Multiple Choice
A low cost provider strategy becomes increasingly appealing and competitively powerful when:
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3. The Market Forces of Supply and Demand
Competitive Markets
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
In competitive markets, consumers typically compare a firm's products and prices with those offered by ______.
A
the government
B
their own previous purchases
C
other firms in the same market
D
firms in unrelated industries
Verified step by step guidance1
Understand the context of competitive markets: In such markets, many firms offer similar or substitute products, and consumers have multiple options to choose from.
Recognize that consumers make purchasing decisions by comparing products and prices to maximize their utility or satisfaction.
Identify that the most relevant comparison for consumers is between products and prices offered by other firms within the same market, as these are direct substitutes.
Eliminate other options: The government does not typically set prices in competitive markets; previous purchases are less relevant for comparison; firms in unrelated industries offer different products.
Conclude that consumers compare a firm's products and prices with those offered by other firms in the same market to make informed choices.
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