Which statement is true about a product market?
A) The cost of labor does not affect the product market because it is an insignificant part of an organization's costs.
B) Product-market considerations are of particular concern to a company when its customers place greater importance on product rather than price.
C) Organizations in a product market are competing to serve the same customers.
D) Product markets typically place a lower limit on the pay an organization will offer its employees.
E) Organizations in a product market must increase the cost of labor every quarter.

Question

Quizplus · Accepted Answer

A product market refers to a market where organizations are competing to serve the same group of customers with similar needs and characteristics. Therefore, option C is true. Option A is false because the cost of labor can have a significant impact on an organization's costs, depending on the industry and type of work. Option B is not necessarily true as customers may prioritize factors such as price, quality, or brand reputation differently. Option D is also false because the limit on pay is not determined solely by the product market but also by factors such as the organization's financial situation and labor market conditions. Option E is false because the cost of labor does not need to be increased every quarter in a product market.

Which Statement Is True About a Product Market