Which of the following is a subtle way for a company to reassure their competitors that it is committed to a tit-for-tat strategy?
A) Setting prices below cost
B) Price-matching guarantees
C) Collusion
D) Offering a commitment strategy

Question

Quizplus · Accepted Answer

Price-matching guarantees indicate that the company is willing to match its competitors' prices, which is a subtle way of signalling a tit-for-tat strategy. By offering to match prices, the company is telling its competitors that it will respond in kind to any price changes they make. The other options (setting prices below cost, collusion, offering a commitment strategy) do not necessarily signal a tit-for-tat strategy and could be interpreted differently by competitors.

Which of the Following Is a Subtle Way for a Company