Question

A low-cost leader's basis for competitive advantage is:

A. Meaningful lower prices than rival firms
B. Using a low cost/low price approach to gain the biggest market share.
C. High buyer switching costs.
D. Meaningfully lower overall costs then rivals on comparable products.
E. Higher unit sales than rivals

Answer 1

A low-cost leader's basis for competitive advantage is meaningfully lower overall costs than rivals on comparable products. Option D

Step-by-step explanation:

A low-cost leader's basis for competitive advantage is meaningfully lower overall costs than rivals on comparable products. By reducing manufacturing and operational expenses, a low-cost leader can offer lower prices to customers, which can attract a larger market share.

This strategy helps the low-cost leader achieve a competitive advantage by appealing to price-sensitive customers who prioritize affordability. One example of a low-cost leader is Amazon, which has established a production model and cost structure that allows them to undercut competitor prices even when factoring in the cost of shipping. Option D