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A first mover is dominating a market, with revenues of $40 million annually. The average total...

Question:

A first mover is dominating a market, with revenues of $40 million annually. The average total cost for the firm is $20 million, of which $19 million is fixed. How can the first mover keep others from entering the market?

First Movers:

Being the first producer in a market allows the firm to have advantages over potential new entrants to the market, but they can be significantly hurt if they do not protect themselves against competition.

Answer and Explanation:

The biggest problem with a first mover is that future competitors can observe what they have done or discovered and be able to enter the market and...

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First-Mover: Advantages, Disadvantages & Examples

from Intro to Business: Help and Review

Chapter 1 / Lesson 8
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