Which of the Following Describes a Barrier to Entry

question 161

Multiple Choice

Which of the following describes a barrier to entry?

• A) something that establishes a barrier to expanding output
• B) anything that protects a firm from the arrival of new competitors
• C) a government regulation that bars a monopoly from earning an economic profit
• D) firms already in the market incurring economic losses so that no new firm wants to enter the market
• E) Firms are legally prohibited from exiting the market in order to enter another market.

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Definitions:

Demand (D)

A consumer's desire and willingness to pay a price for a specific good or service, holding all other factors constant.

Marginal Revenue (MR)

Marginal Revenue is the additional income that is obtained from selling one more unit of a good or service.

Pure Monopolist

A market structure wherein a single company or entity has exclusive control over the production and sale of a particular product or service, with no close substitutes.

Marginal Revenue

The additional revenue that a company receives from selling one more unit of a product.