In a competitive industry a. the industry has high barriers to entry b. the industry has high barriers to exit c. the industry has high barriers to entry and exit d. the industry has no barriers to entry or exit

Question

Business

Boston Hardy

26 September, 09:56

In a competitive industry a. the industry has high barriers to entry b. the industry has high barriers to exit c. the industry has high barriers to entry and exit d. the industry has no barriers to entry or exit

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Answers (1)

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Reece Norris · Answer 1

The answer is D.

Explanation:

In a competitive industry like perfect competitive market, the industry has no barrier to entry or exit. Firms can freely enter the market as long as it can make its profit and leave the industry anytime the firm likes.

This no barrier to entry and exit lead to the large number of sellers that we have in this type of market. And this large number of sellers make competition strong that no seller can influence the price of the market.