Which of Porter's Five Forces Is Most Directly Influenced by the Following

question 20

Multiple Choice

Which of Porter's five forces is most directly influenced by the following factors: number and balance of competitors, degree of difference between products, growth rate of an industry, and level of fixed costs?

• A) threat of new entrants
• B) rivalry among existing firms
• C) threat of substitutes
• D) bargaining power of buyers
• E) bargaining power of suppliers

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Definitions:

Financial Intermediation

The process by which financial institutions act as intermediaries between lenders and borrowers.

Institutional Investor

A business organization that buys and sells securities. Generally, a fund of some kind such as a mutual fund or a pension fund that invests the pooled money of its clients.

Pension Funds

Investment pools that collect and invest funds contributed by sponsors and beneficiaries to provide future pension benefits.

Insurance Companies

Businesses that provide protection against financial losses in exchange for regular payments from individuals or entities.