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Explain How the Availability of Substitutes Affects Business Strategy

question 10

Essay

Explain how the availability of substitutes affects business strategy. Include an example of a company or industry where many substitutes are available and one where few or none are available.


Definitions:

Statistical Arbitrage

A quantitative approach to equity trading that seeks to exploit pricing inefficiencies between related financial instruments.

Multistrategy Funds

Investment funds that employ a variety of strategies across different asset classes to achieve diversification and manage risk.

Asset Allocation Funds

Mutual funds that invest in a variety of asset classes, such as stocks, bonds, and real estate, to diversify investment risk.

Event-driven Funds

Investment funds that seek to exploit pricing inefficiencies that may occur before or after a particular corporate event.

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