Suppose Proctor and Gamble introduces a new brand of laundry detergent. Brand proliferation is an example of

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Brand proliferation, or introducing a new brand of a product, is a strategy used by firms to create barriers to entry for potential new competitors. By introducing multiple brands of a product, the firm can occupy more shelf-space in stores and make it more difficult for new entrants to establish their own brands. This is often seen in industries with high fixed costs and economies of scale, where firms with established brands have a significant advantage over new entrants. Therefore, the best choice is E, a firm-created barrier to entry. The other choices, explicit collusion, Nash equilibrium, tacit collusion, and a cooperative outcome, do not adequately explain the strategy of brand proliferation.

Suppose Proctor and Gamble Introduces a New Brand of Laundry