Question

Sports Inc. has developed a shoe to compete with Air Jordans. In order to keep up with competitors and minimize competitor market power, the firm decides to sell branded sports equipment as well. By introducing another new business so soon outside of its shoe products, the firm stands to lose value. Sports Inc.'s reason for diversifying itself is to ________ by acquiring a ________.

Answer 1

A. neutralize another firm's advantage by acquiring a similar distribution outlet.

Step-by-step explanation:

Competitive advantage refers to those conditions or phenomenon that allows or makes a company's product more desirable than in competitors. In trying to neutralize that competitive advantage the competitors have over their shoe, sport inc decided to diversify its production into other products that the competitors sells. In doing so, they are acquiring a similar distribution outlets with their competitors and neutralizing the competition's competitive advantage.