Answer (C) is correct.
A firm that has successfully differentiated its products through
developing a desirable image, better services, cost leadership, the
features of the product, or other means is in a favorable competitive
position. Competitors find it difficult to acquire the firm’s customers, for
example, by price cutting. The reason is that the firm’s products are
perceived to have few substitutes, and brand loyalty is high. Furthermore,
barriers to entry are favorable to the firm. These barriers deter
competitors from entering the market. Existing firms can increase market
share and emphasize cutting costs and increasing value.