All of the Following Are Forces That Create High Rivalry

question 105

Multiple Choice

All of the following are forces that create high rivalry within an industry EXCEPT:

• A) numerous or equally balanced competitors.
• B) high fixed costs.
• C) fast industry growth.
• D) high storage costs.

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Definitions:

Economic Profit

The return flowing to those who provide the economy with the economic resource of entrepreneurial ability; the total revenue of a firm less its economic costs (which include both explicit costs and implicit costs); also called “pure profit” and “above-normal profit.”

Accounting Costs

The explicit costs of running a business, such as wages, rent, and materials, recorded in the financial statements.

Total Revenue

The total amount of money received by a firm from sales of its products or services before any expenses are subtracted.

Average Product

The output per unit of input, for example, the average quantity of product produced per worker or per machine.