Firm a Has Been Dealing in Baby Food Products for the Past

question 26

Multiple Choice

Firm A has been dealing in baby food products for the past 10 years and enjoys a good market share.Suppose a new firm enters the market to capitalize on the increasing demand for such products.However,the products of the new firm fail to attract customers.The failure of the new firm is due to

• A)the pioneering brand advantage of the incumbent.
• B)the learning curve effect.
• C)scale economies.
• D)the specific assets owned by the incumbent.

---

Definitions:

Biotic Potential

The maximum reproductive capacity of an organism under optimum environmental conditions.

Environmental Resistance

Total of factors in the environment that limit the numerical increase of a population in a particular region.

Carrying Capacity

The maximum population size of a species that an environment can sustain indefinitely, given the food, habitat, water, and other necessities available in the environment.

Exponential Growth

Growth, particularly of a population, in which the increase occurs in the same manner as compound interest.