In mature industries, the diffusion of process technology leads to:
A)Attacks of established firms by rivals targeting specific niches
B)Increasing difficulty in obtaining a cost advantage based on technology
C)A 'level playing field' and perfect competition
D)The emergence of new standards

Question

Quizplus · Accepted Answer

As process technology becomes more widely diffused, it becomes more difficult for any one firm to maintain a cost advantage based on technology alone, leading to increasing competition and potentially lower profit margins. While there may still be some differentiation among firms based on other factors, such as branding or customer service, the technological playing field becomes more level, making it harder for firms to stand out solely on the basis of their technology. The emergence of new standards may be a possibility as a result of this diffusion, but it is not a guaranteed outcome. Attacks by rivals targeting specific niches may also occur, but it is not a direct result of process technology diffusion. Perfect competition is a theoretical model that is unlikely to be fully realized in any market.

In Mature Industries, the Diffusion of Process Technology Leads To