If the firm competes in a very competitive, mature industry, what effect will competitive conditions have on

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If the firm competes in a very competitive, mature industry, what effect will competitive conditions have on residual income for the firm and others in the industry? Now suppose the firm holds a competitive advantage in an industry, but the advantage is not likely to be sustainable for more than a few years because of the potential for entry in the industry. As the firm’s competitive advantage diminishes, what effect will that have on that firm’s residual income?

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