Question

Firms must typically purchase inputs from suppliers to produce output. What effect might suppliers have on an​ industry? A. Suppliers cannot affect output​ markets, although an output market with only a few firms is likely to have the bargaining power to limit a​ supplier's profits. B. If an input is specialized comma then the supplier is unlikely to have the bargaining power to limit a​ firm's profits. C. If suppliers are price​ takers, then a firm will likely be a price taker with no ability to raise price. D. If only a few firms can supply an​ input, then markets will likely experience shortages because firms are unable to produce sufficient output. E. If many firms can supply an input comma then suppliers are unlikely to have the bargaining power to limit a​ firm's profits.

Answer 1

The correct answer is letter "E": If many firms can supply an input comma then suppliers are unlikely to have the bargaining power to limit a​ firm's profits.

Step-by-step explanation:

The negotiating power of suppliers determines the level of competition in a market, according to the concept of the five competitive forces. If only a few companies can supply output or if the input is limited, suppliers are likely to have the bargaining power to limit the income of a business.