Product life cycle assumes that products can be considered as a living organism. Therefore, a product is born, grows up, maturates and dies. There are five stages including product development, introduction, growth, maturity, and decline9. Sales and profits change in different stages  In the first stage, company develops a new product. In the introduction stage, sales start to increase but profits are generally negative or very low because of the cost of new product development . Growth stage is characterized by an increase in both sales and profits. In the maturity stage, sales are at peaks but starts to fall while profits decline. Decline stage is characterized by a decrease in both sales and profits. A is the right answer.