How sellers respond to the price changes
Describe in short how sellers respond to the price changes of their competitors?
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During competition, it might be seen that the competitors might initiate price changes. When the cutting off on prices doesn’t influence the company, then the present pricing strategy itself can be continued to sustain the profitability of the organization. Though when the price change on one firm is influencing the other, then it can:
i) Decrease the product price at par with competitor’s price or beneath competitor’s price orii) Give added benefit to the existing product such as better quality.
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