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Sharyn decides to launch a new variant of her high-performing brand of dish-washing liquid. What role did the market play for Sharyn to make this decision?

(A) Consumers disliked the product.
(B) Cost of production was increasing.
(C) Competitive pressure was strong.
(D) The market environment was conducive to change.

User Jimmeh
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Final answer:

Sharyn likely launched a new dish-washing liquid variant because the market environment was conducive to change, indicating option (D). This decision is consistent with the features of monopolistic competition, where continuous innovation and differentiation are crucial for maintaining a competitive edge and securing positive economic profits.

Step-by-step explanation:

Sharyn's decision to launch a new variant of her high-performing brand of dish-washing liquid was likely influenced by the market environment being conducive to change. In markets characterized by monopolistic competition, such as the laundry detergent market, brands strive to differentiate themselves and maintain a competitive edge. As explained in economic theory, this type of market is neither perfect competition nor monopoly, which means a company might introduce new products to maintain or grow its market position.

When a brand earns positive economic profits, other competitors are tempted to enter the market with their innovations, triggering a cycle of continuous improvement and differentiation. Sharyn's introduction of a new dish-washing liquid variant could be seen as a strategic response to competitive pressures and an attempt to offer consumers an innovative product, which ultimately benefits consumers by providing them with more choices and potentially better prices due to increased competition.

User Ed Gomoliako
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