FedEx and UPS Have ISs That Are Difficult to Duplicate

question 56

Multiple Choice

FedEx and UPS have ISs that are difficult to duplicate and very expensive.Those ISs:

• A)create barriers that reduce the threat of entry.
• B)increase the threat of substitute services.
• C)decrease bargaining power of customers.
• D)increase bargaining power of suppliers.

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Definitions:

Security Returns

The gains or losses from investing in a security, usually expressed as a percentage of the initial investment.

Arbitrage Opportunities

Situations where a financial instrument, or a combination of financial instruments, can be bought and sold simultaneously in different markets to profit from price discrepancies.

Risk-Free Rate

The return on investment with no risk of financial loss, often represented by the yield on government securities.