Why Should a Firm Encourage Customer Complaints

question 42

Multiple Choice

Why should a firm encourage customer complaints?

• A)Customer complaints a firm receives have little impact on its positive image.
• B)Complaints are a means of ensuring work for the customer service department.
• C)Complaining customers can be segmented and treated as a separate group to be handled differently.
• D)Customer complaints inspire improvements to service that would otherwise have gone unnoticed.

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Definitions:

Monopolistic Competitive Firms

These are companies in a market structure characterized by many firms selling products that are similar but not identical, allowing for some degree of market power.

Elastic

A term used in economics to describe a situation where the demand or supply for a good or service significantly changes in response to a change in price.

Product Differentiation

A tactic used by companies to distinguish their products from those of competitors by highlighting unique features.

Customization

The process of modifying goods or services to meet specific customer preferences or requirements.