Question

Revved Rider Inc., a motorcycle company, is the market leader due to its superior engine technology and service orientation. These unique qualities have helped the company generate revenues that are consistently higher than other firms in the same industry. Which of the following can be concluded about Revved Rider Inc. from this scenario?

Answer 1

It has a competitive advantage over the other firms.

Step-by-step explanation:

A competitive advantage refers to a firm's relative advantage in:

• providing the same good as its competitors at lower prices,
• or providing a better good than its competitors at the same price.

Competitive advantages result from a firm developing core competencies that provide them an edge over their competitors. But competitive advantages do not last forever, and can change very rapidly.

In this case, Revved Rider's core competencies are a great engine and high quality customer service, but another manufacturer could develop a better engine.