In which business cycle phase do sales start to increase significantly as a company becomes cash flow positive?

The correct selection highlights the Growth Phase of the business cycle, which is characterized by significant increases in sales as the company expands its market reach and solidifies its customer base. During this phase, businesses typically experience a rapid increase in demand for their products or services, resulting in healthier cash flow and profitability.

The growth phase fosters an environment where companies are not only recovering their initial investments but also generating excess cash that can be reinvested to drive further expansion. As companies establish strong foundations during the earlier phases, such as the Launch Phase where initial traction is gained, the Growth Phase is where they begin to capitalize on that momentum, resulting in a pronounced uptick in sales and cash flow.

In contrast, other phases either precede this stage or characterize different dynamics, such as market saturation or declining sales, which does not align with the conditions present in the Growth Phase where thriving financial performance is observed.