In the market introduction stage of the product life cycle
A) sales are the highest.
B) most companies experience losses.
C) industry profits rise.
D) industry sales level off.
E) total industry profit is highest.

Question

Quizplus · Accepted Answer

During the market introduction stage, sales are usually low as the product is new, unfamiliar to customers, and may require significant marketing efforts to create awareness and generate demand. Therefore, most companies experience losses or low profits during this stage as they invest heavily in product development, marketing, and distribution to establish the product in the market. Industry profits do not usually rise in this stage as competition is still low, and customers may not be willing to pay a premium price for a new product with uncertain benefits. The industry sales may also be limited as the product may be available only in select regions or to a limited customer base. Total industry profit is typically low due to the low sales and high expenses incurred by companies.

In the Market Introduction Stage of the Product Life Cycle