Thinking in terms of the hotelling model assess the following situation: The sma

Question

Thinking in terms of the hotelling model assess the following situation: The small city of Le Locle has been served by the same local newspaper, the Le Locle Tribume. It is written in a failry conservative style yet the demographic of Le locle is comprised of avid readers from a broad spectrum of political dispositions. A new rival newspaper called the Le Locle Examiner has entered the market. Each paper can be delivered, purchased at local news stands and is available on line. a. What would you expect the degree of price competition to be like between the two firms? b. along the spectrum of liberal to conservatice, what style might Le Locle be expected to be written in? Explain your answer.

Explanation / Answer

a. the degree of competition is high between these two firms. becasue there are only two players in the market and the market is predefined. who offers at lower cost, they will be benefited in terms of sales.

b. they should follow agressive strateg now, because of the competitor he may a chance to lose his market. so, for not losing the market, he should approach new strategies and policies, for this they should be in a gressive mode only. otherwise it may lost its sales to competitors.

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