n NISM Certifications
XV NISM Series XV
Medium

What factor contributes to the long-term sustainability of a business regarding competition?

Practice question from NISM XV Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Easy exit for the business

  2. Strong entry barriers

    Correct answer

  3. C

    No entry barriers

  4. D

    All of the above

Why this is the answer

Strong entry barriers such as high capital requirements, patents, regulatory approvals, or strong brand loyalty prevent new competitors from entering the market easily. This helps existing firms sustain profitability and competitive advantage over the long term.

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