Question

A stock analyst observed the following industry-life cycle information:

The current penetration rate in the U.S. Market is significant.
Competition is fierce and focused on the basis of price; price wars within the industry are common.
This industry is most likely in the _______________ stage.

Answer 1

Maturity stage.

Step-by-step explanation:

The industry-life cycle shows the progress of a business in stages over a given period of time. There are basically 5 stages in a business cycle.

-Launch phase.

-Growth phase.

- Shakeout phase.

- Maturity phase.

- Decline phase.

At the maturity phase, sales begin to slow down as the business attains maturity. The cash flow remains unaffected as the market is significant at this stage. The competition is fierce and price wars within the industry are common. At this stage, businesses try to reinvest in new emerging market as a way of strategically positioning themselves in their innovative industries. This creates room for further growth and development of the business.