Final answer:
It is not necessarily true that a low-cost leader is the volume leader. Being a low-cost leader indicates a cost advantage, but other factors influence market leadership in sales volume. A company can leverage low costs to undercut competitors and aim for higher sales volume, but it might not always be the defining factor.
Step-by-step explanation:
The statement that a low-cost leader in a market is by definition the volume leader is not necessarily true. Being a low-cost leader means that a company has a cost advantage over its competitors.
However, this does not automatically make it the volume leader, which refers to a company that sells the most products or services in its market. Factors such as brand reputation, product quality, and distribution networks can also influence a company's sales volume.
To become the volume leader, a low-cost leader must leverage its cost advantage to significantly undercut competitors on price while maintaining profitability.
This strategy can increase market share and lead to a higher sales volume. Nevertheless, it's important to note that there are different competitive strategies, such as differentiation, that businesses may pursue to become volume leaders without necessarily being the lowest-cost producers.