Which of the Following Statements Is FALSE

question 19

Multiple Choice

Which of the following statements is FALSE?

• A) First movers tend to take higher risks than second and later movers.
• B) First movers tend to have significantly higher revenues than second movers.
• C) First movers have lower survival rates than second and late movers.
• D) First movers tend to have more organizational slack than later movers.

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Definitions:

Highly Competitive Market

A market structure characterized by a large number of sellers and buyers, leading to competitive pricing and minimal market power for individual firms.

Security Market Line

A representation in the capital asset pricing model (CAPM) that displays the relationship between the expected return of a security and its systemic risk.

Beta

A statistic that measures the volatility of a stock or portfolio compared to the market as a whole, used in the CAPM to calculate cost of equity.

Systematic Risk

The type of risk inherent to the entire market or an entire market segment, which cannot be mitigated through diversification.