Which Barrier to Entry Uses Cost Advantages Associated with Large

question 119

Multiple Choice

Which barrier to entry uses cost advantages associated with large size?

• A) rivalry among existing firms
• B) switching costs
• C) cost disadvantages independent of size
• D) capital requirements
• E) economies of scale

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Definitions:

Agency Relationship

A legal arrangement where one party, the agent, is authorized to act on behalf of another party, the principal, in business transactions or other matters.

Power

The ability or capacity of an individual or group to influence or control the behavior of others or the course of events.

Business Operations

Business operations encompass the day-to-day activities a company engages in to run and achieve its objectives, including production, marketing, and management.

Principal

The original sum of money invested or loaned, before interest.