34. 34. Which of the following statements regarding product life cycle and profi

Question

34.

34. Which of the following statements regarding product life cycle and profitability is true? A. Profit is highest in the emerging growth life cycle phase because the product is new and unique. B. Cash flows are lowest in the established growth stage of the life cycle because costs are so high. C. Cash flows are at its greatest in the decline stage of the product life cycle because no new investment is needed. D. Breakeven is attained in the emerging growth stage of the product life cycle. E. Cash flow turns positive in the maturity phase.

Explanation / Answer

Correct option is "D. break even is attained in the emerging growth stage of the product life cycle" Since,

Option A is incorrect because profit is highest in maturity stage

Option B is incorrect because cash flows are lowest in the introduction stage not in groth stage

Option C is incorrect because cash flows are greatest in the maturity stage not in declinie stage

Option E is incorrect because cash flow turns positive in groth stage not in maturity phase.

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