Final answer:
The three basic market targeting strategies are Undifferentiated marketing, Concentrated marketing, and Differentiated marketing, with cost-based marketing being a different concept related to pricing.
Step-by-step explanation:
The three basic strategies for targeting markets are A) Undifferentiated marketing, B) Concentrated marketing, and C) Differentiated marketing. D) Cost-based marketing is not typically classified as a market targeting strategy but rather as a pricing strategy.
Differentiated products are key in a market-oriented economy, where the variety of styles, flavors, locations, and characteristics can lead to product differentiation and monopolistic competition. This variety can either be seen as providing consumer benefits or as potentially wasteful if the societal need for such diversity of products is questioned. In a monopolistic competitive market, businesses will choose price and quantity based on their perceived value and differentiation of products, while entry and exit in the market and advertising can significantly impact the level of competition and efficiency.