Question

Which of the following are important factors in determining the intensity of rivalry among existing competitors? (Check all that apply.)

Multiple select question.
short-term contracts
entry barriers
competitive industry structure
exit barriers
industry growth

Answer 1

The intensity of rivalry among existing competitors in an industry can be determined by factors such as short-term contracts, entry barriers, competitive industry structure, exit barriers, and industry growth.

Step-by-step explanation:

The intensity of rivalry among existing competitors in an industry can be influenced by several factors. The important factors that determine the intensity of rivalry are:

1. Short-term contracts: When firms in an industry have short-term contracts with their customers, it can lead to higher rivalry as firms constantly compete for contract renewals.
2. Entry barriers: If there are high barriers for new firms to enter the industry, existing competitors will face less competition, resulting in lower rivalry.
3. Competitive industry structure: A highly concentrated industry with few dominant firms can lead to more intense rivalry as these firms fiercely compete for market share.
4. Exit barriers: If there are high exit barriers, such as high exit costs, firms may be reluctant to leave the industry, leading to higher rivalry.
5. Industry growth: In a slow-growing industry, existing competitors may fight harder for market share, resulting in higher rivalry.

These factors collectively influence the competitiveness of an industry and the intensity of rivalry among its existing competitors.