Competition in an industry tends to drive rates of return on invested capital up towards what is described as "perfectly competitive."

Name: Competition in an industry tends to drive rates of return on invested capital up towards what is described as "perfectly competitive."
Brand: Quizplus
Rating: 4.8 (51 reviews)

Question

Quizplus · Accepted Answer

Competition in an industry tends to drive rates of return on invested capital down towards the cost of capital, not up, as firms compete on price and other factors, reducing profit margins.

Competition in an Industry Tends to Drive Rates of Return