The effectiveness of barriers to entry depends upon:
A)How quickly new technologies emerge
B)How fiercely incumbents retaliate against new entrants
C)The resources and capabilities that potential entrants possess
D)How vigorously governments enforce competition law

Question

Quizplus · Accepted Answer

Barriers to entry are factors or circumstances that prevent or make it difficult for new firms to enter an industry. The resources and capabilities that potential entrants possess are a major determinant of the effectiveness of barriers to entry. If potential entrants lack the resources and capabilities required to compete effectively, then barriers to entry are effective in preventing new firms from entering the market. New technologies, incumbents' retaliation, and government intervention can certainly play a role, but the resources and capabilities of potential entrants are crucial.

The Effectiveness of Barriers to Entry Depends Upon