Choose wisely. There is only one correct answer to each question.
0%
Keep studying!
Review your answers below to learn more.
1.
Regarding buying companies that have economic moats, which is probably the more profitable strategy?
Buying them, holding them for a long time, and then selling them. Given their advantages in their industries, you would likely come out ahead by holding them for a long time.
2.
Private-label products are an example of _______.
Threat of substitutes. Private-label products are an example of the threat of substitutes. These products threaten the sales and margins of branded products, which are typically more expensive to produce.
3.
If a company is involved in doing a lot of different things very well, that is a sign that it has a deep economic moat.
True. In this case, they are really good at more than one competitive advantage.
4.
An example of easy entry into a market would be _______.
A company signing up to become a seller on eBay. Signing up for eBay would be a good example of a new company easily entering the marketplace.
5.
A company that was once a major player in its market but is now suffering the effects of increased buyer power and a flight to other, related products would have a _______.
Narrow moat. It would have a narrow moat of the eroding variety.