Which of the Following Statements About the Decline Stage of the Product

question 7

Multiple Choice

Which of the following statements about the decline stage of the product life cycle is most accurate?

• A)Ironically, in the decline stage, sales decline even though profits increase.
• B)A product always enters the decline stage as the result of a major product flaw or marketing misstep.
• C)A major reason that a firm's product enters the decline stage is as a result of changes in the marketing environment.
• D)The only real step that can be taken to avoid the decline stage and ultimately extinction is to increase marketing expenditures as soon as the product enters its maturity stage.
• E)Service industries are exempt from the decline stage because of their intangible nature.

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Definitions:

Variable Costs

Expenses that fluctuate in proportion to the activity of a business.

Activity Level

A measure of the volume of production or operations, often influencing costs and revenues in a business.

Fixed Cost Per Unit

The total fixed costs divided by the number of units produced, indicating how much each unit needs to contribute to fixed costs.

Level of Activity

A measure of the volume of production, operation, or work undertaken by a business or facility within a particular time period.