Chapter 68, Problem 1MCQ

To determine

To state: the option that is true for product differentiation.

Answer to Problem 1MCQ

Part C is true about product differentiation.

Explanation of Solution

When a firm can differentiate its product from that of its competitors in some or the other unique way and can charm the consumers, then that product will have a competitive advantage and will gain a good market share.

So, product differentiation is also a method that market forces use to do their work and help to keep the prices of the products down for the consumers.

Economics Concept Introduction

Introduction:

Product differentiation is defined as the characteristic or characteristics that make the product or service of a particular firm stand out to your target audience. This is the way a firm distinguishes what they are selling from what its competitors are selling, and it increases brand loyalty, growth, and sales.