80.6k views
0 votes
Which of the following would not be considered a barrier to entry into an industry?

Group of answer choices

a. few competitors
b. high capital requirements
c. limited access to distribution channels
d. many substitute products
e. high bargaining power of suppliers

User Daram
by
8.1k points

1 Answer

4 votes

Final answer:

Many substitute products do not act as a barrier to entry but rather suggest a competitive market environment.

Step-by-step explanation:

The question pertains to identifying which option would not be considered a barrier to entry into an industry. Barriers to entry are factors that make it difficult for new competitors to enter a market. These can include high capital requirements, limited access to distribution channels, and government-enforced regulations such as patents and licensing requirements. However, having many substitute products in the market does not constitute a barrier to entry; instead, it typically indicates a competitive market filled with alternatives for consumers. Hence, the presence of many substitutes actually decreases the market power of individual firms and does not prevent new competitors from entering.

User Wes Cumberland
by
8.4k points