Final answer:
Domino's is using a competitive strategy to regain market share by focusing on cost leadership and product performance, similar to the monopolistic competition and profit-maximizing actions of the Authentic Chinese Pizza store.
Step-by-step explanation:
Domino's is focused on lowering costs and improving the performance of current products. After losing ground to Pizza Hut and Little Caesar's, Domino's has been aggressively working to protect its current market share and gain back what was lost. Therefore, Domino's uses a competitive strategy. This strategy involves a set of actions aimed at creating a defendable position against competitors, involving tactics like cost leadership, differentiation, and focusing on a specific niche.
As indicated by the example of the Authentic Chinese Pizza store in the context of monopolistic competition, such firms determine their profit-maximizing level of output by considering marginal revenues and marginal costs. Their unique product offerings and price decisions based on the costs of production and the desired profit margins enable them to carve out specific segments within the competitive market. Domino's, by lowering costs and improving their product, is focusing on the cost leadership aspect with the intent to enhance their competitive edge and recapture their market share.