Final answer:
A service provider in the retail industry is most likely to use competition-based pricing due to the high level of similar options available to consumers, which necessitates competitive pricing practices to retain customers.
Step-by-step explanation:
In the context of service industries using competition-based pricing strategies, you would most likely find a service provider utilizing this approach in the retail industry. In retail, products are often similar and available from multiple sources, meaning that consumers can easily compare prices and switch to a competitor if they find a better deal. Hence, retailers must price their products competitively to attract and retain customers.
When considering competition-based pricing, a service provider must be acutely aware of the prices set by competitors for comparable products and services. Because retail shoppers are typically sensitive to price changes and have a multitude of options available, retailers closely monitor their competitors' pricing strategies to ensure they are not pricing themselves out of the market.