The primary reason that many companies work to become the low cost producers in their industry is because ?
Correct answer: D. they can set lower prices that that result in greater sales and profits
- A. they can generate more advertising
- B. they can please top management
- C. they can gain tax advantages
- D. they can set lower prices that that result in greater sales and profits
Explanation
A low-cost producer can reduce prices while preserving profit margins, attracting more buyers and increasing sales. Lower costs also give the firm greater flexibility than higher-cost competitors.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
__________ is a philosophy holding that a company's marketing should support the best long-run performance of the marketing system?
If a consumer describes a car as being the most economical car on the market than this descriptor is a?
When a company reviews sales costs and profit projections for a new product to find out whether these factors satisfy the company's objectives they are in which of the following new process development stages ?
All of the following are criticisms leveled against marketing by critics EXCEPT ?
A price reduction to buyers who buy in large volumes is called a(n) ?
A company's compensation plan should reflect its overall marketing strategy For example if the overall strategy is to grow rapidly and gain market share the compensation plan should reward ?