Answer:
Which of the following is typically the case for companies that operate in product markets where there is relatively little competition from other companies?
C) higher wages and higher profits
Explanation:
A situation where different organizations are striving to sell the same product is known as competitive markets. When the number of companies selling the same product is small, then we can say that the market has little competition from other companies. A market that has little to no competition has the following qualities;
1. Reduced efficiency
In a market where companies operating in a market have little competition, the efficiency in terms of processing time, and overall quality of finished products is very low since the demand for products is guaranteed whether the product is of high quality or not. The customers have no other choice but to buy from them.
2. Higher profits
In markets that there is little competition, the companies are always few. This means that the market share per company is relatively bigger than other markets. Bigger market shares translates to increases sales, thus higher profit margins.
3. Higher wages
Companies that have higher profits as a result of bigger market shares tend to pay their employees higher wages since the available disposable income is high.
