As flat screen TVs enter the maturity stage of their product life cycle, which of the following is most likely to be a source of comparative advantage for producers?

• A. Access to advanced manufacturing technology that lowers production costs
• B. High initial investment in research and development
• C. Ability to innovate new product features
• D. Strong brand recognition among early adopters

Answer: (A)

Verified step by step guidance

1. Understand the concept of the product life cycle, which includes stages such as introduction, growth, maturity, and decline. Each stage has different characteristics affecting competitive advantage.
2. Recognize that in the maturity stage, the market is saturated, growth slows down, and products become more standardized, so innovation and early adoption advantages diminish.
3. Identify that during maturity, cost efficiency becomes crucial because price competition intensifies and consumers focus more on price and availability rather than new features.
4. Analyze the options: high R&D investment and ability to innovate are more relevant in the introduction or growth stages, while strong brand recognition among early adopters is less impactful in maturity.
5. Conclude that access to advanced manufacturing technology that lowers production costs is the most likely source of comparative advantage in the maturity stage, as it allows producers to compete effectively on price.