If There Are Many Alternatives to an Organization's Products or Services

question 146

Multiple Choice

If there are many alternatives to an organization's products or services, then the threat of substitutes is _________; if there are few alternatives, then the threat is ______.

• A) high; high
• B) high; low
• C) low; high
• D) low; low

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Definitions:

Network Effects

The phenomenon whereby increased numbers of people or participants improve the value of a good or service.

Simultaneous Consumption

A situation where a good or service can be consumed by more than one individual at the same time without reducing the quantity available to others.

Monopoly Power

The ability of a monopoly to set or influence prices within the market due to the lack of competitive pressures.

Net Social Benefits

The total benefits from an action or policy minus the total costs, considering both direct and indirect effects on society.