Which firm in an industry is likely to have higher profits?
A)Sellers with higher costs than their competitors
B)Sellers with lower costs than their competitors
C)Sellers with the same costs as their competitors
D)All of the above

Question

​Which firm in an industry is likely to have higher profits?
A)​Sellers with higher costs than their competitors
B)Sellers with lower costs than their competitors
C)Sellers with the same costs as their competitors
D)​All of the above

Quizplus · Accepted Answer

In a competitive market, firms with lower costs can offer lower prices and attract more customers, resulting in higher profits. Higher costs mean that prices must be higher to make a profit, which may discourage some customers from buying from that seller. Selling at a lower price than competitors while still making a profit is easier for firms with lower costs. Therefore, sellers with lower costs than their competitors are likely to have higher profits.

​Which Firm in an Industry Is Likely to Have Higher

Which Firm in an Industry Is Likely to Have Higher