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Using Non-Price Competition

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What is â??non-price competition?â?? Why would any seller use this form of competition? Is the use of this form of competition costless to the user? What is the optimum amount of non-price competition by a firm? What would be the likely response of a sellerâ??s rivals? Who benefits from this competitive device in the short run? Who benefits in the long run?

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Solution Summary

The solution discusses how non-price competition is employed to attract markets.

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What is non-price competition?
Non-price competition is a market situation in which competitors would not lower prices for fear of a price war. Instead they focus on extensive promotions to highlight the distinctive benefits or features of their products (Business Dictionary, 2011).

Why would any seller use this form of competition?
As mentioned, in a very competitive market, the last thing that entrepreneurs will do is ...

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