In Which of the Following Instances Is Rivalry Among Competing

question 97

Multiple Choice

In which of the following instances is rivalry among competing sellers not more intense?

• A)when certain competitors are dissatisfied with their market position and make moves to bolster their standing
• B)when strong companies outside the industry acquire weak firms in the industry and launch aggressive moves to transform their newly acquired competitors into stronger market contenders
• C)when competitors are fairly equal in size and capability
• D)when the products of rivals are weakly differentiated, buyer switching costs are low, and market demand is growing slowly
• E)when there are vast numbers of small rivals so the impact of any one company's actions is spread thinly across all industry members

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Definitions:

Tacit Collusion

An unspoken, informal agreement among competitors to limit competition and maximize collective profits without explicit communication or contracts.

Bargaining Power

Bargaining Power denotes the capacity of one party in a negotiation to influence the terms and conditions of an agreement in their favor, often derived from one's status, resources, or strategic position.

Nash Equilibrium

Nash Equilibrium is a concept in game theory where each player's strategy is optimal, considering the strategies of other players, leading to a situation where no player has an incentive to deviate from their strategy.

Tacit Collusion

An unspoken, non-explicit agreement among competitors to avoid competitive practices like price wars, often difficult to detect and regulate.