In the decline stage of the PLC,price is pressured as a result of _______.
A)Consumers forgetting about the brand
B)New companies forging ahead in the market and offering lower prices to gain market share
C)Suppliers giving the firm price concessions, but not helping with the reduction in market size
D)Competitors dropping price and costs remaining high due to lower sales volume
E)None of these

Question

Quizplus · Accepted Answer

In the decline stage of the PLC, sales volume decreases, and it becomes challenging to maintain production levels, which can result in higher costs per unit. In response, competitors may drop their prices to gain market share, putting pressure on the firm to reduce its prices as well. However, this may not be sufficient to maintain profitability, as costs remain high due to the lower sales volume.

In the Decline Stage of the PLC,price Is Pressured as a Result