Which of the Following Fundamental Insights Was Provided by Porter's

question 109

Multiple Choice

Which of the following fundamental insights was provided by Porter's five forces framework from the completion of the Alta Velocidad Española (AVE) in 2008?

• A) A strong threat of substitutes decreases the rivalry among existing competitors.
• B) All the five forces must work together to have a meaningful impact.
• C) Any of the five forces on its own, if sufficiently strong, can extract industry profitability.
• D) Competition must be defined more narrowly to remain confined to the industry's closest competitors.

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Definitions:

Average Daily Receipts

The average amount of cash that a business receives on a daily basis, calculated over a specific period.

Cheques

Written, dated, and signed instruments that direct a bank to pay a specific sum of money to the bearer or a designated party.

Clearing Times

The time period it takes for a financial transaction to be processed and settled.

Lockbox System

A service offered by banks to companies for the collection of payments from customers, where the payments are sent directly to a post office box rather than to the company.