Question

When rival firms compete aggressively by trying to attract competitors' customers, this might be an indication of: a. increasing economies of scale. b. slow industry growth. c. an industry with low exit barriers. d. high switching costs.

Answer 1

Answer:

b. slow industry growth.

Explanation:

Competitive advantage can be defined as conditions, factors or circumstances that allow a business firm (organization) to manufacture finished goods or services better and perhaps cheaper than other (rival) firms in the same industry. Thus, it's responsible for putting a business firm in a superior or more favorable position than rival firms.

This ultimately implies that, a competitive advantage has a significant impact on a business because it increases its level of sales, revenue generation and profit margin when compared to rival firms in the same industry.

Generally, when rival business firms compete aggressively by trying to attract competitors' customers, this might be an indication of slow industry growth.

In conclusion, the various companies or business firms are experiencing a low level of sales of their goods and services. As a result, they engage in activities that would attract potential customers and by extension their competitors' customers.