Question

Which are not the obstacles that make it difficult to enter the market?

A-Finding vendors with whom the suppliers in the market are already contracted.

B-The existing enterprises in the market have reached the scale economy

C-Lack of brand loyalty to the products on the market.

D-Investment costs are very high.

E- Access to distribution channels is difficult.

Answer 1

Answer:

Following are not the obstacles that make it difficult to enter the market:

A-Finding vendors with whom the suppliers in the market are already contracted.

C-Lack of brand loyalty to the products on the market.

Reasoning:

Finding vendors with whom the suppliers in the market are already contracted: This is not an obstacle to market entry as more vendor can be sourced enabling the supplies to happen as desired.

Lack of brand loyalty to the products on the market: This is not an obstacle to market entry as lack of brand loyalty makes it easy for new firms to place their offerings.

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Below are INCORRECT and cannot be considered as they form the obstacles to that make it difficult to enter market:

B-The existing enterprises in the market have reached the scale economy: This makes it difficult to bring their products at a very low price so that it can match it to the current competition offerings which thve high production and low cost.

D-Investment costs are very high: High investment can be because of huge capital requirement which makes it difficult for entry to new players.

E- Access to distribution channels is difficult: The new players if lack access to distribution channels by the existing players will lead to entry barrier.