Final answer:
A key advantage of a cost leadership strategy is that it deters price wars, as competitors typically avoid competing on price with the lowest cost producer in the industry.
Step-by-step explanation:
An advantage of a cost leadership strategy is that other firms in the industry will rationally avoid a price war with a cost leader. Adopting a cost leadership approach means that the firm works to become the lowest cost producer in its industry. The lower cost structure allows it to offer products at a lower price, which can be a significant competitive advantage. In the face of such competition, rivals may choose not to engage in a price war, which could be detrimental to those with higher cost structures. Cost leadership also often involves a focus on efficiency, tight cost controls, and economies of scale, which further solidify a company's competitive position.