- 04/14/2019 at 7:19 am #464688EduGorillaKeymasterSelect Question Language :
Directions: Read the passage/argument and answer the question that follows it.
Small companies are always very defensive in terms of protecting their own turf. They tend to firmly resist any attempt at invasion of their territory by another bigger rival company and will do their best to avert it from happening. They quote examples to prove that such incursions have invariably eaten into their market shares and consequently, profits. They fail to realize that ultimately, competition is going to do a whole world of good to their operations.
Which of the following will tend to support most the standpoint of small companies?
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- Many small firms have gone down under once bigger firms entered their arena of operation.
- The average rate of profit growth for small companies has always fallen by a significant margin every time the sector has seen a new, bigger entrant.
- There has been no change in the profit levels of bigger entrants which invade the territory of small firms.
- Small companies typically form a cartel to meet the onslaught of bigger companies more effectively.
- The Competition Promotion Council has mandated that in future, the bigger companies will not be allowed to enter any product area wherein more than 70% market share is held by small companies.
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