Economics 9708 · AS & A Level · 7.7

7.7 — practice question

What is likely to make it harder for a small firm to remain in business?

  • Aincreased preference on the part of consumers for distinctive non-standardised products
  • Breductions in the rate of interest charged by commercial banks
  • Cthe absence of effective barriers to the entry of potential competitors
  • Dthe existence of decreasing returns to scale

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