Question

Explain in 200 words at least one of the aspects of competitive advantage

Answer 1

The theory of competitive advantage allows the firms to produce in which they enjoy a competitive advantage. These advantages are producing the good at a lower cost, provide superior features, controlling a key resource and continuous innovation which makes the product better over time and also provides a loyal customer base such as Apple which is known for innovation and providing superior products.

Competitive advantage helps the nations to use their resources more efficiently and avoid the wasting its scarce resources. Through innovation, the firm can differentiate its product from its competitors and provide a more standardized product or service. The design and innovation allow the firm to improve on the features of the good and make it better with time and also produce it more efficiently which allows it to lower cost which generates higher revenue and increases profit.