How are the Challengers reprisals probably indicated

Question

How are the Challengers reprisals probably indicated?

Answer 1

Indicating the Challengers that reprisal is probably are as follows:

1. The objective of signaling challengers that powerful retaliation is probable in the event of an attack is either to deter challengers from attacking at all or to deflect them to less threatening options. Either objective can be achieved by hire challengers know the fight will cost more than it is value.

2. Would-be challengers can be indication by:

         i. Publicly announcing management’s commitment to maintain the firm’s current market share.

        ii. Publicly committing the company to match competitors’ prices or terms.

       iii. Maintaining a war chest of money and saleable securities.

       iv. Making an occasional powerful counter reply to the moves of weak competitors to improve the firm’s picture as a tough protector.