This is an example of a pricing strategy which icumbent firms use to discourage the entry of new firms by charging low prices (but not making a loss) that would be unsustainable for new firms to compete with
Limit
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Barrier to entry that involves firms taking advantage of their existing knowledge in technolgy and exploitation of economies of scale to make it impossible for firms to compete with.
Technical
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Costs which cannot be recovered when exiting an industry such s advertising and research.
Sunk costs
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Another pricing strategy that firms use to fprce new firms from the market through charging below costs prices that new firms could not also copy due to their lack of economies of scale.
Destroyer
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Examples of this barrier include government restrictions on the amount of firms in an industry, the need for government licences to operate and patents in the high tech industries such as computer software and pharmaceuticals.
Legal
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Country in the southern hemisphere with a GDP significantly higher than Pakistans despite having a far smaller population and is also ranked 2 on the HDI.
Australia
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Other cards in this set
Card 2
Front
Barrier to entry that involves firms taking advantage of their existing knowledge in technolgy and exploitation of economies of scale to make it impossible for firms to compete with.
Back
Technical
Card 3
Front
Costs which cannot be recovered when exiting an industry such s advertising and research.
Back
Card 4
Front
Another pricing strategy that firms use to fprce new firms from the market through charging below costs prices that new firms could not also copy due to their lack of economies of scale.
Back
Card 5
Front
Examples of this barrier include government restrictions on the amount of firms in an industry, the need for government licences to operate and patents in the high tech industries such as computer software and pharmaceuticals.
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