An industry's driving forces
A) are generally determined by the sizes of strategic groups and the power of rival firms' competitive strategies.
B) generally act in ways which will strengthen or weaken market demand, competition, and industry profitability in future years.
C) frequently cause a reduction in the bargaining power of buyers.
D) are normally triggered by ups and downs in the economy, higher or lower interest rates, or important new strategic alliances.
E) can be triggered by such factors as growing competitive pressures from substitute products, and the efforts of rival firms to employ new or different offensive strategies.

Question

Quizplus · Accepted Answer

Driving forces refer to the key underlying causes of change in an industry. These forces can be related to changes in technology, customer preferences, regulations, and other factors that impact the overall environment in which an industry operates. The driving forces can either strengthen or weaken market demand, competition, and industry profitability in future years. Therefore, option B is the best choice. A, C, D, and E describe various industry influences, but they do not accurately describe driving forces.

An Industry's Driving Forces