Businesses Following a Reactor Strategy

question 30

Multiple Choice

Businesses following a reactor strategy:

• A)attempt to maintain a stable line of products,but follow a selected set of promising new developments in its industry
• B)try to protect their domain by offering lower prices,higher quality or better services than competitors
• C)are not as willing to assume the risks of a new product or market development as its competitors
• D)respond rapidly to early signals concerning areas of opportunity,which often lead to new rounds of competitive actions

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Definitions:

Equilibrium Level

The equilibrium level is a state where supply and demand balance each other, and market forces such as price remain stable.

Monopolistically Competitive

A market structure where many firms sell products that are similar but not identical, allowing for some degree of market power.

Pure Monopolist

A market structure where a single seller dominates, facing no competition in selling its products or services.

Economic Profit

The difference between a firm's total revenues and its total costs, including both explicit and implicit costs, indicating the firm's overall financial gain.