Competitive advantage can be defined as:
A)A firm's ability to establish market leadership
B)A firm's ability to grow faster than its competitors
C)A firm's potential to earn a rate of profit that is persistently higher than its rivals
D)A firm's potential for launching innovative new products.

Question

Quizplus · Accepted Answer

Competitive advantage is the ability of a firm to generate higher profits or achieve greater market share than its competitors. Option C defines competitive advantage as a firm's potential to earn a rate of profit that is persistently higher than its rivals, which accurately describes the key concept of competitive advantage. Options A, B, and D may contribute to a firm's competitive advantage, but they do not fully capture the essence of the term.

Competitive Advantage Can Be Defined As