Which of the Following Is a Feature of the Shakeout

question 66

Multiple Choice

Which of the following is a feature of the shakeout phase of the industry life cycle?

• A) There is rapid industry growth during this stage.
• B) Market demand in this stage primarily consists of first-time adopters.
• C) Competitive intensity within the industry increases.
• D) The mode of competition shifts from price to non-price in this stage.

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Definitions:

Operating Leverage

A measure of how revenue growth translates into growth in operating income, demonstrating the proportion of fixed versus variable costs a company has.

Fixed Costs

Expenses that remain constant regardless of how much is produced or sold, including rent, salaries, and insurance costs.

Accounting Break-Even

The point where total sales equal total expenses, and the company makes no profit but also incurs no loss.

Depreciation Expense

An accounting method of allocating the cost of a tangible asset over its useful life, representing how much of the asset's value has been used up over a period.