If an Industry Earns a Return on Capital in Excess

question 40

Multiple Choice

If an industry earns a return on capital in excess of its cost of capital:

• A)It will soon attracts the attention of competition authorities
• B)Workers will push for higher pay and benefits causing the level of profitability to fall
• C)It will attract the attention of potential entrants and,unless protected by high barriers to entry,the return on capital will fall
• D)Firms within the industry will over-invest causing the return on capital to fall

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Definitions:

Internal Human Resource Supply

Assessment of the current employees' capabilities and potential to meet the future HR needs of an organization.

External Supply

The resources or workforce a company hires or acquires from outside its existing operations to fulfill its needs.

Internal Supply

The availability of resources, talent, or inventory within an organization to meet its needs.

Markov Model

A statistical model used to predict the probability of different states or events based on current conditions, often used in decision-making processes.