The Likelihood of New Entrants Joining an Industry Is Low

question 78

Multiple Choice

The likelihood of new entrants joining an industry is low if switching costs are high because:

• A) new entrants struggle to match incumbents' prices.
• B) this discourages customers from buying a new entrant's offerings.
• C) new entrants struggle to gather enough cash to get started.
• D) each incumbent has a group of loyal customers that enjoy its unique features.
• E) new entrants struggle to get their offerings to customers.

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Definitions:

Recreational Value

The worth derived from natural resources for leisure activities.

Ecological Value

A measure of the importance of a particular ecosystem or species in terms of its benefit to the environment or human wellbeing.

Economic Value

The worth of a good or service determined by the market, reflecting its utility, rarity, and demand by consumers.