When one store stays open late to gain an advantage, its competitors begin to stay open late, too. At this point the first store is no better off than it was before, but now every store has additional expenses. This illustration is an example of what Frank and Cook call a
A) capitalistic marathon.
B) market economy.
C) positional arms race.
D) struggle for parity.

Question

Quizplus · Accepted Answer

This scenario demonstrates a positional arms race, where competitors imitate each other to avoid falling behind in the market. This ultimately results in no one gaining an advantage, but all businesses incurring additional expenses.

When One Store Stays Open Late to Gain an Advantage