According to McGahan and Porter, industry and competitive forces can act as ______ on a company's returns.

A. a floor
B. a ceiling
C. both a ceiling and a floor

Correct Answer: B

Industry and competitive forces can act as a ceiling on a company's returns by creating an environment of intense competition and limited profit potential. However, companies can still strive to achieve above-average performance through effective strategies and differentiation within the industry boundaries.