston Consulting Group) matrix, is characterized by significant investment needs yet struggles to achieve profitability. This designation reflects the dual challenges these units face: they are situated in a high-growth market, which indicates potential, but they possess a low market share, signifying that they are not capitalizing on this potential as effectively as they could.

Units labeled as "problem children" require ongoing investment to increase their market share and profitability. Therefore, recognizing them as such allows management to make informed decisions about whether to invest in them further, divest, or reposition them strategically within the market.

In contrast, the other options do not accurately capture this definition. For instance, units with strong growth and high profitability represent stars; declining market share denotes a unit that might be a dog; and those with stable profits and slow growth fall into a cash cow category. Thus, the rationale behind identifying option C as the best description of a "problem child" hinges on the combination of substantial investment requirements and the current lack of profitability amidst growth potential.