Which of the following results in decreased market profitability?
A)the absence of the threat of new entrants
B)intense rivalry among competitors, based on price
C)lack of competition among suppliers in an industry
D)a lack of leveraging power over suppliers

Question

Quizplus · Accepted Answer

When competitors engage in intense rivalry based on price, it often leads to price wars and decreased profit margins for all players in the market. This can result in decreased market profitability. A lack of competition among suppliers or a lack of leveraging power over suppliers may actually result in higher profitability for firms as they are able to negotiate favorable terms and prices. The absence of the threat of new entrants may also lead to higher profitability as it reduces competition.

Which of the Following Results in Decreased Market Profitability