Question

Switching costs refer to the

a. cost to a producer to exchange equipment in a facility when new technologies emerge.
b. cost of changing the firm's strategic group.
c. one-time costs suppliers incur when selling to a different customer.
d. one-time costs customers incur when buying from a different supplier.

Answer 1

Switching costs refer to the d. one-time costs customers incur when buying from a different supplier. These costs can discourage customers from switching and create a barrier to entry for new competitors in the market.

Step-by-step explanation:

Switching costs refer to the d. one-time costs customers incur when buying from a different supplier. When customers decide to purchase from a new supplier, they may face expenses related to training, installation, or reconfiguring their systems.

These costs can discourage customers from switching to a different supplier and create a barrier to entry for new competitors in the market.