Question

Gavin believes that Maddie engaged in __________pricing. This occurs when a firm deliberately lowers its prices below _________costs with the intent of driving rivals from the market. However, to prove that this occurred, Gavin needs evidence that Maddie ____her bakery's prices significantly after his firm failed.

Answer 1

Answer:

The correct words for the blank spaces are (in that order):  predatory; average; lowered.

Explanation:

Predatory pricing is the scheme in which a business falls in its attempt of reducing the price of its goods or services drastically compared to the market prices, to drag consumers massively. While this might be beneficial for customers in the short run, in the long term business competitors could disappear creating a monopoly, something that gives the predatory-pricing firm all the power to increase the goods or services price at will.