Question

The German company Koenig and Bauer has 90 percent of the world market for presses that print currency Discuss the factors that would make it difficult for new companies to arter at

A Koenig and Bauer's production of presses for currency is a public enterprise
B Koenig and Bauer experiences diseconomies of scale in producing presses for currency
C. Koenig and Bauer's presses for currency experience no network extematies
D Koenig and Bauer makes presses for currency that have no close substitutes
E Only Koenig and Bauer has access to the technology necessary to produce presses for currency

Answer 1

Factors that would make it difficult for new companies to enter the market for currency printing presses include diseconomies of scale, absence of network externalities, and lack of close substitutes.

Step-by-step explanation:

The factors that would make it difficult for new companies to enter the market for presses that print currency, where Koenig and Bauer has a 90 percent market share, include:

1. Diseconomies of scale in producing presses for currency, which can make it challenging for new entrants to achieve the same level of efficiency and cost-effectiveness as Koenig and Bauer.
2. The absence of network externalities for Koenig and Bauer's presses, meaning that there are no additional benefits or advantages for customers to switch to a competitor's presses.
3. Lack of close substitutes for Koenig and Bauer's presses, making it difficult for customers to find alternatives that can meet their specific requirements.