Which of Porter's five forces is most directly influenced by the number and balance of competitors, degree of difference between products, growth rate of an industry, and level of fixed costs?
A) Threat of New Entrants
B) Rivalry Among Existing Firms
C) Threat of Substitutes
D) Bargaining Power of Buyers
E) Bargaining Power of Suppliers

Question

Quizplus · Accepted Answer

The rivalry among existing firms is directly influenced by the number and balance of competitors, degree of difference between products, growth rate of an industry, and level of fixed costs. This force determines the intensity of competition within an industry and affects the overall profitability of firms. The more intense the competition, the lower the profits that firms can earn. Therefore, understanding the nature and extent of rivalry among existing firms is crucial for developing a sound business strategy.

Which of Porter's Five Forces Is Most Directly Influenced by the Number