Describe the Decline Stage of the Product Life Cycle

question 123

Essay

Describe the decline stage of the product life cycle. Explain the two strategies a company might employ if its product were in the decline stage of the product life cycle.

---

Definitions:

Monopolistic Competition

A market structure characterized by many firms selling products that are similar but not identical, allowing for product differentiation and some control over pricing.

Identical Product

A good or service that is exactly the same in quality, function, and design across different sellers, making them perfect substitutes.

Oligopoly

An economic scenario where a handful of companies dominate the market, resulting in minimal competitive activity.

Herfindahl Index

A metric used to assess the level of concentration within a market, achieved by taking the square of each firm's market share and summing these squares.