Can geographic keywords and local ads compete against each other?

[Syyll]

The easiest way is to give an example:

In one adgroup, I have the keywork: 'widget london' with a text ad.
In another adgroup, I have the keyword 'widget' with a local business ad for my london branch.

Are these two kewords going to compete against each other and drive my CPC up?

[nakita_dog]

My understanding is that the only way you can possibly compete against yourself is to "double server" which is against the rules. Since the one ad group with the keyword "widget london" targets the search, Google and/or content networks they are separate from the local business ads (I think).

Even if you had two ad groups with the same exact keyword, Google will only show one of your ads at any given moment in one of their ad places (for example the content network).

The topic on double serving:
[adwords.google.com...]

[Syyll]

Both adgroups are in the same campaign, so there won't be any double serving. But I'm concerned that both keyword might compete against each other, and only the one with the highest max CPC will show. That would increase my CPC.

[Rehan]

Your ads do compete against each other.
[adwords.google.com...]