ITPEC FE Subject A April 2025 Question 50

Question

Which of the following is a characteristic of the growth stage in a product life cycle?

Accepted Answer

d) The market starts to understand the value of the product. Both the product line and distribution channels need to be expanded. This stage sees an increase in sales and also requires investment.

Answer

a) Demand decreases, and the withdrawal of some companies is observed. A decision needs to be made regarding whether it is possible to gain a strong foothold at this stage. Migration into an alternative market is also considered.

Answer

b) Demand is occasional, and exploiting new demand is key to success. Conviction for succeeding in a specific target market is necessary.

Answer

c) Demand reaches a peak, and the differentiation of the product and segmentation of the market become clear. The competition between competitors also intensifies, and it becomes important to add new product types and reduce costs.

Stage	Demand and competition	Main task
Introduction	Occasional demand	Create demand in a target market
Growth	Market understands the value; sales rise	Expand the product line and distribution; invest
Maturity	Demand peaks; competition intensifies	Differentiate, segment, cut costs
Decline	Demand falls; competitors withdraw	Decide whether to stay or move to another market

Explanation