Question

Many small firms seek to establish a particular niche in the market, realizing that they cannot afford to operate on a larger scale without exposing themselves to considerable risk of retaliation from larger companies. When a number of small businesses are operating in this manner, they are forcing the larger businesses to recognize and account for their influence on the market. In this way, small businesses are primarily

Answer 1

Answer: Fostering competition

Step-by-step explanation: In the given case, Small firms wanted to foster the competition in market as they know that else they will not survive in front of larger firms.

If the small firms makes it possible to create the niche and affect the business of larger firms then in result larger firms will too take same corrective measures to maintain their dominance.

This business war will eventually lead to fostering of competition.