When a Firm Has a Greater Positive Difference Between Cost

question 10

Multiple Choice

When a firm has a greater positive difference between cost and value than its rivals,it can achieve competitive advantage by:

• A) Raising the price and maintaining market share and volumes.
• B) Increasing production costs while lowering prices.
• C) Charging the same or even lower prices and selling more goods or services.
• D) Minimizing the difference between value and cost and lowering prices.

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Definitions:

Classical Conditioning

A mode of learning through which two stimuli are systematically associated; a reaction that is initially provoked by the second stimulus soon gets provoked by the first stimulus.

Observational Learning

A learning process where individuals observe and mimic the behavior of others, acquiring new skills or behaviors without direct experience.

Negative Reinforcement

is a behavioral psychology concept where the removal of an unfavorable outcome or stimulus strengthens a behavior.

Reinforcement Contingencies

The conditions or rules that determine whether responses lead to the presentation of reinforcers.