136k views
1 vote
Which of the following best explains why large companies have an advantage over smaller companies

2 Answers

5 votes

Final answer:

Large companies have advantages in financial resources, economies of scale, and established networks, making them more competitive than smaller companies.

Step-by-step explanation:

Large companies have an advantage over smaller companies due to several reasons.

  1. Firstly, large companies often have greater financial resources. They have the ability to invest in research and development, marketing campaigns, and advanced technologies, which can give them a competitive edge over smaller companies that may struggle to access the same resources.
  2. Secondly, large companies can benefit from economies of scale. As they produce goods or provide services in larger quantities, they can spread their fixed costs (such as rent, utilities, and equipment) over a larger output, resulting in lower average costs per unit. This cost advantage allows them to offer lower prices to customers and potentially drive smaller competitors out of the market.
  3. Thirdly, large companies often have well-established relationships with suppliers and distribution networks. This can give them access to better prices, more reliable inventory, and wider market reach compared to smaller companies that may have limited bargaining power or face challenges in establishing such relationships.

In conclusion, large companies have advantages in terms of financial resources, economies of scale, and established networks, which enable them to be more competitive and potentially dominate markets compared to smaller companies.

User Ognjenkl
by
4.3k points
4 votes

Answer: They bigger

Explanation: They are a wide world know company. And they dominate the stock market. Another sneaky thing they do is they buy out the smaller companies to.

User Nageswara Rao
by
3.9k points