Entrepreneurship and Small Business (ESB) V2 Certification Practice Exam

Which of the following best describes a common characteristic of a business in its maturity stage?

1. High levels of innovation

2. Steady revenue and profitability

3. Frequent changes in the product line

4. Increase in startup costs

The correct answer is: Steady revenue and profitability

A business in its maturity stage typically experiences steady revenue and profitability, indicating that it has reached a level of stability in the market. At this stage, the business has often established a strong customer base and brand recognition, allowing for consistent sales. The maturity phase follows growth, where the company has expanded its market presence and solidified its operations. In contrast, high levels of innovation are more characteristic of the growth phase, where businesses are often experimenting with new products and services to capture market share. Frequent changes in the product line also align with earlier stages of business development, where adapting quickly to market demands is essential for survival. An increase in startup costs usually pertains to businesses in their initial stages, as they invest heavily in establishing operations and market presence. Overall, the steady revenue and profitability in the maturity stage reflect the business's success and operational efficiency achieved over time.