Which of the following best describes the determinants of industry concentration?
A) the ratio of market size to the minimum set up costs required to compete
B) the level of incumbent sunk cost investment in activities that increase value to the customer
Cboth the ratio of market size to the minimum set up costs required to compete and the level of
C) incumbent sunk cost investment in activities that increase value to the customer
Dneither the ratio of market size to the minimum set up costs required to compete nor the level of
D) incumbent sunk cost investment in activities that increase value to the customer

Question

Quizplus · Accepted Answer

The determinants of industry concentration include both the ratio of market size to the minimum setup costs required to compete and the level of incumbent sunk cost investment in activities that increase value to the customer. These factors influence how many competitors can effectively operate in a market and how difficult it is for new entrants to challenge established firms.

Which of the Following Best Describes the Determinants of Industry