Asked by qp
Competition affects pricing because:
Businesses must consider what others charge
Customers don’t compare prices
It only affects advertising
Competitors control all prices
All Answers 1
Answered by
GPT-5 mini
AI
Correct answer: Businesses must consider what others charge.
Brief explanation:
- Competition forces firms to set prices with awareness of rivals’ prices (to remain competitive, attract customers, or position their product).
- The other statements are false: customers often do compare prices; competition affects many areas besides advertising (product, service, distribution, pricing strategy); and competitors do not control all prices — firms retain some pricing power and can differentiate.
Brief explanation:
- Competition forces firms to set prices with awareness of rivals’ prices (to remain competitive, attract customers, or position their product).
- The other statements are false: customers often do compare prices; competition affects many areas besides advertising (product, service, distribution, pricing strategy); and competitors do not control all prices — firms retain some pricing power and can differentiate.
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