Which of the Following Is an Advantage of Clustering

question 146

Multiple Choice

Which of the following is an advantage of clustering?

• A) New entrants can charge higher prices for products as compared to existing firms.
• B) New entrants can have a lower cost of gathering regional information about trends in the market.
• C) New entrants can benefit from favorable terms of trade.
• D) New entrants can engage in non-price competition with other firms in the industry.
• E) New entrants can charge low prices for their products.

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Definitions:

Risky Assets

Assets that carry a significant possibility of loss along with the potential for higher rewards.

Money Market Mutual Funds

Investment funds that pool investors' money to purchase short-term, high-quality debt securities, offering liquidity and earning interest.

Check-Writing Privileges

The ability granted to an individual to write checks against an account, such as a money market account, that typically doesn't offer this feature.

Bank Checking Accounts

Banking services that allow individuals and businesses to deposit money and withdraw funds, typically through issuing checks or electronic transfers.