When an incumbent maintains a price below the monopoly price

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The price-cost squeeze is: A tactic used by a vertically integrated firm to raise rival's costs of inputs, while lowering output prices. A strategy where a firm temporarily prices below its marginal costs to drive competitors out of the market. When an incumbent maintains a price below the monopoly price in order to prevent entry. The act of charging a low price initially upon entering a market to gain market share.

Reference no: EM13149048

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