Firm A has been dealing in baby food products for the past 10 years and enjoys a good market share.Suppose a new firm enters the market to capitalize on the increasing demand for such products.However,the products of the new firm fail to attract customers.The failure of the new firm is due to
A)the pioneering brand advantage of the incumbent.
B)the learning curve effect.
C)scale economies.
D)the specific assets owned by the incumbent.

Question

Quizplus · Accepted Answer

The failure of the new firm is due to the pioneering brand advantage of the incumbent, as Firm A has already established a good market share and brand recognition in the baby food products market. This makes it difficult for a new firm to enter and compete successfully.

Firm a Has Been Dealing in Baby Food Products for the Past