Question

The concepts of flexibility and real options are closely related to the importance of history and ________ described as potential sources of sustained competitive advantage. Group of answer choices path dependence commitment cost control causal ambiguity

Answer 1

Answer:

The correct answer is letter "A": path dependence.

Explanation:

Path dependency refers to the stage in which a company does not engage new ventures because it is too familiar with its current processes. Besides, the entity has the belief that continuing with the historical product is has been offering is more cost-effective than engaging in the production of a new good.  

The competitive advantage of the institution remains the same during the whole time which is a weakness because the market of the firm could change but the firm does not implement any measure to keep the pace of the market fluctuations.