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What Is Cost Advantage?

By Rachel Warren – Updated Jul 1, 2025 at 2:59AM

Key Points

  • Cost advantage allows firms to achieve higher profit margins by maintaining lower production costs than rivals.
  • Businesses can expand market share by pricing products below competitors without sacrificing profits.
  • Efficient production and innovation contribute to sustaining a company's cost advantage in competitive markets.
Key findings are powered by ChatGPT and based solely off the content from this article. Findings are reviewed by our editorial team. The author and editors take ultimate responsibility for the content.

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