Question

The likelihood of new entrants joining an industry is low if capital requirements to enter the industry are high because: Group of answer choices

new entrants struggle to match incumbents' prices.
this discourages customers from buying a new entrant's offerings.
new entrants struggle to gather enough cash to get started.
each incumbent has a group of loyal customers that enjoy its unique features.
new entrants struggle to get their offerings to customers.

Answer 1

this discourages customers from buying a new entrant's offerings

Step-by-step explanation:

The high capital costs required of a business to enter a particular industry means it could affect the business's(new entrants) product prices which may not be appealing to customers. In other words, high capital costs means high product prices which are largely influential in choice of products by the customer. A lower price would therefore encourage customers to buy products of new entrants.