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NISM Certifications · NISM-Series-XV: Research Analyst · Industry Analysis

In the industry life cycle framework used by research analysts, which stage is typically characterised by slowing sales growth, intense price competition and consolidation through mergers among firms?

The maturity stage is characterised by slowing sales growth, strong price competition and consolidation through mergers. Demand is saturated, so firms fight for market share on cost and price, and weaker players exit or get acquired, unlike in the pioneering and rapid growth stages.

  1. APioneering (introduction) stage
  2. BRapid growth stage
  3. CMaturity stageCorrect
  4. DStart-up funding stage

Explanation

In the maturity stage, growth rates slow down as the market gets saturated. Firms compete on price and cost efficiency, and weaker players exit or are acquired. The pioneering and growth stages show rising demand and entry of new firms rather than consolidation.

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