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13 Cards in this Set
- Front
- Back
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Barriers to entry |
Factors making it harder for a firm to set up in an industry |
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Incumbent firms |
Firms already in an industry |
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Set up costs |
The costs associated with setting up a business eg purchasing stock |
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Sunk costs |
Costs that cannot be recovered when a firm leaves the market |
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Brand loyalty |
Customers have a preferred firm in an industry |
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Product differentiation |
When products are differing in non price factors |
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Homogenous products |
Products that are identical in non-price factors |
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Perfect competition |
Market structure with many buyers and sellers, goods are homogenous, perfect knowledge and no barriers to enter or exit |
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Price maker |
A firm that has market power and is able to influence the price the good is being sold at |
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Monopolistic competition |
Market structure with slight barriers to enter and slight product differentiation |
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Price taker |
A company that has no ability to influence market price |
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Non price competition |
Competing with other firms on factors apart from price ie branding, quality, customer service etc |
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Name 5 barriers to entry |
Set up costs Economies of scale Loyalty Contracts/ licenses Predatory pricing |
