Which of the following describes a barrier to entry?
A) Something that establishes a barrier to expanding output.
B) Firms are legally prohibited from exiting the market in order to enter another market.
C) A government regulation that bars a monopoly from earning an economic profit.
D) Firms already in the market incurring economic losses so that no new firm wants to enter the market.
E) Anything that protects a firm from the arrival of new competitors.

Question

Quizplus · Accepted Answer

A barrier to entry is anything that protects a firm from the arrival of new competitors, making it difficult or impossible for them to enter a market. This can include things like patents, high fixed costs, economies of scale, government regulations, and brand recognition.

Which of the Following Describes a Barrier to Entry