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Set C Q1 b) Assess whether differences in the level of competition are…

- - - - if low lvl of comp: (rural)
        
        dd is relatively inelastic
        
        pple will not swap to other firms
        
        price is able to be high
      - if high lvl of comp: (urban)
        
        pple can swap to g+s from other firms
        
        dd is px elastic
        
        cannot charge high px
    - - offer discount (urban)
        
        engage in px comp
        
        at the same time other firms will also cut px
        
        hence volatile px
        
        EV: more money to fund discountrs
      - dont offer discount (rural)
        
        no point doing price comp since there are not many competors
        
        price is stable
        
        EV: less money to fund discounts
  - - - rural areas have higher opp cost
        
        because fixed COP eg transporting fuel to the location tends to be higher for rural
        
        they have smaller qty ss as well because fewer pple living in rural areas --> smaller mkt
        
        hence avg COP (cost/qty) is higher for rural areas
        
        hence they have higher prices