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Life cycle costing Stages

Forums › ACCA Forums › ACCA PM Performance Management Forums › Life cycle costing Stages

  • This topic has 3 replies, 2 voices, and was last updated 1 month ago by mrjonbain.
Viewing 4 posts - 1 through 4 (of 4 total)
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  • April 8, 2025 at 10:20 am #716502
    mariastu23
    Participant
    • Topics: 9
    • Replies: 11
    • ☆

    Hello , Good afternoon .

    According to the lifecycle costing method , which two of the following statements regarding the stages of life cycle are true ?
    a) At the introduction stage , further capital expenditure will be needed as production capacity will need to increase to meet demand .
    b) The maturity stage occurs when the market has reached ‘ saturation point ‘ and bought enough of the product .
    c) The majority of a product’s life cycle costs are determined by decisions which are made at the design and development stage .
    d) The growth stage , when sales will have reached their peak and become stable , will be the most profitable stage .

    The answer was given as a) and c) . Pls explain how ‘a ‘ is true and ‘b’ is false . I thought Further capex will be incurred in the growth stage and initial investment in the introductory stage .

    Please clarify : )
    Thank you !

    April 8, 2025 at 3:44 pm #716507
    mrjonbain
    Moderator
    • Topics: 6
    • Replies: 2421
    • ☆☆☆☆☆

    For b) being false I would suggest “saturation point”is more indicative of the decline stage.

    April 9, 2025 at 8:18 am #716530
    mariastu23
    Participant
    • Topics: 9
    • Replies: 11
    • ☆

    Ok , Thank you : )

    April 9, 2025 at 8:58 am #716535
    mrjonbain
    Moderator
    • Topics: 6
    • Replies: 2421
    • ☆☆☆☆☆

    You are welcome.

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