Predatory pricing is pricing below the average variable cost in order to drive out competition.

Name: Predatory pricing is pricing below the average variable cost in order to drive out competition.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Predatory pricing is a tactic used by dominant firms to eliminate competition by setting prices below the average variable cost, causing their rivals to suffer losses and eventually exit the market. This allows the dominant firm to then raise prices and earn higher profits once the competition is gone.

Predatory Pricing Is Pricing Below the Average Variable Cost in Order