The Primary Objective of Porter's Five Forces Model Is to

question 20

Multiple Choice

The primary objective of Porter's five forces model is to

• A) replace a firm's competitive advantage with competitive parity.
• B) understand the profit potential of different industries.
• C) reduce the gap between the value of a firm's product and its cost of production.
• D) break down a firm's value chain activities into primary and support.

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Definitions:

Tax Revenue

The income that is gained by governments through taxation, funding public services, and government operations.

Monetarists

Economists convinced that fluctuations in the money supply significantly impact short-term national output and affect price levels over extended periods.

Money Supply

The complete amount of currency resources available within an economy, covering cash, coins, and the totals in checking and savings accounts, at a particular time.

Potential Growth

The estimated rate at which an economy could grow considering the full utilization of its resources without causing inflationary pressures.