Question

What is the relationship between start-up cost and a competitive market

a. market with high start-up costs are less likely to be perfectly competitive.B)market with high start-up costs are more likely to be perfectly competitive.C)low start-up costs are likely to make a market less competitive.D)there is no consistent relationship between start-up costs and the competitveness of a market.

Answer 1

A) A market with high start-up costs is less likely to be perfectly competitive.

Step-by-step explanation:

The expenses that a new business must pay before the first product reaches the customer are called start-up costs. When the start-up costs in a market are high, entrepreneurs are less likely to enter that market. As a result, markets that involve high start-up costs are less likely to be perfectly competitive markets.

Answer 2

A high start-up cost means that people will be less likely to make many new start-ups; making start-ups will be more risky. Therefore the companies that already exist will have less competition if the cost of start up is high.

So the correct answer is: a) a market with high start-up costs is less likely to be perfectly competitive.