49.0k views
2 votes
How do consumers benefit from competition among businesses?

2 Answers

4 votes
The answer is

Competition leads to lower prices.
User TooMuchPete
by
7.1k points
3 votes

Answer:

They have more options over a single product

Step-by-step explanation:

When a single business owns all supply of one product, then they can choose the price of that product.

Using the example of a mattress, if company A is the only company that supplies mattresses, then consumers have no options but to buy from that company. The company can then put any price on their product because it isn't supplied from any other company.

However, as soon as another company starts supplying the same product, then the consumer has the option of choice. If company A has a higher price, then the consumer will go to the other company, but if company A has better quality, then the consumer has a lot of choice.

User Sonu Oommen
by
7.4k points