Which firm will have a higher level of economic performance: a) a firm with valuable, rare, and costly-to imitate resources and capabilities operating in a very attractive industry or b) a firm with valuable, rare, costly-to-imitate resources and capabilities operating in a very unattractive industry

a) a firm with valuable, rare, and costly-to imitate resources and capabilities operating in a very attractive industry.

Explanation:

Companies that have valuable, rare and costly to imitate resources and capabilities will see a better economic performance overall because they are offering the market something that not a lot of companies are offering which gives them the opportunity to increase profitability.

This would be even more effective if the company was in an attractive industry. An attractive industry means that there are a lot of buyers and sellers but because the company has costly to imitate resources, they will worry less about the sellers and gain more buyers thereby helping them to perform better.