An increase in the rivalry among existing competitors in a target market
A) increases both the attractiveness and the profitability of the target market.
B) decreases both the attractiveness and the profitability of the target market.
C) decreases the attractiveness and increases the profitability of the target market.
D) increases the attractiveness and decreases the profitability of the target market.

Question

Quizplus · Accepted Answer

An increase in the rivalry among existing competitors in a target market decreases both the attractiveness and the profitability of the target market. This is because when there is intense competition, businesses must lower prices to remain attractive to consumers, which ultimately leads to lower profit margins. Additionally, increased competitive pressure can make it more difficult for businesses to differentiate their offerings and capture market share.

An Increase in the Rivalry Among Existing Competitors in a Target