IIA-CIA-Part3 Exam Dumps | During the growth stage of a product's life cycle,

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Question 145/152

During the growth stage of a product's life cycle,

A. The quality of products is poor.

B. New product models and features are introduced.

C. There is little difference between competing products.

D. The quality of the products becomes more variable and products are less differentiated.

Correct Answer: B

In the growth stage, sales and profits increase rapidly, cost per customer decreases, customers are early adopters, new competitors enter an expanding market, new product models and features are introduced, and promotion spending declines or remains stable. The firm enters new market segments and distribution channels and attempts to build brand loyalty and achieve the maximum share of the market. Thus, prices are set to penetrate the market, distribution channels are extended, and the mass market is targeted through advertising. The strategy is to advance by these means and by achieving economies of productive scale.

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