Suppliers Are Powerful When Which of the Following Happens

question 64

Multiple Choice

Suppliers are powerful when which of the following happens?

• A) Satisfactory substitutes are available.
• B) They sell a commodity.
• C) They offer a credible threat of forward integration.
• D) They are part of a highly fragmented industry.

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Definitions:

Net Working Capital

This is a measure of a company's liquidity, calculated as the difference between its current assets and current liabilities.

Current Assets

Assets that are expected to be converted into cash, sold, or used up within one year or within the normal operating cycle of the business, whichever is longer.

Current Liabilities

A company's debts or obligations that are due within one year.

Quick Ratio

A measure of a company's ability to meet its short-term liabilities with its most liquid assets, providing insights into financial health.