Asked by Benjamin Etshim on Apr 28, 2024

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How can a company find its way out of a market characterized by pure competition?

A) consistently offer the lowest price until other competitors leave the market
B) increase prices and attract different, quality-oriented customers
C) decrease the amount of available product until the market reacts
D) increase the amount of available product to flood the market
E) differentiate the product in some way, even by packaging, so customers will see it as distinct

Pure Competition

A market structure characterized by a large number of small firms selling identical products, with no single entity able to influence the market price.

Product Differentiation

The process of distinguishing a product or service from others in the market to make it more attractive to a particular target market.

Market

An area or arena in which commercial dealings are conducted.

  • Recognize the importance of product differentiation in transforming market competition types.
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TJ
Taylor JabczenskiMay 03, 2024
Final Answer :
E
Explanation :
The best choice is to differentiate the product in some way, even by packaging, so customers will see it as distinct. This allows the company to stand out from its competitors and create a unique value proposition for customers. Consistently offering the lowest price may lead to a price war, which can be detrimental to all businesses involved. Increasing or decreasing the amount of available product may not solve the fundamental issue of pure competition. Increasing prices and attracting different, quality-oriented customers is a viable option, but it requires a significant investment in marketing and advertising to reach the desired audience. Differentiating the product is a simpler and more effective approach in the long run.