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Hello
The question no 3 in june 2013-five forces
For the threat to new entrants-i find the barrier to be low because the goverment is supporting this iniative, tax break , infrastructure etccc. while in the answer it has said the opposite because of long production time.Will my answer be correct?
I think both you and the answer are correct.
The long development period is undoubtedly a barrier to entry (many years of investment and no guarantee of success). However, as you say, the government is lowering barriers to entry by their tax breaks and support for refuelling stations.
Like much of life there are good bits and bad bits. You would have got credit for mwntioning the government’s encouragement but more credut for mentioning both. I think ACCA’s answer would also be improved if it mentioned both.
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