Which of the following is an implication for firms that have a threat of new entrants into their market?
A) increased cost
B) reduced quality
C) increased demand for services
D) increased price
E) decreased market share

Question

Quizplus · Accepted Answer

When a firm faces a threat of new entrants into their market, it can lead to decreased market share because competition increases. The new entrants may offer similar products or services that are priced competitively, which can reduce demand for the firm's products or services. This can have a negative impact on revenue and profitability. The other options (A, B, C, and D) are not necessarily implications of a threat of new entrants. Increased cost, reduced quality, and increased price may occur in response to other factors such as changes in the cost of production or changing market conditions. Increased demand for services may also not necessarily be an implication of a threat of new entrants.

Which of the Following Is an Implication for Firms That