The first stage is called new-product stage in which the product is produced and consumed only in the innovating country with skilled labor and high technology. The second stage is the product-growth stage. In this stage, production is increased in order to meet the rapidly increasing demand. In the product-growth stage, imitating country starts to demand the new product. The third stage is product-maturity stage. In this stage, the new product is standardized and the innovating country may give license to the imitating country to produce the product introduced by itself. The fourth stage is product-standardization stage. In this stage, the new product is standardized. It is produced with lower costs of production in the imitating country and does no longer requires high technology within the production. The fifth and the last stage is the product-decline stage. In the fifth stage, the production of the new product within the innovating country decreases rapidly since the imitating country undersells it in its domestic market.