what is the effect of limit pricing if an entrant's post-entry profits are independent of the pre-entry price charged by the incumbent

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Answer 1
Answer:

Limit pricing is a strategy used by incumbent firms to deter entry by setting prices low enough to make it unprofitable for a new firm to enter the market.

However, if an entrant's post-entry profits are independent of the pre-entry price charged by the incumbent, then limit pricing will have little to no effect on deterring entry. This is because the entrant's profits are not influenced by the incumbent's pricing strategy. In this case, the entrant will likely enter the market despite the incumbent's efforts to limit price. The incumbent may still choose to use limit pricing as a strategy, but it will not be effective in deterring entry.

It is important for the incumbent to consider other strategies to protect their market share, such as product differentiation or economies of scale, rather than relying solely on limit pricing.

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Related Questions

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Discuss the impact of technological forces and political and legal forces on the market.

Answers

Explanation:

Technological forces have a significant impact on the market by transforming the way businesses operate and the products they offer. For example, the rise of e-commerce has allowed companies to reach customers all over the world, while advancements in automation have increased productivity and reduced costs. Additionally, new technologies such as artificial intelligence and blockchain are creating new opportunities for businesses to innovate and improve their operations.

Political and legal forces also play a crucial role in shaping the market. Government policies and regulations can impact businesses in various ways, such as taxation, trade agreements, and labor laws. For instance, changes in trade policies can affect the supply chain and pricing of goods, while labor laws can impact the cost of production. Additionally, political instability and uncertainty can create volatility in the market, leading to fluctuations in demand and supply.

Overall, technological forces and political and legal forces are two critical factors that influence the market. Companies that can adapt to these forces and leverage them to their advantage are more likely to succeed in today's rapidly changing business environment.

PLEASE HURRY In the space provided below, please respond to the following: Create a list of business risks and ways to deal with them.

This project will focus on writing about a current event in business risks. The task is to first find an article that deals with business risks and write a summary of the article. In your summary, you should discuss what the risk is and what steps the business is taking to deal with it.

Current Event
Use the Internet to find an article that deals with business risks. Once you have found and read your article, record your summary and upload it. Use the following format.

Paragraph #1 - Summary of article including the link
Paragraph #2 - How it relates to entrepreneurship
Paragraph #3 - Your opinion of whether or not you think the appropriate steps are being taken to deal with the risk

Answers

Answer:

Explanation:

yes

What annual simple interest rate will allow Hosea Soli to increase his initial investment of $80,000 to $100,000 in five years? (Hint: Use the formula I = prt and substitute known values to find I.)A)6%
B)5%
C)6.25%
D)5.5%

Answers

Using the formula I=prt
I will use $80,000 for p or principle.
I will use 5% for r or rate. (this needs to be converted to a decimal so move the decimal point two places to the left, you can't multiply using percents)
and 5 years for t or time.

80,000*0.05*5=20,000.00. He is getting $20,000 in interest. So $80,000 + $20,000 = $100,00.
Therefore, the answer is B.

At ICS Inc., a company that deals in software products, employees regularly complain about the lack of clarity regarding the tasks they are required to perform. Often there are two employees working on overlapping tasks, while some tasks are not designated to any employee. Though employees are satisfied with the pay and work culture, this aspect of their work environment has led to a lot of conflict in the workplace. From the information provided, this complaint of the employees can be closely linked to which HR function?A) compliance with laws
B) analysis and design of work
C) compensation and benefits
D) maintenance of employee relations
E) recruitment and selection

Answers

Answer:

E) recruitment and selection

Explanation:

The human resource department of an organization is responsible for assigning tax to employees after recruitment based on their abilities.

Hence, the human resource team at ICS Inc needs to improve on filling the gaps in the organization or selecting the best employee for a particular job. This role involves providing clarity regarding the tasks employees are required to perform.

visit any successful local business and interview the owner on the initiatives taken by his or her business in poverty, HIV and AIDS, Unemployment, Crime, and Inclusivity

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Achieving egalitarian (among gender, women and children), or being an egalitarian, is hard to achieve since not all people want to be in equal footing with everyone. However we could lessen its prevalence: (1) educate people about the effects of inequality; (2) engage them in talks that relates to being empathetic with the inferior group; and (3) educate the inferior, let them know their rights.

Characteristics of a corporation includea. stockholders having unlimited liability.
b. direct management by the stockholders.
c. stockholders having limited liability.
d. stockholders choosing a board of directors.

Answers

A corporation is characterized by limited liability for stockholders and management by a board of directors chosen by the stockholders. Stockholders' personal assets are not at risk in case of bankruptcy or lawsuits.

The Characteristics of a Corporation typically include:

  • Stockholders having limited liability - This means that the personal assets of the shareholders are not at risk if the corporation goes bankrupt or faces lawsuits.
  • Direct management by the stockholders is not usually happened. Instead, the stockholders elect a board of directors who manage the corporation.

Hence, in the given options, c. stockholders having limited liability, and d. stockholders choosing a board of directors are correct characteristics of a corporation.

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The answer to your question is letter C. Stockholders having limited liability.

Other Questions
Janice really likes potatoes. Potatoes cost $1 per pound, and she has $5.00 that she could possibly spend on potatoes or other items. Suppose she feels that the first pound of potatoes is worth $1.50, the second pound is worth $1.14, the third pound is worth $1.05, and all subsequent pounds are worth $0.30.a. How many pounds of potatoes will she purchase?b. What if she only had $2 to spend?Explanation:_______a. Janice will purchase potatoes until the value of potatoes is less than the cost of potatoes or until her income has been exhausted. For example, assume Janice has $5.00 to spend on potatoes or other items and the cost of a pound of potatoes is $1. Now assume the first pound of potatoes is worth $1.50 to Janice. She will purchase this pound of potatoes, since the value of the pound of potatoes ($1.50) is greater than the cost ($1). If the second pound is worth $1.14 and the third pound is worth $1.05, then Janice will purchase these as well, since the value exceeds the cost of $1. If all remaining pounds are worth $0.30, then Janice will not purchase these because the value is less than the cost. Thus, Janice will purchase 3 pounds of potatoes at a total cost of $3.00.b. Now assume Janice only has $2.00 to spend on potatoes. She will purchase the first pound because it is worth $1.50 to her and it only costs $1. She will purchase the second pound because it is worth $1.14. She has now spent her entire income on potatoes. She would like to purchase the third pound because the value of this pound of potatoes is $1.05, but she does not have the income to make this purchase. Thus, Janice will purchase 2 pounds of potatoes at a total cost of $2.00.