Answer: Porter’s Five Forces is a framework for assessing industry structure that determines an industry’s long-run profitability

## Explanation **Option C is correct** because it accurately describes Porter's Five Forces framework. Porter's Five Forces is indeed a framework for analyzing the competitive structure of an industry and determining its long-run profitability potential. The five forces are: 1. Threat of new entrants 2. Bargaining power of buyers 3. Bargaining power of suppliers 4. Threat of substitute products 5. Intensity of competitive rivalry **Option A is incorrect** because Porter's Five Forces can be applied to new industries. While historical data may be limited for new industries, the framework can still be used to analyze the competitive structure based on current and expected future conditions. **Option B is incorrect** because barriers to exit are not part of the threat of new entrants analysis. Barriers to exit relate to the intensity of rivalry (force #5) - when barriers to exit are high, firms are more likely to compete aggressively even when profitability is low, increasing competitive rivalry. Barriers to entry (not exit) are what should be considered when assessing the threat of new entrants.

Author: LeetQuiz .