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A new entrant into an industry will bring extra capacity and more competition and so could, in turn drive down profits. The strength of the threat posed by new entrants is likely to vary from one industry to another and depends on the strength of the barriers to entry and the likely response of existing competitors to the new entrant.
Required: Identify and explain FIVE determinants of barriers to entry to new entrants into an industry. (10 marks)
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A perfectly competitive market has been described as one in which buyers and sellers have no option but to take the price determined by the forces in the market. Whereas prices are determined by the forces in a perfectly competitive market, a monopolist firm can maximise its revenue by doing one of two things – choose price or quantity.
Required: i) Explain THREE (3) characteristics of a perfectly competitive market. (3 marks) ii) Explain the statement in bold. (3 marks)
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
A new entrant into an industry will bring extra capacity and more competition and so could, in turn drive down profits. The strength of the threat posed by new entrants is likely to vary from one industry to another and depends on the strength of the barriers to entry and the likely response of existing competitors to the new entrant.
Required: Identify and explain FIVE determinants of barriers to entry to new entrants into an industry. (10 marks)
Find Related Questions by Tags, levels, etc.
A perfectly competitive market has been described as one in which buyers and sellers have no option but to take the price determined by the forces in the market. Whereas prices are determined by the forces in a perfectly competitive market, a monopolist firm can maximise its revenue by doing one of two things – choose price or quantity.
Required: i) Explain THREE (3) characteristics of a perfectly competitive market. (3 marks) ii) Explain the statement in bold. (3 marks)
Find Related Questions by Tags, levels, etc.
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