Question

Research suggests that a firm with greater multimarket contact is __________ likely to initiate an attack, but __________ likely to respond aggressively when attacked.

Answer 1

Answer:

less, more

Explanation:

Research suggests that a firm with greater multi market contact is less likely to initiate an attack, but more likely to respond aggressively when attacked.

Multimarket contact occurs when firms compete with the same rivals in multiple markets.

When firms compete with each other in more than one market, their competitive behavior may differ from that of single-market rivals. They do not respond as aggressive as they would have if contact or competition were to be in just one market.

Multimarket contact gives a firm more options to respond to actions or attacks by a rival in other markets other than in the market being challenged. As a result, multimarket competitors may hesitate to attack in one market for fear of retaliation in other markets.

Multimarket competition may therefore reduce the competitive intensity among rivals, an effect known as mutual forbearance.