Question

a second-mover advantage a. exists when a firm can earn greater profit by reacting to earlier decisions made by rivals. b. always arises when there is not a first-mover advantage in a sequential decision. c. arises because rivals have imperfect information about payoffs. d. none of the above.

Answer 1

a second-mover advantage always arises when there is not a first-mover advantage in a sequential decision.

The second-mover advantage is a competitive advantage a company gains when it joins the market after rival companies. A second-mover benefits from the first-mover by appealing to its present clientele and using marketing strategies that have a proven track record of success.

Using the second mover strategy to thrive is paradoxical in many sectors. It involves keeping an eye out for the first competition to create and test a market. However, after a market has been tested, it necessitates a swift entry.

By exploiting the market's current clientele and marketing strategies, the second-mover advantage appeals to mature markets. Instead of inventing, a corporation can build on its current successes to pursue a less risky venture that will yield big rewards.

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