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In economics, "competition" is the rivalry among sellers trying to achieve such goals as increasing profits, market share, and sales volume by varying the elements of the marketing mix: price, product, distribution, and promotion.

Merriam-Webster defines competition in business as "the effort of two or more parties acting independently to secure the business of a third party by offering the most favorable terms".

Competition is, in general, a contest or rivalry between two or more entities, organisms, animals, individuals, economic groups or social groups, etc., for territory, a niche, for scarce resources, goods, for mates, for prestige, recognition, for awards, for group or social status, or for leadership and profit.

It arises whenever at least two parties strive for a goal which cannot be shared, where one's gain is the other's loss (a zero-sum game).

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For example, a firm needs to price a new coffee maker.Competition occurs naturally between living organisms which co-exist in the same environment.For example, animals compete over water supplies, food, mates, and other biological resources.In any market, many firms sell the same or very similar products, and according to classical economics, the price for these products should, in theory, already be at an equilibrium (or at least at a local equilibrium).Therefore, by setting the same price as its competitors, a newly-launched firm can avoid the trial and error costs of the price-setting process.Competition is generally accepted as a necessary condition for the coordination of disparate individuals interests via the market process.