A Competitive Advantage Has Been Established When

question 22

Multiple Choice

A competitive advantage has been established when

• A) customers see the variation as important and the value added to the customer exceeds the cost of providing differentiation.
• B) a high-cost strategy increases customer value by minimizing customer sacrifices.
• C) a low-profit item is dropped from the product line.
• D) both a and B

---

Definitions:

Demand Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, with high elasticity indicating a significant response.

Inelastic Demand

Refers to a situation where the demand for a product does not significantly change with a change in its price.

Elastic Supply

A condition where the quantity supplied of a good changes significantly due to a slight change in its price.

Subsidy

A financial aid or support extended by the government to an economic sector, business, or individual, often aimed at promoting economic and social policies.