Axis Auto Tries to Keep Its Operational Spending as Low

question 3

Multiple Choice

Axis Auto tries to keep its operational spending as low as possible so that it can pass its savings on to customers in the form of lower prices.This is known as a ________ strategy.

• A)cost-leadership
• B)differentiation
• C)specialization
• D)growth

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Definitions:

Perfectly Competitive Market

A theoretical market structure characterized by an infinite number of small firms, homogeneous products, perfect information, and ease of entry and exit.

Demand Increases

A situation in market analysis where the quantity of a good or service that consumers are willing and able to buy rises.

Market Price

The current price at which a good or service can be bought or sold in the marketplace.

Perfectly Competitive Industry

An economic framework where numerous sellers and buyers exist, with unrestricted entry and exit, and the product offered is uniform.