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Business Strategy and Accounting Basics

In the product life cycle, which is the stage at which sales growth slows, the market approaches saturation, competitors multiply and price competition intensifies?

  1. AGrowth stage
  2. BMaturity stage
  3. CDecline stage
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Answer: B. Maturity stage

The product life cycle divides the time from a product's launch to its disappearance from the market into four stages: introduction, growth, maturity and decline. In the maturity stage, sales growth slows and many competitors offer similar products, so price competition intensifies, and securing profit through product improvement, differentiation and cost reduction becomes important. The growth stage is when sales grow rapidly and new competitors enter, and the decline stage is when sales fall and withdrawal or the end of production is considered.

  • A. This is the stage at which sales grow rapidly and new competitors enter one after another.
  • B. Correct. It is the stage at which sales growth slows and price competition intensifies.
  • C. This is the stage at which sales and profit fall and withdrawal or the end of production is considered.
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