In General, Profit Potential Increases with Greater Competition, Stronger Potential

question 91

True/False

In general, profit potential increases with greater competition, stronger potential entrants, products that are similar, and tougher customers and suppliers.

---

Definitions:

Comparative Advantage

The ability of an individual or group to carry out a particular economic activity (such as making a specific product) more efficiently than another activity.

Absolute Advantage

The ability of a country, individual, or firm to produce more of a good or service with the same amount of resources compared to others.

Trade

The exchange of goods and services between parties, which can be within or across national borders.

Trade Deficit

A situation where a country's imports of goods and services exceed its exports, resulting in a negative balance of trade.