Merv's Hardware, a small family-owned store in Middletown, sells a 100-pack of garnet sandpaper for $35. The Home Shoppe, a large retail hardware chain in neighboring Morristown, sells the same product for $29. Based on this scenario, what would you expect Merv's immediate response to be?
A.Merv will remove his advertisements and rely on word of mouth.
B. Merv will reduce his price to respond to the price competition from the HomeShoppe.
C. The HomeShoppe will initiate non-price competition with Merv.
D. The HomeShoppe will raise its price to respond to the price competition from Merv

B. Merv will reduce his price to respond to the price competition from the HomeShoppe.

I would say B in this case as it's the only option that satisfies the "immediate" demand that makes sense.

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SerenaBochenek SerenaBochenek · Answer 2 · 2019-01-08T11:46:14+01:00

Answer:

The answer is B. Merv will reduce his price to respond to the price competition from the HomeShoppe.

Step-by-step explaination:

Given Merv's Hardware, a small family-owned store in Middletown, sells a 100-pack of garnet sandpaper for $35 and the another, a large retail hardware chain, The Home Shoppe sells the same product for $29.

Whenever the Merv's knows about this decreased price of home Shoppe then the first thing which comes in mind is why the customer purchase the same product from him if get in decreased cost.

So, the immediate respond is that Merv will reduce his price to respond to the price competition from the HomeShoppe.