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1.
How can a low-cost producer achieve a barrier to entry?
All of the above. These are all ways that a low-cost producer can achieve barriers to entry.
2.
Which of the following is unlikely to be an attribute of companies with efficient scales?
They are in a rapidly growing market. Being in a rapidly growing market normally means that there is a lot of room for new competitors to come in, and that is not a part of the efficient-scale universe.
3.
Which type of moat benefits from making life difficult for its customers?
Switching costs. High switching costs compel customers to stick with a company, because there is a cost to the customers to choose another alternative. Economies of scale make life better for customers because they allow firms to price their products lower.
4.
Harley-Davidson has what type of economic moat?
Intangible assets. Harley's brand is an intangible asset that is a sustainable competitive advantage.
5.
An example of the network effect is when _______.
A company starts making parts for another company. This kind of complementarity increases the value of the latter company.
6.
There are many ways a company can build a sustainable competitive advantage in its industry. Which of the following is not one of them?
None of the above. All of these approaches can build a sustainable competitive advantage.
