One Key Feature of the Value of a Strong Brand

question 114

Multiple Choice

One key feature of the value of a strong brand is that

• A) it can protect the firm from competition.
• B) it no longer needs to be supported by advertising and promotion.
• C) if it becomes a generic name, the brand is worth even more.
• D) it cannot be successfully imitated by a retailer's own brand.
• E) competitors will typically abandon a sector altogether rather than compete.
• Strong brands protect the firm somewhat from competition because the brand differentiates the firm's products, making customers more loyal.

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Definitions:

Equilibrium Price

A market condition where supply meets demand, and there is no inclination for price to change, leading to market balance.

Mutually Beneficial Trades

Exchanges that occur when all parties involved gain benefits or profits from the transaction.

Total Surplus

The sum of consumer surplus and producer surplus in a market, representing the total net benefit to society from trade.

Consumer Surplus

The separation between what consumers envisage paying for a good or service and the amount they actually disburse.