According to Porter,the Nature of the Interaction Between Potential Industry

question 15

Multiple Choice

According to Porter,the nature of the interaction between potential industry entrants,buyers,substitute products,suppliers,and rival firms determines:

• A)whether or not the government will launch an antitrust investigation.
• B)the industry's profit potential in terms of long-run return on invested capital.
• C)whether a country can generate a balance of payments surplus.
• D)whether a country can create a comparative advantage in the production of differentiated products.
• E)whether a country can generate income by innovation.

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Definitions:

Capital Spending

Expenditure by businesses on physical assets like buildings, machinery, and equipment to enhance their capacity or efficiency.

Privatization

The process of turning government enterprises into private enterprises.

U.S. Economy

The economic system of the United States, characterized by a mixed economy with private freedom combined with centralized economic planning and government regulation.

Marginal Propensity

The proportion of an additional amount of income that is used for consumer spending. It's a key concept in understanding how income changes affect spending.