Asked by Madhur Miglani on Sep 24, 2024
Verified
Porter's five forces portray
A) A zero-sum game
B) A game where your profitability comes at the expense of someone else's
C) The ability of market participants to create a larger total pie
D) Only A&B
Porter's Five Forces
A framework analyzing a business's competitive environment based on five key forces: competitive rivalry, supplier power, buyer power, the threat of substitution, and the threat of new entrants.
Zero-Sum Game
A situation in which one participant's gains or losses are exactly balanced by the losses or gains of the other participants.
Profitability Expense
A cost incurred by a business that is considered when calculating its profitability, often relating to the operational, production, or administrative aspects of the company.
- Determine the elements that affect the competitiveness of a company in a sector from the Industrial Organization viewpoint.
- Understand the significance of developing and maintaining competitive edges to seize value in a marketplace.
Verified Answer
TS
Thothadri Seshadriabout 14 hours ago
Final Answer :
D
Explanation :
Porter's five forces framework suggests that the competitive forces in an industry determine the profitability of companies within that industry. This implies a zero-sum game where one company's gain comes at the expense of another's. Therefore, options A and B are correct. However, the framework does not preclude the possibility of market participants creating a larger total pie through innovation, collaboration, or other means. Hence, option C is incorrect.
Learning Objectives
- Determine the elements that affect the competitiveness of a company in a sector from the Industrial Organization viewpoint.
- Understand the significance of developing and maintaining competitive edges to seize value in a marketplace.