Answer to Question #106563 in Economics for khalil haj-assaad

Question

Consider a hypothetical industry that manufactures a physical output. Three possible industry structures are depicted. Industry structures are depicted at scale (e.g., like on a road map).



Clearly identify the two structures that you elect to use in questions (1A) and (1B). If you do not clearly identify two structures, you will not earn points on parts (1A) and (1B).



First structure: ______________________ (0 points)

Second structure: ______________________ (0 points)



(A) Select a force. In which structure is the force threat lower? Why? (1 point total).

Force: ______________________ (¼ point)





(B) Select a force different from the force used in part (1A). In which structure is the force threat higher? Why? (1 point total).

Force: ______________________ (¼ point)

Answer 1

First structure: number of competitors.

Second structure: distribution of competitors.

A)Rivalry. The force threat is lower in distribution of competitors because if industries are distributed evenly the rivalry is minimized.

B)Threat of substitution. The force threat is higher in the number of competitors.The more the competitors the more the substitution threat.