Which of the Following Are not typically Considered a Threat

question 73

Multiple Choice

Which of the following are not typically considered a threat of new entrants to an industry?

• A) Low current prices relative to costs
• B) Large capital requirements
• C) Extensive distribution channels with exclusive distribution contracts
• D) Government policy restricting access to raw materials
• E) Large volume purchases relative to the sales of a supplier

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Definitions:

Internal Rate of Return (IRR)

A financial metric used to estimate the profitability of potential investments.

Cost of Capital

The rate of return a company must earn on its investment projects to maintain its market value and attract funds.

Discount Rate

The interest rate used in discounted cash flow analysis to determine the present value of future cash flows.

Net Present Value (NPV)

The variance between the current value of incoming cash and the current value of outgoing cash throughout a specific duration.