Why does wal-mart have a cost advantage

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When Wal-Mart locates in a smaller town, often the local retailers (e.g., hardware, clothing, and appliance stores) are unable to successfully compete and are driven out of business. Why does Wal-Mart have a cost advantage over its competitors and therefore is able to charge lower prices. If Wal-Mart drove its competitors out of business, and behaved like an unregulated monopoly, what would happen to its prices and why?

Reference no: EM1392794

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