H12-322_V1.0 Exam Questions and Answers

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Which of the following is a structural factor that may lead to overbuilding in an industry?
A. The need to add capacity in large increments.
B. An increase in the minimum efficient scale of production.
C. Competitors are not integrated.
D. An increase in competitive pressure on the suppliers of the firm.
Answer: D
Suppliers of capital, equipment, materials, etc., face their own competitive pressures. Thus, lower supplier prices, government subsidies, favorable interest rates, and similar incentives may promote expansion by customer industries.

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