A firm is likely to respond to an attack by a competitor in all of the following situations EXCEPT
A) the attack is by a price predator.
B) the attack makes the firm's market position less defensible.
C) the attack damages the firm's ability to use its capabilities.
D) the attack improves the competitor's market position.

Question

Quizplus · Accepted Answer

A price predator is a firm that sets prices below its own marginal cost in order to drive competitors out of the market. If a firm is attacked by a price predator, it is unlikely to respond because it would be irrational to do so.

A Firm Is Likely to Respond to an Attack by a Competitor