A coffee shop decides that it will increase its market share to 55% by the end of the year by lowering the price of a cup of coffee.The price cut will certainly result in an increase in the firm's share but will lower its profits and revenues.Which of the following best explains the firm's decision?
A)A satisficing behavior
B)Price discrimination
C)Social responsibility
D)A sensitivity analysis
E)A benefit-cost analysis

Question

Quizplus · Accepted Answer

The firm's decision to lower prices to increase market share, despite potential losses in profits and revenues, aligns with satisficing behavior, where the firm aims to achieve a satisfactory level of market share rather than maximizing profits.

A Coffee Shop Decides That It Will Increase Its Market