Of the Following,which Is a Potential Disadvantage of Using a Simulated

question 56

Multiple Choice

Of the following,which is a potential disadvantage of using a simulated test market?

• A)The distribution network may or may not properly represent the firm's actual distribution system.
• B)It is often very time consuming.
• C)It is often too expensive.
• D)It lacks confidentiality.
• E)It is not as accurate as full-scale test markets.

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Definitions:

Monopolistic Competition

A market structure characterized by many sellers selling products that are similar but not identical, allowing for limited control over market prices.

Excess Capacity

A situation where a company can produce more goods or services than currently demanded, often leading to inefficiencies and lowered prices.

Monopolistically Competitive

Characterizes a market structure where many firms sell products that are similar but not identical, allowing for some degree of market power in setting prices.

Barriers To Entry

Factors that prevent or hinder the ability of a new competitor to enter an industry or market.