If a firm attempts to dominate a market, a second firm must then decide how to respond, given that the initial firm has already produced a large quantity. This is an example of a _____ advantage on the part of the initial firm.

Question

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First-mover advantage refers to the benefits a company gains by being the first to enter a new market or develop a new product or service. In this scenario, the initial firm's advantage comes from producing a large quantity before the second firm can respond, which is characteristic of a first-mover advantage.

If a Firm Attempts to Dominate a Market, a Second