Final answer:
The intensity with which companies compete for market share and profitability is known as rivalry. It is evident through competitive behaviors like product differentiation and advertising, seen in highly competitive industries such as technology and fast food.
Step-by-step explanation:
The intensity with which companies in an industry jockey for market share and profitability is known as rivalry. Evidence of serious competition between firms in an industry includes intense advertising campaigns, aggressive pricing strategies, frequent introduction of new or improved products, and attempts to differentiate their offerings from competitors. Two highly competitive industries are the technology sector, where companies are in a race to innovate and capture the consumer market, and the fast food industry, which sees an ongoing battle over food quality, menu diversity, and pricing.
In monopolistic competition, many firms compete by selling similar but differentiated products, leading to competition over product features and branding. An oligopoly is characterized by a few large firms dominating the market share and typically competing through advertising and product differentiation. Concerning market dynamics, when one monopolistic competitor earns positive economic profits, others are tempted to enter the market, leading to increased rivalry over time. Factors such as market power, product differentiation, barriers to entry, and competitive strategies all influence the level of competition within an industry.