Which of the Following Is a Disadvantage of Cost Leadership

Multiple Choice

Which of the following is a disadvantage of cost leadership?

A) The presence of a cost leader in an industry tends to discourage new firms from entering the business.
B) Low prices for goods and services always lead to low customer base.
C) Downplaying research and development can slow cost leaders' ability to respond to changes once they are detected.
D) Cost leadership strategy makes companies vulnerable to price competition from rivals.
E) Cost leadership strategy breaks down barriers to entry that protect the firm from new competition.