Which of the Following Is True

question 192

Multiple Choice

Which of the following is true?

• A) Competitive forces are stronger in markets with high entry barriers than in those where entry barriers are low.
• B) Quality competition is an important element of the competitive process.
• C) If the production of a good is highly profitable, the development of substitute products will be discouraged.
• D) High barriers to entry are only the result of natural factors not artificial factors like government regulations.

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Definitions:

Circular-flow Diagram

An economic diagram that traces the path of monetary transactions between markets, involving both households and business entities.

Production Possibilities Frontier

A curve that illustrates the maximum feasible amount of two goods that can be produced with given resources and technology.

Opportunity Cost

The financial setback of forgoing the next highly regarded alternative when determining a course of action.

Technological Advance

Improvements and innovations in technology that increase productivity, efficiency, and economic output.