Lesson 2.3.5

2.3.5 Product Lifecycle & Extension Strategies Quiz: NCFE Business & Enterprise, Unit 2

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

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The product life cycle plots a product's sales over time through introduction, growth, maturity and decline. This lesson explains what happens to sales, costs and profit at each stage, how external factors can shift it, and how extension strategies using the marketing mix can delay decline.

Key points

  • The product life cycle shows sales on the vertical axis over time, split into introduction, growth, maturity and decline.
  • In introduction, sales are low while launch and advertising costs are high, so the product often makes a loss.
  • In growth, sales climb quickly, more shops stock the product and it makes its first profit.
  • At maturity, sales peak and level off, so firms defend market share with offers and loyalty deals.
  • Decline is driven by changing tastes or substitutes, and external factors such as extra taxes can bring it on sooner.
  • Extension strategies, such as a new flavour, new packaging or a new market, stretch the profitable part of the cycle.
  • Reducing the price of a fading product shifts old stock and brings in bargain hunters.

Key terms

Product life cycle
A model showing the stages of a product's sales from launch to decline.
Introduction stage
The launch period with low sales and heavy promotion costs.
Growth stage
The period when sales rise quickly and the product begins to make a profit.
Maturity stage
The period when sales peak and flatten as the market is close to saturated.
Decline stage
The period of falling sales as customers move to newer or better alternatives.
Extension strategy
An action that delays decline by refreshing the product or how it is sold.

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The 20 questions

  1. A smart speaker has been on sale for a year. Sales are climbing fast and more shops are stocking it. Which stage is it in?

    • Growth
    • Introduction
    • Decline
    • Maturity

  2. What happens to sales at the maturity stage of a product lifecycle?

    • Sales grow rapidly
    • Sales level off
    • Sales are zero
    • Sales fall sharply

  3. Sales of a DVD player are falling year on year as shoppers switch to streaming. Which stage of the lifecycle is this?

    • Maturity
    • Decline
    • Introduction
    • Growth

  4. Why might a business use an extension strategy?

    • Increase launch costs
    • Halt production permanently
    • Lower initial prices
    • Revive fading sales

  5. Which extension strategy uses the product element of the marketing mix?

    • Using new shops
    • Cutting prices
    • Adding new flavours
    • Running flash sales

  6. Selling an existing product in a brand new country is what type of extension strategy?

    • Product redesign
    • Price slashing
    • Increased advertising
    • New markets

  7. Sales of a new games console are low and the firm is spending heavily on advertising. Which stage of the lifecycle is this?

    • Introduction
    • Maturity
    • Growth
    • Decline

  8. What is normally measured on the vertical axis of a product lifecycle diagram?

    • Sales volume
    • Production cost
    • Staff numbers
    • Time elapsed

  9. Why does a business often make a loss during the introduction stage?

    • High worker wages
    • Excessive tax rates
    • High launch costs
    • Zero promotional spend

  10. Falling demand caused by extra taxes brings on which lifecycle stage sooner?

    • Introduction stage
    • Maturity stage
    • Growth stage
    • Decline stage

  11. Which model tracks a product's sales revenue from its launch to its withdrawal?

    • Ansoff Matrix
    • Boston Matrix
    • Product life cycle
    • SWOT analysis

  12. Which situation is typical of the introduction stage?

    • Zero promotion costs
    • Low sales volumes
    • Maximum profit levels
    • High market saturation

  13. What usually happens during the growth stage of a product?

    • Prices hit zero
    • Demand disappears
    • Sales climb quickly
    • Sales drop rapidly

  14. Which strategy is typical for a product in the maturity stage?

    • Defending market share
    • Massive research spending
    • Rapid price increases
    • Immediate product withdrawal

  15. What causes sales to fall in the product decline stage?

    • Improved supply chains
    • Heavy price rises
    • Increased production limits
    • Tastes move on

  16. What is the primary purpose of an extension strategy?

    • Delay product decline
    • Speed up withdrawal
    • Double production costs
    • Halt manufacturing forever

  17. Which move is a valid product extension strategy?

    • Halving factory output
    • New packaging design
    • Closing retail stores
    • Stopping all advertising

  18. How does moving into overseas markets extend a product lifecycle?

    • Increases home taxes
    • Finds fresh customers
    • Eliminates all transport
    • Reduces total output

  19. Which product lifecycle extension strategy involves directly altering the item itself?

    • Product redesign
    • Lowering prices
    • Opening new shops
    • Running adverts

  20. Why might a business cut the price of a declining product?

    • To clear stock
    • To attract investors
    • To fund research
    • To increase profit margins

All NCFE Business & Enterprise quizzes