In general, as long as the number of firms that possess a particular valuable resource or capability is less than the number of firms needed to generate perfect competition dynamics in an industry, that resource or capability can be considered rare and a potential source of competitive advantage.

Question

Quizplus · Accepted Answer

This statement is true. If there are only a few firms that possess a valuable resource or capability, then they can potentially use it to outcompete others in the industry and gain a competitive advantage. This is because there are not enough firms to drive down prices or replicate the resource/capability, which would happen in a perfectly competitive market.

In General, as Long as the Number of Firms That