Question

Western Amalgamated Corp. Western assembles computers in the owner’s garage from parts the owner orders over the Internet. This industry is characterized by low barriers to entry, including few operating licenses or governmental approvals, and small investments in productive equipment or facilities.

Answer 1

Yes, it is true that Western Amalgamated Corp. is in an industry is characterized by low barriers to entry an d enjoys the following benefits

• orders online
• assembles computers from the owners garage
• few operating licenses
• small investments in productive equipment

Step-by-step explanation:

A low entry barrier means you can enter an industry and compete successfully with: Little fixed cost e.g The Digital Marketing Industry compared to The Pharmaceutical Industry which requires billions in R& D and marketing. Minimal regulations to worry about e.g The financial sector which is heavily regulated.

Answer 2

Its low barriers to entry expose Western to decreased risk of competition, which improves the predictability of its expected future sales revenues. Its low barriers to entry expose Western to increased risk of competition, which could negatively affect the predictability of its expected future sales revenues.

Step-by-step explanation: