Which of the following is a predictable competitive response to high initial prices?
A) Competition has an incentive to enter the market
B) Competition will stay out of the market because your product quality must be high
C) Competing companies may report you for price gouging
D) Competition will offer radically different products

Question

Quizplus · Accepted Answer

High initial prices give competitors an incentive to enter the market as they see potential profits to be made. They may offer similar products at a lower price or differentiate their products to appeal to a different target market.

Which of the Following Is a Predictable Competitive Response to High