As a general rule, the more similar a firm's product is to those of its rivals, the more intense _____ will be, and the _____ likely customers will be to switch between sellers.
A)non-price competition; less
B)price competition; less
C)non-price competition; more
D)price competition; more

Question

Quizplus · Accepted Answer

When products are more similar, customers are more likely to base their purchase decision on price, leading to more price competition between firms. This also makes customers more likely to switch between sellers in search of the lowest price. Therefore, the correct answer is D, price competition is more intense and customers are more likely to switch between sellers.

As a General Rule, the More Similar a Firm's Product