Answered

Looking for answers? Westonci.ca is your go-to Q&A platform, offering quick, trustworthy responses from a community of experts. Discover solutions to your questions from experienced professionals across multiple fields on our comprehensive Q&A platform. Explore comprehensive solutions to your questions from a wide range of professionals on our user-friendly platform.

A low-cost leader can translate its low-cost advantage over its rivals into superior profit performance by

Sagot :

eooyibo123

Answer:

either using its low-cost edge to underprice competitors and attract price sensitive buyers in large enough numbers to increase total profits or refraining from price-cutting and using the low-cost advantage to earn a bigger profit margin on each unit sold.

Explanation:

Competitive advantage is the edge that a firm has over others in the same industry that results in higher profit margins for them.

One of the importance competitive advantages is price advantage.

This results from the firm being a low cost leader. Their cost of production is low enough for them to attract customers that are price sensitive leading to increased profits.

Also they can underprice their competitors or earn profit margins on the reduced cost of production per unit

jepessoa

Answer:

The low-cost leader can try to underprice the rest of the competition in order to attract more customers. Lower prices should increase total sales volume which will help to increase profits by offsetting fixed costs and increasing the total contribution margin. This strategy can be used as long as the firm is able to produce under economies of scale.

Explanation:

Visit us again for up-to-date and reliable answers. We're always ready to assist you with your informational needs. Thank you for your visit. We're committed to providing you with the best information available. Return anytime for more. Westonci.ca is your go-to source for reliable answers. Return soon for more expert insights.