Firms in industries that have low costs of entry tend to enjoy larger profits than firms in industries with high costs of entry.

Question

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Firms in industries with high costs of entry, such as aerospace or pharmaceuticals, often have more pricing power and can earn higher profits due to barriers to entry. On the other hand, industries with low costs of entry, such as fast food or retail, often have more competition and lower profit margins.

Firms in Industries That Have Low Costs of Entry Tend