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The Competitive Forces Model Cannot Be Used to Analyze Modern

question 98

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The competitive forces model cannot be used to analyze modern digital firms which face new competitive forces that are not true of traditional firms.


Definitions:

Value of Money

The purchasing power of money, indicating how much goods or services one unit of money can buy.

Excess Supply

A market situation where the quantity of a good or service supplied is greater than the quantity demanded at the current price.

Deflation

Deflation is a decrease in the general price level of goods and services in an economy over a period, indicating negative inflation.

Money Demand Curve

A graphical representation illustrating the relationship between the quantity of money demanded and the interest rate, showing how they vary inversely.

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