A Supplier of an Input Is Unlikely to Have Bargaining

question 129

Multiple Choice

A supplier of an input is unlikely to have bargaining power if

• A)the input supplied is specialized.
• B)many firms can supply the input.
• C)it is the sole supplier of the input.
• D)it has a patent on the input.

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Definitions:

Normal Profit

The minimum profit necessary for a company to remain competitive in the market, equating to the opportunity cost of the resources employed.

Normal Profit

The minimum level of profit necessary for a company to remain competitive in the market, often considered the break-even point.

Marginal Cost

Marginal cost is the increase in total cost that arises from producing one more unit of a good or service. It is a critical concept in economics for decision-making regarding production levels.

Purely Competitive Market

A market structure characterized by many buyers and sellers, all of whom are selling a homogeneous product, with no single buyer or seller able to influence the market price.