Question

High levels of _____ create a higher probability that firms cut corners because margins are usually low.
a. return
b. competition
c. loss
d. cooperation
e. profit

Answer 1

High levels of competition create a higher probability that firms cut corners because margins are usually low. 

When there is a lot of competition in the market, producers will sometimes cheapen their product of their materials to mass produce quantity instead of focusing on the quality. This is because they are in constant competition with their competitors and want to get as many products on the market as they can.. and fast!