Question

In a industry in which there are several providers of a type of good, why can one business not charge much higher prices for goods?

A.government rules prevent them from raising prices


B. Higher price will cause more producers to increase producers


C. Higher prices will encourage consumers to purchase substitute goods


D. Buyers are brand loyal, so they will stick with a brand no matter what

Answer 1

Answer: the answer is c

Explanation: i just took the test

Answer 2

Higher prices would encourage consumers to purchase substitute goods. Businesses do not charge higher prices for goods because there maybe competitors in the market providing the same product / commodity and therefore charging higher prices would lead to customers switching to buy rivals products and the competitors gaining revenue.