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How to establish barriers to entry.

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Discuss ways firms establish barriers to entry and explain how they benefit firms but not consumers. Give an example of a law or regulation that limits the ability of firms to establish barriers to entry and an example of a law or regulation that helps firms establish barriers to entry.

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There are many ways for firms to establish barriers to entry, lets list some of them here:

-Technology. For example, Microsoft owns Windows which contain a lot of advanced technology (often have patents as well) that are hard for other firms to develope unless if they are willing to invest a lot into R&D, this is unlikely for anyone who wants to make money.

-Market share/consumer loyalty. For example, Facebook is a site that has little technology, but because ...

Solution Summary

This solution discusses ways firms establish barriers to entry. It explains how they benefit firms but not consumers and gives an example of a law or regulation that limits the ability of firms to establish barriers to entry and an example of a law or regulation that helps firms establish barriers to entry. The explanation is given in 334 words.

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