Explain Product Differentiation as a Positioning Strategy Used by Marketers

question 5

Essay

Explain product differentiation as a positioning strategy used by marketers to distinguish their products from competitors.

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Definitions:

MR < MC

A scenario where marginal revenue is less than marginal cost, suggesting it is not profitable to produce additional units.

Marginal Cost

A measurement of the cost incurred by producing one additional unit of a product or service.

Average Variable Cost

The per-unit cost that varies, calculated through the division of total variable costs by the quantity of products made.

Economic Profits

The financial gain made in a transaction after accounting for both explicit and implicit costs.