Predatory pricing is a form of barrier to entry.

Question

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Predatory pricing is a tactic where a company deliberately sets its prices very low, sometimes even below costs, with the intention of driving its competitors out of business. This is a form of barrier to entry because it makes it difficult for new entrants to compete and survive as they cannot match the low prices set by the incumbent firm. Eventually, once the competitors are out of business, the predatory firm can hike up its prices as it enjoys a dominant position in the market.

Predatory Pricing Is a Form of Barrier to Entry